India real estate
market is anticipated to grow
at a high CAGR during the forecast period of 2025-2029, owing to the growing
demand for real estate in both urban and semi-urban areas across India.
Moreover, expansion of e-commerce industry has boosted the demand for warehouse
facilities. Furthermore, implementation of 5G services and regulations by the
government for data centre are boosting the demand for India real estate market.
Real estate refers to the property in form of
lands and buildings. It involves buying, selling or renting real estate (land,
buildings, or housing). According to India Brand Equity Foundation (IBEF), real
estate is expected to grow from USD 1.72 billion (Rs. 12,000 crore) in 2019 to
USD 9.30 billion (Rs. 65,000 crore) in 2040. During the first nine months of FY
2022, the country witnessed land deals of more than 1,700 acres in top eight
cities. The real estate sector contributed approximately 7% in FY2019 and is
expected to rise to 13% during FY2025.
Rising demand for Data Centers to boost India
Real Estate Market
As India goes digital, the country has seen a
sharp rise in number of online payments, companies implementing permanent work
from home, rise in number of over-the-top (OTT) platform & users and online
education system. All these platforms gather bytes of data which needs to be
stored, thus driving the demand for data centers. This has prompted the Indian government
along with the state government to make regulations and inaugurating data
center hubs in the country. According to India Brand Equity Foundation (IBEF),
real estate demand for data centers is expected to be grown by 15-18 million
sq. ft. by the end of 2025. Various Indian and International Data Centers firms
are investing in the Indian market. For instance, Bharti Airtel Group in January
announced that it would be investing USD 234.60 million for setting up a large
hyperscale data center through its data center subsidiary Nxtra Data Centers in
Telangana. Through this investment, Bharti Airtel is looking to increase its
footprint in the state. Moreover, Adani Group announced investment of USD 2660.50
million in the month of May. The proposed data center would have an integrated
business park in the state of Telangana.
Increasing Demand for Affordable Housing to
boost India Real Estate Market
The housing market is dominated by the high
demand for affordable housing. According to the India Brand Equity Foundation,
there are currently 10 million vacancies in urban areas. By 2030, the country would
need 25 million more affordable housing units to accommodate the rising urban
population. The Real Estate Regulatory Authority (RERA), Real Estate Investment
Trusts (REITs), and housing initiatives like PMAY (Pradhan-Mantri Awas Yojana)
and SWAMIH (Special Window for Completion of Construction of Affordable and
Mid-Income Housing Projects) have all contributed to the push for policy, which
has been beneficial to the real estate industry. Since 2014, the housing for
all (HFA) program has resulted in the completion of more than one million housing
units across the north Indian state of Uttar Pradesh as of May 2, 2022. Over
328 thousand new housing units were introduced to the Indian residential market
in 2022. Despite the country's high demand for housing, residential launches
have been relatively high over the past few years. The Pradhan Mantri Awas
Yojana (PMAY, or The Prime Minister's Housing Plan) would have completed 6.5
million houses in India's urban areas by 2022. The Reserve Bank of India
reports that Indian banks advanced approximately USD 24.44 billion (Rs. 2
trillion) in housing loans during the fiscal year 2022, nearly reaching
pre-COVID levels. Since an increasing number of Indians were investing in the
purchase of a residential property, it reflected a resurgence in homebuyer sentiment.
NRI investments in Indian real estate have
doubled, thus expected to drive the India Real Estate Market
The proportion of non-resident Indians (NRIs)
in the Indian property market is anticipated to double since the Covid-19
pandemic. DLF is looking to put more emphasis on the NRI market. With the
exception of the Middle East and Southeast Asia, where the NRIs are currently
based, the United States is one of our largest markets. According to a recent
survey conducted by India Sotheby's International Realty, a significant number
of high-net-worth individuals (HNIs), many of whom are non-resident Indians
(NRIs), intend to purchase luxury real estate in India within the next two
years. They think now is a good time to buy bigger homes in their own country.
NRIs can now more easily invest in Indian real estate due to the strength of
the dollar against the Indian rupee. Condominiums, branded homes, luxury
villas, and vilaments have been purchased by non-resident Indians. The number
of non-resident Indians looking to invest in Indian real estate has increased
as a result of the digitization of procedures, advantageous currency changes,
indexation benefits for properties held in India, and an easy tax system.
Reduction In Interest Rates and Stamp Duty is
expected to boost the India Real Estate Market
Since 2021, premier lending institutions have
offered appealing home loan options in the range of 6.75 percent to 7.5
percent, resulting in historically low interest rates on housing loans. At
current interest rates, home loans enable substantial savings while producing
an asset for end-use or investment purpose. As a matter of fact, lower interest
rate gives borrowers a chance to increase the amount of their loan, making it
easier for them to choose a property with better amenities and lifestyle
facilities in premium segment neighborhoods. As a result, interest rates have
an effect on the price and demand for real estate. Lower rates attract more
buyers because they not only make it cheaper to get a mortgage, but increase
demand for real estate, which would raise prices. Investors can reduce this
risk by purchasing Real estate investment trusts (REITs) or other diversified
holdings that are either not tied to economic cycles or that can withstand
pandemic. Real estate prices frequently follow the cycles of the economy.
