An overview of the India Real Estate Industry

One of the most recognized sectors globally is the real estate sector. The four sub sectors that constitute it are - housing, commercial space, hospitality and retail. The progress of this sector is fuelled by the by the growth of corporates and MNCs leading to rise in demand for office space and also accommodation in both urban and semi urban regions.  

Eventhough the sector saw a slight dip in the year 2020, Varun Thapar of KCT enterprises believes that 2021 will see the revival of this sector and this can be attributed to many reasons such as increased foreign investment from global players. Ever since the work from home trend gained traction people were able to invest in homes in their areas of choice as one no longer needed to be close to the workplace. Apart from that the need for having your own – this sentiment was once again fuelled due to the monetary impact of the lockdown.  

The real estate sector as mentioned above will continue to see NRI investment both short and long term. 

Market Sizing and Projections 

The real estate sector is expected to touch US$ 9.30 bn (Rs. 65,000 crores) by 2020 – this jump is significant from its valuation of US$1.72 bn in 2019. By 2025 it will contribute 13% on India’s GDP. The growth in this sector will support the growing infrastructural demands of India

Investment In The Real Estate Sector

The real estate sector in India has grown by leaps and bounds in in the recent past due to rising demand of corporate and living spaces. Over US$5 billion was attracted by the Indian real estate via institutional investments in 2020. 

Road Ahead

The Securities and Exchange Board of India (SEBI) gave the nod for the REIT (Real Estate Investment Trust) platform to allow a variety of investors to invest in India. These investments are expected to generate an opportunity worth Rs. 1.25 trillion (US$ 19.65 billion) in the next few year.

The real estate sector now deals and is answerable to a progressively well-informed consumer base and to keep up with globalization trends, real estate developers in India have changed their style of functioning to accept these challenges. Even the family-owned businesses are now acquiring a professional image. They are diversifying with respect to project locations and managing it through a centralised process. The approach has become more modern and progressive with respect to sourcing raw material, hiring educated professionals for engineering, architecture and project management. The residential sector is also seeing the support of the Indian Government with the launch of schemes. 

The increased Foreign Direct Investment is leading to more transparency and global standards have been adopted by the leading real estate players such as KCT Industries to keep up with global accounting, management and due diligence standards. Modernization and a fresh outlook of the real estate sector is expected to attract US$ 8 bn by 2022. 

2021 – A Turning Point For Real Estate 

The desire to own a home is remerging once again amongst people who had preferred rented accommodation close to their places of work. In fact, people are even inclined to shift to suburbs or tier 2 and tier 3 cities because of the changing work culture that doesn’t require one to be physically present in offices. Homebuyers may go for gated communities and townships. Home loan interest rates are becoming attractive & developers are incentivizing purchases from them - making it more enticing for people to invest in real estate. 

2021 is going to be a turning point for real estate which is the economic health indicator of any country. As compared to other sectors the realty sector is expected to nurse back to health much faster than other sectors that impact the economy.

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Created on May 25th 2021 23:14. Viewed 305 times.

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