Indian Real Estate Market Forecast 2022
In the housing market, 2007 was a stellar year, with low rates, the highest yearly price increases and rental increases for single-family homes, historically low foreclosure rates, and the highest number of home sales in 15 years. What are the chances of a housing market crash in 2022? Here are some developments and predictions for the housing market for 2022. 2021 was a market where many home purchasers competed to win the winning bid, with homeowners' properties selling rapidly and frequently above the asking price.
The Indian housing market is experiencing sustained demand owing to record low mortgage rates and a lack of available inventory. In the aftermath of the Covid-19 pandemic, home-buying processes were chaotic. There were significantly more homes sold in 2021 in comparison of past years. While the pandemic created economic uncertainty, many buyers focused more intently than ever before on homeownership. As a result of drastically reduced spending, the homeownership rate increased tremendously, but briefly.
For 2022, some expect a slower rate of price appreciation than this year, while inventory will remain limited. While there is likely to be an increase in listings during the spring and summer of 2022, there is little chance of meeting the demand. There has been strong demand for homes across the country in 2021, with nearly every state experiencing high housing prices. These trends are expected to continue in 2022.
With mortgage rates at an all-time low and an extremely short supply of homes, a robust housing market has taken hold, with homes selling within hours of being listed, and for substantially more than their asking price. More than six million homes are expected to be sold this year, which would be the highest number since 2006. Experts predict that the same trends will be observed in 2022 as they were in the last two years: increased prices, low inventory, and quick turnarounds.
The Residential Property Market Is On A Strong Equilibrium
It is likely that residential property prices will rise again after a long period of falling and then stabilizing. Residential property value growth in 2022 in the country is projected at around 5 percent, according to Knight Frank's report for 2022.
As a result of many factors, both supply- and demand-side, re-evaluated over the past decade, house prices have begun to rise. In 2022, there is an expectation that home buyers will remain interested in purchasing homes as they prefer larger homes, better amenities, and competitive pricing.
Tridhaatu Realty co-founder and director Pritam Chivukula notes there will be a demand for residential sales. CREDAI MCHI Secretary. Developers with a strong reputation for quality work will have a stronger presence in the affordable and mid-income housing segments and will continue to dominate," he said.
Rastogi, Executive Director of Runwal Group, sees robust demand for affordable housing, as well as projects that are ready to move in or are expected to be ready soon. During the past few years, we've seen significant increases in revenue consistently, and we anticipate the same trend will continue in 2022. He adds, "We have a positive outlook for the coming year and are on track to launch a number of new products and expand existing products."
Mostly, the change in consumer behavior is what will drive the demand. In the wider perspective of work-life choices, owning a luxurious residence is not just a matter of investment preference, but rather a necessity.
Transcon Developers' Director Shraddha Kedia-Agarwal says this has contributed to luxury home sales. Increasingly, people seek houses with sea views and expansive open spaces such as balconies, terraces, courtyards, gardens, and parks nearby. This is a result of the WFH culture. In this year's market, customer preferences will continue to shift from premium products to a more sophisticated approach. A luxury lifestyle that incorporates the WFH concept flawlessly while maintaining luxurious comforts and lavishness is what buyers are looking for, she says.
Foreign Investment Will Make The Sector Get-Up-And-Go
In the real estate sector as well as in other sectors, foreign direct investments (FDI) continue to be a major growth driver. Kedia believes the Indian real estate sector has been successful in attracting foreign funds in this regard, most notably in the residential market.
Since increased transparency and eased investment guidelines have improved the properties market in India for ultra-high income individuals (UHNIs) and non-resident Indians (NRIs), says Kedia.
With RERA ensuring transparency and 100 percent foreign direct investment in construction, NRIs are increasing their investments in Indian real estate. This is also supported by the Knight Frank analysis.
As demonstrated by the strength of foreign direct investments in this region, APAC nations, including India, remain attractive investments.
Asia-Pacific lands at number 8 on the list of the 20 best destinations for foreign investment worldwide. According to the World Bank, 9 percent of FDI worldwide goes to the Chinese mainland. India continues to experience growing levels of FDI as well.
