India’s real estate sector shown strong resilience during last year
- 20 Jan 2024
V Nagarajan
The year 2023 witnessed highest levels of investment inflows since 2020 showcasing India’s resilience despite uncertainties in global markets.
On the residential front, 350,746 units have been launched and 329,097 units sold, according to Knight Frank survey. The residential sector continued to break new records through the year and inched closer towards touching a new decadal peak in unit sales and new launches. In a related development, while luxury housing is inching a new high, affordable housing is at a crossroads due to lack of adequate government support, soaring land prices, hike in input and labour costs.
“The land acquisition space has been buzzing with high interest, primarily from the developer community. In 9M 2023, out of the cumulative $5.1 billion inflows into the Indian real estate sector, 40 per cent of the overall investment was committed for land acquisition. On a cumulative basis, nearly 7,700 acres of land have been acquired by developers and investors during the 2018-22 period. Evidently, the residential sector has been at the forefront of these
commitments as it garnered a share of 83 per cent out of the total $2 billion that was committed for land investments during 9M 2023,” according to CBRE survey.
According to CBRE, the premium and luxury housing segment in India, comprising of units priced at INR 2 crore and above, maintained a strong sales momentum, registering a 70 per cent Y-o-Y increase in the Jan-Sep’23 period.
The trend is even more pronounced in certain cities such as Delhi-NCR and Mumbai, where the combined share of these categories in overall sales is around 20 per cent.
The premium and luxury segment has emerged as a sought-after investment avenue, particularly for high net-worth individuals (HNIs) and non-resident Indians (NRIs) seeking to safeguard their investments amid global macroeconomic uncertainties. In fact, sales of luxury units (priced upwards of INR 4 crore) during Jan-Sep’23 grew by more than 75 per cent when compared to the same period last year. This demand is supported by quality supply being launched by leading developers, who are launching projects across configurations such as independent floors, villas, and condominiums. Developers operating in this segment are not only tapping the demand for good-quality homes, but are also looking to strengthen their balance sheets via this self-liquidating, high-profit margin segment.
“The rising economic momentum is reflected in record breaking housing sales numbers in Indian real estate in 2023 and an all-time high stock market. We believe the top end of the real estate market will benefit the most in the next 12-24 months. The affluent class is expected to nearly double to 100 million people within three years, according to Goldman Sachs Group India’s ultrawealthy are growing.”
“The robust start-up eco-systems and a growing number of unicorns have added to the swelling ranks of the super-rich. Our Luxury Outlook survey findings indicate a renewed and heightened interest among investors who now view real estate as a compelling avenue for long-term wealth creation,” said Amit Goyal, Managing Director, India Sotheby’s International Realty.
The annual Luxury Outlook Survey 2024 conducted by India Sotheby’s International Realty (ISIR) unveiled a robust economic optimism among High-Net-Worth Individuals (HNIs) and Ultra High-Net-Worth Individuals (UHNIs), with a staggering 79 per cent expressing confidence in the Indian economy’s positive trajectory for 2023-24, compared to 59 per cent last year.
My father passed away recently without leaving a Will. He has a villa and lands in Pune. How will the assets be divided among legal heirs? Pankaj Chandnani, Sharjah.
Since he died intestate and assuming that the assets were self-acquired, they will be equally distributed among his class I legal heirs comprising his wife and children. If his mother or father is alive, they will also get a share.
I have both inherited and self acquired property. I wish to give it to my eldest son leaving the younger son after my death. What is the legal document needed for this transaction? Satish Chandran, Dubai.
You can pass on your self-acquired property to your eldest son as wished but your younger son will get a share in the inherited property. The inherited property will go to all the legal heirs by virtue of their birth.