Ideal Moment to Upgrade to a More Spacious Home

The extended lockdown in India, stretching over the past six months, has brought to light the paramount importance of owning a spacious and comfortable home. With Work From Home (WFH) becoming the norm for professionals and online schooling now a daily routine for children, families across the country have found themselves struggling with cramped living spaces. The very home that once served as a retreat from the demands of the office has now become a space where work, school, and personal life converge, often leading to a sense of overcrowding and restlessness. In this context, the act of going to work has ironically become the new escape. However, amidst this challenging situation, a silver lining has emerged—the pandemic has inadvertently created one of the best times to invest in real estate. Builders are stepping up with enticing offers, and the government is introducing supportive measures aimed at revitalizing the real estate sector.

The changing dynamics of home life have spurred a shift in priorities, as evidenced by recent surveys. A study conducted by JLL India highlighted that more than 91% of individuals aged 35 and above are now leaning towards purchasing an apartment rather than renting one in the upcoming six months. This statistic underscores a significant change in mindset, where homeownership is increasingly being viewed as a necessity rather than a luxury. Furthermore, the survey revealed that 67% of respondents now consider buying a home essential, a sentiment that has been amplified by the ongoing pandemic. A separate consumer survey by Anarock during the lockdown period reported that 12% of people who had previously not planned to buy property are now showing a keen interest in homeownership, recognizing the stability and security that comes with owning a home.

As the reality of prolonged home confinement sets in, the demand for homes that can accommodate evolving needs has seen a noticeable rise. Families are seeking properties that offer ample space for working from home, online schooling, and personal privacy—all within the same living environment. The uncertainties surrounding rental markets have added to the stress of renting during these tumultuous times. The fear of sudden rent hikes or the possibility of having to vacate a rental property has led many to reassess their housing arrangements. As a result, a growing number of people are realizing that paying EMIs on a home loan—an investment that leads to ownership—offers far greater security than the ongoing liability of rent.

When compared to other popular investment avenues, such as stocks and gold, real estate emerges as a more stable and reliable option, particularly in the context of the current global crisis. While the stock market and gold have proven to be volatile and unpredictable during the pandemic, real estate has retained its appeal as a safe haven for investors. Paying EMIs on a home loan not only ensures that you have a roof over your head but also gradually increases your ownership stake in the property. Moreover, home loans offer attractive tax benefits that renting simply does not provide. Unlike other investments, real estate retains its intrinsic value even during uncertain times, and history has shown that property values tend to appreciate as the economy stabilizes and grows.

One of the most compelling reasons driving the current wave of real estate investments is the unprecedentedly low home loan interest rates. The Reserve Bank of India (RBI) has reduced the repo rate to its lowest level in 20 years, directly influencing home loan interest rates. At present, the lowest interest rates on home loans hover around 6.85%, a significant reduction from the 8.55%-8.75% range seen just a year ago. This drastic decrease makes it an exceptionally opportune time to secure a home loan, as the financial burden of borrowing is significantly lower than in previous years.

In addition to low interest rates, the reduction in stamp duty rates has further fueled the shift towards home buying. As of 1st September 2020, the stamp duty on property purchases was reduced to just 2% until 31st December 2020, with a slight increase to 3% from 1st January 2021 to 31st March 2021. This is a substantial reduction from the previous stamp duty rates of 5% in major cities such as Mumbai, Pune, Nagpur, and Nashik, and 6% in other regions. The reduction in stamp duty has significantly lowered the overall cost of purchasing property, making homeownership more accessible to a broader range of buyers.

The market conditions are currently ripe for homebuyers, with builders in key cities like Mumbai, Pune, Thane, and beyond offering a range of attractive deals. These include no GST on ready-to-move-in apartments, low booking amounts, and various other incentives such as referral schemes and flexible payment plans. Ready-to-move-in properties are particularly in demand, as they offer the dual benefits of being GST-free and allowing buyers to move in immediately, without the wait associated with under-construction projects.

Builders in prominent locations are responding to the increased demand for larger living spaces by offering ready-to-move-in flats at competitive prices. Developments in cities like Mumbai, Pune, and Thane are known for providing not just spacious homes, but also excellent social infrastructure that enhances the quality of life. These developments are designed to foster a strong sense of community, offering amenities and facilities that contribute to better social security and overall well-being.

In cities like Mumbai, which is known for its fast-paced lifestyle and high real estate demand, the current market conditions present a unique opportunity for prospective homebuyers to secure a home in prime locations. Pune, with its growing IT sector and educational institutions, offers a blend of urban living and natural surroundings, making it an attractive destination for homebuyers seeking a balanced lifestyle. Thane, with its rapid development and improved connectivity to Mumbai, has emerged as a preferred location for families looking for spacious homes with modern amenities.

These cities, along with others like Bangalore, Hyderabad, and Chennai, are witnessing a surge in real estate activity as buyers take advantage of the favourable conditions. The combination of low interest rates, reduced stamp duty, and attractive offers from builders has created an environment where buying a home is not just a safe investment, but a financially sound decision that promises long-term benefits.