India’s Real Estate Market Holds Strong Amid Global Trends

India’s real estate sector has seen a steady rise in prices over the past few years, prompting questions about its sustainability and the potential for a future crash. However, according to experts, India’s unique demographic and economic conditions make a downturn unlikely. This was recently discussed in a podcast hosted by Zerodha co-founder Nikhil Kamath, titled “WTF Are Indian Real Estate Giants Up To?”, where top industry leaders explored the future of real estate in India.

Key Drivers of Real Estate Demand in India

With a rapidly growing population and increasing urbanization, India’s demand for real estate shows no signs of slowing. Irfan Razack, Chairman of the Prestige Group, highlighted that these factors are the backbone of the sector’s growth. “In a country with such a vast population, we’re only seeing the beginning of demand for housing and urban spaces,” Razack noted.

This urban growth, combined with aspirations for homeownership, drives both residential and commercial real estate demand. While real estate trends vary globally, Razack emphasized that India’s high population, job creation, and industrial growth make the need for housing exceptionally strong.

Projecting the Future of Real Estate Growth

As per the Indian Brand Equity Foundation (IBEF), India’s real estate sector is set to grow at a CAGR of 9.2% from 2023 to 2028. Real estate is also one of India’s top job-generating sectors, second only to agriculture, making it an essential pillar of the country’s economy.

The podcast also featured industry experts like Nirupa Shankar, Executive Director at Brigade Group, and WeWork India CEO Karan Virwani. They discussed how real estate developers should focus on affordability for the masses rather than exclusively targeting luxury markets, aligning with Razack’s view that broader affordability would sustain demand in the sector.

Changing Demographics and Real Estate Stability

One pressing question for India’s real estate sector is how demographic shifts might impact long-term stability. While countries like Japan and China have seen their real estate markets face challenges due to declining young populations, Razack believes that India is poised differently. “India’s demographics still lean heavily towards a younger population with significant housing demand, which is not likely to change in the near future,” he stated.

The Global Comparison: What India Can Learn from China’s Real Estate Crisis

India’s current position contrasts sharply with China, where the 2021 Evergrande crisis—driven by overbuilding and stringent debt regulations—highlighted the risks of rapid, unchecked growth. Experts caution that while India’s real estate sector is strong, lessons from China’s crisis underline the importance of sustainable growth and responsible financial practices.

Decades of Demand for India’s Real Estate

For now, experts predict that India’s real estate market will continue to grow, driven by urbanization, demographic trends, and increasing aspirations for homeownership. While fluctuations may occur, industry leaders like Irfan Razack remain confident that a full-scale crash is highly unlikely. As India navigates the path of economic and demographic growth, the real estate sector is set to remain a critical part of its development story.