Tag Archives: Boom in real estate

The cost of building real estate in India is predicted to increase by 6% by 2024, with Mumbai being the most expensive city

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JLL’s most recent Construction Cost Guide predicts that in the financial year (2024) across all sectors, the nation’s overall construction costs will rise by an average of 6%. 

With higher prices, Mumbai remains the most expensive city overall, but Chennai is a more cost-effective option. The increased cost of necessary building supplies like cement, structural steel, reinforcement steel, and stones is the cause of Mumbai’s higher prices. 

The handbook offers information on real estate asset construction costs and market trends in important Indian markets. It contains an analysis of market trends for key building materials and a cost matrix representing various styles and quality levels.  

“To maximize expenditure, businesses are currently reevaluating their real estate decisions. The general trend is clear: construction costs are rising, even though the precise impact of the pandemic on these costs is still up for debate, according to Jipu Jose James, Managing Director, Project Development Services  (PDS), JJL, India. 

Customer spending is therefore anticipated to prioritize functions that improve the end-user experience. Cost management is essential to maintaining budget control and completing commercially and qualitatively viable projects. 

An increase in labor costs  

While several factors affect building costs in India, labor is also a key component in the country’s economic expansion. As a result, the supply-demand gap is narrowing as construction shifts to non-metropolitan and rural areas, resulting in a more stable labor market and lower wage inequality, according to the report. 

Labor rates have risen by an average of 6% per year over the last three years, increasing construction costs by about 2%. The industry heavily relies on its workforce, as evidenced by its increase to approximately 71 million employees in FY2023, up from 63.98 million the previous, year, due to urbanization and rising infrastructure demands. 

However, this growth is primarily in unskilled labor, exacerbating the skilled worker shortage. Lack of vocational training institutions impedes skill development, according to the report. 

According to the report, global construction costs will rise in the coming year. 

Pune’s property market data for March 2024 saw a 52% YoY increase in property registrations

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 The Maharashtra government collected Rs 804 crore in stamp duty in Pune in March 2024, a 30% YoY increase from Rs 621 crore in the same month in the previous year.  

In March 2024, 21,744 properties were registered in Pune, a 52% increase from 14,309 the previous year. The Maharashtra government’s Department of Registrations and Stamps (IGR) reports that stamp duty collections during this period amounted to Rs 804 crore, indicating a 30% YoY increase. 

The sum in stamp duty collected as of March 2023 was Rs 621 crore. 

An increase in the number of properties purchased in March 2024 for more than Rs 1 crore 

March 2024 saw the largest residential unit registrations, or 33% of all housing transactions, for units priced between Rs 50 lakh and Rs 1 crore. Comparably, 32% of the market share was accounted for by properties priced between Rs 25 lakh and Rs 50 lakh. According to a Knight Frank analysis, the percentage of properties priced under Rs 25 lakh also increased significantly, rising from 16% in March 2023 to 21% in 2024. 

There was a rise in the market share of the higher value segment, which includes properties priced at Rs 1 crore and above. The proportion of properties in this category increased from 10% in March 2023 to 13% in March 2024, suggesting a growing inclination towards properties within this price range. 

An increase in the desire for larger apartments 

The market share of apartments between 500 and 800 square feet was 40% in March 2024. Comparably, units smaller than 500 square feet also garnered much attention; in March 2024, they accounted for 35% of all transactions, making them the second most popular apartment size. It demonstrated that the market share of larger apartments— those larger than 1000 square feet– stayed steady at 13%. 

“Pune’s real estate market is still growing thanks to a robust demand for homes, reasonable prices, and ideal circumstances. A notable 52% increase in registrations in March 2024 over the same month the previous year set a positive tone for the upcoming quarter, according to Knight Frank India Chairman and Managing Director Shishir Baijal.  

52% of buyers in the 30 to 45 year old range range 

Homebuyers between the ages of thirty and forty-five made up the largest buyer segment in the Pune market, with a sustainable 52% share. Homebuyers between the ages of 45 and 60 made up 18% of the market, while those under 30 made up 24%. 

The analysis revealed that professionals make up a significant portion of the market, especially in the 30-to-45-year-old age range, which is the largest segment. 

How connectedness fuels the expansion of real estate

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When searching for their next project, real estate investors consider several important factors, including pedestrian crossings, proximity to transportation hubs, and accessibility to co-working spaces. 

The old real estate adage, “Location, location, location,” is gradually being replaced by the idea of the local area’s attractiveness in today’s technologically advanced and rapidly evolving world. 

While a project’s location is important, accessibility has been even more important and is now the most important consideration for homes and businesses. One of the most important things real estate investors look for in a property is if it has access to co-working spaces, pedestrian crossings, and transportation hubs nearby. 

