Page 13 - Banking Finance May 2020

HOUSING

HOUSING

NEWS
NEWS
NEWS
NEWS
NEWS

Real estate sector may term savings which were invested in would be the main beneficiaries of the
SIPs and mutual funds. Growing con- reverse migration of professionals, who
take few quarters to re- cern about security of the money saved have lost their jobs in the metros, or

vive in banks has also resulted in a change are likely to lose their jobs, revealed an
2020 has become a challenging year of perception amongst the public. Anarock report titled "India real es-
for all sectors. COVID-19 has brought Banks today are in debt because of tate: A different world post Covid-19".
the entire economy to a halt. It is esti- NPA's and defaulters. Considering the
mated that it will take three quarters current condition and the public per- Reverse migration is already very much
for the real estate sector to revive. ception, it is highly likely that people visible among migrant labourers, and
would now want to invest in something this trend can further percolate to
The emergence of mutual funds and that is secure and less vulnerable to skilled professionals, who have been or
SIPs opened newer and powerful av- volatile market conditions. This is may be off-rostered. Smaller towns
enues for people to invest in, which where the real estate sector may ben- and cities would consequently see a
resulted in low return on investment efit. spurt in housing demand. Primary de-
from residential apartments. People mand may be towards rental housing
preferred to rent an apartment and In order to bring the sector back on the - purchase demand would initially come
invest a major part of their savings in growth track, repo rate has been cut from local investors, keen to meet the
the market to ensure huge returns. consistently for the last nine months. rental demand, the report said. The
This has made home loans cheaper and returnees will benefit from the cost of
Adding to this was the rising price of affordable. Considering the current living and superior infrastructure that
apartments in the cities and overall condition, banks are also willing to lend many Tier-II and Tier-III cities provide.
maintenance cost of the purchase. to homebuyers.
This led to an increased number of Anuj Puri, chairman, Anarock Property
unsold apartments across categories in Reverse migration may Consultants, said "Many NRIs will also
the country. Looking at the sector's boost housing demand return to India amid dwindling job pros-
condition the government introduced pects, particularly in the US and the
several measures such as RERA, PMAY, post Covid-19 European nations that account for

and GST along with tax benefits to in- Reverse migration can spur housing nearly 70% global cases. For them, the
fuse demand in the sector. demand in Tier-II & -III cities after top seven cities would be the best op-
Covid-19, and cities like Lucknow, tions, but many will consider smaller
It is estimated that people have lost Indore, Chandigarh, Kochi, cities where they can be close to their
approximately 50 percent of their long- Coimbatore, Jaipur and Ahmedabad families. Finding suitable employment

BANKING FINANCE | MAY | 2020 | 13