The real estate sector in India is currently a billion-dollar industry, making its place as one of the most promising sectors in the country. This sector has gone through a significant metamorphosis, from the construction of gated communities and luxury residences, to a growing demand for innovation in the commercial real estate category and a focus on bettering infrastructure. According to a 2019 report by IBEF, the real estate market in India is expected to hit $1 trillion by 2030. In addition to this, it is expected to contribute 13 per cent to the country’s GDP by 2025.
The reformative steps brought into the real estate sector in the form of RERA, GST, REIT (Real Estate Investment Trust), Benami Transaction Amendment Act and Pradhan Mantri Awas Yojana have further escalated the pace at which the real estate sector has improved. With these policies introduced by the government, the sector is now much more transparent with financial discipline and increased efficiency. As a result this sector has seen new heights in terms of transactions. These advancements display an advantageous future for the real estate sector at large. In the year 2020, the key drivers of change that will influence the real estate sector are as follows:
While affordable housing has been the main focus for both buyers and sellers in 2019, the coming year is set to focus on different categories of real estate. Due to the implementation of new policies, several developers are diversifying and exploring new arenas. These will provide solutions to niche segments, customized to their needs and demands like senior living communities, co-living and co-working spaces, student housing options, healthcare facilities and other segments like townships and plotted developments.
Many developers and builders in India took to digitisation in 2019 with great aplomb. This trend is predicted to grow even further in 2020, with new techniques being adopted by more developers and builders in less urban areas as well. Additionally, the central government is set to announce the launch of an e-commerce platform for the real estate sector in India as early as January 2020 to make the process of buying and selling houses transparent.
The concept of health and fitness has gained rising importance in India in last one year. The meteoric growth of internet penetration has led to people get empowered on these concepts. In the year 2020, builders and developers will have to place greater emphasis on incorporating wellness aspects into their realty designs. These are known as WELL features, which are a culmination of more than 100 features across 7 concepts (air, water, light, comfort, fitness, nourishment and mental health). There will be a strong focus on the design and operations of the development and how it will create an impact and influence human behaviour.
While residential real estate saw a lull in demand and sales in the latter half of 2019, the commercial real estate sector saw a different sight. Though the share of commercial office market constitutes only 12-15 per cent of the overall property market, it is one of the fastest-growing segments, compelling investors to chase investment-ready assets in Tier I cities. Driven by MNCs and tech companies in India, the demand for premium office spaces is bound to expand, despite temporary roadblocks like the ongoing economic slowdown.
The author is Promoter, Goodwill Developer