Now, slight brakes seem to be applied on the fast pace of the real estate sector. However, this does not at all mean that the real estate sector is declining, rather it means that its pace has now decreased slightly compared to before.
The reason for saying this is the results of the Real Estate Sentiment Index of Knight Frank and NAREDCO. According to this, the current sentiment score of the real estate sector has come down to 65 from the all-time high of 72 in the January-March quarter. At the same time, the future sentiment score has decreased from 73 to 65.
According to experts, there is no need to worry about this decrease at the moment, because it is still in the positive zone. Any score more than 50 in this index is a sign of growth. In such a situation, a score of 65 can be considered much better in terms of real estate sector.
Similarly, the Future Sentiment Score being at 65 is also a sign of bullishness in the future. That is, in the long term, there is confidence that the real estate sector will remain bullish, which is currently considered to be a bit calm after the elections and the budget.
Waiting for reduction in interest rates
According to the results of the Real Estate Sentiment Index of Knight Frank and Naredco, 63 percent home buyers expect an increase in home prices in the coming time, while 51 percent home buyers are confident of an increase in home sales. Whereas 24 percent home buyers expect stability. Experts believe that if there is a reduction in home loan interest rates in the coming months, then it is difficult for the real estate sector to slow down.
The sentiment of developers has weakened!
The real estate sentiment index of Knight Frank and Naredco also takes the opinion of developers and non-developers i.e. banks, financial institutions and PE funds etc. According to this, the future sentiment index of developers has decreased from 72 in the first quarter to 61 and the future sentiment index of non-developers has decreased from 73 in the first quarter to 68.
In such a situation, it can be understood that looking at the current situation in the country and the world, real estate stakeholders are taking precautions, but we will have to wait for the survey of the next quarter to know how real estate will move forward.