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Real estate india Property Trends!

^{Why India}

<sup>Real estate is emerging as one of Indias fastest growing sectors, with the growth spread almost equally across all segments: Commercial offices, Retail, Residential and Hotels.

The main reason for this is the booming economy.

GDP growth of 8.2% over the past three years, compared with 6.2% in the preceding ten years, makes India the worlds second fastest growing economy after China. The growth is largely fueled by growth in the service sector which accounts for 50% of Indias GDP. IT and ITES sectors are growing at 30% per year currently. But other sectors are not doing too badly. Industrial production grew over 10% in 2006, manufacturing clocked a record growth of 11.2% and exports have been averaging 25% annual growth over the past three years. By 2010 India is expected to be worldâs third largest economy (measured in purchasing power) and will have a middle class of around 300 million people, larger than that of USA. According to McKinsey & Company, per capita income in India has doubled in the last nine years, and the number of households earning an annual income of over $10,000 is rising by more than 20% every year. This is making India a dream market for products and services.

Indias unique demographics also is contributing to the favorable conditions for growth in the retail sector.. A half of its population of nearly 1.1 billion is under 25. The median age of India is just 24. India has a graduate population of 50 million out of which 14 million are young university graduates. Nearly 2.5 million new graduates are joining this pool every year, most of whom are proficient in English with strong technical and quantitative skills.

Current Scenario in India Real Estate Market.
Indias real estate market has grown rapidly following the relaxation of FDI regulation in February 2005. The country is now attracting substantial interest from cross-border real estate investors. The rapid growth of India’s Business Process Outsourcing (BPO) activities has led to the spiraling demand for commercial real estate. But with overall boom in the economy there is a strong growth in the retail, residential, hotel and the logistics sectors as well.

The Indian real estate market lacks transparency and liquidity compared to more mature retail estate markets, but the market structure is changing rapidly in response to the changing profile of the clients and their business practices.

The three Tier I cities, Mumbai, the commercial capital, Delhi, the political nerve center, and Bangalore, the technology hub, have been at the forefront of the real estate boom since the last decade, and offer the maximum potential even today. Giving them tough competition are the Tier II cities of Hyderabad, Chennai and Pune with their quality human resource, communication infrastructure, air access, lower cost of living and real estate availability. There are a more than a dozen Tier III cities who have the potential to become attractive propositions for real estate operators within the next five years. Leading among them is Kolkata which is going thorough a major image make-over, emerging as an industry-friendly location. Then there are cities like Chandigarh, Kochi, Thiruvananthapuram, Mysore, Mangalore, Indore, Bhubaneswar and Visakhapatnam which have their own plus points and challenges to overcome.With an urbanization rate of over 2.5% India is set to have 70 cities with population of over 1 million in 2025 as compared to 35 in 2001.

Clearly, any way you look at it as far as real estate goes India is the future.</sup>