Demand for real estate can be boosted or decreased by government policies and
regulations, such as tax breaks, deductions and subsidies. For instance, a
reduction in stamp duty in Maharashtra to 3% until March 31, 2021, has
significantly contributed to the increase in luxury residential real estate
market in Mumbai. The Minister for Housing and Urban Affairs has urged other
states to follow the road. In the upcoming period, sales could be sustained by
low interest rates and lower stamp duty. In India, the Central Board of
Directors of the Reserve Bank of India (RBI) is in charge of setting interest
rates. The benchmark repo rate which is set by the Reserve Bank of India
remained at a record low of 4%. However, for the first time in two years,
India's central bank attempted to reduce high consumer prices in May 2022 by
raising the benchmark interest rate. The repo rate was increased by 40 basis
points to 4.4% at which the Reserve Bank of India (RBI) lends money to
commercial banks. The repo rate had fallen to a record low of 4% during the
Covid-19 pandemic. Therefore, the above factors are expected to boost the
demand for India Real Estate Market during the forecast period.
Recent Developments
· In February 2023, USD9621.90
million, an increase of 66% as compared to previous year were allocated by the
Indian Government for the Pradhan Mantri Awas Yojana (PMAY). The government
would now be providing the buyers with a subsidy in the interest of loan. A
total of USD16200 million in assistance has been given.
· Realty firm M3M
India bought 3 acres of land in Noida in March 2023 for USD30.50 million and
would invest another USD42.60 million to develop a project involving retail
space and studio apartments. The total investment is expected to be USD73.10
million to develop this project located at Sector 72, Noida. According to the
company, M3M purchased this 3-acre land through e-auction from Noida
Authorities. The actual land cost is USD21.90 million. The figure would reach USD30.50
million including registration charges and lease fees.
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Market Segmentation
India Real Estate Market is segmented based on
property type, business, and region. Based on property type, the market is
divided into residential, commercial, land, and industrial. Based on business,
the market is divided into sales, rental, and lease. Based on region, the
market is divided into North India, South India, East India, and West India.
Market Players
Major market players of India Real Estate Market are DLF Limited, Godrej
Properties Limited, Brigade Enterprises Limited, Oberoi Realty Limited,
Prestige Estates Projects Limited, Lodha Developers Limited, Tata Realty and Infrastructure
Limited, Hiranandani Group, Mahindra Lifespace Developers Limited, Phoenix
Mills Limited
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Attribute
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Details
|
|
Base Year
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2023
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Historic Data
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2019 –
2022
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Estimated Year
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2024
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Forecast Period
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2025
– 2029
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Quantitative Units
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Revenue in USD Million, and CAGR for 2019-2023 and 2024-2029
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Report coverage
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Revenue
forecast, company share, growth factors, and trends
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Segments covered
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Property Type
Business
Region
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Regional scope
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North
India, South India, East India, West India
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|
Key companies profiled
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DLF Limited, Godrej Properties Limited, Brigade Enterprises
Limited, Oberoi Realty Limited, Prestige Estates Projects Limited, Lodha
Developers Limited, Tata Realty and Infrastructure Limited, Hiranandani
Group, Mahindra Lifespace Developers Limited, Phoenix Mills Limited.
|
|
Customization scope
|
10%
free report customization with purchase. Addition or alteration to country,
regional & segment scope.
|
|
Pricing and purchase options
|
Avail customized purchase options to meet your exact research
needs. Explore purchase options
|
|
Delivery Format
|
PDF and Excel
through Email (We can also provide the editable version of the report in
PPT/Word format on special request)
|
Report
Scope:
In this
report, India Real Estate Market has
been segmented into following categories, in addition to the industry trends
which have also been detailed below:
- India Real Estate Market, By Property
Type:
o Residential
o Commercial
o Land
o Industrial
- India Real Estate Market, By Business:
o Sales
o Rental
o Lease
- India Real Estate Market, By Region:
o North India
o South India
o East India
o West India
Competitive
Landscape
Company
Profiles: Detailed analysis of the major
companies present in India real estate Market
Available
Customizations:
India real
estate market with the given
market data, Tech Sci Research offers customizations according to a company’s
specific needs. The following customization options are available for the
report:
Company
Information
- Detailed analysis and profiling of
additional market players (up to five).
India Real Estate Market is an upcoming report to be released soon. If you wish an early
delivery of this report or want to confirm the date of release, please contact
us at [email protected]