• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

‘Affordable Housing Continues To Dominate’

Dhruv Agarwala, Group CEO,, &, says the demand for completed residential properties is growing the fastest compared to those for the under-construction units, while discussing the overall sector.

Photo Credit :


The realty sector is showing signs of recovery. Much of this bounce back is visible in the residential segment. Dhruv Agarwala, Group CEO,, &, says the demand for completed residential properties is growing the fastest compared to those for the under-construction units, while discussing the overall sector. Excerpts from his interaction with BW Businessworld’s Ashish Sinha

How have the Union Budget announcements impacted the overall real estate sector?
The infusion of lakhs of crores of rupees into India’s infrastructure segment, with a focus on improving connectivity, will be particularly beneficial for India’s housing sector in the coming times.

Then, the proposed debt financing for REITs and InvITs, and the setting up of the Development Financial Institution for augmenting funds for infrastructure and the real estate sector is expected to provide a major fillip to the industry and help attract more investments.
How has the affordable housing segment developed especially during the pandemic? 

Affordable housing projects continue to dominate the residential housing market, with 87 per cent of new launches during the last quarter of 2020 being in the sub-Rs 45 lakh price bracket.

The Budget came out with a few announcements that would help the affordable housing segment. Amid a sharp improvement in consumer sentiment with regard to property purchases following the start of the Covid-19 vaccine rollout, the government’s announcement in the Budget to extend the benefit of additional Rs 1.5 lakh tax deduction on home loan interest on affordable housing until March 31, 2022 will act as a further impetus to the affordable housing sector. This sector will also benefit from the decision to offer a tax holiday for affordable housing projects for one more year, to boost supply.

However, the long-standing demand of the real estate sector to expand the definition of affordable housing so as to include homes priced more than Rs 45 lakh in big metro cities has not been addressed.
Union Budget 2021 made some changes to provisions regarding the rental housing industry in the country. How do you think the market of rental housing will be impacted?
The support announced in the Budget for rental housing will go a long way in boosting the real estate market and will ease a lot of pressure points in the rental home market. This will also help migrant workers to a great extent and support them in metros and other big cities during times of financial hardships such as the one presented by the Covid-19 pandemic.
What is the current state of government intervention, if any, to make buying a home more affordable?
The government (through monetary support of various kinds), states (through stamp duty reductions and reducing circle rates) and the RBI (by reducing the repo rate leading to multi-year low mortgage rates) have contributed to making home purchases way more affordable than they have been in the past two decades. What is interesting to note is that due to an increase in affordability, India’s housing sector is currently almost entirely powered by end-user purchases, which is good news for the health of the sector.

Why has technology become crucially important? How will PropTech impact the realty industry?
Technology has always played an important role in the real estate sector. But the Covid-19 pandemic is proving to be an inflexion point for adoption of technology within the sector.

It would not be an overstatement if one were to say that innovations such as augmented/virtual reality, live virtual tours, online 3D and drone views, project webinars and online booking platforms saved the real estate sector from coming to a complete standstill during the height of the pandemic.

Many participants in the sector who were previously averse to using technology for sales and marketing have now started adopting digital tools realising that, going forward, one cannot survive without using technology.

In addition to the use of technology for sales and marketing in real estate, which received a major boost due to the pandemic, one will see an increased adoption of technology in procurement, design and planning, construction, property management, financing and other parts of the real estate value chain in order to bring in more speed and efficiency in the entire process, all the way from land acquisition to asset management.
How to you see the rest of 2021 unfolding for the sector?

I am very optimistic about the residential real estate sector in 2021. With interest rates on home loans at multi-year lows, stable home prices, multiple government incentives and improving consumer sentiment due to the vaccine rollout, we may witness the start of a cyclical upturn in residential real estate in 2021.

Additionally, in the wake of Covid-19, the value of a home as the ultimate safe haven for families has never been more important and hence many young people who may not have considered buying a home might chose to do so now.

Tags assigned to this article:
DHRUV AGARWALA real estate