Future of the real estate market in India in 2023
India’s real estate market is growing at an unprecedented rate, which is why it is no surprise that everyone is keen on the future. The advent of trends like sustainable developments, gated communities, improved amenities, low mortgage rates, and government aid for low-income residents helped boost the market last year.
Now the question is what this year has in store for the housing sector in India – from changing trends to different regulations and developments taking place in major cities. We’ll explore how these changes can affect anyone looking to buy or sell property in 2023.
Investing in the real estate market in India can be a profitable venture. The future of the real estate market in India looks promising, with the economy expected to grow at a healthy rate and the demand for housing expected to increase. The Indian real estate market is expected to grow steadily in the coming years, making it an attractive investment destination.
Real estate is expected to act as an investment vehicle, and assets will thus be created for investment and money-making. Traditionally touted as an investment, both buying a home for personal use and securing one solely for investment are two different asset classes in the real estate industry. As the industry matures, certain assets like commercial real estate, which drives income for investors, have taken over residential real estate as the primary destination for investors. In contrast, the latter is now being reserved for private use only.
You can rest assured expect this trend will continue for the better part of the next five years.
NRIs investing in real estate
Non-resident Indians (NRIs) are already a major force in the Indian real estate market, with an estimated investment of over $13.4 billion coming in FY21 alone(source: TheHindu). NRIs are attracted to investing in Indian real estate due to the high ROI on real estate investment and the ease of the home-buying process paired with their cultural and emotional connection with the country. The current trend shows that the NRIs are investing in the Indian market to secure a retirement home or a secondary residence to spend their vacations in.
Such factors dictate that NRIs should take advantage of these favorable conditions to maximize their returns on investment and subsequently buy a home in Pune, a budding metropolitan city with a safe living environment for families. We expect that the projects catering to the needs of NRIs will attract higher investments and quicker transactions throughout the year.
The real estate market in India is evolving, and millennial buyers are playing a pivotal role in this. They are more comfortable with the online space and prefer to conduct their research online before making decisions.
What does this mean for the future of real estate in India?
The need for physical spaces for office transactions will eventually decline as more people embrace digital space and work-from-home & hybrid working models. There will be an increase in the number of online transactions owing to the dependence on online payment methods. Millennials will also likely demand more transparency and better customer service from developers and builders.
It is safe to say that the real estate market in India is at an inflection point, and the coming years will be crucial in determining its future direction.
It is no secret that prices in the Indian real estate market have risen in recent years. This is primarily due to the increasing demand for property, as more and more people are looking to invest in this burgeoning market.
Such a rise in prices showcases the flourishing market in the country. Thus, instilling confidence in people and encouraging investment.
The concept of fractional ownership has been gaining popularity in the real estate market in India. The new regulations, set to effect in 2023, will make it easier for newcomers looking to make their first home investment to buy into the market because it provides leeway for fractional owners.
A property ownership model in which multiple owners share the ownership of a property, usually through a division in equity, timeshare or vacation rental agreement allows owners to enjoy all the benefits of owning a property without the hassle and expense of maintaining it.
Fractional ownership can be an excellent option for those who want to invest in real estate but don’t have the capital for the entire purchase price. It can also be a good option for people who wish to own a vacation home but can’t afford the total cost of ownership.
The changes set to come into effect this year will also dictate contracts used for investments and might warrant an increase in transparency about the terms of such investments as well.
Investment in locations with a high risk-to-reward ratio
A lucrative strategy for those willing to take on more risk in pursuit of higher returns is real estate investment in locations with a high risk-to-reward ratio. Tathawade in PCMC is a destination that presents a compelling opportunity for investors.
Tathawade is the fastest developing site in PCMC and offers a high potential for appreciation in property values. With its proximity to both major business centers of Pune and Pimpri-Chinchwad, it’s an ideal family-centric location with the best schools, colleges, and office spaces, all easily within reach.
The area is witnessing constant development in infrastructure, improved transportation and connectivity, further boosting its attractiveness as an investment destination. While investing in high-risk areas always carries some degree of uncertainty, Tathawade’s strong fundamentals make it a top choice for those seeking high potential returns.
Understanding the region’s growth potential Kolte Patil is ready to launch its new project, bridging the gap between the greens and the built.
The real estate market in India is showing signs of growth and maturity. The current decade has seen the introduction of numerous reforms to promote transparency, efficiency, and innovation within the sector. With these initiatives and improved infrastructure development planned for 2023, India’s real estate market is expected to continue to grow steadily at a healthier rate than before. This will lead to an increase in demand from domestic and foreign investors looking forward to the higher potential returns available in this booming sector by the end of 2023.
For more information on the real estate industry, look at a comprehensive property investment guide by Kolte-Patil.
- Will 2023 be a better year to buy a house?
Homebuyers should not expect a sudden drop in mortgage rates at the start of the year 2023; however, there could be a slight decline gradually throughout the year.
- What is the outlook for the real estate sector in 2023?
India’s real estate market is expected to undertake a growth rate (CAGR) of 9.2% during the five-year period from 2023 to 2028.
- Is it good to invest in real estate in 2023?
The government will be taking an active interest in helping out the Tier 2 cities expand, local activity will resume, and the economy will be robust throughout the year. We suggest that the climbing trend of the property market in India as of now is the perfect time for investment.
- Will property prices fall in 2024?
There’s no evidence that suggests that property prices will fall in 2024. Reports suggest that the 5-year period between 2023 and 2028 will showcase a CAGR growth of 9.2%.