In recent years, property prices in India have surged, leading to speculation that they might soon stabilize or even drop. However, the Confederation of Real Estate Developers Association of India (CREDAI) dismisses such concerns, stating that housing demand remains strong across the country. According to CREDAI, the shortage of new projects is the real issue, not a potential recession in the market.
Demand for Housing Remains Robust in India
CREDAI is preparing for its annual summit, CREDAI Natcon, to be held in Sydney from September 23-26, with more than 1,100 industry leaders attending. On the eve of the summit, CREDAI’s National President Manoj Gaur addressed the speculation surrounding a potential slowdown in the property market. He acknowledged that sales might dip slightly in the current quarter due to fewer property launches but emphasized that the overall demand for residential units is still high.
“There is no ‘inventory,’” Gaur noted. He explained that demand is especially strong for properties from reputable developers in prime locations with reasonable pricing. While sales figures may show some decline, this is due to fewer new launches rather than a lack of interest from buyers.
Supply Shortage, Not Recession, Is the Problem
Recent data from property analytics firm PropEquity revealed that sales across nine major Indian cities fell by 18% in the July-September period, dropping to 1,04,393 units. However, this reduction is being attributed to limited supply rather than a drop in demand.
Irfan Razak, Chairman of Prestige Group and a former CREDAI President, reiterated this point, saying, “There is demand, but there is no supply.” According to Razak, the Indian housing market is characterized by continuous demand, which has been particularly strong since the COVID-19 pandemic.
Razak cited Prestige Estates, his own company, as an example. Their sales bookings saw a decline in the April-June quarter, but this was primarily because fewer new projects were available for buyers.
CREDAI Calls for Policy Changes in Real Estate
Alongside the issue of supply, CREDAI is urging the government to implement certain policy changes to support the sector. National President Boman Irani highlighted the need for Goods and Services Tax (GST) input credit for the real estate industry. This move could help reduce the cost burden on developers, potentially encouraging more new projects.
Irani also called for a revision in the definition of affordable housing. The current cap, set at ₹45 lakh in 2017, no longer reflects the rise in real estate prices, which have grown significantly over the past few years. Adjusting this limit could make it easier for homebuyers to access affordable housing options.
With 14,000 real estate developers as members across India, CREDAI continues to play a pivotal role in shaping the future of the housing market. Despite recent concerns about property prices, the organization’s stance remains clear: demand is strong, and any sales slowdown is temporary, driven by supply shortages rather than an economic recession.
