Indian Residential Market likely to Grow

According to analysts, after seeing difficult time in 2013, India’s residential real estate sector is likely to observe rise in demand and growth in price.

The demand for residential property in the country was sluggish last year during the borrowing costs and slowing economic growth.

Anuj Puri Chairman and Country Head of Jones Land LaSalle (JLL) India says, currently across the country, the residential estate prices are expected to grow by 10 to 12 per cent year-over-year (y-o-y) in 2014.

According to, a property firm, post general elections in India, an improvement in the real estate market is expected, but until then, some ambiguity would be created.

Mr. Puri also described that post elections in the country, the ambiguity that persists now will come to end. He also added, in the first two quarters of 2014, the consumer sentiment will be sluggish due to the qualms related to the general elections and the global and domestic macroeconomic conditions. But, post general elections, it is likely that the inactive investors would become actively involved in investment activities. The raise in absorption of residential units would lessen the currently piled-up inventories of the developers and builders’.

According to the Knight Frank, a property consultant in order to diminish the piled-up inventories that had reached to 13,000 units in the Indian City of Mumbai, developers in Mumbai reduced the property prices by 25 per cent in the end of 2013, but it also added that real estate market is optimistic.

Shishir Baijal, the Chairman and Managing Director of Knight Frank, India said that the real estate story of India remains to be immensely eye-catching. While the Tier-I cities is considered to be going through a phase of inundation, the Tier-II cities have started to attract investors as the IT sector, infrastructures, and industrial sectors are developing here. Hence, a thought is given about the growth of real estate considering other facts of economy along with it. The concept of expensive properties is for the undeveloped land as it is limited, but still the office space and completed residential projects are available at affordable price in most of the places.

The prices in housing segment are likely to increase by 10 to 15 per cent in this year, says the Vice President of Finance and Investor Relations at HDIL, Mr. Hariprakash Pandey. He also added that the post-general elections, real estate activities will get grow and results of the election will raise the demand in the housing sector.

Mr. Baijal of Knight Frank elaborated that the real estate market would be doing well this year. The drive will remain optimistic, if the investment activities are taken in right line that is by lowering the financial shortage and advanced monetary policies that would be drafted by the Reserve Bank of India (RBI). If these are in place, then nothing can cease us in going on the track of the growth, which is likely to happen in the second half of 2014.