How 2022 was for the real estate sector and expectations from 2023?

A group of industry stalwarts are speaking about how 2022 was and what they expect from 2023 in a discussion with Thought Habitat.

Indian real estate sector is one among the largest in the world. In the past few years, the industry went through several challenges and is yet surviving through the tides. A group of industry stalwarts are speaking about how 2022 was and what they expect from 2023 in this blog.

Nayan Raheja, Raheja Developers

A strong demand  for homes across segments has augmented the realty sector growth post-pandemic. While the luxury category has seen visible foreign and NRI interests, plots have also witnessed great traction with growing price appreciation. Farmhouses remain a rich-class indulgence, while independent floors are becoming a preferable investment category for home buyers who prioritize personal space and privacy. The realty sector projects a positive growth and looks towards another year filled with rising customer engagement.”

Ankit Kansal, Founder & MD, 360 Realtors

2023 will be one of the most promising years for Indian real estate in recent times. After a prolonged period, we are witnessing demand outstripping supply, which will make it a seller’s market. Property prices will continue to grow, which in conjunction with recent growth in interest rates will drive first-time homebuyers to make quick decisions. Households who already have homes might think of opting for a second home or retirement villa.

Besides the organic surge in demand, India’s bullish economy will also bolster the sector toward an accelerated growth trajectory. India will remain one of the bright spots in the global economy with most of the rating agencies projecting growth in the range of 7-9% in the next fiscal. This will consequently drive both housing and office demand. India already is registering a jump in disposable income and expansion in the labor market, which are very positive signs for realty demand. Investors will also gravitate toward the market, lured by growth in appreciation and rental income.

Ritu Ahlawat, CEO, InvestinPRO

The real estate sector projected a smooth recovery from the pandemic effects this year. However, the pace of recovery was affected by high-interest rates, global recessionary pressures, and supply chain fluctuations caused due Ukraine-Russia; the healthy buyers’ demands proved to be a facilitator in bringing the realty sector back on track. The sales augmentation post-normalcy marks an example of its market hold and resilience. The recovery could have been fast-paced if the unforeseen economic and political implications had not occurred, but the performance of the realty sector was impressive in the face of the market realities. In the year 2022 we have seen demand increase in the residential sector as compared to the last few years. Besides, the year was difficult for the commercial segment but it has picked up speed now and will continue in 2023 too. Also, the SCO segment has attracted many buyers this year. We are hopeful that along with the residential segment, commercial and SCO will also see a good percentage growth in 2023.”

Ashwani Kumar, Pyramid Infratech

Every facet of real estate prices has increased in 2022, including raw material costs, Repo rate increases, project prices overall, etc. All of these elements temporarily halted project sales. However, since more and more buyers expressed a strong desire to possess their private spaces in the most prominent areas of their individual regions, the market remained healthy. As more members of society’s economic class register for their dream homes, residential developments, particularly those in the inexpensive segment, have seen a huge increase in sales. As more and more developments near completion, demand for apartments has remained steady and is anticipated to continue in 2023 ahead.”

Rajesh K. Saraf, Managing Director, Axiom Landbase

2022 has been a fruitful year for the real estate sector despite adverse trends such as rising inflation, input cost, raw material costs, Repo rate, etc. The most favourable factor remains the availability of efficient projects offered by developers that cater to the needs of buyers. Also, buyers’ sentiments to own their private spaces have remained intact throughout the year, whether it is in the residential, commercial, plotted development and SCOs. Especially the luxury segment has witnessed a massive response, along with Tier-2 cities emerging as realty hotspots. We look forward to a similar trend in 2023 as well.”

Harpal Singh Chawla, Director, Spaze Group

Different real estate corridors have clearly increased prices. This is the immediate result of repo rate increases, which inevitably cause a rise in property prices. Despite regional and global economic pressures, there has been a strong demand for real estate projects, especially the commercial segment, including SCOs and mixed-use projects, as more people become aware of the long-term appreciated advantages of real estate investments. The most significant price growth has been seen in Gurugram, which reflects both the appeal of the corridor and the speed with which buyers have acquired properties. Additionally, there has been a noticeable surge in pricing models in areas near the Dwarka Expressway. It consistently demonstrates a rise in property demand as well as how Gurugram has become a well-liked area for homebuyers to settle down.”

