INDIAN REAL-ESTATE SECTOR: THE OUTLOOK OF 2019 AND THE FUTURE IN 2020
Having an outlook in the past couple of years for the real estate industry, the sector has had a lot of situations and changes. From demonetization, RERA (Real Estate Regulation Act) and REITs in 2016, to the GST in 2017, the government has implemented various major shifts that affected the industry. In recent years, the real estate industry is going through a significant transformation. Lately, with the Budget 2019 and other current changes in the economic, legal and competitive environment has led to various changes and an opportunity for various trends to start. For every essential buyer in the industry, the awareness regarding the trends is necessary. The value of land in the country is changing at a pace.
All these policies have affected the industry in positive ways. The RERA has brings uniformity into the industry while also protecting the rights of the people. Along with transparency in real-estate deals, improved accountability of builders, the industry has had increased demands. The GST has also largely affected the market positively.
Foreign Direct Investment
Construction or Real Estate industry is essential to infrastructural as well as economic development of the developing nation like India. Indian real estate industry is one of the most fluctuating industries in India. The government tends to regulate the industry with various laws and legislations especially related to FDI.
The fastest-growing economy in the world, India’s growth and development is a great opportunity for foreign investors and hence the government manipulates the policy to control the amount of foreign investment. Most of the policies and rules that are applied by the government are to essentially maintain the surplus-deficit situation of the Indian Economy.
Investors invest in property as it yields great results. The investors usually buy the properties to resell it in the future when the prices are high. Indian real estate industry has been successfully yielding a good amount of Foreign Direct Investment and trend is expected to grow in the upcoming years.
Digitalization of the Industry:
There is not a single industry that is not affected by the internet and digitalization. Since the product, real estate industry deals with is property or land. It is difficult to sell the product online but through digital mediums, the minds of the prospective buyers can be manipulated. The power that the Internet and digital media hold is unquestionable; the technology has solutions to every problem that can arise in the industry. In India, the penetration of digitalization is not as much as it is in developed countries, but the trend is becoming popular as the brokers are assisting the people online.
The Rising Demand in Mega Cities
The five megacities of India is growing at a swift pace, the employment opportunities are increasing leading to an increase of demand for the real estate by many working professionals. The professionals working in the corporate sector usually prefer to own their flat rather than staying with someone. This is leading to an increased demand for affordable housing. Builders are constantly working on innovative opportunities to provide people with well-furnished houses. With the government’s aim to provide “housing to all by 2022” is constant with the expected growth of the cities and emerging economies.
Collaboration with the Government
The builders and real estate managers have collaborated with the government organizations to ensure the minimization and mitigation of the risks that may arise due to schemes. This will help both the parties have a fair chance to make the industry to be economical. The government will be taking initiatives in developing urban real estate and infrastructure and for which it needs to be in collaboration with many real estate companies and builders. The urban population is expected to grow by a large number and settle in the megacities with the creative hubs, and better infrastructure.
The future of housing and real estate is “sustainable living”. The concept of sustainability is being the motto and goals of various countries, but the practice of the concept is very limited. The builders and real estate agents are working towards creating buildings with the sustainable infrastructure, green housing concepts and better concept to manage resources and waste.
The most essential part of having a sustainable housing is not only having a better design but also support the imitative to secure the future for the next generation. The future investment in designs that support sustainability is expected to increase as the government is taking initiatives to establish a city with a sustainable infrastructure that is smart as well. Various concepts like Smart Cities have also been introduced with “Sustainability” as one of the goals.
The outlook at the year 2019 and looking forward at 2020, the real estate industry in India is expected to grow at a significant pace. The comprehensive analysis of the current scenarios and future expectations showcase the real estate as a great investment option. With better housing options and government initiatives to support the buyer and bring transparency, 2020 is expected to a good year for the construction and real estate industry.