January 10th, 2024
The housing demand within India is estimated to surge to a mammoth requirement of 93 million houses by the year 2036. This is according to a report by the Collaborative Real Estate Development Association of India (CREDAI), in conjunction with Liases Foras. The report was unveiled during the New India Summit in Varanasi, Uttar Pradesh.
The projected exponential growth stems from various pivotal factors, such as the increasing population in both urban and rural landscapes, robust macroeconomic indicators, and favorable demographics. Key indicators suggest that Tier II and III cities are poised to take the lead in both driving and meeting this escalating demand. This surge aligns with government initiatives aimed at establishing Smart Ccities and the burgeoning commercialisation activities in emerging regions.
According to the report, 2023 witnessed a substantial influx of registrations and heightened interest from prospective homebuyers. Notably, over 19,050 Real Estate Regulatory Authority (RERA) registrations were recorded nationwide, predominantly in the residential segment, indicating a significant uptick in the housing market.
Furthermore, the report provided insights into the existing housing inventory dynamics. At a pan-India level, the inventory currently stands at 10,42,195 units, showcasing a 3% decline on a quarterly basis but a 2% increase year-on-year.
Cities like Mumbai Metropolitan Region (MMR) and Ahmedabad notably experienced a considerable decline in inventory during the quarter ended September 2023. Tier II cities, buoyed by robust demand, also witnessed a drop in inventory, now averaging a 20-month supply as of the quarter ended September 2023.
Pricing trends revealed a 6% compound annual growth rate (CAGR) in apartment prices, reaching ₹11,660 per square foot, with the National Capital Region (NCR) observing the most substantial spike at 22%. Additionally, the report offered detailed insights into sales figures and carpet prices across major emerging cities such as Nagpur, Bhopal, Surat, and others, outlining the changing real estate landscape across India's diverse regions.
Boman Irani, President, CREDAI, said, “The rapidly growing Indian population and economy has resulted in accelerated demand and supply of homes, while also improving home buyers' purchasing power and inclining them to buy bigger houses. The country is set to develop manifold in the next 10–15 years, and hence, through this report we look towards setting a new precedent with the emergence of Tier II, III regions and their contribution towards the sector and economy. Housing in such cities will witness a sharper trajectory as crucial Government Programs and increasing commercial commercialization activities come to the fore to create a strong pipeline of projects across all segments.”
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