Top-5 trends in Indian real estate to watch-out for in 2024

Top-5 Trends In Indian Real Estate To Watch-Out For In 2024

The real estate industry had a busy year in 2023 and is predicted to have an even busier year in 2024. It would be fascinating to see the developments in 2024 from the viewpoints of end users and investors, residential and commercial, affordable and luxury properties, fractional ownership and REITs, among other important perspectives.

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The real estate industry, which includes participants from a variety of market areas, including residential, commercial, luxury, and affordable, among others, shared its predictions and opinions for 2024. Industry insiders' perspectives make one thing abundantly evident: the real estate sector is held in high regard for innovation and growth. If their predictions come near to reality, the real estate industry as a whole may experience exponential growth this year.

Top Trends That Will Shape The Realty Sector Story In 2024

Trend 1: Demand Will Steadily Increase In Commercial Real Estate And The Office Sector.

The office market has been looking into more innovative strategies to increase absorption, and it continues to flourish in terms of innovation and growth.

It is anticipated that 2024 will be a year of consolidation on stable foundations, reflecting the steadiness of the Indian office sector. The needs of occupiers will persist in changing, and market options will consistently realign. Strong economic growth potential in India combined with a positive domestic picture will maintain developer and occupier confidence. The balance between supply and demand will maintain range-bound vacancy rates, allowing for potential rental growth.

The manufacturing output, increasing capital investments, and encouraging government policies are projected to propel the industrial and warehousing industry in India forward. The industrial and warehousing sectors will be redefined in the future by the development of smart and automated warehouses and the monitoring made possible by AI and IoT.

Experts predict that the flex segment will surpass the 1.45 Lac level reached in 2023 and lease over 1.5 Lac seats. Flex demand is becoming a component of occupier strategy and is linked to improved employee experiences.

Trend 2: Despite The General Election In 2024, Residential Real Estate Will See Fresh Launches And Expansion.

The early part of 2024 will see the General Election. Both the policies and the mood of the market may be impacted. The supply of residential real estate is influenced by a number of variables, including labor costs and the accessibility of raw materials. Additionally, there won't be any major surprises for the real estate industry in the first half of the year with an interim budget owing to elections.

With a strong response from purchasers in the mid- and premium segments, we anticipate that the residential market will continue to be buoyant and ride the next wave of growth and expansion. Given that numerous reputable developers have announced new launches and their entry into more recent markets, there is a strong demand for residential units that is supported by a robust supply pipeline. In 2024, there will probably be a significant number of launches—between 280,000 and 290,000 units.

Trend 3: The Percentage Of Luxury Residences Could Rise, And The Need For Second Homes Could Not Go Away.

The luxury market is typically rather unaffected by shifts in variables like interest rates or market volatility. Nonetheless, their purchasing habits are always changing. In 2024, luxury property purchasers' purchasing tastes might also shift slightly.

Reputable developers' high-end projects are probably going to see technology play a major part in providing individualized services that increase comfort. In order to provide a more upscale living environment, advanced technologies like artificial intelligence (AI) and chatbots will be used for services like biometric authentication, virtual concierge services, and increased security. In 2024, the demand for second homes, holiday properties, and planned communities is probably not going to decrease. In 2024, there will likely be a noticeable rise in the proportion of luxury sales to total residential market sales.

Trend 4: More Innovation For A Better Experience Through Affordable Housing

Experts note that changes in technology, like home automation through the use of devices and artificial intelligence capabilities, have revolutionized the real estate industry's growth. Real estate growth is anticipated to pick up steam in 2024 as innovation and technology are accepted more widely.

Homebuyers' growing desire for opulent living filled with luxuries and one-of-a-kind experiences is indicative of a larger trend in lifestyle expectations and preferences. As we look ahead to 2024, we see middle-class homebuyers hoping for a higher quality of life. They are viewing properties that are well-located, well-connected, and luxurious in nature but still cost a reasonable amount.

Trend 5: The Top Seven Cities Will Maintain Their Growing Momentum.

End-user demand is what propels the residential market. Therefore, the market must develop an increasingly favorable atmosphere to support growing end-user demand.

The top seven Indian cities' sales area is predicted by ICRA to increase by 13–15% in FY2024 and by 10–11% in FY2025, mostly due to robust end-user demand and stable, albeit declining, affordability. Launches are expected to rise by 9–10% in FY2025 after reaching a decadal peak in FY2024 (higher 15% YOY).

As a result, it is predicted that in FY2024 and FY2025, the replacement ratio will nudge towards little above one time. It is anticipated that home purchasers would continue to favor larger areas. Due to this, the overall segment makeup has changed, with the mid and luxury sectors contributing a larger share of overall sales throughout the top seven cities.

Conclusion- Other Patterns That Could Appear In 2024

In addition to the aforementioned trends, attention will also be paid to other critical acts that could affect the performance of the sector. In 2024, both developers and homebuyers will be closely monitoring interest rates on mortgages. Both the residential and commercial real estate sectors' prices will be impacted by inflation's effects on the input materials utilized in the building industry. The industry's present expectations, however, indicate that it is prepared to overcome all challenges in 2024 and achieve growth, outperforming its 2023 performance.

Top-5 trends in Indian real estate to watch-out for in 2024