Five trends that will reshape Indian real estate market in 2017
One of the globally recognised sectors, the Real Estate Market is expected to grow exponentially in the upcoming years. The real estate industry is, in fact, the second largest employer in India. According to a report by Indian Brand Equity Foundation, the real estate sector is expected to grow by 30 percent over the next ten years.
Thanks to globalisation and the subsequent growth of corporate environment, the need for real estate – be it in retail, hospitality, housing, or commercial has vastly increased. Since real estate is a huge industry by itself, there are a lot of factors that influence its development. I have compiled a list of five emerging trends that will reshape Indian real estate market in 2017.
1. Increase in Start-Ups Leads to Increase In Subleasing Commercial Spaces
With the start-up ecosystem booming significantly, demand for office spaces that would match the start-up culture has gone up in the past couple of years. With a lot of individual contributors and freelancers working with these start-ups, co-working spaces have become a trend.
More and more companies are purchasing or leasing and sub-leasing commercial spaces to start-ups and other companies as shared office spaces. Approximately, there are more than 100 such business centres in India that function as co-working spaces and incubators for start-ups.
This trend has already made many real estate investors to show interest in commercial office spaces. In 2017, it is expected that the trend of investing in co-working spaces will be beneficial for both start-ups as well as the real estate sector.
2. Technological Advancements Will Transform Real Estate Requirements
With smart technological advancements like Amazon Nest, real estate will now move forward to become a genuinely technology-focused sector. Various other advancements, like tech-enabled workspaces, wireless connections, automated security systems, etc., have reshaped people's expectations from the property they are investing in, no matter whether it is commercial or residential.
Particularly in the commercial properties, the need to establish a full-fledged IT infrastructure is constantly increasing. Therefore, in the future, the buildings are going to be more technology focused, thus more convenient.
3. Indian Real Estate Sector Becomes More Transparent Than Before
According to a recent Global Real Estate Transparency Index (GRETI) 2016, India is one of the semi-transparent markets. As India has made an improvement this year in the overall transparency scores by moving four places up, the country’s real estate sector is bound to undergo significant structural changes.With more and more investors expecting real estate transparency, the fact that Indian property sector is becoming more transparent is good news for both investors and builders.
4. Excellent Return on Investment for NRI Investors
In India, non-resident Indians (NRI) are allowed to invest in real estate under the same rules and regulations that apply to the residents. This is an advantage for NRI investors as Indian real estate investment is bound to give them a higher return on investment in comparison to investing in the country they are living in.
Therefore, in the forthcoming years, the real estate sector is expected to incur more non-resident Indian investments in both residential and commercial categories. To cater to these, various investors in the real estate development will undergo various changes regarding construction aspects, like contemporary interiors, advanced technological infrastructure, premium amenities, etc.
5. Crowdfunding in the Real Estate Field Will Be the Next Big Thing
Crowdfunding helps innovators to raise money online for their product or cause. Although crowdfunding is in nascent stages in India, it is expected to grow steadily in the Indian market, especially in the real estate field.
While other industries have already started to utilise crowdfunding efficiently, real estate sector is catching up slowly. With more and more NRI investors with good credibility preferring to invest in Indian real estate, crowdsourcing is expected to be the next big thing in the real estate sector.
These trends that are expected to reshape the real estate sector. They will not only benefit real estate developers, builders, and investors but will also be favourable for homebuyers and other property buyers, who are the most important stakeholders in the Indian realty market.