Amid COVID-19 pandemic, real estate has emerged as the safest investment option. In India, buying a home considers being a matter of prestige and safety. The sector has been in the gloom from the last few years with the sharp hike in equity markets where investor sentiment supports the latter.
The reluctance to invest in land for sale or real estate may be based on shorter returns, but a higher rate of return would be of great interest. However, the coronavirus pandemic can change your mindset.
For beginners, the ownership of the house comes out with an unmatched sense of security. The people buy their house, which is a silver lining going forward. What is the ongoing weakness in the equity market will further aid the emotion and rekindle consumer interest in the sector. Thus, the value of properties in the real estate market remains stable.
This makes investors seek greater transparency and credibility in their spendings. To put it into account, the National Council of Real Estate Investment Fiduciaries’ (NCREIF) July 2018 data stated that the commercial real estate returned an average of 9.85% over the past five years.
Above all, real estate is not paper money; it is the asset one can hold substantially that further increases its return on investment and reliability. The effective relationship between demand for real estate and GDP growth stems from the inflation dodging capability of the sector.
Real estate Sector as Best and Secure Investment
With the expansion of the economy, the demand for real estate generates higher rents, which in turn converts into higher capital values, leading real estate as a secure investment. As the Reserve bank of India (RBI) has reduced the repo rate by 75 bps, and a new base rate is 4.4 percent, the reduction of the home loan interest rate has become a sentiment booster.
It is irrefutable that the post-pandemic world falls well for the sector. Timing is crucial to invest in the real estate industry, which is now. Financial security is foremost on people’s minds, and one must use their money through multiple avenues.
Investing in Property as Wise Decision
Whether you look for land or homes for sale in this pandemic situation, the clear thing is to invest in property. After the crash of the stock market, no one wants to risk their money in volatile instruments. However, good fixed income options are not pleasing after a flurry of rate cuts. Beyond that, the property is seen as a secure bet that keeps on holding value even in a downturn.
Also, investing in property is beneficial if your time horizon is at least 8-10 years. It is the minimum time when investment takes up to gain good returns. One can put it on a lease or have any home business. Moreover, buying a house comes out to be an excellent opportunity for buyers because of the reasonable prices.
Residential Sector VS Commercial Sector
No doubt, the residential sector has seen a rise in demand for owning homes, especially looking for their dream homes amid the coronavirus outbreak. As people are indoors or rental houses, they are getting time to discuss their perfect living space with their family members. Besides the millennials, the demand for homes comes from first-time buyers as the working class is experiencing paying rents in current times.
Residential properties are bought primarily for end-use and long-term investment. Yes, commercial real estate has high demand due to big profits, but residential real estate has remained largely stagnant from the last few years due to the impact of regulatory changes. This time, COVID-19 spread has affected a lot.
Crisis brings changes. It makes society shift to become more productive. It is the same within any industry. There seem to be long-lasting effects on the way people approach decision-making due to the economic-rises. One can witness the small impact of Coronavirus on real estate since it has all begun.
The trend in the digital age is a need in every industry to go online and build a direct relationship between the product and consumer. The same trend has been taking place in the real estate industry, where people can invest directly online. In the present situation, real estate offers you the best bet, security, stability, and safety.