Over the past few years, the Indian real estate sector has been a subject to various changes. It has witnessed both stagnancy as well as growth, which is likely to be the trend this year as well.
With a number of reforms, the sector underwent changes in the tax, regulatory as well as the business scenario. The upcoming elections will reveal if the government continues with the changes or in case of a new government taking over, will it be able to further enhance the reforms.
Performing exceptionally in the last two years, India has to rise 52 positions in the Ease of Doing Business rankings released by the World Bank. This mainly accounts for the improvement in six of the 10 evaluated categories. Out of these, dealing with construction permits witnessed a significant growth on the back of the government’s policy reforms.
Owing to the increased transparency and accountability, various institutional investors are considering the realty sector with great interest. The Real Estate Investment Trusts (REITs) is likely to come into place anytime soon, thus, enhancing the cash flows into the sector to a great extent.
Listed below are the key trends expected to impact the real estate market in 2019:
- Increasing demand for office spaces
- Rise in trends like co-working space
- Balance between residential supply and demand (due to increasing population, rapid urbanization, increasing number of nuclear families and rise in disposable incomes)
- Consolidation (which will not be limited to developers but can also include co-working operators)
- Warehousing (mainly due to the increase in the trend of online shopping)
- Financial instability (which is quite apparent from the prevailing NBFC crisis)
While everyone anticipates and hopes for the best in the Indian real estate sector, it is only the time after the general elections which will decide its fate.