Track2Realty pan-India survey
The quest for property has not subsided among the Indians; nor do they have any doubts over the appreciation potential of real asset. They still consider property the tangible asset class that is less prone to market volatility, compared to stock market and other avenues of investment. However, they need a bit of cushioning this festive season to take a plunge into the property market.
No less than eight out of 10, as many as 81%, Indians have an affinity for one’s own property, including commercial spaces. 76% believe no other asset class can appreciate as much as a piece of property over a long period of time. 82% even endorse property for the reasons of being least volatile in the wake of economic uncertainties.
What is then holding them as a fence sitter who are yet not ready to commit buying real asset this festive season? Nearly everyone, 93% to be precise, blame it to the economic uncertainties and bleak job market outlook.
These are the findings of a pan-India survey by Track2Realty, real estate thinktank group. Track2Realty conducted this online survey with a sample size of 3000 respondents. The respondents were asked both open-ended and close ended questions and the responses were grouped in five key areas of – Economic Outlook; Job Market Outlook; Property Quest; Property Returns; and Confidence Boosting Measures.
The survey was aimed at finding the mood of the nation on the eve of this festive season. The total respondents were 58% males and 42% females. The idea was to find out whether this festive season would be better or worse than the previous years. More importantly, what could be done to bring the fence sitting buyers back in the market to make this festive season count.
“If you ask me whether I would like to buy a property this festive season, my reply naturally would be yes. Property is something that is not just an asset but also holds emotional value. The real issue today is uncertain job market; reason enough to be apprehensive. Prices on this festive season are quite attractive too, and I am expecting some good marketing offers as well. But the layoffs that I have been witness to in my office is scary,” says R Jaishankar, an IT professional in Noida.
The study finds that more than the project execution uncertainties, it is the job market uncertainties that is bothering the Indian home buyers. 62% Indians cited bleak job market to be the reason of apprehension, as against only 38% buyers who are afraid of project delays. A large share of the home buyers, as many as 78%, even believe there are many ready to move options available in the market today.
“The market never had this much of ready to move options. So, the fear of project getting delayed is not something that is a deterrent to me. My real issue is what if I lose my job tomorrow. You know how a distress sale causes huge loss with the home purchase. I wish there was some safety valve to bank upon,” says Ramya Maharshi, a fashion designer, in Bengaluru.
As an interesting trend, the survey noted that 88% Indians believe property is no longer the game of short-term momentum traders and speculators. Most of them, 86% respondents, believe property is best valued over a period of time.
79% Indians believe short-term property exchanges is no longer a business strategy but distress sale. Nearly all the potential home buyers, as many as 94%, believe short-term sale means distress sale that would be a major loss in today’s market.
Is property the best hedge against inflation? As many as 90% believe it is! but only over a period of 10 years and more. Short-term property gains have been anticipated by only 10% Indians.
A whopping majority of the Indians, as many as 94%, are nevertheless ready to take a plunge into the housing market, if only there is a back-up plan in case of any post purchase economic fallout. The home buyers hence demand some sort of Pay Cheque Protection Plan in the Indian housing market.
There are two ways, as suggested by the home buyers, that can ensure a potential buyer doesn’t fall into debt trap. 90% of the home buyers suggest some sort of sovereign guarantee, like:
Defer the EMIs in case of job losses for minimum two years
Restructure the loan tenure/EMIs in case of proven salary cut
“Give me a sovereign assurance that my house is insulated against the future job uncertainties, even if that insurance is only for a year or two. Similarly, if my EMIs are deferred during the unemployment transition and also if I have the option to restructure my bank loan EMI & tenure if I face a salary cut, I am ready to commit this festive season. My finances are supporting me to buy a house; my fear factor with the job market is not,” says a Chartered Accountant, Himanshu Jha in Mumbai.
Was the EMI deferment during the Covid induced lockdown of any help? No ways! 94% Indians believe that was an eye wash and what the real estate needs at this year’s festive season is some tangible comfort to the buyers.
Covid seems to have dented the confidence of the Indians. It is hence no surprise that 90% Indians recommend home loan protection plan to be an integral part of housing mortgage. 74% categorically maintain they won’t mind paying extra, so that the loan is no longer a liability for survivors if the borrower dies.
Furthermore, the insecurities of the job market have dented so much to the Indians that 76% believe LTV (Loan to Value) should not exceed more than 60%. A few more Indians, as many as 78%, believe DTI (Debt to Income) should not be more than 40% in today’s uncertain times.
Survey Highlights
81%, Indians have an affinity for one’s own property
76% believe no other asset class can appreciate as much as a piece of property
82% even endorse property for the reasons of being least volatile in the wake of economic uncertainties.
93% blame it to the economic uncertainties and bleak job market outlook for housing degrowth.
62% Indians cited bleak job market to be the reason of apprehension
78% believe there are many ready to move options available in the market today
88% Indians believe property is no longer the game of short-term momentum traders and speculators
86% respondents believe property is best valued over a period of time
79% Indians believe short-term property exchanges is no longer a business strategy but distress sale
94%, believe short-term sale means distress sale that would be a major loss in today’s market
90% believe property is the best hedge over 10 years
90% of the home buyers suggest some sort of sovereign guarantee, like
94% Indians believe EMI deferment during lockdown was an eye wash
74% categorically maintain they won’t mind paying extra, so that the loan is no longer a liability for survivors if the borrower dies
76% believe LTV (Loan to Value) should not exceed more than 60%
78%, believe DTI (Debt to Income) should not be more than 40% in today’s uncertain times
Ravi Sinha
#RaviTrack2Media
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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