Economic Survey 2022 (Housing Prices): In cities like Hyderabad, Ahmedabad and Gandhinagar, Covid-19 shocks failed to hit housing prices.
Economic Survey 2022 (Housing Prices): In cities like Hyderabad, Ahmedabad and Gandhinagar, Covid-19 shocks failed to hit housing prices, according to the Economic Survey 2022 released today (January 31, 2021). Housing prices have continued to increase in these cities despite the pandemic.
“Unlike the decline in quarterly housing transactions during first and second COVID-19 waves, the impact of the COVID-19 shock on the prices of residential properties was not uniform across the cities,” the survey noted.
“During the first COVID-19 wave, the housing prices increased in cities such as Gandhinagar, Ahmedabad, Hyderabad, Thane, Mumbai, Kolkata, Pune and Bengaluru over the pre-pandemic level, and the housing prices decreased in Delhi, Noida and Ranchi. Similar trends were also visible during the second COVID-19 wave over the pre-pandemic level. The housing prices in cities such as Ahmedabad, Hyderabad, Gandhinagar and Ranchi continued to increase despite the COVID-19 shocks,” it added.
According to the Survey, housing transactions recovered swiftly between two COVID-19 waves, from June 2020 to April 2021. “This boost in housing demand is possibly because of pent up demand and measures taken by the government to increase affordability. The number of unsold residential units have also witnessed significant drops during the second wave of the pandemic,” the survey said.
The COVID-19 induced restrictions had affected the residential housing sector. Due to lockdowns, not only construction of new houses slow down, but the launch of new housing projects also got delayed.
“With the loss of income, uncertainty about future income, and stay at home orders, home buyers delayed their housing purchases. After the initial COVID-19 nduced restrictions were removed, transactions in housing properties increased significantly, possibly because of pent up demand and improvement in affordability in response to measures taken by government during the pandemic, such as lower interest rates, reduction in circle rates, and cut in stamp duties…” survey said.
“Besides, several major banks, mortgage companies, and housing finance companies have significantly reduced their interest rates on home loans, that fueled the revival in housing demand. During second COVID-19 wave (April-June, 2021), transactions of housing properties were once again impacted adversely, but not as much as it was seen during first COVID-19 wave (April-June, 2020),” the survey added.