Expectations From The Government- One Serious Hand Here
In the history of the country's economy, the real estate industry has always played a major role. Since the sector has been the recipient of a number of new government policies, buyers and developers should have more expectations in the coming months.
Both residential and commercial real estate segments will benefit from these policies, according to industry sources. The authorities need to provide more support in some areas, however.
The Managing Director at Wadhwa Group, Navin Makhija, points to those grey areas by saying, "We need to set up a Single Window System that includes the financial and human resource departments.". These initiatives are expected to reduce project costs and ensure timely development, therefore meeting the actual objectives of RERA," he says.
Rather than focusing on new projects, the experts highly recommend that developers complete those which are currently underway. There is a demand for the projects that already exist, which will eventually trigger sales since more buyers will prefer the projects that are already developed.
While high demand for luxury homes remains, the demand for affordable homes and ready-to-move-in homes will also persist. Furthermore, various experts and stakeholders of this sector are predicting relatively higher sales for the players in this segment in 2022.
Use Of New Technology- High End And High Tech World Revolutionising
Technology is not new to the real estate sector. Over the next few years, new technologies will continue to be adopted by the industry. Among the technologies expected to be applied to this sector are smart home technology, online home selling platforms, and apps. Also on the horizon are an increase in startups and high-tech companies servicing the industry, with many paying close attention to speeding up transactions.
Building management, design, and organization are also slated to be areas of application for artificial intelligence in real estate. In the field of property design and urban planning, machine learning is also increasingly being used. This trend has even been seen in office space construction. The fact that many owners of properties have been embracing the best property management solutions further simplifies things.
Data from 2021 indicate that consumers are also moving digitally. More than half of new homeowners search online for houses first. Further, 12% of respondents used the internet to get information on the home buying process. The fact that *1% of new homeowners learned about the buying process from magazines and books is also very significant.
New Technology Trend Takeaways
- New technologies continue to be used by both buyers and sellers of real estate.
- Home sellers are now using online platforms, apps, social media, and smart home technology to market their properties.
- Startups and technology companies serving the industry are expected to grow.
- Real estate will be transformed by artificial intelligence.
Use Of Amenities To Attract Customers
Building owners, property managers, and landlords want to take advantage of amenities to attract new tenants. There seems to be less of a need for a gym and parking access, as they are now expected from most properties. In addition to the aforementioned amenities, property owners are now considering gardening spaces and movie theatres.
Investing savvy real estate companies are also launching smart homes. In recent years, investors have sought amenities that add value to their properties. The quest for amenities may be a sign that they need to identify amenities that do just that. Marketing strategies should be re-evaluated as well, as amenities alone cannot attract tenants. It is imperative to advertise all property offerings and to inform existing tenants of any new amenities.
As far as IoT sensors are concerned, around 49% of the owners of smart properties see the benefit of sharing the information with their tenants so as to improve the overall experience and provide the best facilities for their tenants.
Use of Amenities Trend Takeaways
- The real estate industry uses amenities to attract tenants.
- New homes will be demanded to have unique amenities.
- Intelligent property owners use IoT technology to deliver the best amenities to their customers.
Indian Real Estate Market Forecast 2022
For the Indian real estate market, the year 2021 has been one of recovery. New launches and home sales have risen dramatically. With the market's growth expected to continue into 2022, momentum in the real estate market is robust.
- Investments in the housing market will continue to yield healthy returns in 2022.
- Despite rising mortgage rates, existing homeowners may continue to purchase properties despite rising rents.
- Investors purchased more properties than they sold in the spring of 2021, and this trend continued through the summer.
- The strong demand and predicted increases in rental prices will make 2022 a great year for earning a high return on rental properties.
Q. Will property prices go up in 2022?
Ans. 2021 has witnessed good growth in real estate investment after a sluggish market for years and the same upward trend is expected in 2022. The increased cost of products and supply chain will surely lead to the increased prices of property in 2022.
Q. Is 2022 a good time to buy a house in India?
Ans. 2022 is expected to be a good year for home buyers and the property prices are expected to increase this year, bigger homes, better amenities, and outstanding housing patterns will surely make the year attractive for properties.