Future of Real Estate
Future of Real Estate/ Construction in India
Real Estate sector is one of the most globally recognised sectors. The growth in this sector is complemented by the growth in the corporate environment and the demand for office space as well as urban and semi urban accommodation. Real Estate industry ranks third amongst fourteen other major sectors- in terms of direct, indirect effects in all the sectors.
Once a billionaire Andrew Carnegie has said 90 per cent of the millionaires have got their wealth by investing in real estate. There also have been an observed trend of Non-Resident Indians to invest in real estate. Bengaluru is the one of the most preferred places for investment followed by Ahmedabad, Pune, Chennai, Goa, Delhi and Dehradun.
Real Estate in India is expected to grow and reach the market size of US$ 1 trillion by 2030 from US$ 120 billion in 2017 and contribute 13 per cent to country’s Gross Domestic Product by 2025.
There has been a successful launch of India’s first Real Estate Investment Trust (REIT) – a government initiative providing a relief in this sector.
Robust performance by manufacturing, construction and service sectors and good farm output pushed GDP growth to this seven-quarter high, helping it retain the fastest growing major economy tag.
If we look at Office’s future growth in detail-
There is likely a possibility of steady medium-term growth in the economic fundamentals and positive occupier and investment sentiment. But the vacancy rate is anticipated to remain below 15% at a Pan India level.
Retail markets in India are growing an increasing urbanisation and consumerism continue to act as key drivers. Net absorption of retail spaces is projected to increase notably in the near to medium term. Cities are also witnessing healthy pre commitments of space in projects. In next three years according to JLL REIS projections 96% of total supply would be lined up.
Residential markets are slowly witnessing a revival due to implications of the Real Estate Regulation and Development Act, 2016. The government’s policy push to affordable housing and helping the segment gain traction and developers across the country. The future could witness-
Continuous consolidation in the market.
Steady sales momentum across most cities
The emergence of new sectors like senior living and student housing
Increased private equity investments.
Backed by this growth engine, the sun would shine bright for the real estate sector in the medium term. The real estate numbers are all indicative of real demand whether it be office, retail, residential, student housing or warehousing.