The Reserve Bank of India (RBI) Governor, Shaktikanta Das in his latest statement said that India’s growth troubles appear to be over, and the economy will see a turnaround and move upwards from here, with the massive spending announced by the Centre, hoping to lift the economy out of one of the world’s worst disruptions caused by the pandemic.

On the other hand, Knight Frank’s latest research report – Global House Price Index Q4 2020 cited that India has moved down 13 spots in the latest global home price index finishing last at 56th rank in the quarter ending December 2020. Against its 43rd rank in Q4 2019, India saw a decline of 3.6% year-on-year (YoY) in home prices, leading to the drop in global position.

According to National Real Estate Development Council (NAREDCO), the worst is over for the sector, but more financial support is required to bring it back on the growth trajectory. “There is a positive sentiment visible across the economy, and as GDP growth happens through the V-shaped recovery, the aspect of recovery in commercial real estate, especially office spaces, remains a concern in light of ‘work from home’ as also ‘work from remote location’. Similarly, while the SWAMIH Fund has done well, there are many stalled and delayed projects, recovery of which will need ramping up of the quantum of the fund as also allowing financial institutions to participate in the process. Home loan interest rates are at historic lows; some states have reduced stamp duty rates. What is also needed is support for project finance, and I hope positive steps happen – and soon. As the vaccination drive shifts into high gear with the publicprivate partnership, one expects normalcy to return by June-July this year,” said Niranjan Hiranandani, National President, NAREDCO.

Expressing similar sentiments, Shishir Baijal, Chairman & Managing Director, Knight Frank India stated“Lowinterest rates and other demand stimulation measures by the Government have fuelled real estate demand. This has led to sales and launches in Q4 2020 witnessed a significant jump compared to the first three quarters of 2020. The pandemic has effectively changed end users’ outlook towards ownership of homes leading many fence sitters to make their purchase decisions. As the vaccine roll out takes place, we expect normality to return, post which the government will have device measures to extend the current sales momentum.”

Dr. Samantak Das, Chief Economist and Head – Research, JLL India & Sri Lanka was of the view that real estate was broadly, but not universally affected by the pandemic in a negative way. “Industrial and warehousing, along with alternative sectors like data centres thrived in the COVID-19 era, while office, retail and hospitality suffered. If 2020 was the year that changed everything, 2021 may be the year where change becomes the ‘new normal’ and adapting to this ‘new normal’ will require imagination, innovation and digital transformation. The arrival of 2021 will not shake off all the challenges of a pandemic-riddled economy but the groundwork for a sector-wide recovery has been laid. The year is poised to establish itself as the year where India enters a new phase of real estate growth, innovation and investment.”


Real estate market is considered a major indicator of economic health of the country. Indian economy suffered its biggest blow in 2020 and it has been roughly one year but the realty sector is bouncing back much faster than other sectors of the economy.

The pandemic is driving back the desire to own a home. The buyers inclination is towards tier- 2 or 3 cities, the place of their family homes, since the need to stay close to office has reduced for many. Within cities, integrated townships and plotted developments on city periphery are the preferred choices for homebuyers.

With less new project launches, the inventories are low but demand has surged especially for ready to move in properties due to low home loan interest rates and stamp duty exemptions in certain state and incentives offered by the developers.

One can also see the consolidation happening within the real estate industry as developers with strong financial backing and brand equity gaining a higher market share and weaker players divesting their assets either through development management agreements or business takeovers.

Surprisingly, despite the slowdown foreign investors continues to be buoyant about the Indian commercial real estate. Good quality rent yielding office spaces segment, warehousing and logistics sector have been the direct beneficiaries of foreign investments. Undoubtedly, REITs will continue to be the key theme of the capital markets in 2021.


In addition to many of the new developments of 2020 getting pronounced in the year 2021 there are some noticeable new trends making an appearance. Changing homebuyer preferences and product metrics indicate a new era of Indian real estate much different from what it used to be.


A novel household category identified in India – the ‘New Middle Class’ –has an average savings of Rs 20-lakh per annum and have major allocation towards physical assets such as primary residential property and automobiles. The total number of such cumulative households in India is pegged at 633,000.

According to Hurun India Wealth Report 2020 there are 412,000 dollar-millionaire households / affluent households in India with a net worth of at least Rs 7 crore. Hurun Rich Listers have a wealth of Rs 1,000 crore and pegs the number of such cumulative households in India at 3,000. At the other end of the spectrum is the ‘Indian middle class’ that has earnings of over Rs 2.5-lakh per annum and a net worth of less than Rs 7 crore. “It is estimated that around 56400,000 families in India fall under this category,” findings of the Hurun India Wealth Report 2020 suggest.

