Real Estate continues to be the preferred asset class for investment, in the wake of the COVID-19 pandemic but a majority of home buyers want discounts along with flexible payment options as incentives, according to a survey by Housing.com and NAREDCO.

According to the survey findings, real estate was the preferred mode of investment for 43% (as compared to 35% last year) of respondents, followed by stocks at 20% (15% last year), fixed deposits at 19% (22% last year) and gold at 18% (28% last year).

The real estate portal conducted the survey between January and June 2021 of more than 3,000 consumers.

“The health crisis has reinforced the importance of home ownership across the world. As a result, the residential real estate market is not only witnessing fresh demand from first -time home buyers but also from a lot of consumers who are upgrading to bigger apartments,” said Dhruv Agarwala, group CEO, Housing.com, Makaan.com and PropTiger.com.

“This demand increase, generated post-COVID, aided by rock bottom housing prices and historically low interest rates on home loans, has helped residential real estate developers to successfully navigate through the tough economic situation caused by the pandemic,” Agarwala added.

See also: Online searches for residential properties pick up pace in June 2021: Housing.com’s IRIS

Commenting on the survey findings, NAREDCO president and founder and MD of Hiranandani Group, Niranjan Hiranandani emphasised on the fact that the demand for housing was inherent. “The value of owning a home has been reinforced by the COVID-19 pandemic, with renewed preferences. Integrated township living will garner traction, as it offers a holistic lifestyle in a one-stop destination and also offers opportunities for working near home. The economic recovery is scaling up gradually, in the backdrop of festive tailwinds, buoyant capital markets, softening of home loan interest rates, record high foreign reserve and FDI, increasing employment rate and optimistic demand impetus. Cuts in GST and tax benefits will go a long way in strengthening sustainable demand and signals positive consumer confidence index for H2 FY 2021-22,” he maintained.

Among other key findings, the majority of the respondents (71%) felt that flexible payment plans and discounts would provide much-needed financial aid during current times and drive them to make purchase decisions. Strong housing sales in Maharashtra’s two key markets – Mumbai and Pune – suggest that stamp duty reductions by the state government played an important role in stimulating demand during the September 2020 to March 2021 period.

See also: Real estate activity seen picking up in June 2021, post COVID-19 second wave: PropTiger report

“Builders’ margins for under-construction properties have reduced due to increase in construction costs and land prices in some cities. Therefore, there is little scope for reduction in the basic selling price (BSP). However, builders have been offering flexible payment plans and discounts in some cases to attract customers,” said Mani Rangarajan, group COO, Housing.com, Makaan.com and PropTiger.com.

“The housing market has shown great resilience during the second wave of COVID infections, with demand and supply both growing during April-June 2021, as compared to the same period in 2020. The survey shows that buyers’ sentiments have improved since June and people have started searching for properties with renewed vigour. We expect demand to remain strong during the festive season,” Rangarajan added. He also said that state governments should reduce stamp duty on registration of properties, to encourage home buyers.

See also: 78% buyers willing to buy property in 2021: PropTiger consumer sentiment survey

The survey found that the economic and income outlook for the coming six months is more optimistic as compared to H1 2020. The sentiments have been less impacted this year, given that uncertainty is lower as compared to last year. Also, the lockdowns have been more selective along with vaccine availability. “While the second wave did see home buyers shying away from making a purchase, the subsiding Coronavirus cases have seen buyers resume their home searches a lot quicker than after the previous lockdown period,” the report said.

As expected, prospective home buyers are now taking into account nearby healthcare infrastructure for selecting a property. Recreational spaces and daycare centres have also made it to the list of top amenities that buyers look for. With corporates adopting work-from-home and hybrid work policies, home buyers are expressing interest in larger homes. Traffic on real estate portals for searching properties has gone up due to an acceleration in the use of digital tools during this pandemic.