Manoj Gaur President  CREDAI NCR and CMD Gaurs Group

The year 2022 has been one of the best years for the real estate sector. After pandemic, people have realised the importance home ownership and demand for bigger homes has increased.  The home preference are 3 and 4 BHKs  and we have seen increase in the demand for plotted development too. This year price has been increased from 25 to 30%. We believe that this will continue in 2023 also as stock for unsold inventory is at its lowest corner and the demand is increasing simultaneously. The impact of the rising home loan interest is marginal as of now because the customers preference to have their own piece of real estate and the peoples are also going for second & third house and they want to hold the real estate for the long time because we have seen in past that the wealth creation is always been done by investment in the real estate sector only. 2023 will be a great year for the real estate.

Amit Jain, Director, Mahagun Group

It proved to be a fairly good year for the realty sector as the normalising conditions opened space for markets to perform and buyers to make investments in their choice of homes. The luxury markets prospered on the back of the strong demands of High-Net-worth individuals and the advent of NRIs in the real estate space. The growing share of the real estate sector in the national GDP outperformed everyone’s expectations and doubts regarding its revival tapered off. It was a critical year for the realty sector as it would reflect whether people would be interested in investing in homes right after weathering a pandemic. It showed positive signs of growth right from the year’s beginning and continues to stay strong.

Yash Miglani, MD, Migsun Group

The real estate sector enjoyed a good run this year both in demand and sales. Realising the high appreciative value of home ownership, buyers returned to the markets and invested in properties of various categories. The sales reported in a few categories even overpowered the sales of the pre-pandemic years. This shows the market resilience of the real estate sector and buoyant customers’ demands. Even the rise in home prices did not prove to be a deterrent, and people heavily invested in properties located in high-end residential corridors. The festive season also marked a solid uptick in home investments in 2022.

Amit Modi, President, CREDAI, Western UP and Director, County Group

2022 was a year of overriding expectations for the economy to begin returning to normalcy after more than years of lockdown. Likewise, the realty sector edged towards regaining its pace, and there was a revival of growth in the property markets. However, it was not a smooth run, with many economic headwinds like an inflationary onslaught, constant hikes in repo rates, and a stark increase in construction material costs posing significant hurdles to the acquired revival speed. Despite that, real estate investment emerged as a stable and resourceful asset, which led to buyers’ empowerment in times of crisis. This perception kept the housing demand buoyant, and as people started attaining financial bandwidth and emerged out of pandemic ramifications, they preferred to invest in homes. The homeownership process became more smooth and more buyer-friendly with the greater integration of technological advancements in the real estate space.

Sanchit Bhutani, Managing Director, Bhutani Grandthum

The real estate industry had a relatively good year overall in the commercial real estate market was clearly expanding. A steady increase in sales, commercial leasing, increase in FDI and a welcome change in the spending pattern of consumers, all indicated that the commercial real estate market had recovered from the effects of the Covid recession. Due to its promising cyclical growth and returns on investments, the sector is frequently cited as the safest investment zone. Additionally, this industry proved to be one of the key drivers of the economy’s development and was unaffected by tight inflation and repo rate hikes.

Ashwinder R. Singh CEO, Residential Bhartiya Urban

This year was a litmus test for the realty sector as restoration of economic activity took place in a phased manner which could also possibly mean revival of real estate fortunes. On the brighter side, the realty sector plunged out of the pandemic deadlock and property markets rekindled on the back of strong buyers’ demand. The residential sales grew, and commercial leasing activity picked up. Luxury housing held the lion’s share in the markets, and the phenomenon of rental housing saw an uptick.The rental yield which has grown at a healthy rate and now hover between 3-5% in metros also make residential asset a great investment product offering both return and stability, which is attracting investors’ interest like never before. Despite inflationary challenges and interest rates getting dearer, the realty sector recovered its pace and never lost its hold, irrespective of economic travails. 2023 will be another crucial year in real estate’s progression towards creating an impactful mark in the post-pandemic world.

Ansh Batra, Director, Buniyad Group

Considering the momentum gathered by the realty sector in 2022, 2023 will be a favourable year. Realty, in its entirety, has projected a smooth-paced recovery despite tumultuous international and domestic implications. The segment which had the most impressive run is luxury real estate. There were a few concerns which also troubled the sector, such as the consistent repo rate hikes and rapid increases in home prices. However, the demand remained stable, and the growth drive picked up, spelt out in the decrease in unsold inventories. Overall, the steady realisation of the sustainable value of home ownership drove housing sales. Positive sentiments for real estate investments will continue in 2023.

Mr. Kushagr Ansal, Director Ansal Housing

The findings of the report augur good outcomes for the realty sector, especially the premium segment. Largely unaffected by the interest rate hikes, modern luxury homes have become buyers’ favourite investment territory. The price rise did not have a collateral impact on the housing demand, which continues to be buoyant. Coming on the heels of a year-ending, it posits healthy market conditions for the realty sector, which will most definitely be carried forward in 2023.”

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