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  • Ahmedabad, Jaipur, Chandigarh, Nashik & Kochi top favourite among Tier 2 & 3 destinations
  • Bangalore 2nd-most preferred investment destination with 21% votes in favour, followed by Pune with 18%
  • For over 30% NRIs, Bangalore is the hot favourite investment hub
  • Low property prices coupled with improved infrastructure facilities in Tier 2 & 3 cities the primary investment magnets

Anuj Puri, Chairman – ANAROCK Property Consultants

The quintessential Indian’s yen for investing in real estate continues. The latest data vouchsafes the visible return of investor sentiment for real estate, and the enthusiasm is not limited to traditional property hotspots of the big cities.

ANAROCK’s recent second edition of its Consumer Sentiment Survey confirms that investors are equally – if not more – upbeat on the prospects that India’s Tier 2 & 3 cities offer.

Lack of affordability in the larger cities is the primary hurdle to the largest investor base, and property investors are now looking at smaller towns and cities.

However, their increasing bullishness on Tier 2 &

Can the real estate industry’s strongest champion to date finish what he started?

Anuj Puri, Chairman – ANAROCK Property Consultants

Billions of Indians have given their verdict and the real estate sector has every reason to cheer. After all, the sector got the maximum policy-related attention during this government’s first tenure.

In retrospect, Modi’s victory in 2014 ushered in a new era of Indian real estate, unambiguously marked by his vision to set the ‘house’ in order.

He tightened the Centre’s grip on real estate – the favourite ‘laundromat’ for black money hoarders – and brought speculative activity to an all-time low even as big-bang schemes benefited genuine homebuyers and long-term investors.

His government gave a decisive impetus to all-around infrastructure development, major policy overhauls such as DeMo, RERA and GST, amended old Acts like Insolvency & Bankruptcy Code and the Benami Transactions (Prohibition) Act, and envisioned schemes like 100 Smart Cities, Housing for All by 2022, Make in India, AMRUT Cities etc.

Historically, no other government has done as much for the real estate sector. In just one tenure, Modi set the stage for Indian real estate to flourish in the long-term.

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Attractive Prices Lure 61% Hyderabad Homebuyers, 50% in NCR Respond to RERA Implementation – ANAROCK

  • Current avg. property prices in Hyderabad hover around INR 4,170 per sq. ft. – the lowest among all top 7 cities
  • In the last 5 yrs. the city’s average prices have risen by 15% – 3rd only to Pune Bangalore that saw 25% and 16% appreciation respectively
  • Hyderabad micro markets with max. absorption in last one year was Pocharam, Bachupally, & Kondapur
  • 50% of buyers in NCR bought property due to effective RERA implementation while 58% of buyers in Kolkata were driven by lower home loan rates

E-commerce biggies may be toning down their offers, but discounts and freebies are still alive and kicking in real estate – and developers are going all out to lure buyers with attractive deals and discounts. Is it working?

As per the recent ANAROCK Consumer Sentiment Survey, as many as 50% buyers across the country bought homes due to attractive prices.

Anuj Puri, Chairman – ANAROCK Property Consultants

Co-living, like car-pooling and co-working, is the result of demand for more evolved rental housing solutions coming from millennials, students and young working professionals whose choices differ vastly from those of previous generations.

Currently, this new accommodation option is most popular with young and unmarried millennials aged anywhere between 20-30 years. Professionals who don’t live with their families in the city of work are also considering this option.

Co-living provides such individuals with a way to circumvent the isolation and loneliness that is often integral to a hectic, driven urban experience.

While the primary demand for co-living spaces currently comes from such tenants, the concept itself is a lot more ‘accommodating’. In fact, the future may very possibly see demand for co-living solutions coming single seniors, as well.

Cities such as Pune, Bengaluru, Gurgaon, and Mumbai first saw this new concept emerge in force, and it is now also taking root in smaller cities such as Lucknow and Jaipur – basically, in cities with a large student and millennial workforce population.

So, How Is Co-Living Different?

Prashant Thakur, Head – Research, ANAROCK Property Consultants

Developed by the Bangalore Development Authority (BDA) decades ago, HSR Layout – home to upper-crust residents and even some ministers – is strategically located between major IT hubs including Electronic City, Outer Ring Road and Sarjapur Road.

Not surprisingly given these excellent location antecedents, HSR Layout has transformed into a major residential-cum-commercial hotspot of Bangalore.

This micro-market is largely defined by sizeable bungalows, small builder-floor apartments, wide roads, several small parks and well-established retail options. It is also one of the most self-sustained localities in the city.

