The Knight Frank-NAREDCO Real Estate Sentiment Index for the third quarter of 2022 shows that customer score has declined to 61 from 62 in the previous quarter due to global economic uncertainties.
The report noted that there is still optimism as the Indian economy and the real estate remain resilient.
The future sentiment score, which measures stakeholder perceptions for the real estate sector over the next six months, has also declined from 62 in Q2 2022 to 57 in Q3 2022.
Shishir Baijal, chairman and managing director of Knight Frank India, said: “The extensive changes in the geo-political environment outside have pared down the overall growth across all economies.
“Despite the retardation in the growth pace, India remains as the highest GDP growth among the larger economies. The real estate sector over the past few quarters continues to be strong. "
The report further highlighted that as inflation remains high in India, tight monetary policy measures and an adjusted economic growth forecast have altered the stakeholder sentiment for the next six months. Both the current and future sentiment scores were moderate despite the fall.
"Additionally, housing affordability has shrunk further after the repo rate hike in September 2022," said the report. "However, because of the headwinds caused by the high rate of inflation and geo-political tensions, the Future Sentiment Index has shown a marginal decline and that could influence the developers’ sentiment in general in the next few quarters," added Baijal.
Rajan Bandelkar, president of NAREDCO and director of Raunak Group said, “The market has several reasons favoring homebuyers. After increasing the repo rate sequentially over the past few months, the RBI will likely increase the key policy rate again in December. But the sequential rise in repo rate has very little impact on mortgages in the affordable housing segment.”
He added that first-time homebuyers would also receive tax incentives to buy. “With an abundant supply of good-quality housing projects, homebuyers can strike a good bargain.”
