Indian rupee’s miserable fall continues. After a heavy plummeting against USD in the past few months, focus has tremendously shifted to the real estate sector. The biggest target customers now are the nonresidents, who have started to consider purchasing properties in the subcontinent. Residential sector in specific is now seeing a massive hike, particularly great shift after the damage caused in the form of demonetization and RERA enactment. There was doubt and apprehension earlier among the minds of investors, but not anymore. Fall of rupee against dollar has now put real estate in the country as a promising option of investment for the NRIs.
This is just one of the factors. There are many others as to why the realty sector is picking up in India. While the NRIs can reap additional income, the pace of investing has particularly grown in tier 1 and tier 2 cities. Capital appreciation and rental income are some of the additional perks. With more exchange value with respect to rupee versus dollar, the NRIs find solace in getting more square feet of space for the same amount in their very own country.
Regulations are also playing friendly for the investors. There is more accountability and transparency from the real estate developers thanks to the strict norms in place, empowering the morale of the investors and buyers. Residential properties are seeing greater consumption, that too from a large part of NRI segment. Few private players are also joining the forces and putting in their money in brick and concrete.
Coming to the numbers, the India realty sector is likely to touch $1 trillion, which is Rs 72 Lakh crore by the year 2030. This will make the country the third largest on the global platform, with many strengthening factors like affordable housing scheme, emergence of co work spaces and their increasing demand and clean transactions. KPMG vouched for the above, also adding that the sector is expected to grow to $650 billion by the year 2025, all the way from $120 billion witnessed in the year 2017. The realty has been contributing 7% to the overall GDP, which will rise to 13%, as per the report that was recently released at NAREDCO and APREA’s Real Estate & Infrastructure Investors’ Summit that was held in Mumbai on 27th September 2018.
Affordable housing and startup infrastructure is playing a crucial role in the emergence of real estate boom. More consumption is evident from both, given the feasibility of acquiring property. While lower middle class is going to benefit largely from the PMAY scheme, increasing startup revolution will call for more demand of co work spaces, which is already the case in primary metros.
Government of India has been seriously focussing on schemes like Pradhan Mantri Awas Yojana (PMAY) to encourage more affordable housing in the country. The reforms and policy making are also conducive for warehousing and EPC projects. Technology is also playing a prominent role in the space, welcoming active participation from the private sector.
Third largest sector
Real estate is the third largest after agriculture and manufacturing in the country, employing close to 50 million people. There will be anticipated demand for over 66 million people by 2022 as per the National Skill Development Council (NSDC).