A Unique Lifestyle Quotient

Its proximity and easy connectivity with major IT hubs make HSR Layout a preferred residential destination for IT professionals working in nearby Infotech hubs.

There is no dearth of rental options here which are more affordable than in HSR Layout’s neighbouring IT/ITeS-dominated markets.

Its well-planned layout includes parks, schools and hospitals at a convenient distance in every corner of the locality.

HSR Layout’s well-developed social and physical infrastructure also makes it a desirable residential option, both from a purchase and rental point of view.

Shajai Jacob, CEO – GCC (Middle East) – ANAROCK Property Consultants

  • NRI investments into Indian real estate are led Indian expatriates from UAE, USA, UK, and Canada
  • Bengaluru, Mumbai, Pune, Hyderabad, Chennai and Delhi-NCR currently attract the lion’s share of NRI investments
  • Equities score higher than real estate on capital appreciation, but residential property comes with the benefit of rental yield, relatively lower risk and considerable tax benefits

Riding on a wave of economic reforms, improving transparency and better governance, foreign investments in Indian real estate are set to scale new heights.

With laws now allowing 100% FDI (foreign direct investment) in construction development and REITs now in place for commercial real estate, the Indian real estate industry will see increasing investment infusions from NRIs (non-resident Indians).

According to a World Bank report, India received USD 79 billion in remittances in 2018 – with a sizeable portion going into real estate.

NRI investments into Indian real estate are led Indian expatriates from UAE, USA, UK, and Canada. In terms of Indian cities,

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Santhosh Kumar, Vice Chairman – ANAROCK Property Consultants

By what seems like a cruel twist of fate, the grounding of the country’s largest airline coincided with provisional construction approval for India’s largest (by surface area) airport at Jewar in Noida.

It may be recalled that the Allahabad court dismissed petitions filed by farmers and gave in-principle approval to commence the construction of Jewar International Airport, which is estimated to be built at a cost of USD 3.1 bn.

Naturally, the expectation is that just like any mega infrastructure project, this greenfield airport will give a major boost to the overall economic activity around Noida and Greater Noida region. Let’s take a closer look.

Economic Impact Of Jewar International Airport

Once completed, Jewar International Airport will not only ease traffic at Delhi’s IGI Airport but also create multiple job opportunities and give decent impetus to the property market in Noida, Greater Noida and Yamuna Expressway.

These markets have been reeling under tremendous pressure over the last three to four years, and require a fresh injection of opportunity and intent to overcome this slump.

Anuj Puri, Chairman – ANAROCK Property Consultants

Inarguably, the Indian real estate vertical that in the direst need of funding is the residential sector. In a perfect world, the private equity that is now pouring into the country’s realty sector would focus on where it is needed the most.

However, PE firms have their own investment rationale, and Indian residential real estate has been far from attractive to them.

There are sound reasons for this. The Indian residential sector has been hounded by multiple problems for the last 3 to 4 years. These include the issue of stalled/delayed projects, liquidity crunch, and high property values despite weakened demand and slow sales.

The country’s housing market has also seen the highest impact of policy-induced disruptions. Given the fact that the housing market was tainted by malpractices and lack of customer-centricity by developers, the Government had to step in with policy interventions squarely aimed at cleaning up the sector.

The inevitable fallout of demonetization (DeMo) on an industry which was ‘thriving’ on black money aside:

  • The long-pending enactment of the Real Estate Regulation Act (RERA) drew clear regulatory lines for the housing market –

Anuj Puri, Chairman – ANAROCK Property Consultants

  • Maharashtra still leads with 20,718 projects & about 19,699 RERA-registered real estate agents
  • Gujarat comes second – 5,317 RERA-registered projects & 899 registered agents and agencies
  • Karnataka – 2530 projects & about 1342 RERA-registered real estate agents; Andhra Pradesh – 307 RERA-registered projects
  • West Bengal the only state with its own real estate law WBHIRA

It’s been two years since the deployment of the Real Estate Regulatory Authority (RERA) across the country and the Centre’s aim to enforce it in each state is gathering visible momentum.

Even the north-eastern states including Manipur, Meghalaya, Mizoram, Nagaland, and Sikkim – which earlier shied away from it – have agreed to officially notify RERA rules soon.

West Bengal is the only state which notified its own real estate law under West Bengal Housing Industry Regulatory Authority (WBHIRA).

It may be recalled that RERA intended to cover developers as well as real estate agents seamlessly across the country.

As it stands now, 

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