2020’s onset brought on the dreaded virus, causing a worldwide pandemic, but more importantly, the damage didn’t stop there. The real estate industry faced several hefty punches, with the entire home loan landscape witnessing new protocols. However, experts believe that real estate is now on its road to revival, with the affordable housing sector being one of the main saviours.
How affordable housing survived the monstrous year
While the initial months of 2020 were almost impossible to recuperate from, the affordable housing segment quickly pulled up its socks, thanks to the vast amount of middle-segment homeowners. Since this sector caters to a favourable price bracket, it welcomed maximum demand, especially since most people sought a way out of rented living.
With RBI announcing a liquidity infusion worth Rs 3.74- lack crore during March ’20, this housing segment found its way to survival. However, the ultimate support was through the unprecedented slash in RBI’s repo rates, resulting in record-low home loan interest rates.
With financial lenders offering home loan EMI rates at the sub-7% level, affordable housing boomed with most middle-class homeowners jumping on the opportunity. Though the real estate market was hit by the COVID, the drop in home loan rates has certainly helped the real estate market gain some momentum.
Moreover, to stay strong amidst the business, these institutions also relaxed the home loan eligibility rules. Thus, people with mediocre or adequate CIBIL scores and required documentation, easily availed home loan. This ultimately resulted in a massive demand for such financial aid amidst a host of individuals looking to purchase a new house affordably. The sales kept increasing, and eventually, this sector came out of the troubling year, victorious.
What’s in store for 2021?
From the looks of how this past year has been, real estate experts believe that affordable housing will continue to be the frontrunner in reviving this industry. The pandemic was somewhat of a blessing in disguise, as it forced millions to realize the significance of owning their house, which will seemingly persist for now.
The key focus points appear to be the budget (below Rs 45 lakh) and mid-income (Rs 45 lakh – one crore) segments, which are the affordable housing’s forte. Since this section provides developers offering numerous amenities at reasonable prices, homeowners are already inclined towards it. With 2021 coming into play, this tone will probably remain this way, as people bounce back from the pandemic.
With the RBI sticking to its repo rates, it’s unlikely that they’ll lower it further, mainly due to aggressively high inflation. This will barely create any rifts, as the current scenario seems to be the sweet spot for most homeowners, availing interests at 7% and below.
Start capitalizing on this window NOW!
If you were waiting to build your dream property, things could not get any better than now. With affordable housing in the centre stage, the best deals and interest rates are available in the market. Furthermore, if you opt for an online lender, you can also use their home loan EMI calculator to check the monthly instalment you’ll have to pay and get a quick head start on your plans. Why wait?