International real estate consultant Knight Frank India declared in a report on Thursday that 2022 could be a more stable year for the pandemic-affected real estate sector, encompassing both residential and commercial segments.
Knight Frank India Report
In its Outlook 2022 report, Knight Frank India predicted that the housing segment could witness a price increase of up to 5% in 2022. The trends indicate that physical offices, portfolio optimization, and hybrid operations are set to become dominant themes, with rising demand from IT companies and the reactivation of flexible office operators contributing to this growth.
In the housing sector, demand is anticipated to continue rising due to heightened interest from end-users. This surge is driven by public sector initiatives and incentives provided to builders. Additionally, the warehousing segment, which managed to avoid significant risk during the pandemic, is expected to thrive due to sustained demand from e-commerce and third-party logistics (3PL) players.
Key Findings
- Housing Segment: Capital investment is projected to grow by around 5% in 2022.
- Home Sales: Expected to continue in 2022, driven by preferences for larger homes with better conditions and attractive prices.
- Office Space: Increasing demand from the top five IT companies, with an estimated 11.67 million square meters required over the next one to two years.
Pandemic Disruption is Declining
Shishir Baijal, Managing Director and Chairman of Knight Frank India, stated that the real estate sector has demonstrated a strong recovery despite low demands in 2021. Residential properties are performing better than other segments. The disruption caused by the pandemic is gradually receding, with the housing market expected to grow over the next two to three quarters.
While fears of the new variant are contained, minimal disruption is expected at the beginning of the new year. If the sector continues to operate at this pace, it is poised to experience a recovery that could reach or even surpass pre-pandemic levels.
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