! BREAKING NEWS !

 

News like these are flooded online almost everyday. The news of rising prices of real estate could feel unsettling to those who are planning to own a house for personal use, but for investors, this also means “an opportunity to grow their money.”

Yes! We are talking about real estate investing. Every city in India is going through transformation with the inflow of MNC companies, presence of startups, and development of residential and commercial properties accelerating the growth. And without a doubt, the price of land has grown exponentially in the past few years, especially post pandemic. 

Here’s how the residential real estate market has performed in the last 5 years. 

 

 Data Source- Knight Frank

Let’s break down what these trends mean: 

Growth in housing unit sales year on year

The sales data shows a significant growth trajectory from 2020, with unit sales in 2020 standing at 154,434 and increasing to 3,50,612 in 2024. This reflects a growth of approximately 126% over the period.

The substantial increase in sales indicates a recovery and boom in demand for residential properties after the pandemic. Factors like low-interest rates, increased buyer confidence, and the desire for more space post-pandemic have fueled this growth. Additionally, people have been looking for secure investments, with real estate traditionally being a safe haven.

Growth in housing unit launches year on year 

The data on new unit launches reflects similar growth. In 2020, there were 146,628 launches, rising to 3,73,936 in 2024, which marks a growth of around 155%. This shows that the developers are speeding up their construction activities to meet rising demand. The increase in launches also signifies that builders are more confident about the future of the real estate market, and demand for new residential units is expected to remain high.

Now, let’s take a look at the commercial real-estate market trends of the last 5 years, so that you can get a clearer picture of the growing real estate market scenarios. 

Commercial Real Estate Market Trends - 2020-2024 

Let’s break down the numbers and what they mean for the real estate investors. 

Looking at the commercial real estate market trends from 2020 to 2024, we see a clear pattern of growth in both completions and transactions. Completions (new properties coming into existence) have been steadily increasing, from 35.5 million square feet in 2020 to an expected 50.3 million square feet in 2024. This indicates a rising supply of commercial space. On the other hand, transactions (properties being bought and sold) have grown even faster, especially in 2023 and 2024, reaching 59.6 and 71.9 million square feet, respectively. This suggests strong demand for commercial real estate, with more investors actively buying and selling properties. For real estate investors, this could mean a healthy market with rising opportunities, but also increasing competition. The growth in transactions outpacing completions may indicate that demand is currently outstripping supply, which could drive up prices and make now a good time to invest. 

Now with a clearer and better understanding of the real estate market health and performance, let’s move on to understanding what real estate investment is. Many people think real estate investment is just about buying land, house, office space or a shop. But, that’s just half of the information. There are different types of real estate investing options and through some avenues you can indirectly invest in real estate without having to purchase a property. In this blog, you will get to know almost everything that there is about real estate investment in India. 

What is real estate investment?

Real estate investment in India refers to purchasing property for investment purposes to generate income rather than using it as a primary residence. The real estate in which you can invest could be raw land, flats and apartments, commercial spaces such as shops and offices, roads, and other assets.

How to invest in real estate in India?

Before we tell you how to invest in real estate, you should know where to invest and for that you need to know all the different types of investment instruments in real estate. Here are some of the most common types of real estate investment options in India:

1: Residential Real Estate 

• Buying Residential Properties: This includes apartments, villas, and houses. Investors can buy residential properties and rent them out for a steady cash flow or sell them later for capital appreciation.

• Buy-to-Sell Model: Investors purchase homes or apartments and sell them at a higher price after renovations or market appreciation.

2: Commercial Real Estate 

• Office Spaces: Investing in office spaces is popular among investors who want to lease out their properties to businesses. These properties can offer higher rental returns.

• Retail Spaces (Shops and Malls): With the growth of the retail market, commercial properties in shopping malls and high-street locations can be lucrative investments.

• Warehouses and Industrial Real Estate: With the growth of e-commerce, demand for warehouses and distribution centers is rising. These properties can offer good returns.

