Residential bookings in MMR fall by 78% in Feb-March due to COVID-19

Photo: For representational purpose

CREDAI MCHI has released a research study, titled ‘COVID 19 Impact: Real Estate’, conducted via a survey and research of over 100 leading Mumbai Metropolitan Region (MMR) developer members as well as various real estate experts and professionals. It highlights the impact of COVID-19 or the Coronavirus on the MMR real estate market and showcases a comprehensive analysis of the adverse implications of the virus on the residential, commercial and industrial real estate asset classes.

The pandemic has currently brought the entire industry and the economy to a slowdown, proving to be a force majeure situation. This report attempts to underline the substantial and unprecedented impact that it has had on the sector at large. It further highlights the possible change in trends and individually analyses the extent of COVID-19’s implications on each asset class.

Key findings of COVID-19 impact on real estate

Residential

Residential bookings have fallen by 78 per cent (a month, from February 2020 last week to March third week) as compared to January 2020.

250 per cent drop in home loan collection in March 2020 as compared to January 2020.

Total number of walk-ins dropped by almost 80 per cent in a span of 30 days.

7,766 confirmed scheduled site visits were cancelled due to COVID-19 in a span of 30 days of the study.

While there was a 200 per cent rise in cancellations in the third week of the study, the trend normalised to average figures in the last week of the study.

Commercial

Pre-commitments will form a significant part of leasing in H1 2020.

Existing tenants might delay lease renewals to H2 2020 and will renegotiate rent free periods until lockdown.

Construction of office spaces to be delayed due to disruption in the supply chain of vendors.

Co-working spaces could face long term impact. Seat based short term leases might see a fall due to a surge in ‘work from home’ productivity during lockdown.