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The real estate industry in India has strongly bounced back from its slowdown during the pandemic. With stringent lockdowns and a dip in sales, the sector struggled for quite some time. However, information obtained from the leading researches in the industry reveals that the demand for residential properties continues to rise, with the impact of the pandemic gradually diminishing. The unsold inventory in the real estate market is also lowering gradually.
The commercial sector, in particular, has witnessed the inflow of private equity investments. This implies that the investors are a lot more confident in purchasing real estate in the local market. Insights also reveal that in the affordable housing sector, there was a 21% decline in unsold inventory compared to the pre-pandemic numbers.
The number of unsold residential units declined from 234,600 to 186,150, when you look at the figures in March 2020 and March 2022. Experts reveal that this has been the highest rate of reduction in the available supplies. Also, it points to the consistent demand for homes among the buyers.
Even the ultra-luxury properties that are priced above INR 2.5 crore witnessed a sharp decline. In the last one year, the top seven cities in India reported a decline of 5.4% in this supply. Here, it should be noted that there has been a consistent increment in the number of new projects. The developers continue with their supplies to address the increasing demand for luxury homes in India. The inventory reduction rate has been the highest in Mumbai and Kolkata, at 16% and 15%, respectively.
Therefore, the residential real estate market is finally recovering back to health. While the demand for properties in the commercial real estate sector has been consistently high, the residential segment is also beginning to catch up & gradually improve.
At the same time, the inception of the work-from-home concept during the pandemic is driving consumer preferences. Also, they are looking for larger homes to accommodate their workspace. Therefore, the pandemic has been a blessing in disguise for the developers. The fence sitters have also joined the party, investing in properties when the home loan rates were low. Coming to the commercial real estate sector, private equity investments would continue growing on a large scale as well.
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