3: Real Estate Investment Trusts (REITs) & Alternative Investment Funds (AIFs)

• REITs are a way for small investors to invest in large commercial real estate without needing to buy physical properties. These trusts pool money from investors to buy and manage income-generating properties such as offices, shopping malls, etc. REITs pay regular dividends to investors from the rental income.

• Alternative Investment Funds (AIFs) are another way to invest in real estate, where a fund manager pools money from multiple investors to invest in real estate or related assets. These are typically high-net-worth individual (HNWI) investment instruments. 

4: Real Estate Mutual Funds

• Real estate funds or real estate mutual funds where you can invest money just like mutual funds, but in securities of companies dealing in real estate or real estate sector. Such mutual funds allow the investors to earn good returns from the real estate market without having to own a property. Through real estate mutual funds, you can invest in a diversified portfolio of various real estate assets, including residential properties, commercial properties, and infrastructure developments. However, keep in mind that just like any other mutual fund, real estate mutual funds are also exposed to market risks. Another advantage of such mutual funds is that they offer liquidity wherein you can withdraw money whenever required at your ease. Some of the popular real estate mutual funds are Tata Housing Opportunities Fund, HDFC Infrastructure Fund, and HDFC Housing Opportunities Fund. 

5: Agricultural Land

• Investing in agricultural land is a long-term investment strategy. It involves purchasing land for farming or other agricultural purposes, with returns coming from land appreciation or agricultural produce. In some cases, it can also involve leasing the land to farmers.

6: Land (Plot) Investment

• Investors buy undeveloped land or plots in upcoming or emerging areas with the intention of selling them for a higher price once the area develops. This is generally a high-risk, high-reward option, as the value of land depends on factors like infrastructure development, urbanization, and government policies.

7: Vacation or Holiday Homes 

• Buying vacation homes in popular tourist destinations can be a profitable investment option. Investors can rent them out to tourists or use them for personal use. With platforms like Airbnb, it’s easier to monetize such properties.

8: Real Estate Crowdfunding 

• This is a relatively new concept where multiple investors pool their money to invest in large-scale real estate projects. Crowdfunding platforms allow small investors to be part of bigger, high-value real estate projects. You can invest in a high-value commercial property through crowdfunding platforms with as little as Rs. 10,000. Unlike REITs (Real Estate Investment Trusts) that diversify your investment across multiple projects, crowdfunding allows you to choose projects based on your specific preferences. The best part is that it is mandatory for crowdfunding platforms in India to obtain a license from SEBI (Securities and Exchange Board of India) under the SEBI AIF (Alternate Investment Funds) Regulations 2012. In addition to that, make sure that you do proper research before investing your hard-earned money in any new project or real estate company in India.  

9: Real Estate Developments 

• For those with more capital and a higher risk appetite, becoming a real estate developer could be an option. It involves purchasing land, developing it into residential or commercial properties, and then selling or leasing it.

10: Student Housing and Co-living Spaces 

• With the increase in the number of students in urban areas, student housing has become a profitable investment avenue. Investors can buy properties near educational institutions and lease them to students for rental income.

• Co-living spaces are shared residential spaces with shared amenities, targeted at millennials and working professionals. The demand for co-living has risen in urban cities, making it a growing investment opportunity.

Is real estate a good investment option?

Many people who are planning to invest in real estate have this question in common. Is real estate a good investment option? To answer this, we will give you 5 major benefits of investing in real estate assets, funds, and projects.

1: Potential for high returns

• Over time, real estate properties in prime or developing locations tend to appreciate in value. In India, where urbanization is rapidly increasing, land and property prices often see significant property appreciation. This can lead to high returns on investment when the property is sold after several years.

2: Rental income promising steady cash flow

• Real estate investment, especially in residential and commercial properties, can generate a steady stream of rental income. With the growing demand for housing and office spaces in urban areas, investors can earn a consistent monthly or yearly income, which can provide financial stability.

3: Diversification of investment portfolio 

• Real estate is a tangible asset that behaves differently from stocks and bonds. Adding real estate to your investment portfolio can provide diversification, which reduces overall risk. When the stock market is volatile, real estate can offer a more stable investment option.

