In the upcoming decades, India’s real estate market is expected to experience substantial expansion. During the CREDAI NATCON conference in Sydney, Colliers and the Confederation of Real Estate Developers’ Associations of India (CREDAI) jointly presented a new research titled “Indian Real Estate: The Quantum Leap.” In addition to outlining the reasons propelling the real estate industry toward being a $10 trillion market by 2047, So in this blog post, we will examine the role that real estate will play in India’s economic growth and also provide an overview of the major causes of achieving this milestone.
First thanks to strong domestic demand, a better business environment, and forward-thinking government policies, India’s economy is currently the one with the fastest rate of growth in the world. The real estate sector is predicted to increase from less than $1 trillion to an estimated $10 trillion as the nation approaches its centennial year of independence, potentially accounting for 14–20 % of India’s GDP by 2047.
Important Factors Influencing Indian Real Estate Growth
- Several factors are supporting the rise of Indian real estate, and by 2047, they will have laid the groundwork for this expansion.
- Rapid Urbanization: The demand for real estate will move from conventional large cities to smaller towns and tier-II and tier-III cities as India’s urban population grows.
- Infrastructure Development: New real estate developments will be fueled by improvements in transportation and logistics infrastructure. Like in DELHI/NCR Dwarka expressway played a very crucial role in real estate infrastructure growth.
- Changes in the Population: It is anticipated that India’s median age will rise, opening up additional housing and senior living options. And rapid urbanization is also a major cause of real estate development.
- Digitalization: The design, construction, and management of real estate will be completely changed by technological advancements.
- Sustainability: Building practices and design will be impacted by the growing emphasis on sustainability.
- Investment Diversification: Beyond conventional asset classes, real estate will draw new kinds of investment.
Together, these elements will propel Indian real estate to unprecedented heights, with the potential to rank among the world’s biggest real estate markets.
Urbanization and Changing Demographics Will Fuel Demand for Real Estate
India is experiencing a population shift. By 2050, the median age is predicted to increase from roughly 30 years old to 40 years old. The demand for real estate across a range of asset types, including residential, retail, and commercial spaces, will rise as a result of this demographic shift and urbanization. Half of India’s population is expected to reside in cities by 2050, which would increase demand for homes, businesses, and other real estate projects.
Housing markets will continue to grow as more people enter the “first-time homebuyer” age range. Investments in senior living facilities will also be fueled by the growing population of senior residents. Urbanization will also result in the growth of real estate in smaller towns as well as larger cities, opening up new markets for investors and developers.
Regulation and Infrastructure: Foundations for Sustainable Development
An important factor in the expansion of India’s real estate market has been the development of infrastructure. Significant government initiatives like the National Infrastructure Pipeline, PM Gati Shakti, and the Golden Quadrilateral Project have already started to stimulate real estate development and industrial expansion, especially in the areas of storage and logistics.
Investor trust and transparency have increased as a result of policy measures like the Real Estate (Regulation and Development) Act (RERA) and Real Estate Investment Trusts (REITs). These rules, together with other initiatives like Gati Shakti and the Pradhan Mantri Awas Yojana (PMAY), are promoting long-term real estate investment. These regulations will continue to help the industry throughout time, guaranteeing consistent and long-term growth.
The Growth of Alternative Investments in Real Estate
Foreign investors have made a substantial contribution to the current boom in institutional real estate investment. Alternative real estate investment choices like data centers, senior housing facilities, and co-living spaces will expand as a result of this cash inflow. Furthermore, it is anticipated that financing options like as venture capital funds, green bonds, and social impact investments will proliferate.
The Indian real estate market will diversify as demand for these alternative asset classes increases, giving developers and investors additional options. Real estate investment will now encompass a wide range of developing industries rather than just classic property kinds.
Sustainability and Digitalization in the Future of Real Estate
Technological developments will influence Indian real estate in the future. Digital tools for property management, building, and planning are being used more and more in this industry. While the growth of data centers will satisfy the increasing need for digital infrastructure, innovations like PropTech and the Metaverse will increase operational efficiency and transparency.
Furthermore, a major subject in real estate development will be sustainability. Eco-friendly building techniques will become more widely used, and green certifications will be a typical part of new construction. At every stage of construction, developers will prioritize de carbonizing buildings, incorporating sustainable practices, and creating energy-efficient designs. There will be a notable rise in green-certified buildings in the commercial real estate sector as a result of this trend toward sustainability.
Delhi real estate growth
According to PropTiger, Delhi-NCR sales growth was 29% during July-September 2024 at 10,098 units, compared with 7,800 units in the same period last year. One of the major driving factors for this trend is primarily because of the high investment potential and constant demand for premium properties.Delhi-NCR (National Capital Region) has seen rapid real estate expansion in recent years, with typical home prices rising by 30% by 2024. Numerous factors, such as the high demand for luxury real estate , rising building costs, and infrastructural initiatives, are responsible for this growth.
In conclusion, a major pillar of India’s economic growth is real estate.
A significant change is about to occur in the Indian real estate industry. Rapid urbanization, demographic shifts, and technology improvements are expected to make the industry worth $10 trillion by 2047. There will be plenty of chances for home buyers, developers, and investors as new real estate markets arise and established ones mature.
Real estate will continue to be a key component of India’s economic growth thanks to the sector’s adaptability and durability as well as encouraging government policies and reforms. The Indian real estate market is positioned to grow into one of the biggest and most inventive in the world by adopting technology, sustainability, and alternative investment strategies.
➢ Note ➡
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Written by: ✒ Dwarika Mishra
