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COVID-19 Crisis Pushes Real Estate Industry To All-time Low In Q1 2020: Survey

The Knight Frank-FICCI-NAREDCO Real Estate Sentiment Index Q1 2020 Survey shows the current sentiments of the real estate sector in India have dropped to 31

COVID-19

As the country battles COVID-19 pandemic, the Real Estate Sentiment Index is witnessing an all-time low, said an industry report on Thursday. The Knight Frank-FICCI-NAREDCO Real Estate Sentiment Index Q1 2020 Survey shows that the current sentiments of the real estate stakeholders, developers, and financial institutions, in India have dropped to an all-time low score of 31, during January-March (Q1), 2020.

The survey also reveals that the ''future sentiment score'' outlining the industries' market expectations may also witness a dip into the pessimistic zone at a score of 36 in Q1 2020 against the score of 59 in Q4 2019. As per the report, the real estate sector has begun showing some signs of revival after suffering a severe setback in the last quarter of 2019 due to the COVID-19 crisis.

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Government's aid to the real estate sector

Chairman and Managing Director of Knight Frank India, Shishir Baijal said that the pandemic condition has hit global markets and societies, causing is a severe shortage of liquidity. Despite stimulus measures provided by the Government, the real estate sector requires support to stay afloat during the crisis.

The Government infused confidence in the real estate market by creating a stressed asset fund (AIF) of Rs 250 billion to revive the sector in the last quarter of 2019. However, the COVID-19 outbreak has marred the stakeholders' sentiments.

According to Niranjan Hiranandani, National President, NAREDCO, the economy has come to a standstill due to the pandemic and its recovery curve will depend on the fiscal stimulus rolled out by the Government. Although, he said that the consumers and developers are showing a great amount of resilience and adaptability during this period. He said the real estate sector is expecting a slowdown across the industry post-Covid-19 crisis.

Amid the extension of nationwide lockdown till May 3, the Ministry of Home Affairs (MHA) on Wednesday, allowed the functioning of manufacturing and other industrial establishments in Special economic zones (SEZs), Export oriented units (EoUs), industrial estates, and industrial townships by following social distancing in its new guidelines. MHA also exempted services of manufacturing of IT hardware and of essential goods and packaging. 

READ | 3 Months Extension To Real Estate Projects: UP RERA

READ | Coronavirus: Real Estate Developers In Bengal Seek Relief For 6 Months

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