4: Protection against inflation

• Real estate tends to be a good hedge against inflation because property values and rents generally rise with inflation. As the cost of living increases, so do rental incomes, which means your returns can keep pace with rising prices.

5: Tax saving and benefits

• The Indian government offers several tax incentives to real estate investors. You can claim tax deductions on home loan interest payments under Section 24(b) for up to INR 2 lakh. The deduction on the principal component under Section 80C remains at INR 1.5 lakh, but the overall tax benefits make homeownership more affordable. Additionally, borrowers can also benefit from other deductions, like Section 80EEA, which offers INR 1.5 lakh for first-time buyers of affordable housing. Another big benefit of investing in a residential property is that now you can claim two houses as self-occupied property and don’t have to pay any tax on both the homes. This means, even if you let-out the second home on rental, you won’t have to pay taxes on rental earnings. Moreover, the TDS (Tax Deduction at Source) has been increased from Rs.2.4 lakh to 6 lakhs, benefitting the landlords. 

These benefits make real estate a popular investment choice in India, offering both short-term returns through rental income and long-term growth potential through property appreciation.

Now you know why real estate is one of the best investment options in India. If you want to invest in premium residential or commercial properties in the prime location of Gurgaon, Noida, Delhi, and Pune, all you need to do is drop your query with Inframantra. An Inframantra property expert will get in touch with you and give your proper property consultation. After understanding your needs and expectations, you will be provided with a list of best properties, choosing which you can start your real estate investing journey. Inframantra is one of the best real estate companies in Gurgaon, Noida, Delhi and Pune, that offers seamless property buying and selling experience with end-to-end assistance. So what are you waiting for? Start your real estate investing journey today and see your money grow. 

Frequently Asked Questions (FAQs)

Is real estate a good investment option?

Real estate can be a good investment option depending on your goals, risk tolerance, and the current market conditions. It generally offers long-term appreciation, passive income (through rent), and potential tax benefits. However, it requires substantial capital upfront, and can not be easily sold. 

Can I invest Rs. 10,000 in real estate?

While traditional real estate investments (like buying property) require a significant amount of capital, Rs. 10,000 is generally not enough for direct property investment. However, you can explore Real Estate Investment Trusts (REITs) or crowdfunding platforms, which allow you to invest smaller amounts in real estate portfolios.

What is the biggest disadvantage of real estate?

The biggest disadvantage of real estate is its illiquidity. Unlike stocks or bonds, properties can take time to sell, meaning you might not be able to access your money quickly in case of an emergency or when you need to liquidate your investment. 

Which is better, real estate or stocks?

It depends on your investment goals and risk profile:

• Real Estate: Offers long-term stability, potential for passive income (rent), and tax benefits but can be illiquid and requires significant capital.

• Stocks: Provide liquidity, higher growth potential, and easier access with lower initial capital, but are more volatile and riskier in the short term.

You may also like to read:

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Propеrty Valuation – Definition, Significance, Methods, Factors, Roles, And Benefits

Sources:

• https://www.moneycontrol.com/budget/union-budget-allowing-to-declare-two-houses-as-self-occupied-is-a-big-tax-relief-will-boost-rental-housing-say-experts-article-12927450.html

• https://www.hindustantimes.com/real-estate/now-homeowners-can-claim-tax-relief-on-two-properties-budget-2025-eases-the-tax-burden-101738418880228.html

• https://economictimes.indiatimes.com/wealth/tax/income-tax-rules-for-house-property-simplified-in-budget-2025-how-it-will-benefit-taxpayers-with-2-houses/articleshow/117823688.cms?from=mdr

• https://www.financialexpress.com/budget/budget-2025-big-incentives-for-property-owners-3734977/

• Consultation Paper About Crowdfunding in India- SEBI

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H2 2023

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H2 2022

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H2 2024

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H2 2021

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H1 2020

• Real Estate Market Trend Report by Knight Frank - Residential and office market - H2 2020