Real Estate Industry Wants Govt To End Work From Home For All Employees! Approaches State Govt
Real estate representatives will approach Karnataka Chief Minister Basavaraj Bommai and request him to call companies to end work from home and rejoin offices.
This will help the real estate sector bounce back from the pandemic downturn.
Stamp Duty, Guidance Value
A delegation led by CREDAI-Bengaluru will also appeal to Bommai to take steps to help the sector grow.
One of their requests is a reduction in stamp duty from 5% to 3% for registration of properties regardless of the price tag.
They also want the CM to extend the 10% cut in guidance value by another quarter at least.
Govt Urged To Impose Work From Office
The delegation said that it will seek the government’s help and wants work from office to resume on a full scale.
It says that the government placed restrictions on working from office and the government has to ensure people go back.
Bhaskar Nagendrappa, chairman, CREDAI-Bengaluru said that residential sales have improved and surpassed pre-pandemic levels.
The monthly absorption in the residential sector has touched 42,000- 45,000 units a month, compared to 30,000-35,000 before the pandemic.
Low Occupancy, High Vacancy
This growth stands in contrast to the slump in occupancy of commercial offices and retail spaces.
The pre pandemic vacancy rate in the commercial office segment was 6-8% which has now grown to 15%-18%.
The same goes for the retail segment where vacancy has increased from 10% pre-Covid to 22%-33% at present, which experts say is due to widespread work from home.
Real estate service firm Cushman & Wakefield reports that overall vacancy in the office segment is up from 8.2% in the fourth quarter in 2020 to 9% in 2021.
Moving To Suburbs, Home-Cum-Office
Data also shows that people in cities like Bengaluru are moving into houses in the suburbs.
This is to maximise cost benefits since they get spacious houses which can double as a home office.
Sales in other segments will pick up only when employees return to offices.
13,450 units in the residential sector were sold in this year’s first quarter compared to 8,670 in the corresponding period in 2021.
Little Power Over Private Sector
An official from the department of stamps and registration said that the government is taking steps to increase property registrations.
However, it has a limited role in getting private sector employees to resume work from offices.