What does the real estate sector do, to recover from the prolonged slowdown that has only been made worse by the Coronavirus outbreak? We get an expert’s opinion
The road to recovery for India’s land sector must involve concerted action from all stakeholders, especially since the important estate sector may be a significant contributor to India’s overall economic growth and is the second-largest employer in India. Although the important estate sector has been reeling from a slowdown and liquidity shortage over the past few years, it's also witnessed transformative reforms in recent years that have laid the foundation for massive growth ahead. However, the emergence of the COVID-19 pandemic has halted any momentum that was being built as a results of the policy reforms.
As the sector moves forward, the necessity of the hour are going to be to closely check out a number of the key elements and accordingly think, re-think, improvise, adopt and adapt certain aspects, for quick revival. Here are few crucial aspects which will impact the expansion of the sector:
Keeping the simplest interests of the workforce in mind
Employee welfare should be the top-most priority for the important estate sector, as operations resume after the lockdown. Developers must revisit their standard operating procedures and adopt new methods that enhance efficiency, while minimising the chances for contamination. They will need to devise an epidemic contingency plan, specifically addressing bottlenecks that occur thanks to a widespread crisis, like employee health monitoring, absenteeism, remote working and travel restrictions.
Keeping ahead of the digitisation curve
The need for operational efficiency and digital transformation, cannot be taken without any consideration. It is imperative to make sure an entire restructuring of technology both, at the front and rear. It is an opportune time for previous industry practices to be reassessed and for brand spanking new systems to be introduced, including AI (AI) and data analytics. This applies to all or any parts of the world like ERP, project management and customer service. Virtual offices and therefore the capacity for remote working, will convince be advantageous for land developers that adopt it, as they're going to not be restrained by potential travel restrictions. Daily operations, training and development programmes would continue unimpeded.
Ensuring a personalised connect with the consumers
Maintaining communication with customers is important for a strong sales pipeline. This is very true, when face-to-face interactions and site visits are limited. Having a strong IT and digital infrastructure, will offer land players another advantage of allowing personalised and precise communication with potential customers. Adopting a digital-first marketing strategy, will end in a more immersive and responsive consumer experience.
More reforms from the government
The recently announced relief measures for the real estate sector in light of the pandemic are helpful but they are not a long-term solution. Much more intervention is required. For example, preserving liquidity for operations and relaxing delivery timelines, will allow developers to specialise in completion of projects with none added burden. While some negative aspects of the lockdown are going to be mitigated, more fundamental sector-wide changes must be seen. Over the future, it's important to get the inspiration, which can provide a robust impetus for growth. Government policies must address staple price escalations, input tax credits and reduction in GST rates.
Immediately implementing announced reforms
The government has recently announced multiple reforms, to deal with the concerns of the world. However, just announcing them will not be adequate. The positive initiatives, including the relief funds, loan moratorium and repo rate cuts, must be realised immediately. The repo rate cuts are a positive move but the transmission of those rate cuts must be implemented with immediate effect, to bolster the world. Swift implementation of the relief measures also will boost consumer confidence.
Moving forward, the important estate sector requires supportive measures which will improve upon the policy reforms. At the forefront of those measures, is that the granting of infrastructure status to the entire land sector. We have all witnessed the impact of infrastructure status on affordable housing, with many reputed developers having successfully launched projects in this segment. The sector also will benefit heavily from a streamlined approval process, with single-window clearance. This will allow project approvals to be processed more efficiently, resulting in lower construction costs, thereby, and reducing overall property costs. These measures will curtail the slowdown, generate demand and revive the market.