Indian Real Estate: Homebuyer Preferences and Market Trends in 2024
The Indian real estate market is undergoing significant changes, as revealed by the “Homebuyer Sentiment Survey – H1 2024” conducted by FICCI-ANAROCK. Despite high returns in mutual funds, 59% of respondents prefer real estate as their investment choice. A majority, 67%, are buying properties for personal use, while 33% are investing. However, the demand for ready-to-move homes is declining, with a current ratio of 20:25 compared to 46:18 in H1 2020, indicating a shift towards new projects.
There is a growing preference for larger homes, with 51% of respondents favoring 3BHK units. While properties priced between Rs45 to 90 lakh remain popular, 28% of buyers now prefer homes priced between Rs90 lakh and Rs1.5 crore. Apartments are the most preferred property type, accounting for 58% of choices, though residential plots are gaining popularity, especially in southern cities.
Key concerns for buyers include timely project completion (98%), construction quality (93%), and well-ventilated homes (72%). Rising rental rates in major cities are attracting investors, with 57% purchasing properties for rental income. However, affordable housing is struggling, with over 53% of buyers dissatisfied due to location, construction quality, and unit sizes.
Home loan interest rates below 8.5% have little impact on buying decisions for 71% of respondents, but rates above 9% significantly influence 87% of potential buyers. Pramod Rao, Executive Director of SEBI, emphasized the importance of regulatory frameworks for sustainable growth. Raj Menda, Chairman of FICCI Committee on Urban Development and Real Estate, highlighted the thriving commercial real estate sector and the need for diversification. Anuj Puri, Chairman of ANAROCK Property Consultants, and Sanjay Dutt, CEO of Tata Realty, discussed the evolution of the sector and the benefits of fractional ownership.
Doubts Revealed
Real Estate -: Real estate refers to property consisting of land or buildings. In India, it includes buying, selling, and renting homes, apartments, and plots.
Homebuyer Preferences -: Homebuyer preferences are the choices or desires of people looking to buy homes. This can include the type of home, location, size, and other features they want.
Market Trends -: Market trends are patterns or changes in the way people buy and sell homes. In 2024, trends include a preference for new projects and larger homes.
Plots -: Plots are pieces of land that people can buy to build their own homes. They are becoming more popular as people look for more space.
Rising Rents -: Rising rents mean that the cost of renting homes is increasing. This can make buying a home more attractive to investors who want to earn money from renting out properties.
Affordable Housing -: Affordable housing refers to homes that are priced lower to be accessible to people with less money. There is some dissatisfaction with the quality or availability of these homes.
Interest Rates -: Interest rates are the cost of borrowing money from banks. Rates above 9% mean it is more expensive to take loans for buying homes.
SEBI -: SEBI stands for the Securities and Exchange Board of India. It is a government agency that regulates financial markets to protect investors.
Pramod Rao -: Pramod Rao is a person associated with SEBI, who emphasizes the importance of rules and regulations in the real estate market.
Diversification Opportunities -: Diversification opportunities mean exploring different types of investments or projects. In real estate, this could mean investing in various types of properties or locations.
