BUSINESS

Low mortgage rates, stagnant prices boost housing demand in Tier-II cities too

Developers are offering various discounts such as straight-up price reductions, delayed payment arrangements, and other incentives to attract fence-sitters and prospective homeowners as the holiday season is fast approaching.

The recovery in housing demand is being driven by a growing demand for homeownership, which is being fueled by historically-low mortgage rates, stamp duty waivers in several states, and stagnant prices. According to the JLL – Residential Market Update: Q3 2021, “in Q3 2021, sales witnessed an upward trajectory, increasing by 65% on a sequential basis, with 32,358 apartment units sold during the quarter against 19,635 units in Q2 2021.”

Developers eagerly launched new home projects with an eye on the festive season as economic growth returned in tandem with the gradual return to normalcy. According to data collated by Housing.com, 65,211 units were launched in Q3 2021 — a jump of 199% compared to the Q2 2021 period when 21,839 units were launched.

Sales in the real estate sector are also increasing due to people’s revived interest in real estate assets. As per Housing.com, 55,907 units were sold in Q3 2021 compared to 15,968 in Q2 2021.

Tier-II cities had a similar story. According to realtors operating in the TriCity (near Chandigarh) market, the region also had a healthy movement.

“In the post-pandemic scenario, people are preferring developers with a good track record. The demand for luxury homes is on the rise in this market, and also the definition of affordable housing has changed as people want home with full amenities like security, safety, recreation, and shelter all at once. Apart from this, the demand for commercial projects has also increased because people have realized the financial stability of such assets,” says Prateek Mittal, Executive Director, Sushma Group & IIT Alumnus.

The rise of surrounding areas such as Mohali and Zirakpur in Punjab was prompted by high real estate prices in the main city. “Infrastructural development is also adding to the sustainability of the Tricity market as people prefer buying properties near areas that can provide good connectivity; that is why people are thronging to real estate projects in Mohali and Zirakpur; this is attracting investments from NRIs,” adds LC Mittal, Director, Motia Group.

Developers are offering various discounts such as straight-up price reductions, delayed payment arrangements, and other incentives to attract fence-sitters and prospective homeowners as the holiday season is fast approaching.

The realtors here maintain that Chandigarh has long been on the realty map for NRIs; the opening of properties in neighbouring regions such as PR7 Airport Road has provided them with the opportunity to expect exceptional returns on their investment. It also boasts a high level of living, making it a popular location for buying and investing. Similarly, Mohali offers a diverse range of real estate prospects supported by robust infrastructure development. The recently constructed 200-foot Mega Airport Road has increased the value of properties in Mohali. Then there’s Zirakpur, which is seeing continuous real estate growth in Chandigarh. People are increasingly choosing larger, more secure homes, and this consumer trend has paid off handsomely for Zirakpur.

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