India's Real Estate Industry Anticipates Long-Term Growth, Despite Current Challenges
Amidst reports of market slowdown and price adjustments, the consensus in India's real estate sector is cautiously optimistic. According to recent insights gathered by Ernst&Young and FICCI, approximately 62% of participating developers believe in the industry's capacity for long-term growth, citing resilience in the face of a 10-15% price correction in the previous year.
Key Insights from Ernst&Young and FICCI's 'Realty Pulse' Report
In a preview of the 'Realty Pulse' report set for release on September 10, Ganesh Raj, Partner and Leader at Ernst&Young, summarized the situation, saying, "There's been a marked dip in demand and a subsequent adjustment averaging around 15-20%.
The market's resilience, he clarified, is expected to bounce back, and healthcare infrastructure, logistics, warehousing, and affordable housing are poised to emerge as high-potential sectors for real estate development in India. Raj attributed the anticipated resurgence in activity to innovative practices, the exploration of new areas, and a more flexible approach toward pricing and delivery models.
Market Adjustments and Prospects
With a surge in the traditional residential sector, organized retail, and the hospitality industry, the report observes increased confidence in investment opportunities. The analysis shared by Raj foregrounds end-users, who now constitute 80-90% of current project sales, effectively stepping in as the market's primary movers.
Regarding property valuation, Raj observed a range of opinions among those surveyed, though most indicated a consensus suggesting stability over the short-to-mid term with a muted outlook on land value appreciation in the upcoming year.