No Real Estate investment is a short-term investment at least in terms of the values of assets, and constructions built up. Real Estate investment in the time of the pandemic is the best thing to go for because now you can purchase property and land assets at a low price which will shoot up after the pandemic. With probable vaccines being launched by the year-end or next year, we can hope that the market will regain steam within the next 5–6 years.
The current lowering in the prices of real estate properties and under-construction projects are due to the immensity of risks and timeline of the builders. I would explain in a little detail. For example, one builder has got investments worth 200 crores for a large commercial project before the pandemic. They have a specific timeline to complete the project, sell/lease the commercial units, get NOC from Government, and give possession to those who have already booked the units, failing in any one or all may create a loss of reputation and creditors. Not only that, they have to give an assured return to their investors. So the pressure on the builder or project owner is huge. The risk held by the project owner or builder is cumulatively much more than individual risks of buying property. The project owner in a bid to negate the risks would lower the cost to sell more. Capitalize on this situation.
Now, we saw that one builder reduced the price of units to sell it quickly(even reducing the profit margin to a large extent), owing to the pandemic, a comparative downfall of prices occurred in the market as others were comparatively forced to bring down their costs.
It’s a gain for the buyers. You can use certain portions of your savings to invest in property right now when the costs are lowering. So, after the pandemic, in the next 3–5 years, when the prices rise, you can sell them back and earn hefty on the investment you have made in your property.
So, it's like you buy a 20 lakh small commercial unit in a hot spot. In the next 4- 5 years, you sell it at double the cost.
Moreover, you do not buy properties from your salaries but your savings, am I right?. So, even if your salary or earnings have gone down, use your savings to overcome the loss in earnings during this period of the pandemic by investing in real estate units. It is a way of getting something positive from the pandemic when it goes away.
Work something like this —
Loss in earnings and income during pandemic < Gains or profit on investment in the property after 3–5 years.
I remember the old statement “ Every problem is an opportunity”. “Every misfortune is a light to something great.”