According to CREDAI Omicron Covid variant will not immediately impact the property market

Real estate developers’ apex body CREDAI (Confederation of Real Estate Developers’ Associations of India) does not see an “immediate impact” of the Omicron Covid variant on property bookings.

While the cost of apartments are expected to see a 5 – 10% rise at the end-user level, primarily to off-set a similar or “more than that” hike in raw material cost; bookings of existing properties or launch of new ones are unlikely to see an immediate adverse effect.

Harsh Vardhan Patodia, President, CREDAI said, “The long term impact of Omicron is yet to be ascertained. But, as of now, we do not foresee a slowdown in bookings or new property launches because of the variant. The festive momentum is expected to continue for quite some time now.”

Patodia added that property bookings have been at pre-Covid levels despite “possibility of an increase at the end-user levels”. Micro-market fluctuations could see a higher (than 5-10 per cent) price rise for buyers.

Property consultants Knight Frank India had recently said that despite the strong second wave of the Covid pandemic, property sales were likely to increase over the 2020 level this calendar year driven by pent-up demand, festive sales, gradual recovery of India’s economy, stronger employment market and low home loan interest rates.

Sharad Agrawal, Executive Director – Capital Markets, Knight Frank India, said the property market seems to have a clear sense that the real estate cycle, which witnessed a turn from the festive season, is a durable one. And that it will continue for some quarters.

Agrawal said, “We expect the demand to become broad-based as the cycle progresses. We are also witnessing pricing power come back in the property developers’ hands combined with strong volumes. This has led to a re-rating of the sector which is driving the realty index.”