Second wave may delay 422,000 houses meant for delivery this year: study

40% of these are in the affordable segment priced under Rs 40 lakh; 35% are in the mid-segment priced at Rs 40-80 lakh

Over 422,000 residential units that were to be completed by the end of 2021 across the top seven cities are likely to be delayed due to the second Covid-19 wave, says a new report.

The National capital region (NCR) has 28 per cent share in completion, followed by Mumbai Metropolitan Region with 26 per cent and Pune (18 per cent), said Anarock Property Consultants in a report.

Notably, 72 per cent of the homes for delivery by 2021-end are already sold out and only 28 per cent remain unsold. "If the fallout of the second Covid-19 wave does not impact construction activity again, the top-7 cities will have 118,000 homes available for purchase by year-end. Once-bitten-twice-shy homebuyers' preference remains skewed towards ready-to-move homes which mitigate construction risks and project delays," it said.

In terms of budget categories, of the over 422,000 homes, 40 per cent (about 169,000 units if completed) are in the affordable segment priced under Rs 40 lakh. Thirty five per cent (148,000 units) are in the mid-segment priced at Rs 40-80 lakh.

Anuj Puri, Chairman-ANAROCK Property Consultants said, "The tally of 422,000 homes scheduled for delivery across the top 7 cities by 2021-end must, however, be viewed in context with the severe second wave of Covid-19 infections. All the top cities have been affected, and it is likely that a part of these project deliveries will be pushed to 2022. That said, many will be completed one way or the other. Amid localised lockdowns and curbs in most states, construction activities are permitted--albeit mandating COVID-19-specific protocols like adequate social distancing and sanitising among in-situ labourers."

Also, most developers underwent a steep learning curve since Lockdown 1.0. Since ready homes are in such high demand, many players with projects due to reach completion in 2021 will consider this a do-or-die deadline, he added.

"As far as housing sales are concerned, we are seeing a temporary slowdown due to the rampant spread of the coronavirus," says Puri. "The market will quickly regain an even keel once the vaccination drive picks up and the health infrastructure crunch abates."