The real estate industry is now open to only a select few for investment. Once upon a time buying a home was a matter of great pride to Indians. It still is for many, but that trend is slowly starting to change. Youngsters are now realizing the futility in saving up for a lifetime to buy a house, which in the end only becomes a liability. They instead prefer investing their money in other places. Real estate is still lucrative, but only to the rich, so that they can become even richer. The common man is looking for other avenues to save and earn more money. This is the case especially in metro cities where the property prices have escalated. Be it Real Estate Bangalore or Mumbai, the problem is mainly the inflating prices. A recent report showed that a lot of properties are in a ready to occupy stage but have no takers. The high property prices and inflation is one reason. But are they the only ones. What are the factors that are posing a threat to our real estate industry? Let’s find out.
The younger demographic- More than half of population is the youth. The youth are the ones who are mainly looking for accommodation after graduating. But our youngsters are not highly paid enough to buy houses at such an age. They are mostly consumed by their student debt, their job woes. Additionally the youth are not in the habit of saving money and long term planning. While there is a huge demand for rental spaces in our country among this demographic, permanent residential property is much less.
Demand change for retail outlets- A decade back any retail outlet needed a space to set up shop. But since the advent of digital era things are slowly changing. The online retail companies have been a game changer. Not everyone goes to a retail outlet any more, especially the youth. The younger generation is very comfortable buying apparel, accessories, electronics and now even groceries. Everything is slowly moving to the virtual world. Many new start-ups are operating online, completely eliminating the need for retail rental spaces. Only once they are hugely successful, do some open up physical stores. This has greatly declined the demand for rental retail outlets and this trend continues.
Work from home- While there is a high section of the population doing office jibs, more and more people are also joining the work-from-home bandwagon. The digital era has brought about a lot of changes in the employment sector and in the way we work. A lot of companies now allow people to work in their pajamas in the comfort of their homes. Some employees do have to visit their office once in a while, but the number of companies that allow theory employees to work from home has drastically increased. This could result in less demand for office space in the future.
Real Estate Brokers- Digital era has brought about a lot of changes and this has affected the business for real estate agents and brokers. Now-a-days many people look up for house listings online and find their homes. They feel that this will help them save money by avoiding the middle men. Real estate agents are still the best people to consult while property hunting, as they have a lot more listings than what is put up online. But in order to save on brokerage fees people opt for direct transactions whit the landlords, which has reduced their clientele.
High prices- This is probably why many people avoid purchasing their own homes and more and more people are deciding that renting is better for them.