Housing market 2024 : Developers foresee robust growth, rise in housing prices

(King Johnson Koyyada, 8008001741)

In a significant pulse-check of India’s real estate sector, the CREDAI – Colliers Developer Sentiment Survey 2024 reveals a buoyant outlook among developers, driven by increasing buyer engagement and optimistic market dynamics. Conducted across 18 states with over 550 respondents, the survey encapsulates the industry’s expectations and challenges as it navigates through 2024.

The survey underscores a notable uptick in buyer enquiries, with 53% of developers reporting increased engagement in 2023 compared to the previous year. This surge in interest is poised to sustain through 2024, supported by stable interest rates and a continued preference for homeownership. Reflecting this positive sentiment, 52% of developers anticipate housing prices to rise this year, mirroring a 9% year-on-year increase observed in major cities during 2023.

Boman Irani, President of CREDAI, emphasizes the sector’s pivotal role in India’s economic growth trajectory, citing robust transaction volumes and their contribution to quarterly GDP figures. He underscores developers’ bullish stance on the market’s sustainability but highlights challenges such as escalating construction costs and the need for tax rationalization.

Looking beyond traditional residential offerings, developers are increasingly exploring alternate segments like plotted developments and branded residences. Nearly two-thirds of respondents express interest in these niches, driven by evolving consumer preferences for privacy, green spaces, and enhanced lifestyle amenities. This trend is particularly pronounced in tier II cities, where demand for plotted developments is on the rise.

Badal Yagnik, CEO of Colliers India, notes the strategic shift among developers towards more selective project launches amidst growing unsold inventory levels. He anticipates a moderation in new launches while developers adopt a cautious approach to align with market dynamics.

With over 80% of developers foreseeing increased demand from Non-Resident Indians (NRIs), the survey highlights the sector’s attractiveness as an investment avenue bolstered by favorable regulations and potential returns. Upscale residential projects tailored to NRI preferences are anticipated to emerge across key micro-markets nationwide.

Moreover, the survey underscores developers’ expectations from the government, with more than 50% advocating for tax rationalization, incentives for affordable housing, and streamlined approvals. Such measures, including GST concessions and reduced interest rates, are seen as pivotal to enhancing the financial viability of projects and fostering a conducive business environment.

Looking ahead, as India positions itself towards becoming a USD 7 trillion economy by 2030, the real estate sector remains integral to this growth narrative. The Developer Sentiment Survey 2024 not only reflects confidence in the market’s resilience but also underscores the sector’s readiness to adapt and innovate amidst evolving consumer preferences and regulatory landscapes.

In conclusion, while challenges persist, developers are optimistic about the housing market’s trajectory in 2024. With strategic diversification, policy support, and continued consumer interest, the sector appears poised for sustained growth, contributing significantly to India’s economic ambitions.