Affordable housing segment is likely to be one of the worst affected owing to the COVID-19 pandemic as concerns over the target audience’s limited income and unemployment continues to rise. The segment was leading the sales traction in residential real estate for the more than a year.
Around 6.1 lakh affordable units were under construction across the top 7 Indian cities until the lockdown was announced. This is over 39% of the total 15.62 lakh under-construction units in these cities, the highest share of all budget categories, said an ANAROCK Property Consultants report.
Overall unsold housing inventory is estimated to shrink annually by 1-3% in 2020, while the unsold affordable stock may actually increase by 1-2% in this period, the report showed. As on March end, there are more than 2.34 lakh unsold affordable homes in the top 7 cities– 36% of the total unsold stock across all budget categories.
“This segment will be severely impacted by the current COVID-19 outbreak. The target audience typically has limited income and unemployment fears currently loom large. This could result in deferred property purchase decisions in 2020 and ultimately derail the segments’ growth momentum. As a result, unsold affordable stock can rise by 1-2% on a year-on-year basis,” said Anuj Puri, Chairman, ANAROCK Property Consultants.
The government’s ‘Housing for All’ push coupled with multiple sops to buyers and developers has pushed supply of affordable housing projects across the country. Around 40% of the new supply added across the top 7 cities in the past few years was in the affordable segment with units priced below Rs 40 lakh.
Of over 6.1 lakh affordable units under construction across the top 7 cities, Mumbai Metropolitan Region (MMR) and the National Capital Region (NCR) together account for nearly 59% or 3.59 lakh units launched between 2013 to 2019. Both cities together also have a 57% share or 1.34 lakh units of the overall unsold stock of 2.34 lakh units in the budget homes category.
(Source: Economic Times)