The golden collar / salary-driven households that have been earning an eight-digit salary per annum for at least five years mostly prefer to invest in a house, followed by cash / stocks. Region-wise, the top 10 states are home to 70.3 per cent of millionaire households in the country. Maharashtra, the report said, has the highest number of millionaires (56,000), followed by Uttar Pradesh (36,000), Tamil Nadu (35,000), Karnataka (33,000) and Gujarat (29,000). City-wise, Mumbai is home to most millionaires (16,933), followed by Delhi (16,000), Kolkata (10,000), Bengaluru (7,582) and Chennai (4,685).


Women’s preference for real estate has risen postcovid-19 more than men with at least 82% of women surveyed willing to buy a home for end-use and 18% for investment in contrast to 68% of men buying for end-use and 34% for investment.

As per the current edition of the survey by ANAROCK Property Consultants, the main sentiment drivers include affordability, offers and discounts, and home loan rates. Over 70% of women consider this to be an ideal time to buy a property and major preference is for affordable and mid-segment housing (below Rs90 lakh). Women buyers favour ready-to-move-in homes, reflecting a strong aversion to the perceived investment risk of underconstruction properties.

In addition, various government policies support and promote women homeownership. Women enjoy multiple benefits when buying homes such as –

  1.  To avail homes under the government’s flagship scheme Pradhan Mantri Awas Yojna (PMAY) homes have to be mandatorily registered either in a woman’s name or with women as co-owners.
  2. Stamp duty charges are lower if property registration is executed in the name of a woman. The exemption for women varies between 1-2% across different states. In some cases, it might even vary within a particular state, based on the classification of regions as ‘urban’ and ‘rural’.
  3. Many banks such as SBI, ICICI, HDFC, etc. offer discounted home loan rates to women. The difference can be as much as 0.25%.
  4. To avail of certain tax benefits, a woman can also become the joint owner of a property, if she has a separate source of income, both can claim tax deductions individually


Until recently, millennials were consistently driving up the demand for studio apartments in the top 7 cities – to such an extent that, over the last 7 years, developers customarily offered this configuration in their projects. In fact, studio apartments’ share in new launches had been rising y-o-y since 2013. However, the COVID-19 pandemic year of 2020 saw a sudden reversal of this trend.

“The studio apartments trend so far can be clearly plotted. Out of the total 2,102 projects launched in 2013 in the top 7 cities, just 75 projects (or 4%) offered studio apartments. The share increased to 5% in 2014, followed by a y-o-y increase in the overall share of projects offering this configuration. This growth trend remained consistent till 2019, when the share was highest at about 19%. In 2020, the COVID-19 pandemic hit, bringing with it the uniquely new WFH and study at home compulsions requiring larger homes. The onus also suddenly shifted from expensive central locations to the more cost-effective suburbs and peripheries. In a single year, studio apartments’ new supply share dipped to 15%,” Anuj Puri, Chairman – ANAROCK Property Consultants explained the trend.

The “affluent middle class” has benefited from access to growing markets through digital platforms and aspires to a better standard of living. This category in urban areas is taking benefit of the government schemes and incentives as well as the attractive offers by the developers to increase their investment in real estate, which now seems safer investment than financial markets.

Women are an increasing part of the workforce in urban locations across India and for them, real estate spells safety and security. From being an influencer to the actual homebuyers, the current regulatory benefits have prompted more women to shift their focus from traditional asset classes like gold and fixed deposits to investing in real estate for their financial independence, sense of ownership, stability and healthy returns.

The studio apartments phenomenon was historically strongest in West India, with MMR and Pune predominantly driving the trend. Of the total projects with studio apartments launched in the top 7 cities between 2013 and 2020, MMR and Pune together accounted for a massive 96% share. The average size of studio apartments (on built-up area) was highest in NCR (400 sq. ft.) and lowest in MMR (300 sq. ft.). In contrast, the southern cities of Bengaluru, Chennai and Hyderabad had never caught the studio apartment bug – just 34 projects in these three cities had this compact configuration in the same period.

There has been a clearly-defined growth trend in terms of the number of projects offering studio apartments in the last seven years. But, in 2020, out of a total of 884 projects launched throughout the year, just 130 projects had studio apartments – a 15% share.

Year 2020 kick-started a trend reversal wherein larger homes – spacious enough to accommodate home offices and online study spaces for children – began to be in higher demand, and developers accordingly amended their new supply configurations.


