Indian Real Estate Sentiment Takes a Cautious Turn in Q2 2024
The residential market outlook in Q2 2024 remains optimistic, with 63% of respondents expecting a rise in residential prices, while the office market outlook exhibits buoyancy on all key parameters.
Real EstateSentiment IndexResidential MarketOffice MarketEconomic ScenarioReal Estate NewsAug 14, 2024
The residential market outlook in Q2 2024 sustains optimism, with 63% of respondents expecting a rise in residential prices, while 51% anticipate an increase in sales. The office market outlook exhibits buoyancy on all key parameters – leasing, supply, and rent – as stakeholders remain confident of the performance of this asset class in the next six months.
The quarterly Knight Frank-NAREDCO report captures the current and future sentiments towards the real estate sector, the economic climate, and funding availability as perceived by the supply-side stakeholders and financial institutions. A score of 50 represents a neutral view or status quo; a score above 50 demonstrates a positive sentiment; and a score below 50 indicates a negative sentiment.
The developer future sentiment score moderated from 72 in Q1 2024 to 61 in Q2 2024, indicating a more measured outlook. Non-developer future sentiment score adjusted from 73 to 68, reflecting stakeholders’ careful evaluation considering macroeconomic concerns.
Shishir Baijal, chairman and managing director of Knight Frank India, stated, “The sentiment score of 65 remains positive. The recent dip reflects cautious optimism rather than concern. The economy is stable and resilient against global uncertainties, with continued growth in residential and office markets supporting ongoing stability.”
Hari Babu, President of NAREDCO, said, “The Q2 2024 Knight Frank NAREDCO real estate sentiment survey shows a resilient and optimistic Indian real estate sector. Although sentiment has slightly adjusted due to recent political and budget uncertainties, the overall outlook remains positive. The residential and office markets are active, and confidence among developers and financial institutions is strong. Despite short-term challenges, the sector is set to adapt and continue growing.”
The future outlook for the residential market remains in optimistic territory, while all stakeholders have adopted a cautious outlook for the next 6 months. In this quarter’s survey, 51% of the respondents expect residential sales to increase in the next six months as compared to 73% in the last quarter.
The office outlook exhibited buoyancy on leasing and supply parameters as survey respondents remained confident about this sector in the next six months. Stakeholders opined that demand in India’s office market will bolster in the next six months and give a fillip to new supply as well.
Based on the findings of the survey, 59% of respondents expect an improvement in the economic scenario, reflecting optimism about India’s economic resilience and potential growth. 51% anticipate an increase in funding availability, demonstrating confidence in the financial sector’s continued support for real estate investments.
Frequently Asked Questions
What is the current sentiment index score for the Indian real estate sector?
The current sentiment index score for the Indian real estate sector is 65.
What is the expected outlook for the residential market in Q2 2024?
The residential market outlook in Q2 2024 sustains optimism, with 63% of respondents expecting a rise in residential prices, while 51% anticipate an increase in sales.
What is the expected outlook for the office market in Q2 2024?
The office market outlook exhibits buoyancy on all key parameters – leasing, supply, and rent – as stakeholders remain confident of the performance of this asset class in the next six months.
What is the expected economic scenario in Q2 2024?
59% of respondents expect an improvement in the economic scenario, reflecting optimism about India’s economic resilience and potential growth.
What is the expected funding availability in Q2 2024?
51% of respondents anticipate an increase in funding availability, demonstrating confidence in the financial sector’s continued support for real estate investments.
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