COVID-19 And Its Impact On Real Estate Developers in Bangalore

The coronavirus pandemic appears to have made the residents of cities realize the worth of their living space, which is now working as their office as well. Real estate developers are seeing an increased demand for larger homes, given that people now want to put up a dedicated study room or office space within their homes. And since the current situation is unlikely to change soon, home buyers are searching for larger space – to ensure sufficient space and ease. They are also witnessing renewed interest in villas from serious home buyers. The change in priorities is visible in the demand people are making.  Searches at real estate developers in Bangalore show that space and size have become the major concern for most buyers.

Builders are seeing a rise in inquiries for ready-to-move homes and apartments with large space under the budget between Rs 70 lakhs and Rs 1 crore post the Covid-19 outbreak. According to a real estate developer in Bangalore, “Around 75% of the demand is for 3 BHK flats and apartments from homebuyers in the last two months”. It is also expected that this trend is likely to remain for the next 12-18 months and will gradually exhaust the ready-to-move homes. Real estate builders like Bhadra Group are gearing up to meet the increased demand for large and spacious homes.

Further, six months of extension provided by RERA for completion of ongoing projects should reduce the supply of large and ready-to-move-in – homes. Since RERA has provided an extension to real estate developers to finish the under-construction projects, very few new projects will come up in the coming times to meet this demand-supply break. Also, Bangalore doesn't have much large 3 BHK homes reason being that no new projects have been announced in the last three months due to lockdown imposed.

The nationwide lockdown imposed to contain the spread of COVID-19 from the last week of March has hit the real estate sector very badly, resulting in delayed launches. Further, new completions are unlikely to come in the market within a few months due to a shortage of labor and high input costs.