The second-largest employer after agriculture in India is the real estate sector. The burgeoning population of India, at 1.3 billion in 2019, coupled with an average 6% GDP growth has catalyzed the growth of the real estate sector in India. A favorable economic growth and demographics have further facilitated the demand for commercial, residential, and retail property in India. Rapid urbanization, growth of nuclear families and a rise in household incomes have escalated the demand in the sector. Amongst the 14 major industries that exert a direct or indirect effect on the economy, the construction industry stands at third position. The realty sector is showing stability after the unsettling phase triggered by demonetization, GST, and RERA. Investments in real estate, both domestic and foreign, are witnessing an upward trend due to firm market fundamentals, friendly policies, and the introduction of the first Real Estate Investment Trust in India.
Real estate sector in India is estimated to increase from USD 120 billion (Rs. 857.16 crores) in 2017 to USD 1 trillion (Rs. 7143000 crores) in 2030 and will contribute 13% to India’s GDP by 2025. While the housing segment contributes 80% to the real estate sector, the commercial, retail, and hospitality segments are growing at a rapid pace. The fast-paced growth in industries like IT and ITES, retail, e-commerce has led to a corresponding rise in demand for commercial and office space. The Real estate stock in India is estimated to reach 3.7 million square feet in 2019. The Total commercial area amounted to 600 million square feet in 2018. Office space leasing is expected to occupy 100 million square feet of space between 2018-2020 in the top eight cities of the country. Gross office absorption reached 36.4 million square feet between January and September 2018, growing at 26% year on year. Warehousing spaces will see an investment of USD 7.76 million (Rs. 50000 crores) in 2018-2020 with total space absorption of 247 million square feet. Co-working spaces reached 3.44 million square feet in 2018 in the top seven cities as compared to 1.1 million square feet in 2017. 2019 is expected to be the year of 20 million square feet new retail space. The government has approved 423 Special Economic Zones (SEZ’s) in 2017. The Union Budget of 2019-2020 has allocated USD 6 billion (Rs. 48,032.17 crores) for Housing and Urban Affairs.
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