Average property values in India’s National Capital Region (NCR) showed a whopping 49% appreciation in the past one year as demand for luxury homes continued to sustain. This comes amid an escalation in the cost of building materials and labour, according to a new report by PropTiger.com.
The latest data of the National Housing Board’s Residential Index (Residex), comparing prices between 2018 and September 2024, has revealed that the highest leap in rates countrywide was in Gandhinagar, the capital of Gujarat. Price per sq. feet of built-up property more than doubled, a feat not matched by any city under the NHB study. At No. 2 was neighbouring Ahmedabad, where the carpet rate per sq. ft doubled in the six-year period.
Real Estate Sector In India: The real estate sector continues to be on the cusp of transformation. Despite global economic uncertainties, the sector is witnessing strong demand, driven by record-breaking office leases, decade-high residential sales and a healthy supply of new launches.
As real estate developers shift focus on luxury housing, the supply of homes in the affordable and mid-income category priced ₹1 crore and below has dipped by 30% in the last year across nine cities to 1,98,926 units in 2024 from 2,83,323 units in the preceding year. The supply was 3,10,216 units in 2022, a report by PropEquity has said.
The top nine cities are ‘staring at a housing crisis,” said the report by the real estate data analytics firm.
The Gurugram housing market witnessed unprecedented growth in 2024, with investments of Rs 88,000 crore in newly launched real estate projects, according to an internal review report by Haryana Real Estate Regulatory Authority (RERA), Gurugram.
The report highlights that 124 new housing projects applied for licences in 2024, marking the highest annual investment since 2017. Interestingly, 34 of these projects have an investment of over Rs 1,000 crore each, nearly doubling the investments made in 2023.
Rajesh Joshi works in the hospitality sector and has been looking to purchase a residential plot in Bengaluru. He has found several plotted development projects in north Bengaluru spread across 1350 sq ft for about ₹50 lakh. He plans to invest in a plot to use it as a retirement home after 15 years or sell it if he gets a good return on his investment.
Nearly 62 percent of wealthy Indians, including HNIs (high net-worth individuals) and UHNIs, are interested in investing in luxury real estate in the next 12-24 months despite a substantial rise in luxury property prices in the last two years and subdued economic growth.
India’s real estate (RE) sector has long been one of the key drivers of economic growth, contributing 7 per cent to the nation’s GDP. The sector’s performance in 2024 has been strong with both residential and commercial RE segments showing notable growth. For instance, India’s housing market has seen a 60 per cent growth since 2019, with premium housing driving much of this demand.
In recent years, there has been a major preference by home seekers, especially among working population, for tier 2 cities in India. The lower cost of living and affordability of housing in tier 2 cities compared to the mega cities is a major reason for this shift. However, there has been a significant rise in property values in these cities in the past one decade, backed by infrastructure development. This has inspired Indian real estate developers, as well as state governments, to focus more on these tier 2 cities in India which are high-potential and yet, neglected markets.
Flexible office space providers are bullish on demand for managed workspace during 2025 as corporates look for agile and cost-effective solutions to reduce overheads.
Many flexible workspace operators are expected to hit capital markets this year to raise funds for the expansion of their businesses.
The overall gross leasing of office spaces across major seven cities hit an all-time high in 2024.
