Realty Sector – 2022 Review and Growth Prospects in 2023

The Indian realty sector performed exceptionally well in 2022 with the demand soaring high and registering record-breaking growth numbers. The housing segment saw a surge in tractions and the top eight housing markets in India recorded substantial sales.A mall located in sec 85 & 86 GurugramMr. Pradeep Aggarwal, Founder, and Chairman, Signature Global (India) Ltd. said, “After a two-year lull, the realty market has rebounded with developers reporting a surge in property demand. Affordable housing has been a leading force, with the demand for mid and affordable segments steadily improving, backed by the renewed confidence of buyers/developers. Also, independent floors are gaining traction among the middle class because of their greater affordability, and space. The segments growth can also be attributed to the Pradhan Mantri Awas Yojna, which aims to complete approximately 80 lakh houses by 2023. Also, affordable housing finance will grow the fastest, with mortgage penetration expected to double to 8-10% over the next few years, driving further growth.”Industry experts believe that the realty sector is likely to witness a favourable 2023 for sustained growth momentum.Vinay Wadhwa, General Manager – Sales, Vatika Limited said, “Both residential and retail realty segments grew substantially this year, strengthening developers’, consumers’, and investors’ confidence in the property market. The growing homeownership awareness has contributed to a 40% increase in home sales in Indias eight major housing markets in the first nine months of 2022 despite increasing interest rates, indicating a positive trend. The year also witnessed a strong demand for luxury housing, owing to homebuyers growing desire for spacious homes with luxurious amenities. Additionally, NRIs too have re-established their faith in real estate this year due to the depreciation of the Indian rupee, which has enabled them to invest more in Indian real estate. If current growth trends continue, the countrys real estate sector may experience explosive growth next year.”According to an industry report, housing sales in the top 7 cities are at an all-time high breaking the record of 2014. The top 7 cities witnessed an increase in sales by 54% Y-o-Y. Siddharth Katyal, Group Director & Business Strategist, Omaxe Ltd. said, “The Indian real estate sector witnessed spectacular growth this year across the housing, commercial and retail real estate segments. Consumers nowadays are more likely to own a home as it is considered a better investment than renting. The retail sector is gradually returning to growth mode, with consumers visiting malls to shop and spend quality time with their families to restore their social life. We believe that in the next five years, the demand for real estate infrastructure will outweigh the supply, and the more infrastructure we build, the more demand we will have. However, the development should be infrastructure and need-based. Also, there is a need for the government to ease the policies for promoters and developers. In addition, developers should be given an extended arm by the government so they can market compliant properties, have a streamlined approval process, and can be developed quickly.”Furthermore, retail leasing picked up this year, driven by strengthened consumer confidence, which prompted retailers to expand their presence in potential locations. Industry experts predict a robust real estate market for 2023 based on the growing demand and investment opportunities. Aman Trehan, Executive Director, Trehan Iris said, “The year witnessed monumental growth with the investment recording hiked numbers and it is expected to increase in 2023. According to an industry report, the real estate sector registered 18% YoY growth in the investment flow in the first nine months of 2022. Delhi-NCR received the highest share of inflows which demonstrates the strengthened interest of investors in the region and its micro markets across. Though the housing and office space segment performed exceptionally well, retail real estate grabbed the interest with record-breaking leasing growth across cities. The phenomenal boost in the demand and supply of Grade A quality retail space is driven by the increased investment inflow, economic growth, rapid urbanization, changing consumer preferences, and positive market sentiments.”The commercial real estate segment also charted new growth trajectories this year on the back of increased demand for flexible, tech-enabled office space. Kaustubh Chandra, Manager, Marketing and Leasing, Brahma Group said, “According to the JLL report, the H1 2022 saw over 6.97 million sq. ft. of space leased out to startups indicating that the industry might emerge as one of the top occupiers in the coming years. Gurugram, in particular, stood out by registering 80% of NCR office leasing this year. Besides housing, Gurugrams commercial and retail real estate segments are gaining substantial traction. With retailers regaining confidence and planning expansions, the retail realty segment has displayed an optimistic outlook. As 2023 draws closer, the anticipation of investors and industry players is at a new level as they expect the sector to set new standards and achieve significant milestones in 2023.”Based on the current upbeat sentiments witnessed across real estate segments, 2023 looks promising for investors, developers, and buyers in real estate.