Real Estate prices may rise 5% during 2022

Real Estate prices may rise 5% during 2022

According to Knight Frank India, housing prices could rise by 5 per cent next year on better demand.

In its '2022 Outlook Report', the property advisory said: "While 2021 was mostly affected by the volatility caused by the pandemic, 2022 could prove to be a more stable year for the sector, both commercial and residential."

On the housing segment, the report said the sales momentum is expected to continue in 2022 as potential home buyers' preferences for larger homes, better amenities and attractive prices keep them interested to seal deals.

“After facing a series of structural reforms such as demonetization, GST and RERA during the last decade, the pandemic came as yet another blow to the real estate sector. Our decadal analysis of the period 2011 to 2021 on the supply and demand-side several factors have started putting upward pressure on home prices and as a result, we anticipate a price increase of around 5 per cent in 2022."

Knight Frank India Chairman and Managing Director Shishir Baijal said the real estate sector registered a smart recovery in 2021 despite the pandemic situation, with residential among other outperforming segments.

Knight Frank said the growing demand for office space is estimated at 11.67 million sq ft, based on strong hiring in the last eighteen months from the top five IT companies, spread over the next one to two years.

“The co-working sector will benefit as the pandemic reinforces the need for agility like never before. Agility, a keyword associated with the co-working sector, will rebound demand for flexible office spaces despite the return of normalcy.

The recovery and flight-to-quality trends in the office sector are expected to keep fares stable in 2022," the report said.

Transactions for the warehousing segment, riding on the e-commerce sector boom, are projected to grow at a CAGR of 20 per cent (compound annual growth rate) from 31.7 million sq ft in FY21 to 45.9 million sq ft. fiscal year 2023.

The Indian data center market currently has an estimated 445 MW of significant IT capacity, and with a significant increase of around 290 MW in 2022, the total count will increase to 735 MW by the end of next year.