Coronavirus: a guide for Realtors

The outbreak of COVID-19 and the nationwide lockdown in the country has adversely affected the real estate sector in Kerala, India. Already the real estate sector is crippled by the prevailing subdued demand and liquidity crisis.

Here‘s a guide for realtors in these times of the Coronavirus pandemic from luxurykeralaflats.com, one of the best real estate websites in Kerala. 

It is predicted that the sales in the residential sector could fall by up to 35 per cent across seven major cities. The commercial (office and retail) real estate segment will also be hit drastically. The net office space leasing could fall by up to 30 per cent while the retail area absorption could fall by 64 per cent. For the realtors it means a bleak scenario for the time being but, this too will pass!

The lockdown has brought to a stop site visits, discussions, documentation and closures. This means the real estate sector in Kerala will make a slow recovery over the next 2 years. Many of the projects launched between 2013 and 2019 are still in the process of being built. The lockdown has resulted in breaking down the regular supply of construction materials causing a slowdown.

The supply of imported items like glass, marble, MEP (mechanical, electrical and plumbing) works and other finishes may stall. This is clearly not good news for realtors as well. The RERA rules have made it mandatory for developers to deliver projects in a specified time frame & any significant delays may cause further litigation. Moreover, it may even affect the limited trust between builders and buyers further breaking it down. 

Construction delays might come to several months for well-funded projects, while for others, they may even turn out to be longer. For the buyers this means a delay in occupation & they have to continue paying rents as well as EMIs, in case they took on a housing loan.

Builders with a financially sound foundation can survive in the days to come as cash flows of companies active in the real estate of Kerala will be affected badly. But the expenses of buying material and employing labourers will come down. This could to some extent help realtors to keep up the balance. The loans taken by the realtors for funding their projects may be helped by the 3 months Moratorium declared by the banks as per Government directives. 

The home loan rates are going to come down with the lesser Repo rates of the Reserve Bank of India. But the lockdown may cause loss of jobs in the months to come & home loan defaults are likely to go up.

What’s the way out? It is better to follow a wait and watch policy. Curtailing expenses in marketing and delaying the announcement of new projects will help to some extent. Announcing attractive discounts may cause sales to go up as well. 

To book flats in Kerala contact us at luxurykeralaflats.com, the premier real estate website in Kerala.