This report profiles India’s property industry, discussing market trends and outlook into 2015 and beyond. The report also highlights leading players in the sector including DLF Ltd, Oberoi Realty Ltd and Sobha Developers Ltd.

The real estate sector has been one of the key drivers of Indian economic growth during the last decade. India’s housing sector ranks fourth in terms of multiplier effect on the economy. However, in the last few quarters, persistent inflation and high interest rates caused a dent in the growth of this sector. Affordability is a major concern for middle class Indians and a steady rise in housing prices, together with high interest rates and inflation, has neither helped their cause nor has it benefited the real estate sector.

Lowering of interest rates and incentives announced for the housing sector in the Union Budget have improved home buyer sentiments in the last few months. The office market of the top eight major Indian cities have also recovered slightly, with vacancy levels falling.

Key Points:

• Based on estimates by the Ministry of Housing and Urban Poverty Alleviation, India’s total urban housing shortage was around 18.78mn at the start of 12th five-year plan (2012-17).

• According to a study conducted by the Federation of Indian Chambers of Commerce and Industry, the property sector contributed around 6% to Indian GDP in 2014 and generated more than 7mn jobs.

• Between January 2000 and March 2015, the real estate and construction development sector saw cumulative FDI of USD 24bn. The sector accounted for 10% of the total cumulative FDI received during this period.

• According to the Reserve bank of India (RBI), all India’s house price index grew at a CAGR of 20% during 2010-13. The index continued its upward trend and recorded a change of 14% y/y in December 2014, higher than the 10% y/y growth in December 2013.