Home loan disbursals have reached record levels, driven by strong demand for both residential and commercial properties in the Indian real estate market. According to the Reserve Bank’s Financial Stability Report (FSR), the share of residential housing loans in total advances has seen a significant increase over the past eleven years. In March 2023, it reached 14.2 per cent, up from 8.6 per cent in March 2012, as reported by the RBI.
The commercial real estate (CRE) sector, particularly in regions like NCR, has thrived due to robust infrastructure development and favorable government policies. These positive developments point to a promising outlook for the real estate industry.
Manoj Gaur, Chairman and Managing Director of Gaurs Group, attributes this surge in residential housing loans to the thriving real estate sector, which has experienced healthy sales growth and new project launches. The demand for larger houses and luxury residential properties has been fueled by consumers’ desire for a better lifestyle. Additionally, the market’s availability of better projects and reputable developers has instilled confidence in buyers.
The implementation of the Real Estate Regulation and Development Act (RERA) has played a crucial role in boosting consumer trust. This legislation ensures transparency, accountability, and buyer protection, creating a favorable environment for homebuyers.
Mr. Sanjay Sharma, Director of SKA Group, highlights that developers have adapted to the changing landscape by conducting extensive research and aligning their projects with consumer expectations. Embracing digital marketing and customer interaction tools has further facilitated the buying process and improved customer experiences. State governments’ substantial investment in infrastructural development has also contributed to the positive momentum.
The National Capital Region (NCR), particularly Noida and Gurugram, has witnessed remarkable growth in commercial real estate. This growth has been driven by rapid urbanization, improved connectivity, and robust infrastructure development, attracting both residential and commercial investments.
Salil Kumar, Director of Marketing And Business Management at CRC Group, explains that Noida and Gurugram emerged as attractive alternatives to accommodate the growing population and businesses as Delhi became congested. The rise in commercial infrastructure, including retail and office spaces, reflects the increasing demand for premium residential living, fostering a conducive ecosystem for businesses and economic growth in the region.
“Apart from the need for better homes, the increase in residential housing loans has also been aided by factors such as the implementation of RERA and infrastructural push. Tier 2 and 3 cities have been major beneficiaries of this development. Reputed developers are coming up with Grade A residences, retail spaces and offices in these cities, fulfilling a huge unmet demand,” says Pankaj Kumar Jain,MD,KW group.
After a sluggish performance, the real estate industry has received encouraging news with an upswing in home sales. With a continued focus on transparency, accountability, and customer-centric approaches, the real estate industry is poised for further success in the years to come. As pointed out by several reputed reports in the last few months, the decline in unsold inventory is another highlight.