The year 2024 has proven to be a landmark year for the Indian real estate sector, particularly for the residential market, where investors significantly increased their stakes. According to Colliers India, the escalating demand for residential properties, coupled with favorable government policies, has bolstered investor confidence. In 2024, private equity (PE) investments in the real estate sector surged to an impressive $4.15 billion, reflecting a robust 32% increase compared to the previous year.
Record Institutional Investments in Real Estate
In total, institutional investments in this sector reached $8.9 billion, surpassing the previous record of $8.4 billion set in 2007. Notably, the residential sector attracted the majority of investments, accounting for 45% of the total. Domestic investors also displayed increasing interest, contributing 37% to the overall investment. The momentum indicates that 2025 may witness even more groundbreaking investments in the real estate sector, setting new benchmarks.
Surge in Residential Sector Investments
The Indian residential market experienced a remarkable 46% growth in institutional investments, rising to $1.15 billion in 2024 from $789 million in 2023. This trend signals a shifting perspective among investors, who now regard Indian real estate as a strong and secure investment opportunity. Their enthusiasm signifies a promising future for the sector.
Growing Interest in Industrial Office Spaces
Investment is not limited to residential properties; there has been a significant increase in interest in industrial offices and lounges as well. In 2024, investments in these segments reached $2.5 billion, a substantial rise from $877 million in 2023. This growth showcases companies’ readiness to expand their operations in India swiftly.
Unprecedented Overall Investment Levels
Overall institutional investment in Indian real estate reached a remarkable $6.5 billion in 2024, exceeding the $5.4 billion recorded in 2023 by 22%. This marks the highest investment level since 2020, reflecting the sector’s resilience and ongoing attractiveness.
Impact of Government Policies
According to Ankur Jalan, CEO of Golden Growth Fund, the government’s policies have played a pivotal role in this achievement. The rising demand for real estate at all levels over the past few years has attracted both domestic and foreign investors, creating a robust investment landscape.
Future Projections for the Indian Real Estate Market
As we move into 2025, the Indian real estate sector is expected to continue its upward trajectory. With ongoing urbanization and changing demographics, the demand for both residential and commercial properties is likely to strengthen. The proactive stance of the government in ensuring a conducive environment for investments will further catalyze growth in this sector.
| Year | Total Institutional Investment (in billion USD) | Residential Sector Contribution (%) |
|---|---|---|
| 2023 | 5.4 | 45 |
| 2024 | 6.5 | 46 |
| 2025 (Projected) | Expected to surpass 7.5 | Continuing trend |