India’s real-estate sector has exhibited consistent growth in recent years, primarily driven by factors like rapid urbanization, improved infrastructure, favorable demographics, and government policies aimed at fostering development. With an anticipated economic growth rate of 7%, India lays a robust foundation for the upcoming fiscal year. The current landscape of the Indian real estate market reflects a dynamic shift and robust consumer demand. Several compelling factors, including rapid urbanization, political stability, infrastructure development, thriving capital markets, institutional investments, favorable demographics, and rising incomes, collectively contribute to the standout nature of the Indian real estate sector. This comprehensive growth, resilience, and innovation instill a sense of optimism for FY 2024-25.
Under stable policy environments, India’s real estate market continues to attract both homeowners and institutional investors. Given India’s housing deficit, the demand for sustainable housing remains strong. There’s a substantial pipeline of supplies in development. Notably, there has been a surge in real estate demand in metropolitan and tier cities due to increased disposable incomes and improved employment prospects among Indian demographics. Anticipated for 2024 is a surge in demand resulting in a projected 10-12% increase in property prices, coupled with expanded commercial and retail space. Investors, developers, and homebuyers will keenly observe these developments at macro and global levels to navigate the evolving landscape of the Indian real estate market.
However, the real estate sector grapples with several unresolved challenges. These include slum redevelopment, reducing development fees, timely completion of infrastructure projects, simplifying contract resolutions through a unified platform, rationalizing taxes, and enhancing business operations. Addressing the lack of affordable housing requires consistent progress and strategic intervention. Persistent issues such as population density, climate-related risks, governance, and adherence to sustainability standards can be mitigated by streamlining real estate development.
India can fortify its regulatory framework by implementing structural reforms conducive to stimulating real estate growth and bolstering stakeholder confidence, aligning with global trends.
Also read: Residential Real Estate Trends and Growth Projections in Top Indian Cities