Shifts in real-estate demand amidst pandemic

 Zora Mohsin
 Published at 11:34 pm June 16th, 2021

While there was a more “relaxed” attitude among the citizens,

real-estate, overall, maintained government-directed health and
safety regulations

Since March 2020, most industries have seen massive changes in how the
markets operate, thus adopting new strategies to cater to the public and keep
businesses afloat. The real-estate industry in Bangladesh has also
encountered and adapted to drastic shifts in demand since the pandemic.
Bproperty, the country’s sole property solution provider, gives us an insight on
how the market has changed, and what trends have been observed recently.

Changing trends

Similar to last year, a strict lockdown was enforced during the months of April
and May. While there was a more “relaxed” attitude among the citizens, real-
estate, overall, maintained government-directed health and safety regulations.  

In terms of demand, in the first five months of 2021, Bproperty saw around
18.2% more housing demand Year-Over-Year. However, the demand is less so
than it was during the third quarter of 2020 -- just after the lockdown was lifted
last year. The record increase in real-estate activity can be attributed to a
number of favorable regulations introduced last year, but it was not possible to
capitalize on them until after the lift.

After things settled considerably during the fourth quarter of last year, housing
demand experienced some slowdown, but was seen to be gaining momentum
again during the first quarter of this year. The enforcement of another
lockdown in April has derailed some of that momentum as, compared to the
first two months of 2021, there was about 34% less housing demand in April
and May.

Transactions of affordable housing have increased since last year. Compared

to last year’s Jan-May period, 12.4% more properties were sold that are priced
within Tk1 crore, while 9% more properties were sold that are priced within
Tk50 lac. Last year, in total over 55% of the properties sold did not exceed Tk1
crore, and this year that percentage already stands at about 64%.
Who is seeking housing solutions?

As Bangladesh’s only property solutions provider, Bproperty caters to people from all
walks of life -- regardless of age, gender, socioeconomic status, marital status, or
religion. They have had a good mix of people of varying ages and genders, from
young professionals who just started their careers, to those who are older and
looking to secure their post-retirement futures.

In general, the median of Bproperty’s clients’ age falls in the 30 to 40 age

demographic, but there is also an influx of property requests from the more “tech-
savvy” children of older clients. According to their data, the majority of Bproperty
website users (40.6%) are aged between 18 and 24, while 28% of users are between
the ages of 25 and 34. In addition, 70.5% of the visitors tend to be male.

Housing prices on the rise

Regardless of Dhaka’s condition, the capital city is the focal point of the nation. It is
the administrative hub and the alpha and the omega, according to many people’s
perceptions. According to some estimates, the population growth rate of Dhaka has
been hovering around 3.5% to 3.6% for the last few years.

Despite this growth, the city hasn’t grown, and there is a severe lack of housing -- not
to mention affordable options. While there are plans to expand the city eastward
towards Purbachal, that is still an ongoing process. Moreover, even though the latest
draft of the DAP plans to expand the Dhaka metropolitan area, decentralization is still
not possible. As per Bproperty data, the ratio between demand and supply of housing
in Dhaka is about 9:1. So, limited supply coupled with an overwhelming demand result
in an increase in property prices.

Shifts in preferences

There has been limited change in housing choices so far in the past few years. The
full effect of the pandemic is yet to be properly realized. Many real estate consumers
have, however, opted for more affordable housing options in recent times, with a
significant number of them preferring areas such as Uttara where they can be more
secluded from the usual hustle and bustle of Dhaka.

In lieu of affordable housing choices, people have been looking for flats on the
smaller side -- which is also the result of the changing family dynamics of modern
times. Overall, we’ve seen the 1,000-1,500 square feet range to be the most desirable
property size in the last few years.