Covid Implications – Housing Demands in tier II and III cities expedites.

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Leading developers like DLF, ATS, Omaxe and Alpha Corp have shifted focus towards smaller cities to monetise the land banks they had held for long.

Housing Demands Accelerates

The Covid-19 pandemic has accelerated demand for houses in tier II and III cities due to reverse migration, availability of better value-based pricing and larger spaces, and lower cost of construction

Leading developers like DLF, ATS, Omaxe  have shifted focus towards smaller cities to monetise the land banks they had held for long.

“Tier II and III cities have witnessed considerable rise in demand in the recent past, primarily due to accessible pricing, more space, better returns on investment and lower cost of acquisition, mostly for ready to move in units,” said Aakash Ohri, senior executive director, DLF Developers Ltd.

“In a post-Covid era, there is a rise in trend among home-buyers to build a lifestyle away from the hustle of a metropolitan yet offering all the amenities of advancing cities.”

Currently, the top seven cities account for almost 70% of India’s Residential Market, with the remaining 30% accounted for in tier II and III cities.

“Covid has made people realise the importance of a house in a gated community. Unlike metro cities, houses in tier II and tier III do not require major investment. The traction in Haryana is better than UP because of weekend lockdown in UP.”

According to DLF, it’s residential projects in cities like Lucknow, Indore, Shimla, Kasauli and Tri-city(Punjab), which offers plots to ready-to-move-in units, are gaining traction.

“Being an end-user driven market, the demand has picked up faster in II/III cities due to a host of reasons like government’s industry and infrastructure push, corporates looking for cheap real estate and skilled workforce that are staying back or returning and higher capital appreciation,” said Mohit Goel, CEO at Omaxe Ltd, which is developing projects in New Chandigarh, Lucknow, Ludhiana and Indore.

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