The real estate sector has performed well, driven by strong housing and office demand across the country. According to the Economic Survey, this growth is fueled by economic stability, positive market sentiment, and the expansion of physical infrastructure such as metro networks, roads, and improved connectivity, not just in Tier 1 and Tier 2 cities but nationwide.
“India’s real estate market witnessed robust performance under office demand as well as residential sales driven by economic stability and positive market sentiment,” the Survey tabled in Parliament on January 31 said.
“The demand for real estate is emerging not only in tier 1 and tier 2 cities but across the country due to the expansion of metro networks, enhancement of road networks, and improvements in connectivity, ” the Economic Survey said.
Citing research reports of real estate consultants, the Survey noted that housing demand in India is expected to touch 93 million units by 2036.
“The residential real estate market scaled an 11-year high in sales volume in the first six months of 2024. During this period, total sales across the top eight cities recorded an 11 per cent YoY growth,” the document said.
The Economic Survey noted that the real estate law RERA and goods and services tax (GST) have brought many benefits to the real estate sector.
RERA
The Real Estate (Regulation and Development) Act, popularly known as RERA, has brought “numerous improvements in the real estate sector, including protection against fraud, increased transparency, timely project deliveries, and measures to prevent misuse of funds, among other benefits”, the Survey said.
After the enactment of the Real Estate Regulatory Authority, India ranked 31st out of 89 countries in the Global Real Estate Transparency Index in 2024, it said.
Giving an update on the RERA implementation, the Survey said that Rules under the Real Estate (Regulation & Development) Act, 2016 (RERA) have been notified in all States and Union Territories except Nagaland, with various regulatory authorities established.
As of January 6, 2025, about 1.38 lakh real estate projects and 95,987 real estate agents have been registered under the Real Estate Regulatory Authority(RERA). Moreover, the RERA has disposed of 1.38 lakh complaints across the country, it said.
The Real Estate (Regulation and Development) Act, 2016, was passed by the Rajya Sabha on March 10, 2016, and by the Lok Sabha on March 15, 2016. The was Bill passed by Parliament was assented to by the President on March 25, 2016. Certain Sections of RERA were notified with effect from May 1, 2016, and the remaining sections from May 1, 2017.
ON GST
The Survey noted that the Goods and Services Tax (GST) has helped to simplify the taxation structure in real estate transactions by applying a single unified tax system across states. It has encouraged proper invoicing and documentation, thus reducing the scope for tax evasion.
REITS
The Economic Survey observed that the rise of real estate investment trusts (REITs) further amplifies the positive trajectory of the commercial sector.
The government introduced REITs as an investment vehicle in commercial real estate, allowing investors to pool funds and invest in income-generating real estate. This helps increase commercial real estate market liquidity and attracts institutional investors, it noted.
“Implementation of online platforms for the submission and approval of building plans has led to a reduction in delays and brought more transparency to the process,” the survey said.
The digital India land records modernization programme aims to create a comprehensive, accessible, and transparent land record management system.
Overall, the Economic Survey noted that India is expected to record GDP growth of 6.3-6.8 per cent in the financial year 2025-26 on the back of strong fundamentals, calibrated fiscal consolidation and stable private consumption. The economic growth rate is estimated to slip to 4-year low of 6.4 per cent in the current financial year.
“…the fundamentals of the domestic economy remain robust, with a strong external account, calibrated fiscal consolidation and stable private consumption. On balance of these considerations, we expect that the growth in FY26 would be between 6.3 and 6.8 per cent,” the survey said.
The Economic Survey 2024-25, tabled by Finance Minister Nirmala Sitharaman in both houses of Parliament, said navigating global headwinds will require strategic and prudent policy management and reinforcing the domestic fundamentals.