Investing Wisely: What You Need to Know About Indian Real Estate Trends in 2023
Indian real estate has always been a great contributor to the country’s economy. Indeed, while other assets are viewed as temperamental and subject to market fluctuations, real estate investments have always been viewed as stable and resilient. However, it is critical to remember that due diligence is a must when investing in this asset class to avail of its full benefits. Part of this due diligence is keeping abreast of market trends so one can make wise investment decisions.
In light of this, we have compiled a list of market trends in 2023 that you need to be aware of to help facilitate navigating this complex labyrinth.
1. As per industry reports, the sale and launch of residential real estate is projected to be higher than the average of the last five years in 2023, estimated to touch or exceed the 3,00,000 unit mark. In particular, the launches are forecast to be higher than the average of 1,87,000 units, whereas sales are expected to surpass the average of 1,84,000 units.
While there are many reasons that can be attributed to attaining this feat, we cannot deny the role the resilient Indian economy, the near parity of house loan EMIs and rentals, and the lack of security during the pandemic have played in raising the positive sentiment towards home ownership.
2. While sales between January and June surpassed last year by 4 percent, exceeding 1,50,000 units, as per research, many first-time buyers are anticipated to enter the market in the second half of the year to avail themselves of the festive season’s offers and discounts.
Indeed, with Millennials, who account for 36 percent of the country’s population and have spending power of US $330 billion, increasing inclination towards investing in residential real estate, this number is primed to grow even further. Millennials today view residential real estate not only as a housing necessity but also as an intelligent investment avenue, given its cash flow generation and wealth accumulation potential.
3. Another trend that the report forecasts is that the premium and luxury sectors will emerge as the most sought-after investment avenues. This popularisation can be attributed to the inclination of HNIs and NRIs to invest in this asset class, one that has been witnessed to grow stronger in light of India’s trajectory to become one of the superpowers in the global economic ecosystem. This, in combination with the relatively affordable price of expansive, luxurious properties in the country, has led to many NRIs looking for a second home here.
4. In recent years, companies have faced increasing pressure from society to be cognisant of their impact on the environment, as the built environment contributes to a whopping 42 percent of global CO2 emissions. In light of these, many companies have endeavoured to ingrain sustainability throughout their business operations.
It is no surprise that, then, sustainability-focused office stock has also been on the rise in the country. As per a study conducted by a global real estate consultancy, green office spaces have increased by over 36 percent since 2019 to approximately 342 million sq. ft across the top six cities in India. Amongst these, Bangalore, Delhi-NCR, and Mumbai were the top three cities spearheading the green movement, with a cumulative total of 68 percent until June 23. The IT capital of the country, Bangalore, accounts for the largest green office stock in the country, with 30 percent of the total green office stock.
In conclusion, keeping a close eye on Indian real estate trends in 2023 is essential for anyone looking to invest wisely in this dynamic market. By staying informed and making informed decisions, investors can navigate this ever-evolving sector with confidence. Whether you’re a seasoned investor or just starting, the key is to adapt, strategize, and seize the opportunities that this exciting year in Indian real estate has to offer.
