The Covid-19 infections and worries thereof have led to reverse migration by labourers back to their home towns. In fact, over the last few weeks several migrants have left the cities and returned to their home towns. Real estate developers believe this could lead to a healthy demand for housing property in the Tier 2 and Tier 3 cities.
"With reverse migration, the rise in demand for homes in the post-covid scenario is likely to be seen in integrated townships due to the controlled living environment they offer to its residents. Reasonable land prices, scarcity of organized living options and migration of working professionals etc are some of the reasons that could reignite demand in cities like Lucknow, Chandigarh, Ludhiana, Indore etc. With home loan interest rates at their historic low and government subsidy to home buyers, the acceleration in demand seems certain," says Mohit Goel, CEO, Omaxe Limited.
According t o Pradeep Aggarwal, Founder & Chairman, Signature Global and Chairman, ASSOCHAM - National Council on Real estate, Housing & Urban Development the increasing reverse migration to Tier II and Tier III cities due to the lockdown and dwindling job prospects in metros will present affordable housing as the most attractive option for living.
"The buyers can think about buying these properties and not just renting it due to its affordable price range coupled with series of amenities offered. NRIs returning to India will also be staying here, till the time international travel becomes safer. The new residential segment coming up in these small towns is likely to garner considerable interest from them due to the essential and advanced lifestyle requirements these projects will offer," he says.
Kushagr Ansal, Director, Ansal Housing believes that in the coming years, market consolidation is expected with the increased preference for branded developers.
"Organized Housing will become an essential need that can promise wellness and holistic growth for the inmates residing in it. The scenario of reverse migration to Tier II and Tier III cities will be creating demand for these structured units due to the need of people wanting to stay close to their hometowns, and the uncertain job prospects for NRIs who have returned to India. Cities like Karnal, Amritsar, Yamunanagar, Indore, Meerut etc would be some of the main beneficiaries of this pattern. The trend will be setting up the process for driving investors to tier II and III markets who are looking to explore options that promise them stable and long-term returns, " he says.
According to Uddhav Poddar, MD, Bhumika Group , there is now no doubt that reverse migration from metros will disrupt the population scale of Tier II and Tier III towns. "This will spur demand for A-grade residential, office, retail, entertainment and mixed use asset classes in Tier 2 towns. Such A-grade projects would also attract NRI investment into these cities catering to the NRIs who have returned to their homes due to the uncertain global market conditions. Tier 2 towns in states of UP, Rajasthan, Bihar, Jharkhand and Orissa would be some of the main beneficiaries of this pattern," he states.