Normalcy is a term that appears to be a far-fetched dream for many people these days due to the impact of the pandemic. Although the whole world has been burning with various other political and climatic issues, 2020 will be remembered for the unprecedented living conditions the virus set in. The screeching halt that the global economy was brought to has been slowly loosening, helping multiple verticals to focus on their plans all over again.
One of the sectors that were hit hard by the pandemic is real estate, and the trajectory of its growth has been declining with time. Since the national economy has been attaining a firm position through this major industry, people are trying to find ways to bring back some traction to the industry in order to set the cash registers ringing. The stall of the industry has led to a confounding state of mind within the investors. Let us look at the impact of COVID-19 on the real estate industry in detail.
The Real Estate Industry in 2020
Investors are expecting a bounce-back of real estate, but this may take quite some time to happen. The launch, purchase, and sale of properties have been seriously affected by the pandemic. All the processes involved have become unpredictable and slower due to the lack of labor and materials. Builders are adjusting to the changing market conditions to fight the delay and make a recovery happen sooner. However, this seems to be taking more time than the people were expecting. The companies are being impacted by COVID-19 in different ways, and that would largely depend on the asset class and region. Preservation of the value and liquidity is the major concern of the real estate executives.
The situation of labor in almost every country has shifted from dormant to slightly active, but that doesn’t make the industry look any better or promising. Key aspects to be checked by the boards and executives need to be checked in order to understand what needs to be done next. Although short-term impacts haven’t been badly affecting the companies and investors, this situation could go on to hit them right at the head if they don’t take the necessary pre-emptive measures.
All lower segment families and labors were faced with a financial crisis during the lockdown, further leading the daily wages to endure one of the worst phases ever. A vicious circle has been formed to keep the labors going on the same path to make a living. Nothing can possibly make things better for the industry unless the labor and money start rolling in. The people at construction sites needed a proper supply of food and kits, which were provided by the companies. A relaxation over the interest rates and loans is also helping the workers find stable ground. But none of this appears as a light at the end of the tunnel for the investors.