PropTech experts anticipate that the real estate industry in India, which has been booming since the pandemic, will maintain its upward momentum in the first quarter of 2024.
According to Magicbricks Research on real estate proptech, the residential demand in the top 8 Indian cities is predicted to expand by over 15% YoY by the end of 2022, and the overall picture for 2024 seems promising.
The real estate industry was recovering well after the pandemic but succumbed to the outgoing war that brought about global recession. For Indian real estate, it meant an increase in raw materials and costing, which ultimately increased house pricing, given the developers' profit margins. This also resulted in an increase in home interest rates. All of this has created a supply and demand gap that will be seen this year.
- Property Pricing Trends Pune
Many real estate market developers have held from raising home rates over the past few years due to poor demand. However, rising input costs affect the construction industry, and in 2022, the entire property rate will rise by 5-7%.
The increases in real estate prices will be greater next year, at least by 8%. Some developers believe this may not have as large an impact on demand. Younger generations prefer to own rather than rent homes, and this shift in perspective will benefit real estate businesses.
According to Square Yards research on proptech solutions, there will be considerable demand for real estate in all tier 1 cities. In Mumbai, Delhi, Noida, Bangalore, Hyderabad, Gurgaon, and Chennai, the residential demand would be influenced by the reopening of offices and increased economic activity.
Due to their rapid infrastructure and real estate technology development, other cities such as Ahmedabad, Lucknow, Kochi, Indore, Agra, Varanasi, and Gwalior are also anticipated to experience strong demand.
Hiring in the real estate market grew 10% in November, both month over month and year over year, indicating that the sector expects better times to come.
- The Effect of the War on Housing Market Predictions 2024
Concerns about the rising cost of raw materials in light of the current conflict in Ukraine have been expressed by developers from various Indian metropolises. Due to the fact that the price of steel has increased by more than 120% and the price of cement has increased by about 40% in the previous two years, developers in Maharashtra and Delhi NCR have threatened to halt the building of ongoing residential projects.
According to developers, the price of the building has gone up by at least Rs 500 per square foot. Due to this, residential constructions are unprofitable. Many developers pre-sell their units so they can't later increase the price. They are now left with no choice but to suspend building until the government steps in. Developers could burden home purchasers further and reduce the desire for homeownership in general if they decide to raise the price of housing units.
Construction expenditures account for 30–40% of the overall cost of a housing unit in real estate. Therefore, every increase has a negative effect on the selling price.
- Increase in the Rate of Interest
Interest rates have a big impact on real estate growth in India as well. If you're considering obtaining a mortgage to purchase a home, it is helpful to utilize a mortgage calculator to analyze interest rates. Changes in interest rates can have a significant impact on a person's ability to purchase a residential house. This is because mortgage application fees drop when interest rates do, increasing demand for real estate and raising prices.
What Homebuyers Are Feeling about the Industry
Two years after the pandemic, the country's real estate market grew in 2022 as customer confidence improved due to record-low lending rates, government initiatives, and discounts provided by builders, according to NoBroker's annual report.
Investors and homeowners were drawn to the business sector in addition to the residential sector. According to the report, the falling value of the rupee also encouraged non-resident Indians (NRIs) to invest in India.
The demographics and data show that, at 36% and 37%, respectively, persons aged 25 to 49 and over 50 invested the most in property purchases. In 2022, 53% of private sector employees by profession purchased a home.
Sales Trends and Housing Market Prices in the Hottest Micro Market
- Bengaluru: Whitefield, Electronic City, Krishnarajapura Sarjapur Road, Hennur-Kempegowda Airport Road
- Chennai: Madipakkam, Perambur, Ambattur, OMR, Pallikaranai
- Delhi-NCR: Golf Course Extension, Dwarka Expressway, Sector 150 Noida, Indirapuram, Dwarka
- Hyderabad: Kukatpally, Miyapur,,Kondapur, Gachibowli, Kokapet Narsinghi
- Mumbai: Thane West, Kharghar, Panvel, Malad West, Dombivli
- Pune: Wakad, Hinjewadi, Hadapsar, Kharadi, Baner
The real estate market was expected to grow through 2023, according to the graph on people's attitudes toward home ownership in urban areas. It offers a fantastic restart for the industry, but in 2024, it will be essential to determine how much it will last.
Conclusion
Real estate demand and supply can be challenging to balance. More saleable assets require time, labor, and effort to create. It's not always possible, and even when it is, the supply might not be able to keep up with rising customer demand, as was the case during the 2021 housing market boom.
The customer can determine the ideal time to buy or sell a property by understanding the fundamental economic principle of supply and demand. Brokers and digital marketing for real estate in India can better anticipate and respond to these forces by being aware of them.