The sentiment index score for India’s real estate sector remained positive and touched an all-time high during October-December quarter, while stakeholders showed “prudent optimism” in their outlook for the next six months amid rising cases of coronavirus, according to a survey report.
As per the Knight Frank-FICCI-NAREDCO Real Estate Sentiment Index report, the ‘Current Sentiment Index’ touched an all-time high of 65 in October-December 2021.
The previous high was a sentiment index score of 63 in Q3 2021.
The score of above 50 indicates ‘Optimism’ in sentiments, a score of 50 means the sentiment is ‘Same’ or ‘Neutral’, while a score below 50 indicates ‘Pessimism’.
The report attributed the improvement in the index to reduced uncertainty on the economic front leading to stability in demand in the real estate sector.
The ‘Future Sentiment Index’ which measures the outlook for the next six months, remained optimistic, but dipped from 72 in Q3 2021 to 60 in Q4 2021, reflecting a prudent optimism as the Omicron-inflicted risk on the Indian economy is yet to be discerned.
The Real Estate Sentiment Index is based on a quarterly survey of key supply-side stakeholders which include developers and financial institutions.
Sanjay Dutt, Joint Chairman FICCI Real Estate Committee and Managing Director & Chief Executive Officer Tata Realty & Infrastructure Ltd said, “2020 and 2021 can be coined as historic years for real estate.”
While the pandemic disrupted the sector globally, it also presented an opportunity to take a step back and put in place building blocks for long-term sustainable growth, he added.
“As we deal with each wave more confidently, I am sure that we are on the cusp of a very exciting and unprecedented cycle of real estate growth,” Dutt said.
Naredco President Rajan Bandelkar said the countries are getting better at dealing with the COVID pandemic.
“We are currently in the third wave of COVID, which has definitely impacted the Future Sentiment score. However, I must add that it still remains in the optimistic zone and is temporary and will inch back up soon,” he added.
Knight Frank India CMD Shishir Baijal said the demand continues to be strong but stakeholders are adopting a cautious approach in the wake of the uncertainty arising from the third wave of COVID-19.
“The real estate sector has demonstrated an indomitable spirit and has remained robust in the last 5 quarters mostly led by the residential sector growth,” Baijal said.
Home loan interest rates are at a historic low and the RBI’s firm assurance in maintaining the status quo has further boosted demand in the market, he added.
Source : Business-Standard