Overview Of Indian Real Estate

India’s real estate is growing warm day by day. India appeals as dream market for investors who are eyeing for high returns. India depicts as one of the hottest markets next to china compared to the matured market such as Europe and America. A recent Wall Street Journal article estimated that returns in India range from 12 percent to 15 percent, compared with the 3 percent to 4 percent earned in the United States and Western Europe. The Indian real estate market is valued at $12 billion and is expanding at an annual rate of 30 percent. It is a fragmented industry with high transaction costs. However the high Government focus on infrastructure development and easing of restrictions on foreign ownership has brought the industry to new high. Given these positives, it is predicted that the real estate market will touch $90 billion in 10 years time.

With the growth in the economy catching up rapid phase, the demand for real estate is felt almost in all sectors. For example, taking into account the IT/ITES service alone, it is estimated that it requires around 50-70 million square feet in the next two to three years.

Moreover the Government has also eased restriction on foreign ownership of real estate to 100%. From now foreign developers can have wholly owned subsidiaries in India if they invest $10 million. Also they can build commercial and residential buildings if the projects exceed 50,000 square meters, or 538,000 square feet. This move is likely to change the face of real estate industry in India. According to Pricewatercoopers, as much as $7 - $8 billion in venture capital is anticipated to flow into large scale real estate development during next 1-2 years period.

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