The country’s top developers are seeing green shoots amid the slower sales environment caused by Covid-19-related issues.
For many developers, conversion rates, from inquiries to sales, have risen by as much as 20-25 percent from single digits in the days leading up to covid as working from home has become the norm and average size. of units has also increased for many.
The recovery is important for developers, as home sales fell 81% in the country’s main cities in the April-June quarter of this year and launches fell by 98%.
And the big brands are benefiting from the pent-up demand in the last three months.
Mumbai-based Oberoi Realty is seeing talk rates of about 25 percent of people visiting its show floors compared to 10 percent previously, said Vikas Oberoi, president of Oberoi Realty.
“We have seen a V-shaped recovery in residential demand in July and more in August. Despite Covid, we have seen more than 1000 people visit our various show floors. We also see clients who want a good brand, quality, guarantee and are not so demanding with the price, ”said Oberoi.
Oberoi Realty’s earnings before taxes fell 81.6 percent in the June quarter of fiscal 2021.
Properties priced between Rs 60 lakh and Rs 1.2 crore in carpet area sizes from 400 to 800 square feet are in the highest demand in the Mumbai Metropolitan Region, Anarock Property Consultants said in a recent report. Buyers in their 30s and 35s currently renting are the most inclined to buy, he said.
Demand from non-resident Indians and financial schemes also helped improve sales, developers said.
For example, for Bengaluru-based Brigade Enterprises, the conversion rate has increased by 20% after Covid and the average unit size has increased by almost 15% in the overall sales portfolio. The contribution from finished inventory has increased by nearly 50 percent in total sales, said Rajendra Joshi, CEO, Residential, Brigade Enterprises
“NRI customers contributed a quarter of our sales between April and June. Their contribution used to be around 12 percent before Covid, ”Joshi said. He said that while June and July sales were at 60 percent of pre-Covid levels, August sales are almost touching pre-Covid covid levels.
“Hopefully we will fully recover by Diwali, if not sooner,” he said.
In Bengaluru, inquiries for larger homes have risen by as much as 40 percent and property seekers are predominantly looking for 3BHK (1,800 sq. Ft. Average built area) compared to the previously preferred 2 BHK, Anarock said.
Another Bengaluru-based developer, Shriram Properties, used to see a conversion rate of two to three percent of total site visits. Now, the conversion rate has increased to more than 15 percent, said Murali Malayappan, president of Shriram Properties.
“We cannot compare pre-Covid sales to sales during Covid’s time as customers were unable to visit the sites due to blocking and other restrictions, we clearly see an increase in site visit conversion rate,” Malayappan said. .
For Salarpuria Sattva, the conversion rate has increased three times more than during pre-covid, as there are more serious buyers looking for quality construction.
“An additional advantage for buyers is the various schemes such as paying only 25 percent now and balance after 12 months and the flexible payment options offered that help buyers make decisions quickly,” said Adrija Agarwal, Strategy Advisor of Salarpuria Sattva.
Demand for ready homes:
Mumbai-based Lodha Developers saw a 20 percent increase in conversion this quarter, made 700 bookings in August this year, and made a business of Rs 617 crore.
Lodha posted a business of Rs 1,175 million in July-August 2020, which is almost close to the business it did in January and February 2020, said Prashant Bindal, director of sales at Lodha Developers.
“With the pandemic restoring a sense of home ownership, there has been an influx of business since the last two months and sales are reaching pre-Covid levels. Given the changing times, buyers are looking for immediate occupancy, leading to peak demand for move-in-ready homes, ”said Bindal.
He said the interest in that extra space is pretty apparent, as the group sees consumers seeking one-bedroom apartments graduating from one-bedroom and one-and-a-half-bedroom apartments and, similarly, two-bedroom apartment seekers. rooms are moving for two rooms. Apartments and a half bedroom.
Kamal Khetan, president of Mumbai-based Sunteck Realty, also said that there is substantial demand for ready homes and that conversion rates have increased by 10-20% depending on the categories.
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