2023 has been nothing short of transformative for India’s real estate sector, witnessing unparalleled growth fuelled by a convergence of factors. From the rising affluence of the middle class to heightened aspirational desires, this year has underscored the significance of homeownership. Crucially, governmental policies and regulations acted as catalysts, propelling the industry to new heights.

Sector performance in 2023

Pritam Chivukula, Co-Founder & Director, Tridhaatu Realty, and Vice President, CREDAI MCHI, highlights the pivotal role played by government policies, saying “2023 was the year that will be etched in the annals of the country’s real estate history as a period of unprecedented growth.”

According to him, people have realised how important it is to own a property to escape the cycle of perpetual rentals. The allure of steady home loan costs and creative payment plans offered by developers have reinforced this tectonic shift in attitude, making property buying an appealing option.

Aakash Patel, Director, Atul Projects India, also feels that the growing awareness among home buyers regarding the significance of homeownership led to the surge in demand in the property sector last year.

“One of the prominent trends observed was the notable surge in luxury home sales in comparison to the affordable housing segment. This shift can be attributed to the enhanced affluence among home buyers, resulting in a heightened aspiration for luxurious living experiences. Notably, in Mumbai, there has been a distinct elevation in luxury living standards, with penthouse living emerging as the latest trend among the affluent strata of society,” he says.

Samyak Jain, Director at Siddha Group weighs in, saying, “Buyers are now inclined towards larger living spaces equipped with luxurious amenities that provide an indulgent lifestyle at a well-connected location. The focus on luxury and wellness amenities and sustainability features, along with green living initiatives and zero-waste planning, reflects the evolving priorities of developers and homebuyers.”  

Srikanth C, Managing Director of Intercontinental Infrastructure notes that in 2023, territories functioning as commercial centres, particularly those near major cities, had transformed into significant residential areas.

Chakan in Pune, a well-known automobile hub, is a prime illustration of this shift, he says.

“This locality has not only attracted residents from Pune but also from Mumbai, mainly in search of job opportunities. The increase in people relocating to Chakan for employment has spurred extensive development in the region. This extends beyond the mere expansion of residential properties to include the establishment of retail stores, hospitality services, healthcare facilities, and educational institutions. This all-encompassing growth is a result of the rising population and the demand for essential services and amenities,” he elaborates.

Dr. Sachin Chopda – Managing Director, Pushpam Group, says that 2023 witnessed a noticeable surge in people choosing to invest in holiday homes in India.

“The trend is gaining due to numerous factors. For starters, income levels among home buyers have risen. Furthermore, there is a growing desire among people to enjoy short weekend trips. These considerations add to the likelihood of investing in vacation homes being an appealing alternative. One of the most alluring characteristics of investing in this asset class is the possibility of generating a significant and consistent monthly income while incurring no maintenance fees,” he points out.

Real estate outlook for 2024

As the real estate sector stands on the cusp of transformation in 2024, the demand will shift towards “smart homes” and a green revolution in residential architecture.

According to experts, 2024 will witness big spending on luxurious amenities, along with everything smart.

Chivukula says, “Luxury, it seems, has found a new companion in the form of “smart homes,” and a green revolution is sweeping through the residential landscape as sustainability takes centre stage.”

Jain maintains that in 2024, homebuyers in the mid-segment of housing will aspire for a better lifestyle. “They are looking at homes that are luxury in nature yet come at an affordable price point and at a centrally located, well-connected property,” he says.

Patel, who also feels the same about Mumbai’s real estate, adds, “Looking forward to 2024, there is a strong expectation that luxury living will reach new heights, especially among the residents of Mumbai. The prevailing trend towards luxury homes and penthouse living is expected to continue, and potentially intensify further, as the city’s elite and well-heeled individuals seek even more opulent and exclusive residential experiences.”

Srikanth C notes, “With the expansion of commercial hubs and the attraction of more businesses, the subsequent increase in job opportunities is expected to fuel the creation of extensive residential spaces equipped with essential amenities and infrastructure.”

Additionally, technology is redefining the expectations of modern homeowners.

“Consumers are preferring houses that combine digital systems for smooth living. The rise of smart houses, which are outfitted with cutting-edge automation and networking technologies, has emerged as a defining trend in the real estate market,” Chivukula contends.

At the same time, a major shift towards sustainable living is redefining the basic underpinnings of residential buildings.

The emphasis is on decreasing the environmental imprint of homes, from the materials used in construction to the implementation of eco-friendly technologies. Homebuyers, who are more environmentally sensitive than ever before, are driving the need for sustainable homes that prioritise energy efficiency, waste reduction, and responsible resource use.

Leading developers recognise and react to changing trends, embracing change and ushering forth a new era of real estate development. The dedication to sustainability is more than just marketing; it is a true recognition of the importance of responsible urban development.

However, the sector faces challenges, and the quest for sustainability comes at a time when external factors are influencing property prices. Over the last decade, the convergence of increased interest rates and supply-demand dynamics have already set residential property prices on an upward trend. In this context, the real estate industry sees government backing as a driving force for a positive transformation in 2024.

Parallelly, the 2024 forecast envisions a sustained momentum in residential property sales. Prospective homebuyers, driven by a desire for more significant living spaces, enhanced amenities, and attractive pricing models, are poised to keep the market afloat. Reputed and trusted developers, especially those catering to the mid-income and affordable housing segments, are expected to thrive, maintaining their dominance throughout the year.