New Delhi, March 26 (SocialNews.XYZ) As India goes into a nation-wide lockdown till April 14, completion of over 15 lakh under-construction housing units are likely to face delay.
According to data by Anarock Property Consultants, more than 15.62 lakh units, launched between 2013 and 2019 are under construction in the top seven cities, out of which projects in Mumbai Metropolitan Region (MMR) and National Capital Region (NCR).
A report by Anarock said that a lot is currently at stake for Indian residential real estate as cities go into complete lockdown mode to battle the spread of COVID-19.
Developers tend to schedule project launches during the auspicious festivals of Gudi Padwa, Akshaya Tritiya, Navratri and Ugadi. The strict advisories for complete lockdown will impact housing sales during the upcoming festivals, usually considered auspicious by several homebuyers to buy homes, as per the report.
Prashant Thakur, Director & Head, Research, Anarock Property Consultants says, "Another fallout of the lockdown is that many key markets will have almost zero construction activity at the project sites. This will further strain several developers' financial health."
"As many as 15.62 lakh units across the top 7 cities were in various stages of construction as on 2019 end, reveals Anarock research. These include all under-construction units launched between 2013 till 2019-end. Even this figure is conservative - the number of units will be higher once Q1 2020 data comes in," Thakur said.
According to Dhruv Agarwala, Group CEO, PropTiger.com although the lockdown is necessary to control the coronavirus outbreak, it would have an adverse economic impact.
"While necessary, the virtual lock-down in major cities across India, due to the recent corona virus outbreak, will certainly have an adverse impact on economic activity across sectors including real estate. We too have begun to see a dip in traffic on all our platforms," he said.
Niranjan Hiranandani, National President, NAREDCO said that Indian real estate was already facing a challenging time, the COVID-19 crisis just adds fuel to the fire.
"It has impacted all types of work related to real estate, be it planning or construction or sales and marketing. Even home seekers are impacted, and the festival of Gudi Padwa/ Ugadi/ Cheti Chand which traditionally sees good activity as regards new booking as also taking possession, this year, might see lesser numbers."
He further said that the economic response task force is evaluating the scenario from the Indian economy perspective, "so we expect real estate to be on the list, given that 250-plus ancillary industries depend upon real estate; not to forget it being the second highest employer in the Indian economy.
"I am sure the task force will evaluate the situation and take necessary action, at the right time," Hiranandani said.
In a letter to the Finance Minister, industry body CREDAI had sought measures from the government to prevent the sector from collapsing on account of COVID-19 impact.
It said that all interest and principal repayments falling due over the next three months in case of real estate projects should be put off and recovered over the next nine months and south waiver of penal interest charged by banks and financial institutions for a period of one year or until such time as it takes for the pandemic to abate.
Since the spread of the virus in India, developers have also taken precautionary measures.
Ravish Kapoor, Director, Elan Group said, "We are taking all necessary precautions to tackle the COVID-19 threat. We are encouraging employees as well as workers to wash their hands at regular intervals and adhere to the standard hygiene practices. Residents with even a mild cough and cold are being encouraged to consult a doctor immediately."
Rahul Singla, Director, Mapsko Group said that similar precautionary measures have been adopted in his company and apartments.
"Employees and residents are also encouraged to wash their hands at regular intervals and take special care of sanitation. Also, we have installed hand sanitizers at various places on the campus as well as chemical spraying is being done to prevent infection," he said.