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The current real estate industry tendencies indicate that the future looks bright despite dynamics like prices, buyer behaviour, demographic shift, and the cost of raw materials playing their roles. Read on to know more about the projected growth of the sector.
As the real estate industry adapts to changes and is set to enable recovery with a new phase of growth, innovation and technological trends in a pandemic riddled economy, the year will see immense growth. Although the common word circulating in social circles is that the pandemic has hit the economy hard, the realty prices across cities have risen around 30-100 percent across different categories.
The recent and unusual combination of buoyant housing demand shocks the negative housing supply. The pandemic led realisation of the importance of home security, passive income sources and the importance of space has led to a spark in the realty market in every category.
With the adaptation of work from home culture and location and distance from work no longer a restriction, the aspirations of consumers are changing. People are constantly looking for bigger spaces. People also have realised the importance of liquidity and want to own assets that reap a return. With the rise in commercial and residential demands, lands with clear titles have also risen to cater to them.
Throughout these turbulent times, the world has learned a lot about coping, mitigating, and quickly bouncing back from crisis. The real estate sector being a multi-faceted industry, has resonated the same beliefs. Thus, it becomes crucial to keep in view some of the significant trends in real estate that we foresee in the coming years.
More Property Technology (PropTech) innovations
The property and real estate industry is still a reasonably conventional industry that has been inactive to adopt modern technologies. But this is shifting as the industry is experiencing a significant digital transformation. Several modern procedures and solutions are also being incorporated across the sector. Such advancements have quickened the market’s growth trajectory. PropTech startups and scaleups are leveraging emerging technologies to enable fractional selling to motivate every category of investors to own Grade A assets, which promise a regular Return on Investment (ROI) and long term appreciation. Grade A assets appreciate consistently and steadily, get rented easily and offer security and a reasonable ROI.
Sustainable and environment friendly residential developments
Environment, governance and sustainability are expected to be the path to progress in the real estate industry. With climate changes and increasing congestion in cities due to rising density, developers are now emphasising on self-sustainable communities and per capita space requirements.
India is still a traditional country where families focus on their present and future security. With the uncertainty caused by the pandemic, young India wants to ensure they build a permanent roof over their family’s head. That is a fundamental reason behind the boom in the housing category, especially in the affordable segment. The quality of construction and well-planned housing units that cater to the personal and professional needs of the families will play an important role in shaping the growth trajectory of any developer.
Invest in land
Land has witnessed a huge appreciation in the last two years. Whether for residential, commercial or agriculture use, land has achieved around 50-150 percent growth in the last 24 months across the country in most urban and semi-rural regions. In rural areas, the growth is around 20-40 percent.
Land is the raw material for any development, and it is limited in supply. With the rise in commercial, residential and recreational demand, the demand for land has increased multifold to cater to the present and create a reserve for the future. It is advisable for investors to make land a part of their portfolio as it is estimated to outrun all other categories due to its limited availability.
Land as a sub-segment will be a front runner due to its unique nature and heavy asset value. Hence, affordable, self-sustaining properties will lead the way for the industry in the coming year.