Introduction: An Overview of the Current Indian Real Estate Market & Predictions for 2023
The Indian real estate market has been going through a period of significant changes in recent years. The introduction of regulatory reforms such as the Real Estate (Regulation and Development) Act, 2016 (RERA) and the Goods and Services Tax (GST) has brought greater transparency and accountability to the sector. At the same time, the COVID-19 pandemic has had an impact on the industry, with the lockdowns and economic slowdown affecting both demand and supply.
Despite the challenges posed by the pandemic, the Indian real estate market is expected to continue to grow in the coming years. [3] According to a report by Knight Frank, a global property consultancy firm, the Indian real estate market is expected to reach a size of $1 trillion by 2030, driven by factors such as urbanization, rising income levels, and the growth of the middle class.
How Economic & Technological Trends will Reshape the Indian Real Estate Industry
⦿ Digitization
The Indian real estate industry has been witnessing the integration of technology into various aspects of the sector. Technologies such as artificial intelligence, virtual reality, and the Internet of Things (IoT) have been adopted by many developers to enhance customer experience, improve project management, and streamline operations. In 2023, we can expect increased adoption of technology in the real estate industry.
The emergence of property technology is revolutionizing the way we view and interact with the real estate industry. It provides homeowners and investors with a range of benefits such as enhanced customer experience, increased transparency and convenience and enhanced security. Click here to read more about PropTech.
⦿ Sustainability
With an increased focus on sustainability and environmental conservation, green buildings have become a popular trend in the Indian real estate industry. Green buildings are designed to reduce energy consumption and minimize the carbon footprint of the building. In 2023, we can expect to see more developers adopting green building practices. Click here to check out some of the top sustainable residential projects in India.
⦿ Affordable Housing
The Indian government’s Pradhan Mantri Awas Yojana (PMAY) scheme has been driving the growth of the affordable housing segment in the country. The government’s initiative to provide housing for all by 2022 has resulted in increased demand for affordable homes, which has led to the development of more affordable housing projects. In 2023, we can expect a continued focus on the affordable housing segment.
⦿ Smart Cities & Integrated Townships
Co-living and co-working spaces have gained popularity in India in recent years. These shared living and working spaces are seen as a more affordable and convenient alternative to traditional office spaces and residential apartments. The demand for co-living and co-working spaces is likely to increase in 2023, as more people embrace the shared economy model.
⦿ E-Commerce and Online Platforms
The rise of e-commerce and online platforms has impacted the Indian real estate industry significantly. These platforms have made it easier for buyers and sellers to connect, reducing the need for traditional real estate agents. In 2023, we can expect more real estate transactions to take place online, with the growth of e-commerce platforms in the sector.
⦿ Millennial Homeowners
As a generation, millennials have different needs, preferences, and buying habits compared to previous generations, and these are driving changes in the real estate sector.
One of the primary ways in which millennials are driving real estate sales in India is through their preference for urban living. This generation is highly urbanized, and many are looking for properties in cities that offer easy access to employment opportunities, entertainment, and social activities. As a result, developers are focusing on building properties in urban areas with good connectivity and amenities to cater to this demand.
What will drive the real estate market growth in 2023?
Due to homebuyers’ preference for privacy, comfort, and a holistic ambiance, the demand for luxury homes is anticipated to stay strong. Here are some factors that are expected to fuel the growth of the Indian real estate market in 2023.
Increased demand for bigger living spaces: The changing preferences of homebuyers have significantly transformed the perception of homes. As a result of the COVID pandemic, people are now seeking larger living spaces to accommodate the new ways in which we live and work. This trend is predicted to continue in 2023. Real estate and residential assets have gained greater significance since the onset of the pandemic. There is a noticeable increase in demand for luxury properties, indicating that consumers are placing more emphasis on life experiences.
Increased demand for homeownership due to higher consumer sentiment: The release of pent-up demand and the growing interest of millennials in the Indian real estate market have contributed to a positive attitude towards homeownership. This trend is expected to continue in the coming year, as incomes rise and real estate is increasingly viewed as a dependable asset class.
Increased interest shown by the NRIs and HNIs: The appreciation of the US dollar against the Indian rupee, coupled with attractive investment prospects, have piqued the interest of non-resident Indians (NRIs) in the Indian real estate market. Wealthy Indian consumers are now willing to invest in luxury properties in various parts of the country, with a preference for their hometowns to establish or maintain an emotional connection with their home country.
Conclusion
The Indian real estate industry is undergoing significant changes, with several trends expected to redefine the sector in 2023. Builders who embrace these trends are likely to be better positioned to meet the changing needs and preferences of their customers, and to stay competitive in the market.
