With the gap between rents and equated monthly installments (EMIs) narrowing, as many as 65% people across the country are willing to buy property in 2024, the annual report released by real estate property website NoBroker has said.
As many as 35 percent wish to buy property on account of the security it offers, 30 percent prefer buying property as rents have become expensive, 26 percent want to purchase property as it is affordable, 5 percent on account of the savings accrued during the pandemic and 4 percent because they are getting married, said the report.
Bengaluru has seen the highest concern about rising rental costs. As many as 42 percent buyers want to buy a house because rents have become expensive compared to 31 percent in Chennai, 24 percent in Delhi-NCR, 33 percent in Hyderabad, 27 percent in Mumbai and 17 percent in Pune, the report said.
The high rents associated with gated communities have led to a gradual shift in demand for independent houses and floors, as they are relatively more affordable. Demand for properties easily commutable by metro has also shot up. This is driven not only by convenience but also as a strategic response to soaring rents, said the report.
Another trend is that of demand spreading to areas that may not be in proximity to office complexes but are commutable by metro. This is driven not only by convenience but also as a strategic response to soaring rents. Rentals in areas that are not around office complexes and IT hubs have not seen an exponential surge. The surge in rental costs has also prompted a change in behaviour, with tenants increasingly considering homeownership as a viable alternative, said the report.
Nobroker gathered responses from tenants, buyers, sellers, landlords and NRIs. Over 32,000 customers participated in these surveys from major cities such as Bengaluru, Mumbai, Pune, Chennai, Hyderabad, Delhi-NCR, and overseas.
“Like previous years, 2023 continues to be characterized as a sellers’ and landlords’ market. The return-to-office mandate has prompted a significant migration of people back to their work cities, consequently driving up the demand for residential properties. The demand-supply mismatch, as a result of the pandemic, coupled with the need to buy a house, has increased demand for residential houses. This in turn has driven up rentals and prices,” said Saurabh Garg, Co-founder and Chief Business Officer, NoBroker.
“Escalating rents have also acted as a catalyst by nudging fence sitters to take a plunge into home ownership. We see this trend pay out especially for first time home buyers. Also, as property prices within the city limits are unaffordable, many tenants are considering purchasing in areas that are not necessarily around IT hubs or the centre of the city as an investment. That way, they have the satisfaction of owning a property and also have rental income that supports their rentals,” he added.