Indian Real Estate: An Overview
This sector is one of the most recognized worldwide. In India, the real estate sector is the second largest employer after agribusiness and is projected to grow by 30 percent over the next decade. This sector is made up of four subsectors: housing, retail, friendly reception, and commercial.
Demand for office space as well as urban and semi-urban accommodation. The construction industry ranks third among the top 14 sectors in terms of direct, indirect. It caused effects in all sectors of the economy.
Market size
The market is expected to reach USD 180 billion by 2020. The housing sector is expected to contribute around 11% to India’s GDP by 2020. Retail, hospitality and commercial real estate are also they are growing significantly, providing much-needed infrastructure for India’s growth. needs.
New home launches in India’s seven major cities rose 27% year-on-year between January and March 2018.
Sectors such as IT and ITES, retail, consulting and e-commerce have registered a high demand for office space in recent times. Demand for office space in the country increased 23% year-on-year between January and March 2018, with office space absorption of 11.4 million square feet during the quarter. Private capital inflows into the office real estate and IT/ITES sector have grown by 150% between 2014 and 2017, supported by a strong attraction to the office sector
There were significant price increases, creating the illusion of good returns for investors and buyers alike. Combine that with the propensity to build larger and larger units at a higher price, and most real estate is unaffordable for the average buyer.
About the market
After all, how many people can afford to buy Rs 5-10 crore apartments in a country where the average household income is Rs 40,000?
With sales velocity slowing and prices stable on the downside, cash flows have been reduced and construction has slowed dramatically. The slowdown in construction activity further sends the wrong signal, scaring off the next round of buyers.
And I’m talking about the capital. Most of that invested capital has returned single-digit or, in most cases, negative returns. And therein lies the problem.
The global investment herd is a retrospective package. They mainly look at historical returns to decide whether to allocate more money to a specific market. In this sense, our record is dismal. Combine that with the fact that we are nothing more than a rounding error in a global investment portfolio, and the likelihood of a large equity allocation for India is low.
indian real estate
Indian Real Estate