New Delhi, Nov 17 (UNI) The real estate sector has been contributing 7.8 pc of GDP and providing employment to 77 million people in India, said a combined report released by Ernst & Young (EY) and Confederation of Real Estate Developers Associations of India (CREDAI).
The report said, “In the last 25 years, the overall sector has grown exponentially with demand for more than 6m graded residential developments, 750m sq ft of Grade A commercial office and retail and over 350m sq ft of warehousing space.”
In the last decade, real estate growth is also been fueled by structured investments, regulatory reforms, urbanisation and rising income levels, whereas co-working/living, student/worker housing and data centers have evolved as new growth avenues.
Sharing an industrial perspective, Vishal Raheja, Managing Director of InvestoXpert, said, “India is rapidly becoming a hotspot for global investors. With strong economic fundamentals, an expanding middle class, rising disposable incomes, and improved regulatory frameworks, the country offers unmatched opportunities across residential, commercial, retail, and alternative asset classes. The 2047 roadmap reaffirms that India is entering a golden era of real estate-driven wealth creation.”
The EY report also noted that momentous growth in the Indian economy, which is expected to hit USD 26 trillion by 2047-48, is also fueling optimism in the real estate sector.
The real estate sector is poised for growth with economic and demographic changes, and key building blocks in this journey include: (i) Infrastructural development, (ii) Policy initiatives and simplification of taxes, (iii) Focus on ESG and Sustainability, (iv) Technological advancements.
Additionally, there is a noticeable synergy between India’s infrastructure and the real estate sector due to the initiatives such as the National Infrastructure Pipeline (NIP) and PM Gati Shakti, which were accelerating the pace of innovation in real estate.
NIP is a plan to identify and develop different infrastructure projects to drive the pace of economic growth and PM Gati Shakti is a digital platform and master plan that aims to integrate all these projects through synchronized, holistic, and comprehensive planning and execution.
These policies are yielding results as India’s leap in the World Bank’s ‘Doing Business Index’ reflects the efforts to ease real estate regulations. Construction permits, property registration, and contract enforcement are vital for the real estate sector’s growth.
As India targets global urban standards, the role of technology becomes foundational, not optional.
Moreover, India’s smart city initiative is revolutionizing urban development and focusing on creating cities that are both high-tech and eco-friendly. Doubtless, technology has significantly streamlined real estate development and service models.
The emergence of artificial intelligence, machine learning, Internet of Things (IoT), and Building Information Modelling (BIM) is reshaping real estate practices. Moreover, the presence of PropTech (property technology) also improves the efficiency of real estate dealings.
‘PropTech’ refers to the intersection of the real estate industry with technology, software, and digital solutions aiming to maximize the sale-purchase, research, marketing and management of properties.
The EY estimation of current market penetration for Information and Communication Technology (ICT)/PropTech-based solutions in the Real Estate (RE) sector is USD 10.5 billion, which is less than 5 pc of the overall real estate market size.
The EY report also raised some concerns regarding institutional financing in the real estate sector as in recent times, private equity and structured finance have witnessed high penetration in funding of corporate real estate.
Moreover, almost 80 pc of construction finance is still derived from traditional sources of funding, which demonstrates dependence on banks and Non-Banking Financial Companies (NBFCs).
Region-specific initiatives contributed a lot to India’s real estate. One of the popular ones is Vapi which is famous for chemical industries and a popular destination for businesses.
“With its strong industrial base, proximity to major employment hubs like Daman and Silvassa, and placement along the Mumbai–Ahmedabad corridor, Vapi is becoming one of the fastest-growing real estate destinations in Western India. Vapi’s real estate landscape is undergoing a remarkable shift. Its robust industrial ecosystem, excellent interstate connectivity, affordable property prices, and rising workforce are creating strong rental and ownership demand. Cities like Vapi will be instrumental in India’s push toward balanced and inclusive urban growth,” said Virender Kumar, Vice President of Marketing at Arete Group
“Tier II & III cities such as Indore, Surat, Coimbatore, Bhubaneshwar, Jaipur, Chandigarh, Salem, Bhopal, Visakhapatnam, and Agra, amongst others, are emerging as new real estate investment hubs and are expected to grow fuelled by various factors such as development of infrastructure, government reforms, initiatives, and demand,” it added.
Shedding light on regional growth, Akshay Taneja, CEO of TDI Infrastructure, said, “ The northern region is benefiting significantly from India’s infrastructure-first development model. With the Delhi–Meerut RRTS, the expansion of highways, elevated corridors, and the Kundli–Manesar–Palwal (KMP) Expressway, peripheral NCR is transitioning into a high-value, high-demand real estate belt.”
“Kundli’s growth perfectly mirrors the national real estate outlook. As connectivity, highways, and urban infrastructure mature around Delhi–NCR, micro-markets like Kundli are seeing unprecedented end-user and investor demand. This corridor is fast evolving as the natural northern extension of the capital region,” Taneja added.
The report also suggested different steps that should be taken by the government to realize the vision of ‘Viksit Bharat 2047.’ These are the availability of land through effective zoning and land acquisition policies, investment friendly models to support infrastructure development, and environment-friendly urban development practices.
Additionally, it also suggested a need for a simplified government. regulations for fast-track approval systems and transparent policymaking.
