Rentals are an important component of the financial market, and it does get affected with a shrinking economy. Every year, with the help of negotiable rents, a section of people manage to evade homelessness. However, due to the pandemic, every calculation of the finance sector seems to have been upturned. The speculative investments in the stock market are already several times the GDP. However, buying capacity, which is tied to net income, does not seem encouraging. The travel industry is particularly affected due to the contagious nature of the coronavirus. Should you, as a traveller, be concerned? How will this unprecedented unsteadiness affect us? Let’s find out together about these travel tips.
Firstly, what do we actually mean by rental costs? It can be anything—you rent a lot of things every day, from the commute to the cafe you hang out at. Ever wondered what accounts for the difference in rates at the various cafes you visit? Is it the quality of the coffee? It might be, but that difference is not a significant one. What caused the major difference is the location and the investment that went into the establishment of the cafe. So you are basically paying an hour’s rent at the cafe. The rent is judiciously evened out on the items on the menu.
That takes continuous brainstorming—from marketing experts to culinary geniuses. The discounts of the season are just a sales promotion to achieve the targets of the last quarter. Sounds bleak? It is bleaker when you learn about the number of shut-downs in the mining industry in the past months. Reasons include not being able to generate enough revenue to afford taxes.
So the effect of the virus might get on to an emotional level if your favourite cafe calls it a day. The chances of that happening are anything but slim. According to a Financial Express report, losses of around 1 lakh crore threatens to end business for a sizeable part of the restaurant industry. Will eating out see a bigger pocket pinch according to our travel tips? It is only logical if one has to make a profit with fewer guests and soaring taxes.
On the same note, we can contextualize the rising costs of rents that plague the lower middle class. We cannot talk enough about the 2008 housing collapse that made a lot of people face disbelief and foreclosure. However, the pandemic has left landlords searching for tenants in India. On average, rents have gone down by 10-30%–which makes travelling look like a good prospect. However, it is not good news for the owners, who have invested a lot in their property. The US and Canada do not face such issues; with the former projected to see a 42% increase in rents next year.
Now think about an aeroplane company. With countries closing off airports, businesses went on a ghastly silence. According to a Business Standard report, airlines are losing out on a whopping three hundred thousand dollars every minute. Will lesser planes mean more expensive flight fares? Forbes magazine predicts that there will be some exciting deals post-pandemic, for a while. After that, prices will soar again, bridging the gap between business and economy class. Flights will definitely try to recover the fare they are losing out to social distancing. On average, the flights will be taking around 67% of their capacity. Further, the magazine also predicts that the flight timings will also be less flexible. With the downsizing of about 20-30%, there will be lesser flights that you can avail of.
So, the crux of the matter is that everything around you will change after the pandemic. If you look carefully, they are already showing signs of change. Costs will see unprecedented differences, triggered by the financial market. We have only outlined three aspects in these travel tips, but there will be noticeable changes in almost every sector. Will we be able to mix freely with everyone, without maintaining physical distancing? Only time will tell. Even if we manage to do so, it will take an awful lot of time. But let’s say we can only hope for the best.
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