The Growth of Telecommuting and Digital Nomadism 

The COVID-19 pandemic and telecommuting contribute to the growing number of digital nomads worldwide. More and more people need reliable internet to avoid losing out on effective options like remote jobs because of problems with internet connectivity. Because remote work is increasingly becoming the norm, having high-speed internet is now essential for residential and business settings, rather than just being a luxury. 

Getting to Transit Hubs 

Regarding location, being close to transportation has always been valued in reality, but it is now even more so. “Accessibility related to airports, train stations, and major highways is highly significant for organizations and people,” notes LC Mittal, Director of Motia Group. It enables easy mobility for tourists and employees heading to the ideal getaway destinations.”

The Revolution of Coworking 

We have changed our business practices as a result of co-working spaces. They draw in a new kind of worker that values community, creativity, and teamwork. “Co-working spaces provide conferring, useful contacts, requisite materials, and stimulation for productivity,” says Anurag Goel Ganga Developments. They therefore benefit greatly from the strong desire to exist. 

Smart City Coordination 

The concept of “smart cities” is becoming more pertinent as urban areas consider integrating technology into their infrastructure. The connections between the technologies enable this integration. According to Sanjoo Bhadana, Managing Director of 4S Developers, smart cities should optimize resources, enhance quality of life, and promote sustainability. Consequently, the seamless operation of all systems depends heavily on connectivity. It helps guarantee energy management, and smart transportation and offers useful services to citizens. 

Opening the Door for New Property Values and Amenities

A real estate’s value and property prices are determined by its connectivity, an appreciated attribute. Properties with strong internet infrastructure, convenient access to transportation hubs, and coworking spacing that facilitate office setups are essential in today’s competitive rental market, according to RPS Group partner Suren Goyal. Today, investors and developers are deeply grateful for this revolution, which goes beyond mobility to create projects where connectivity is a key component. 

Aspects and Sustainability

As such, there is a sustainability component, which lessens the environmental impact, alongside the ease of connectivity. People can choose where and when to work, which reduces their carbon footprint because they can commute less. This trend is seen as more and more work is done remotely and coworking spaces spring up. Furthermore, the efficient connectivity of all the other components that effectively optimize the use of natural resources and encourage environmentally friendly practices also helped to advance the idea of the smart city. Real estate and connectivity will develop so quickly in the future that they will eventually become essential components of the economic equilibrium and our daily lives. 

As technology develops more, integrating connectivity into real estate will become easier. Suren Goyal said, “We have everything planned so that connectivity is planned. Like electricity and water, internet infrastructure will be vital.” 

The adage “Location, location, location” is undoubtedly still relevant, but in the modern world, connectivity is more crucial than ever. The properties that prioritize occupations, accessibility to transit and workspaces, integration with co-working spaces, and flexibility in response to changing needs will be chosen by businesses and individuals who depend on the services offered by these establishments. Embracing connectivity is a crucial first step in maintaining the real estate ecosystem’s rapid development. 

Vision for 2024: Booming prospects in the Indian real estate sector

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With its diverse news and aspirations, the Indian real estate market is a vibrant tapestry set to grow even more in 2024. There are numerous opportunities for investors, developers, and stakeholders in this ever-changing landscape. To maximize potential benefits and navigate this complex environment, one must be well-versed in the developments, forecasts, and challenges to come. 

Residential: Meeting a range of requirements 

In 2024, the residential sector– the cornerstone of the Indian real estate market— is anticipated to keep growing. The need for affordable housing will increase due to a growing middle class and rapid urbanization, particularly in tier 2 and 3 cities. In response, developers emphasize smaller units, adjustable payment plans, and integrated townships that provide a full range of lifestyle choices. 

Environmental awareness also fuels the trend toward sustainable housing solutions. Green buildings, which are gaining popularity, use eco-friendly materials and energy-saving technologies. These buildings appeal to investors and consumers who want to find a way to reconcile modern living and environmental responsibility. Proptech is one of the key players in the way that technology is further revolutionizing the residential market. Finding and managing properties is becoming more and more convenient thanks to innovations like virtual tours, online booking tools, and AI-powered property management systems. These innovations are also improving the buyer experience and streamlining procedures. 

Commercial: Adjusting to a transforming environment 

The demand landscape for commercial real estate is shifting due to changing consumer behavior and evolving business needs, resulting in a paradigm shift in the market. The emergence of flexible workspaces, which meet the demands of established companies, freelancers, and startups looking for adaptable and affordable solutions, is one of the most noteworthy trends. 

