The real estate market in Delhi’s NCR (National Capital Region) is bustling with high property demand and price hike. The market boom comes against the backdrop of sluggish demand for properties owing to the Covid-hit economy. The real estate business in Gurugram and Noida has seen a momentous growth in the last one year in comparison with Hyderabad, Kolkata, Bengaluru, Chennai and Mumbai. The humongous infrastructural development in Delhi-NCR has played a key role in the bustling business of real estate. According to a report published by CREDAI, Colliers and Liases: Delhi-NCR has seen an exorbitant increase in residential prices at 16 percent year-on-year in the March ending quarter of 2023, followed by Kolkata and Bengaluru with 15 percent and 14 percent Y-o-Y up respectively.

Soaring sales

The present soaring in home sales has sent the prices of property northwards. The presence of reliable developers, quality projects and infrastructural boost have made a conducive landscape of the real estate market in Delhi-NCR areas. Property prices have shot up by around 59 percent, as per media report, near Dwarka Expressway after the opening of the loop connecting Dwarka Expressway with NH-8 and the central peripheral road. The housing properties along Golf Course Road in Gurugram have witnessed a jump of 42 percent price rise.

Rising rentals

The CREDAI report has also stated that rental prices of residential properties have skyrocketed in Delhi-NCR. Home rents have increased up to 40 percent over the past year. The rental values of properties in Noida and Gurugram are exponentially going high as demands triggered by returning of employees to office from the Work-From-Home orientation. During the Covid catastrophe, legions of people shifted to their native hometowns that pulled down rents in Delhi and its neighbouring areas. Now new hiring and resumption of full office hours have jacked up the demands of new housing and house rents.

Gurgling Gurugram

The significant influx of people, establishments of corporate sectors, surging IT growth, and infra development have made Gurugram the most preferred destinations for the real estate investment in the country. In recent years, the real estate business has gone through a remarkable growth with property prices witnessing double-digit appreciation. As several major projects are on the horizon, the uptick in housing demand is expected to keep continuing.

As per JLL India report, Gurugram has registered a 31 percent growth in housing sales in 2021 with 8,400 units sold. The residential properties price hiked by 9 percent. As developers are incorporating eco-friendly features–solar panels, energy-efficient appliances, and rainwater harvesting–the demand of green buildings may grow at a CAGR of 30-35 percent, as the report suggests. RERA has brought transparency and trust in the real estate business, leading to increased investments of NRIs in Gurugram areas.

Nicety of Noida

Noida (New Okhla Industrial Development Authority), a part of Delhi-NCR, has become the most sought-after property destination because of majesty of MNCs, major commercial complexes and top-notch residential apartments coupled with the easy access to the national capital. Numerous renowned educational institutions, world-class medical institutions, reputable financial institutions, upscale restaurants, premium brands and recreational parks among other amenities have caught attentions of people from every walk of life.

Noida’s potential for future growth and development is also a key factor in its popularity. The city is witnessing ongoing expansion and the launch of new infrastructure projects, including the Jewar International Airport, which will further boost connectivity and economic activities in the region. Such developments create a positive outlook for property investment and appreciation. Real estate experts are of the view that it is the ideal time of investment in Noida. The city offers a blend of urban conveniences, job opportunities, and a comfortable living environment, making it an attractive choice for both investors and residents.

Conclusion

The real estate boom in Delhi-NCR can be attributed to factors such as urbanization, infrastructural development, economic opportunities, affordable housing options, expanding retail sector, government initiatives, and future growth prospects. These factors combined have created a favorable environment for real estate investment and have contributed to the region’s overall growth and development.

Given the positive fundamentals of the Indian economy, realtors and buyers can find their sweet spot in the real estate market. Despite global headwinds, the real estate industry in India stands resilient and may continue its strong momentum with positive sentiment of homebuyers. The improved infrastructure in Gurugram and Noida has boosted the real estate market that creates millions of job opportunities and attracts investments as well.

-RAMAKANT CHAUDHARY

Ramakant Chaudhary works with PR Professionals as DGM-Content, and has worked in various editorial roles with Financial Express, Mint (Hindustan Times Group), The Times Of India, Jagran Post (Dainik Jagran Group), The Pioneer, and The Political and Business Daily. He writes on politics, government policy, economy, infrastructure, , social issues, lifestyle, and health

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Affordable price

Although Tier 1 cities are clouded with 3-P: Population, Pollution, and Price, every dark cloud has a silver lining as people have shifted their spotlight from big cities to towns. The burgeoning populace from Delhi, Mumbai, and other metro cities now prefer to stay in smaller cities where infrastructure is laid with smart planning, prices are affordable, and places are more livable. As per a CBRE research report — ‘Tier-II cities: Coming of Age’– towns and small cities are poised to be the epicenter of new economic growth as they are riding the waves of infrastructure development, real estate landscape, quality of life, work environment, and sustainability. Domestic, global companies and investors want to establish their footprints in these markets.

