The Year of the Homebuyer: Recapping 2023 and Forecast for 2024

2023 was an extremely distinguished year for Indian Real Estate, led by a marked change in industry’s market dynamics and overall perception towards buying houses. This has been primarily led by improved Homebuyer sentiments, playing a huge factor in not just the volume of housing registrations, but also having a cascading impact on the strong QoQ GDP growth, with a rate of 7.6% witnessed in the July to September quarter - which was higher than estimated projections. On the back of a stabilized economy, job security, stable lending environment, we project this sales momentum to continue going into 2024 and into the final quarter of the fiscal year, with sustainable development and Green Housing expected to lead the next growth phase in the industry. Developers have also been at the forefront to ensure that it remains a conducive buying environment, facilitating enhanced transparency and providing financial incentives that added to the overall appeal of purchasing homes.

All above factors are also validated quantitively by sheer volume of housing registrations in India. According to a report by Anarock, In the top seven Indian cities, around 3.49 lakh units of homes were sold between January and September 2023, compared to approximately 3.65 lakh units sold during the whole of 2022, surpassing expectations and showcasing how stakeholders have come together and collectively built a thriving eco-system.

In 2024, we expect the industry to be redefined through the following aspects:

Integration of Technology

The ongoing global digitalization and technological wave will further accelerate the use of online tools and platforms for property searches, virtual tours, and even online transactions. This shift is not only streamlining the buying process but is also broadening the reach for both buyers and sellers, reducing traditional barriers associated with geographical constraints. Furthermore, the demand for smart homes equipped with advanced automation and security features has also surged. Homebuyers now seek properties that offer integrated smart technologies, reflecting the changing lifestyle preferences and a desire for convenience and efficiency.

Sustainability and Green Housing

Consumer preferences will also play a pivotal role in shaping real estate construction and trends in 2024. Sustainability and eco-friendly features have gained prominence as homebuyers increasingly prioritize environmentally conscious living. Developers incorporating green technologies and sustainable practices in their projects have found and will continue to be favored among a growing segment of environmentally conscious buyers. The Government has also taken considerable measures and launched pilot programs to inculcate sustainable, emerging technologies and materials, and we expect developers to adapt to this new normal in 2024.

Growth of Tier II, III Cities

Due to a number of Government programs like Smart Cities, PMAY, emergence of satellite cities, and overall thrust towards building robust infrastructure, we’re seeing a great opportunity in Tier II, III cities as they emerge with their own unique economic identity. Tier I cities will always have the appeal and attraction of the investors and ultimate homebuyers and 2024 will see sustained demand for that, however we expect to see a sharper growth curve in Tier II, III cities as they come forward to spearhead the development and complement the success of the established regions. We expect the prices to rise in these cities in the coming years as we project more commercialization and more economic movement to happen that will ultimately add to the demand-supply dynamics.