As per a real estate report by India Infoline, with demand remaining high over the next few years, supply is not yet keeping pace and prices are unlikely to cool down anytime soon
A real estate sector report by brokerage firm India Infoline pegs the real estate market to be growing at a healthy 33% compounded annual growth rate. And yet, it will not be able to meet the demand, as there will be a shortage of 18 million housing units in 2010.
Sachin Neema, Head-research, India Infoline says, "To give you a perspective, we are short by almost 19 million units of housing at this point of time. With the population growing by 1.5% per annum for the next decade, even if the housing stock grows by 2.5% yearly we would still fall short by a large number of units at the end of five years.
And while the total market will balloon to $50 billion from its current size of $12 billion, it will be driven by strong office space.
Demand will touch 200 million square feet by the year 2010. The IT sector, says the report will itself need 450 - 500 million square feet of space over the next 10 years. With organized retailing expanding aggressively and estimated to take up 11% of the retail pie by 2010, it will create a demand for 150 million square feet of mall space over the next five years.
Also, with SEZs becoming the buzz word over the last six months, and major players like DLF, Parsvanath and Unitech signing up for the development of more than 50,000 acres, it is expected to provide an additional kicker to the real estate market.
With multiple themes pushing the growth of the real estate sector and demand remaining high over the next few years, supply is not yet keeping pace and prices are unlikely to cool down anytime soon say experts.
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