Furthermore, the demand for intelligent buildings like features like data centers, automation systems, and high-speed internet connectivity stands by the need for seamless connectivity and advanced technology. It enables companies to meet the increasing demand for technology-driven solutions while operating more profitably. In reaction to the growth of internet shopping, retail solutions while operating more profitably. The retail landscape is evolving due to the surge in online shopping. To draw customers and create a distinctive shopping experience, malls, and retail spaces are introducing dining, entertainment, and leisure options. There is a move away from the mere consumption of products and toward an immersive experience. 

Industrial: Advancing the economy 

In 2024, the industrial real estate market— vital to India’s economic expansion—will undergo several significant changes. The growing e-commerce sector is driving the need for logistics and storage facilities. In response, developers are constructing contemporary warehouses with effective floor plans, cutting-edge technological integration, and proximity to transit hubs to guarantee quicker and more effective deliveries. 

Government programs like “Make in India,” attracting foreign investments and supporting the manufacturing sector, contribute to the increasing need for industrial land and production facilities. The influx of capital will help strengthen India’s claim to prominence in the global manufacturing landscape. 

Technological developments encourage automation and robotics in the industrial sector, causing a rise in demand for specialized facilities capable of handling cutting-edge technologies. Higher output and efficiency will solidify India’s position as a vital participant in the global manufacturing industry. 

Opportunities and challenges: striking a balance 

Despite the positive trends, the Indian real estate market will struggle in 2024. Complex regulations and bureaucratic processes may impede market expansion and investment activity. Simplifying bureaucratic procedures and streamlining regulatory processes are imperative in creating a setting that’s better suited for market expansion. Infrastructure deficiencies can restrict market accessibility and growth potential, especially in tier 2 and 3 cities. A more equitable and inclusive growth trajectory and the realization of the full potential of the real estate market will depend on investments in infrastructure and development, particularly in emerging cities. 

Interest rate increases and changes in the world economy can affect investor mood and market liquidity. The preservation of economic stability and the execution of policies that foster investor confidence are imperative to mitigate the effects of exogenous factors and guarantee the ongoing expansion of the Indian real estate market. 

Conclusion: A cooperative strategy 

In 2024, the Indian real estate market offers a vibrant environment with plenty of room for expansion. To realize its full potential and support the nation’s economic development, the Indian real estate market has to embrace technological innovations, adjust to changing demands, and tackle pressing issues. 

To influence the future of the Indian real estate market, stakeholders, investors, developers, and the government must collaborate. By working together and embracing innovation and adaptability, stakeholders can ensure the market’s ongoing success and realize its full potential to promote economic growth and create a dynamic and sustainable future for the Indian real estate industry. 

Ahead of The Opening Of The Ram Temple, Boom In Real Estate

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The home of God Ram, Ayodhya, was once a sleepy town and is undergoing an infrastructure makeover as the much-awaited Ram Mandir will be open in just a few weeks. The city is experiencing a real estate boom, with property values rising sharply. Due to the influx of investors, hoteliers, and business owners, property values in the city have increased by up to three times their initial value. 

Local real estate brokers say there are very few left to purchase. “Ayodhya does not have any new land available,” real estate broker Kakku Singh stated. 

In the periphery, where rates ought to have hovered around Rs 3,000. The current rates range from Rs 6,000 to Rs 7,000. There is no land around the Ram Mandir. If there is, it has no rate. One can obtain anything they desire, “he continued.” 

As of November last year, over 9,000 houses had been solid in Ayodhya. The corresponding figure has increased by over 100% this year. According to data, 20,067 properties have sold this year. 

As the inauguration date draws near, the prices have been at their highest. 

From about 10,000 lakh in 2018-19, the department’s revenue has increased to Rs 15,631.33 lakh as of November. 

As for a percentage increase, the Department’s revenue receipt for November was the highest in the State at 109%. 

I get calls from people looking to purchase land to open resorts and hotels. According to Yogendra Pratap, Assistant Commissioner of the Stamp & Registration Department,” Therefore, this has increased the revenue of the Stamp Department.” 

The community hopes that the investment will draw tourists and give many of them a source of income. 

To capitalize on the rapidly expanding infrastructure, Rajjan Lal, who resides 40 km from Ayodhya, sold his property in the village and purchased a 1000-square-foot plot to open a small cement shop close to Ayodhya. 

“There is a possibility of earning a decent living because of the temple construction. Though the rates are also high, I will do business here,” he remarked. 

In Ayodhya, the government also intends to construct a 4.40-acre tourism facilitation center. A budget of Rs 130 crore is forecast.

The project will develop several commercial centers in the tourist center, such as a tourist office, lodging, food court, shopping center, art and craft center, and parking area. Soon the project should take off. 

By the end of this month, the Ayodhya International Airport will probably be finished, according to Union Aviation Minister Jyotiraditya Scindia.