The Indian real estate sector has seen its share of ups and downs in the last few years but for the most part, remained stable. The year 2023 looks positive for the Indian real estate sector and the upside momentum is expected to continue. The real estate sector attracts all kinds of investors – those looking for their first home, those on the hunt for bargain investments as a second property to let out, those looking for resale properties, and those interested in commercial real estate.
Real estate is usually a reflection of the economy and the Indian economy seems to be on a strong foot in showing the highest GDP growth in the world. An 8-9% overall growth is expected with an expected rise in the creation of jobs and a boom in the equity market. These factors are usually conducive to a corresponding rise in real estate. Working professionals usually prefer to buy a home once they settle down in their job. Those at senior levels prefer to buy a second or third property for investment purposes. So, a rise in the number of jobs created usually translates into more demand for houses. Similarly, profits earned in the share market also find their way into less risky investments like real estate.
A third reason for the boom in real estate could be due to the incentives offered by the government for affordable housing for first-home buyers under Section 80EEA of the Income Tax Act, of 1961. The government has launched major policy initiatives like Housing for all and Pradhan Mantri Awas Yojana. With the general development of infrastructure in the form of highways, airports, metros, etc, connectivity is expected to improve which will lead to a greater demand for housing in the vicinity of these projects.
We are also looking at interest rates peaking out soon which will lead to a positive impact on the real estate sector in the near future. Combined with tax incentives, this could be a real shot in the arm for real estate. At current prices, real estate could provide handsome returns to investors in the near future.
With IT companies moving back to offline working, commercial estate will be back in demand. Moreover, eCommerce companies are also looking to set up an omnichannel presence. They also need warehousing and logistical support which is leading to demand in industrial real estate. Global giants like Intel and Apple are moving their operations to India.
All these positive factors bode well for the growth of the real estate sector in India.
According to Reuters, real estate prices across India are expected to rise by nearly 7.5% across India. 2023 could easily be the best year for real estate. Since the Covid-19 pandemic, residential sales are already up by 51% and are only expected to move up further.
Millennials have a lot of aspirations and they are moving towards buying homes instead of renting them. Buying a house always works out better in the long run as it provides capital appreciation and the satisfaction of living in your own space. The money paid out as rent can be used to pay off the EMI and over a period of time, an appreciating asset can be created.
As India moves towards a decade of rapid growth, the aspirations of its young population are fuelling the demand for luxurious real estate spaces. Today’s generation wants comfortable, spacious living spaces with all modern amenities. They want state-of-the-art facilities within the residential complex so that they can relax with the family in style.
This trend is expected to continue in 2023 and you will see developers trying to impress buyers with excellent residential projects in picturesque locations with all modern facilities. This gives buyers the feel of escaping from the hustle and bustle of work life to the serene calm of the home. So, it looks like India is poised for an exciting 2023 in the real estate sector.
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