Sustainability catches attention of global brand

Agra, Patna, Srinagar, Thane, Vadodara, Varanasi, Chandigarh, Jaipur, Kochi, Ahmedabad, Lucknow, Meerut, Dehradun, Indore, Bhubaneshwar, Visakhapatnam, Thiruvananthapuram, Malappuram, Coimbatore, Gwalior, Udaipur among others have become emerging markets for real estate players, developers, and investors as a growing tide of people is opting to settle in Tier 2 and 3 cities. As talents are not constrained to geographical boundaries, corporates are reported to be venturing into these small cities to get closer to the working force, which has opened the floodgate of job opportunities as well. Also, vis-a-vis climate changes and sustainability, Tier 2 and Tier 3 cities are considered to be more sustainable that attract the attention of domestic and global brands.

Migrant professionals heading to native

Tier 2 and 3 cities are contributing to the state and India’s GDP, and are all set to become the economic powerhouse of the country. The government’s spotlight on boosting infrastructure and connectivity has added economic boom in these small cities. Most of these cities have got their own designated special economic zones that will make them a potential place for employment. The tourism sector is also seen blooming in these small boroughs of the country. For example, Lucknow, Ludhiana, Kochi, and Amritsar have expanded their contours and they are now shining on the horizon of the country’s growth. As investments made in Tier 2 and Tier 3 cities give potential returns, they have become popular hubs for real estate. Capital appreciation and rental yields are said to be higher than those in bigger cities. Covid-19-induced Work-From-Home culture has created lots of latent demands in Tier 2 and 3 cities. The dynamic of hybrid work culture has made migrant professionals go closer to their native places in small cities, which has boosted demands in the local economy. This will spur developers to enter towns by rolling out quality projects.

Stable Indian economy  

In the coming time, India may witness a residential and commercial boom. In addition to metro cities, Tier 2 and Tier 3 cities could see a significant supply of housing projects. With efforts being put into the expansion of road, rail, and airports and widening the footprints of commercial clusters, the real estate sector finds potential markets in these locations as people love to own their dream houses. As a result, real estate developers look to leverage the buying power of people in these cities. Despite global economic turmoil owing to the Russia-Ukraine war and the cascading effect of the Covid-created lockdown, the economy of India remains a bright spot. Domestic resilience has made the Indian economy stable and competitive. The growth story of Tier 2 and 3 cities has played a pivotal role in this resilience.

– RAMAKANT CHAUDHARY

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Real estate experts are of the firm opinion that the fundamentals of the Indian economy as well as the dynamics of its market will insulate the country’s housing sector from the global economic slowdown. They are of the view that the sentiment of Indian homebuyers has been positive because of a suitable market ecosystem. Also, a pause in RBI’s rising repo rate and dazzling domestic economic outlook will help the housing market sentiment buoyant.

Housing demand

According to a recent report prepared jointly by Credai, Colliers, and Liases Foras, home price in India has increased 8 percent during January – March period of 2023 with Delhi-NCR registering a humongous surge of 16 percent, closely followed by Kolkata and Bengaluru with 15 percent and 14 percent year-on-year increase respectively. The tangible reason behind such a steep surge in home prices is said to be robust housing demand and consistent quality launches by high-end developers.

Real estate boom in small cities

If the cascading effect of the West slipping into recession and subsequently IT/ITeS companies tightening their budgets reach India, the commercial segment could have some bearing. However, the residential real estate ecosystem in India has been robust with astounding sales records in 2022. In the backdrop of Covid catastrophe that brought the world economy to its knees, the year 2022 witnessed a major real estate boom in Tier 2 and Tier 3 cities and continued the growth momentum in hurly-burly of the global slowdown.

Rosy real estate in 2023

The Indian economy is on the cusp of becoming a world leader. Soaring urbanization, larger disposable incomes, and a rise in GDP per capita script a rosy picture for the real estate market in 2023. Despite sluggish trends in the global economy, India’s strong growth potential paves the way for the high demand for offices and commercial space in Tier 1 and Tier 2 cities. Catering to the needs of young growing India, the coworking sector — coworking is a situation that allows several workers from different companies to share an office space– as media report suggests, may cross 50 million sq ft by the end of the year 2023 that would be a year-on-year 15 percent surge.

Strong economic conditions

The real estate market, as experts feel, appears bullish on the future of its economy in 2023. The residential and office market will be spurred by several factors like strong economic conditions, financial stability, GDP growth, healthy supply and demand dynamics, and regulatory framework. The RBI monetary policy, which kept repo rate unchanged, could have far-reaching significance for the home finance and real estate market.

Budgetary boost

For the real estate sector, the Union Budget 2023-24 is conducive in several ways. Finance Minister Nirmala Sitharaman has underlined “Green Growth” as a priority. Several organizations are efficiently working on the concept of sustainable and green living which implies a brighter future of sustainable infrastructure in the face of climate challenges.  An increase in the allocation for the Pradhan Mantri Aawas Yojana (PMAY), earmarking around ₹ 79,000 crore for the flagship scheme, will boost the economy related to the housing sector.

In India, real estate has always gravitated investors to grow their wealth. They find alpha opportunities in the investment in the real estate market. Going by careful calibration of market pulse and carrying due diligence, well-informed investors can potentially maximize their returns from the real estate market in the fiscal of 2023-24.

-RAMAKANT CHAUDHARY

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