In the ever-evolving investment landscape, real estate has become the preferred choice for investors while gold, once a haven, is losing its luster. The Anarock Consumer Sentiment survey revealed that in the first half of 2023, over 60per cent of respondents expressed an inclination to invest in real estate, which is a 3percent increase compared to the previous survey. It indicates that investors are seeking tangible and long-term assets due to growing financial market uncertainty.
The persistent rise in inflation rates has a significant impact on people’s financial stability. According to the survey, 66 percent of respondents in the first half of 2023 experienced a reduction in their disposable incomes, which is an increase from the 61percent recorded in the same period in 2022. Despite the difficulties posed by high inflation, escalating property costs, and interest rate hikes in the past year, the survey reveals an interesting trend. 67percent of participants prefer buying property for their use, indicating a strong demand from end-users. However, the survey also highlights that increasing inflation may limit people’s ability to make home-buying decisions.
S K Narvar, Group Chairman, Trident Realty says “The housing market is upbeat backed by positive sentiments and an increased sense of pride in home ownership. Market survey highlighting that real estate is the most preferred investment asset class amongst people, is of the fact that there is a noticeable shift amongst buyers. The desire for luxurious living, work-life balance, well-being, and future stability has prompted buyers to invest in real estate. Besides, steady home loan rates coupled with healthy economic growth, and other favourable factors are fuelling housing growth across cities.”
He further added, “Interestingly, homebuyers seeking luxury living and comfort are on the constant lookout for big and spacious homes nestled in serene, pollution-free locations. Their preference to go beyond the metropolis has brought a considerable focus on tier 2 locations like Panchkula. Developing the city’s modern infrastructure, coupled with its pristine natural surroundings, offers a distinctive fusion of luxury, practicality, and convenience, tailored to the needs and desires of homebuyers yearning for plush amenities in their homes. We expect new age and end-users to dominate the housing market ahead and maintain healthy growth momentum.”
The younger generation is having an impact on the real estate industry. A large portion of millennials and Gen-X respondents, 52percent and 35percent respectively, are planning to use their investment earnings from different asset classes to buy homes in the future. This shows their confidence in real estate as a way to secure their financial future and their desire to own homes.
Navdeep Sardana, Founder, Whiteland Corporation says “Real estate undoubtedly remains a top choice for investment, with a growing trend towards purchasing properties for personal use as well as high returns investment, driven by the desire for stability in an uncertain economic scenario. This inclination towards homeownership is particularly prominent amongst Millennials and Generation X. The alluring skylines of Gurugram, showcasing a blend of modernity and urban comfort, have become a magnet for real estate investment. The city’s evolving landscape offers not just a property but a promise of a secure future, making it an attractive prospect for potential investors seeking both a dwelling and a sound investment.”
The housing market is constantly changing and adapting to the preferences of homebuyers. Recent surveys show that despite past rate hikes and increasing property prices, 59 percent of buyers are still looking for mid-range and premium homes priced between Rs 45 lakh to Rs 1.5 crore. This indicates a positive trend with a 10 percent increase in demand for homes in this budget category since 2020. 35percent of homebuyers prefer Rs 45-90 lakh homes, while 24percent prefer Rs 90 lakh to Rs 1.5 crore homes.
Kaustubh Chandra, Manager, Marketing and Leasing, Brahma Group says “The real estate industry is experiencing impressive growth, with more people prioritizing the security of owning a home over dealing with the uncertainties of rented accommodations in the post-COVID era. Besides, improved market sentiments and the desire for a safe and secure future are driving people to invest in property. According to Anarock, housing sales in the top 7 cities reached a new peak in Q2 2023 with a 36 percent YoY increase compared to 2022. Additionally, new launches in Q2 2023 saw a 25 percent YoY increase. Among the top cities, Gurugram experienced significant growth in housing demand in Q2 2023, which can be attributed to the city’s improved infrastructure and connectivity, its position as a hub of commercial and business activities, and the availability of high-end homes, highlighted by an industry report. Homebuyers in Gurugram are increasingly looking for properties offering more open spaces, greenery, low-density, and environment-friendly features. According to a recent survey by ANAROCK shows that 48 percent of homebuyers prefer 3 BHKs or larger homes. The desire to live a comprehensive lifestyle is driving the demand for high-end properties in Gurugram and is expected to record new growth numbers ahead.”
The current investment market demonstrates that real estate continues to be a popular investment option and a means of personal security. It also shows that homebuyers are more confident in making informed decisions based on their goals and financial abilities, even in difficult economic times.
Santosh Agarwal, Executive Director and CFO, Alphacorp says “Real estate is a popular investment choice for young investors due to its enduring value and potential for wealth accumulation. It offers stability, security, passive income, and versatility, accommodating various investment strategies from residential properties to commercial ventures.”