By In terms of the Indian housing market, 2022 marked a new high. This strong pace will certainly continue through 2023, with home sales performing more strongly than in 2022, which was greater than in 2014. Both housing sales and fresh developments have improved significantly.
Despite numerous fluctuations over the past couple of years, the Indian real estate market, which has become tried and true and is generally believed to be impervious to market turbulence, has remained loyal to investor expectations. Its potential to endure has been shown by rising momentum, and it will continue to do so in the following year.
The government as well has been doing its part in the last few years. It has been developing and constructing massive infrastructure projects including motorways, new airports, metros, etc. in addition to implementing policy initiatives like “Housing for All” and the Pradhan Mantri Awas Yojana (PMAY).
Current trends in real estate market in India
Shift to Tier II and III cities
In 2023, a growing number of investors looking for real estate will relocate to Tier II and Tier III cities. These cities have developed into new economic centres because of government initiatives like the Smart Cities Mission and Atal Mission for Rejuvenation and Urban Transformation (AMRUT). Due to growing economic activity and employment opportunities, there is anticipation that Tier II cities will develop into outstanding residential markets. In addition to government initiatives, a number of cities are the headquarters of Indian and international MNCs or have good connections to the metropolises.
Transport becomes more and more important for boosting the living conditions for citizens in Tier II and III cities as more people relocate there. The government’s efforts to provide efficient public transport would boost demand for effective real estate.u
Demand for vacation houses and ultra-luxury apartments is expected to rise
The market for ultra-luxury homes has been increasing, with demand frequently outpacing supply, thanks to increasing disposable incomes and a rise in the number of Indians who are among the richest individuals in the world. Customers are increasingly choosing projects with facilities that are comparable to those provided by global developers, even in areas like Mumbai, Bengaluru, Delhi, and Kolkata that have historically had a solid pipeline of such units.
Indian real estate builders have launched new luxurious housing projects to meet the demands of this expanding segment of domestic investors as a result of this shift in consumer behaviour.
Physical workplaces vs Work From Home
Most workers still don’t visit their places of employment as often, compared to before the pandemic and lockdowns. Less than half of the employees, at least in large markets, are reported to enter an office each day. As a result of this, major software businesses and financial banks, for example, have set dates for returning to work.
Many businesses are holding onto their workplaces while employers and staff decide on their ideal working arrangements. This is due to them exhibiting caution, in case they require the space in the not-so-distant future or because they’re unable to cancel their lease. But more companies are laying off employees or choosing not to renew leases.
The houses being constructed now are designed to facilitate work from home lifestyle. People are looking for larger houses with a number of amenities and facilities, offered inside the residential complex.
Few undeniable real estate trends in India
Digitalization in the real estate market
The pandemic has accelerated digitization across all sectors, and the real estate market trend is no exception.
Due to the epidemic and the competitive housing market in 2020, some buyers made purchases without even setting foot inside their new homes.
Trends in single-family houses
Due to escalating demand and dwindling supply, single-family home prices soared in 2020 and are expected to continue doing so, well into 2023 and beyond.
Soon after the outbreak started, the housing market was impacted as prices dropped and many who were considering selling their homes changed their minds. However, a few months later, real estate values rose once more. These real estate price trends, India suggest that the market will continue to bloom.
Decrease of mortgage rates
In 2020, mortgage rates were at an all-time low, promoting home ownership.
According to some reports, mortgage rates dropped to a 50-year low in 2020. They are now declining since they reached a high of 4.94% in 2018.
On the contrary, at the start of January 2021, mortgage rates hit an all-time low of 2.65%. As a result, the number of mortgage applications rose, reaching a 10-month high in the beginning of 2021. The Federal Reserve made the decision to maintain rates of interest at zero until the close of January 2021 in response to the pandemic’s detrimental economic impacts.
This and other real estate trends in India suggest that the Indian real estate industry is expanding quickly. Although the real estate market has experienced its fair share of fluctuations, analysts believe the next five or six years will witness a steady uptick. Now is the ideal time to invest in the Indian real estate market.