The year 2021 narrates a positive story for the residential real estate with mid-income buyers keen to advance to better homes that come equipped with open spaces and better amenities. People have started to upgrade not from the perspective of space, but also amenities, ecosystems and recreational activities post lockdown. The second-home destinations like Goa, Dehradun, and Alibaug have become all-year destinations, and sometimes even primary homes, with the new norm of WFA or work from anywhere.

Despite the pandemic, luxury housing (priced >INR 1.5 Cr) in Delhi-NCR performed reasonably well in 2020. Of the total housing sales of ~23,220 units that NCR saw last year, luxury housing comprised over 4% share – increasing marginally over 2019, when it was 3% (of 46,910 units).

The rise in sales of premium properties has also been driven by the stamp duty cut and the discounts doled out by developers. Additionally, lower interest rate provides borrowers with an option to raise the loan amount, helping broaden their choice for a more luxurious property, inclusive of finer amenities and lifestyle facilities in premium neighbourhoods. Moreover, there is a good traction from the NRIs amidst good deals and discounts and favourable rupee vs dollar value.

Noida witnessed total housing sales of ~3,240 units in 2020 of which luxury comprised a 9% share. Gurgaon sold a total of ~7,240 units of which luxury homes comprised a 5% share. Noida, Gurgaon and Ghaziabad were the only cities in NCR that saw new luxury supply in 2020.

Mumbai’s western and central suburbs along with the MMR region too experienced high demand in this category. Several transactions worth Rs 25 crore to Rs 50 crore were registered in the Mumbai market in February 2021, clearly indicating that there is appetite for the high-value segment even in pandemic times.

The preference towards premium homes, especially independent ones for both, investment and rental purposes, is on the rise. Bengaluru is witnessing a perceptible shift towards vills properties as they seek luxury and safety


As corporate occupiers continue to be uncertain about long-term office leasing plans in 2021 and 2022 and are still re-assessing their office space needs, they are exploring leasing desks in flexible workspaces to avoid long-term capital expenditures, and to get more flexibility on their lease terms.

Conversely, despite large workforces working from home, as of March 2021, top flexible workspace operators across the top six cities have about 65% of their seats already leased, that indicates a continued confidence in managed workplaces.

Enterprises are looking for shorter leases for about one to two years, with more flexibility on lease terms to tide over uncertain times, which they get in a flexible workspace. We are seeing increasing interest from corporate occupiers in flexible workspace leases, which shows that there is adequate confidence in this space, and we expect demand to increase for well managed spaces that focus on digital workplace infrastructure and wellness. Over the next two years, the market is likely to see newer models evolving in this space, especially on the managed office front.

“Flexible workspaces are here to stay, with their share growing in the real estate pie. Though 2020 was muted for the growth of flexible workspaces, markets like Bengaluru, Hyderabad & Chennai continue to drive demand. Further, enterprises are also driven by the desire to offer locational flexibility to some of their employees and functional departments. Thus, they are leasing desks in flexible workspaces closer to the employee’s home”, said Arpit Mehrotra, Managing Director, Office Services (South India) at Colliers.

The total flexible workspace stock in the top six Indian cities is almost 30 million sq feet, equivalent to 4.3% of total Grade A and B commercial office stock. Bengaluru leads the tally with a 37% share of the total flexible workspace portfolio, followed by Delhi NCR and Mumbai, with 18% and 14% shares respectively. By 2022, flexible workspace stock is likely to account for 5.4% of the total office portfolio, led by demand for well-located, high quality and efficient flexible workspaces.

During 2021, flexible workspace operators are likely to lease about 3 million square feet of space across the top six Indian cities, as operators are likely to focus on signing large enterprise-level deals and cut down on speculative centers.

From an occupier perspective, enterprises are driven by the desire to offer locational flexibility to some of their employees and functional departments. Thus, they are leasing desks in flexible workspaces closer to their employees’ homes to provide ease of access and flexible work hours. During 2021, technology companies are likely to be at the forefront of demand, followed by BFSI and consulting companies, with demand from such companies to increase from the latter half of 2021.

As occupiers focus on portfolio optimization through 2022, many are exploring ways to shift teams into multiple, smaller managed spaces than their existing large, consolidated offices or use flexible workspaces as a stopgap arrangement until they relocate to entirely new offices. Occupiers are also likely to take up flexible workspaces near suburban residential catchments, providing their employees more conveniences and choices. Many of these existing centres are currently operating at 50-70% occupancy levels

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