In the ever-evolving landscape of real estate, staying abreast of trends and economic factors is imperative for informed decision-making. The current real estate sales scenario reflects a dynamic interplay of economic factors, technological advancements, and changes in consumer preferences. The past year posed challenges to a flexible market, navigating through global events and local market dynamics.
As everyone steps into 2024, the real estate industry is poised for new transformations with various factors coming into play. The upcoming year holds promise for new-age innovation, the role of technologies, the growing impact of sustainable practices, and shifting economic factors.
1. Economic Trends Shaping the Real Estate Market
Understanding economic trends is crucial for making well-informed investment decisions. The Indian government plays a major role in shaping the industry, and having a brief knowledge of the latest policies and initiatives is a game-changer for investors.
2. Affordable Housing Initiatives
The Union Budget 2023-2024 allocated INR 79,000 crores for the PMAY (Pradhan Mantri Awas Yojana), giving a significant boost to the affordable housing sector. This scheme, targeted to be completed by December 31, 2024, benefits Middle-Income Groups (MIGs), Low-Income Groups (LIGs), and Economically Weaker Sections (EWS).
3. RERA (Real Estate Regulation and Development Act)
Enacted in 2016, RERA is a landmark legislation aimed at protecting homebuyers’ interests and promoting transparency. It mandates the registration of real estate projects, ensures adherence to project timelines, and establishes a grievance redressal mechanism, boosting confidence among homebuyers and investors.
GST (Goods and Services Tax)
GST, a single tax applied to goods and services, has brought uniformity to the tax structure. Residential properties have a GST rate of 5%, while commercial properties are taxed at 18%.
FDI (Foreign Direct Investment) Policy
India’s real estate market has seen a surge due to favorable FDI policies, with 81% of total investments coming from foreign sources. Institutional investments in Q1 2023 witnessed a notable 37% year-on-year surge, reaching $1.7 billion, with the office sector leading the way.
4. Sustainable and Green Investments
Real estate is undergoing a paradigm shift towards green and sustainable developments. From eco-friendly construction materials to energy-efficient resources, these initiatives align with environmental safety and cater to the growing demand for eco-friendly living spaces.
As energy costs rise and climate change awareness deepens, investors recognize the long-term viability and marketability of green initiatives. Sustainability is not just a trend but a fundamental reorientation of the real estate industry towards a greener and more responsible future.
5. Emerging Technologies in Real Estate
In the digital age, technology is a transformative power shaping not just the real estate industry but people’s lives. Proptech, Virtual Reality (VR), Artificial Intelligence (AI), and blockchain technologies are becoming key drivers.
Integrating property and technology, Proptech introduces innovative solutions like online property management platforms and digital marketplaces, streamlining processes and enhancing user experiences.
Virtual Reality (VR)
Reshaping the real estate landscape, VR offers immersive property tours and virtual walkthroughs, enabling remote exploration and providing a realistic preview before physical visits.
Artificial Intelligence (AI)
AI drives efficiency through predictive analytics, creating property valuation models, and personalizing customer experiences, contributing to a more streamlined and informed industry.
Enhancing transparency and security, blockchain technology reduces fraud risks and increases trust among stakeholders in real estate transactions.
These technologies redefine the entire real estate experience, benefiting investors with streamlined processes, developers with project management efficiency, and homebuyers with more informed and immersive property exploration.
6. Trends in Property Investment
Understanding the ever-changing trends is crucial for potential investors. Whether it’s shifting preferences towards smart homes, shared spaces, or a specific type of architecture, investors must stay updated with the latest market trends.
The rise of co-living and co-working spaces is a noteworthy trend, influenced by changing work dynamics and lifestyle preferences. Additionally, the demand for housing in Tier 2 & Tier 3 cities is creating new real estate investment opportunities, with cities like Hyderabad, Pune, and Chandigarh witnessing steady growth.
Real estate industry promises a stable future for online sales and real estate investment in India in 2024. Economic trends, sustainability practices, government policies, and emerging trends will be key drivers. Investors and buyers must align their decisions with a proper understanding of these factors to navigate the future of real estate effectively.