If current trends in the real estate indicate anything, good times are here and some real action is necessary to sustain it. This sector can grow and may well be decoupled from the global cues only if India outstrips world economic performance. Moreover, a host of sector-specific factors will ensure speedy recovery.

All this will be possible if timely action is taken by all the stakeholders, including the Central and state governments, the developers and the fi nancial institutions, after assessing the sectoral needs followed by organized steps for collective growth.

In 2008, the Indian real estate sector took an unprecedented body blow in the shape of recession. Until then, it was a seller’s market where developers easily found buyers for their properties and obtained funding for new projects. The end-user, was, however neglected.

Today, we are witnessing a slow revival after a severe downturn across all segments. Residential demand, especially in terms of affordable housing, is beginning to perk up after an overall drop in demand to the tune of 45%-50%.

Despite less rain this time, there are green shoots everywhere, especially in the residential space. Demand is currently almost 60% of what it was at the peak. SME commercial is again witnessing investor and end- user interest while enquiries are showing signs of robust revival.

Also discernible is the fact that large-scale offi ce formats and retail are still to see traction, but the firm “no” for many has turned to a cautious “may be.” Further, while prices remain below peak levels, they are stable and the pent -up demand and the supply situation may push up prices as we approach the season in many micro markets across the country. PE deals are being struck and FDI is fl owing in again. The winds of hope seem to be blowing across India.

Like elsewhere in the world, India is at a crucial turning point in economic history at the moment. Certain profoundly impacting structural changes are engulfing key economic sectors in the country, including real estate. In the current scenario, the outlook for the future is a mixed bag.

However, before a comment is made about the future outlook, it is imperative to step back and look at the events of the recent past. Rising interest rates and the prevailing global economic conditions seem to have subdued the demand from investors and occupiers alike.

Registering a growth of over 7% during the 2003-2008 period, the Indian economy emerged as the second fastest growing in the world, led primarily by the services sector and real estate. A recession then appeared but a large domestic market, minimized its impact.

The current growth of real estate can be attributed to a combination of factors that include a fall in property prices, lower home loan interest rates and an overall robust economy with a positive buyer sentiment. All these have increased overall demand for residential projects.

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