Good morning, to cut the long story short, yesterday, we were collectively under the weather and putting out the Chai just didn't happen.
However, we are back with today's late edition, and promise to be in your mailboxes at the usual time tomorrow onwards.
Today's newsletter will be a tad short, but we have ensured to keep it positive by answering a critical question - is Omicron going to derail the real estate train?
Nope, says an industry veteran. 🔮
😷↔1 metre↔😷
Omicron: It's A Temporary, Slight Situation
Per Anurag Mathur, CEO of Savills, India, the threats that omicron poses for the real estate sector are temporary, and in the long term, every type of real estate asset is expected to perform well.
Let’s dive straight into the uplifting stuff then.
Commercial Leasing
The year 2020 saw many leasing renewals going AWOL, however nothing as such has been noticed ever since the second wave died down.
There could be delays due to the present threat of Omicron, however, there is little to no chance of leasing commitments being cancelled.
Industrial And Warehousing
Tier 2 and 3 cities have seen a boom in warehousing activities, credit to e-commerce, pharma among others. The trend seems to be moving in the positive direction.
Moreover, operators are now willing to move inlands for data centres. Folks in Noida - be on the lookout.
Return To Normal?
🔽 It may take us a couple more years to come back to the pre Covid levels of leasing and rental activity.
🔼 Post the second wave, not many construction activities were delayed or stopped and developers are taking the requisite precautionary measures to ensure projects get completed on time.
Half A Cup Extra
🔼 If Interest Rates Increase Due To Inflation. . .
Will housing prices drop or at least cool down as a result?
Here’s the theory: Higher home loan interest rates mean higher monthly payments, which fewer buyers can afford, which means less demand and lower home prices.
But inflation changes things, per housing experts.
If you look at mortgage rates relative to inflation, they are still very cheap right now. Plus, rents are still rising dramatically. If rents go up, then homebuyers are going to say - ‘I’d rather not rent.
Most housing economists expect higher interest rates to marginally slow price growth in 2022. And that's about all.
🧐 Is the Australian Home Ownership Dream Dying?
🎙 “The whole home ownership does seem to be an Australian dream but, with current prices and wages not having moved anywhere near enough to keep up, I don’t think the numbers work out at all for owning a property."
"I think people buy places because they want stability but with changes in work and lifestyle, it’s great to be more flexible."
Assam RERA: No Website? Face Legal Action
In a Jurassic age update from the north east, we have the Assam Real Estate Regulatory Authority facing legal action.
404 Not Found
A PIL was filed stating that the Assam Real Estate Regulatory Authority (ARERA), a statutory body under the Real Estate Act, 2016 did not function per the law.
Furthermore, ARERA had also failed to create a website which is mandatory as per section 34(b), (c) and (d) of the Real Estate Act.
Digital Public Records Mandatory
It’s pretty simple, according to the act, the authority has to publish and keep a website for records. These records have details of all the real estate projects which have been registered and can be publicly viewed.
Moreover, this database also includes the name and photographs of all promoters, defaulters, registered real estate agents and projects which have been denied registration.
Clearly, despite being in action for a while now, ARERA doesn't have any of the above necessary stuff up and running yet.
Now What?
As a result of this PIL, the Gauhati High Court has issued a notice to the Chairperson of ARERA and listed the matter for Feb 3, 2022.
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Much like the happy hours at Kolkata pubs, greenhouse gases rebounded in a big way last year.
As Covid restrictions eased in 2021, greenhouse gas emissions have started their high jumps. That represents a sharp U-turn from the I Am Legend days of 2020, when emissions plunged for their largest yearly drop on record.
While analysts were anticipating a bounce back in emissions in 2021, current data provides a stark reminder that we are falling behind our climate targets.
Stay safe. See you tomorrow. 💚
☕ The Crew@Ginger Chai