India's Real Estate Sector Envisioned to Surge to $5.8 Trillion by 2047: Knight Frank Report

In a collaborative effort, International Property Consultant Knight Frank India and the National Real Estate Development Council (NAREDCO) have unveiled the 'India Real Estate: Vision 2047' report.

This forward-looking analysis anticipates remarkable growth for India's real estate sector, estimating a substantial expansion to USD 5.8 trillion by 2047.

Real Estate's Economic Impact:

The report forecasts that this projected value will translate to a notable 15.5 percent contribution to the overall economic output in 2047. This surge is set to elevate the sector's significance from its present share of 7.3 percent, as stated in a press release from Knight Frank.

The revelation will be unveiled by M Venkaiah Naidu, Former Vice President, during NAREDCO's Silver Jubilee Celebration event in Hyderabad.

Real Estate and India's Economic

Transformation: Looking ahead to India's centenary of independence in 2047, the report aligns its projection with the country's anticipated economic prowess.

It expects India's economy to reach around USD 33 trillion by that milestone year, with a mean estimated growth of USD 36.4 trillion by 2047. Rajan Bandelkar, President of NAREDCO India, highlights the role of real estate as a driving force behind India's economic journey.

Fueling Economic Demand:

Rajan Bandelkar emphasizes that the extensive expansion of the Indian economy will be powered significantly by the real estate sector. This vigorous economic growth will trigger amplified demand across various asset classes such as residential, commercial, warehousing, and industrial land developments. These sectors are poised to flourish exponentially to meet the economy's evolving demands and individual consumption needs.

Residential Market Potential:

Knight Frank India's projections also underscore the residential sector's potential. The report anticipates an estimated requirement of 230 million housing units over the next 25 years. This demand equates to a residential market value potential of USD 3.5 trillion by 2047, reflecting the ever-evolving needs of India's population.

Transformation and Sustainability:

Shishir Baijal, Chairman & Managing Director of Knight Frank India, envisions a dynamic transformation within the Indian economy and the real estate sector over the next quarter-century.

He points out that factors like favorable demographics, improved business sentiments, and government emphasis on high-value sectors like manufacturing and infrastructure will robustly support India's economic expansion.

Adapting for Future Growth:

Baijal stresses that sustainable growth necessitates adaptation to economic shifts and technological advancements. The real estate sector must optimize resources, particularly human capital, while accommodating the evolving economic landscape and technological developments.

Office Sector's Role in Economic Expansion:

According to Knight Frank estimates, a significant portion of the working population, about 69 percent, will contribute formally to the economic expansion predicted to reach USD 36 trillion by 2047.

The report also highlights the potential of the office sector, estimating a value of USD 473 billion in 2047. Over the years, the office stock has expanded remarkably, growing from 278 million sq ft in 2008 to 898 million sq ft across India's leading eight cities in 2022.

The report attributes the growth of the real estate sector to a number of factors, including:

• Demographic advantages: India is one of the youngest countries in the world, with a median age of 28. This means that there is a large and growing population of potential homebuyers and renters.

• Improving business and investment sentiments: India's economy is growing at a steady pace, and there is a growing confidence among businesses and investors. This is leading to increased investment in the real estate sector.

• Government policy push towards high-value output sectors: The Indian government is promoting high-value output sectors such as manufacturing and infrastructure. This is creating new jobs and opportunities, which is driving demand for real estate.

Conclusion: The 'India Real Estate: Vision 2047' report paints a promising picture of the real estate sector's evolution in India. With ambitious growth projections and a pivotal role in the nation's economic journey, the sector is poised to shape India's landscape well into the future.