ArticleRPS Group

Four reforms that may shape the Indian real estate industry in 2023-24 By Mr. Suren Goyal, Partner, RPS Group


The real estate sector which is believed to be among the key sectors for India’s economic development has shown stable growth in recent years. Following the enormous growth last year, home ownership has unquestionably become a secure investment.

As we briskly move towards the start of a favourable year for Indian real estate, here are the expected reforms that will fuel the Indian real estate industry in 2023-24.

Expansion to peripheral suburbs

Strong connectivity will unlock enormous economic development potential in remote and under-explored smaller cities and towns, inevitably providing a significant opportunity for real estate businesses to thrive. The upcoming infrastructure projects would redefine the realty landscape beyond metro corridors. The availability of fresh open land to design a well-planned integrated development with conducive layouts, designated parking space, and a host of social and civic amenities will attract potential homebuyers who desire a well-balanced lifestyle. Commercial real estate projects will also boom as more business and IT companies are setting up offices in smaller cities.

Adoption of green business practices

While many real estate conglomerates have taken the commendable step of adopting a green business strategy in line with global efforts to reduce carbon footprint, most small and medium-sized developers have avoided ESG (Environmental, social, and governance) programmes to avoid high operational costs. The year 2023 will most likely mark the start of a paradigm shift toward environmentally friendly principles, which will be enforced by tighter policy, mandatory sustainability disclosures, certifications, and government incentive measures. Customers are willing to pay more for housing that features greener open spaces, cleaner air quality, and waste and water management techniques.

Office leasing will see incremental growth

Demand for leasing space, notably from IT, IT, and retail businesses, will increase. Already, large tech businesses have signed office leases with hefty price tags. E-commerce and third-party logistic companies will continue to pour money into warehousing, making it one of the fastest-growing commercial real estate segments. Moreover, investments in data centres will surge.

The luxury market will continue to boom

The luxury segment has been the growth driver for real estate in 2022, and the trend will continue in 2023. There will be an increased demand for bigger, high-end properties priced at Rs 2.5 crore and above. The growing trend of WFH and Hybrid Working Models is further fueling the demand in this segment.

Finally, real estate stands as an exception to the fragility of other financial assets like stock market, making it a feasible alternative. In FY23, real estate will be an exciting and profitable investment opportunity for investors with a long-term horizon and long term returns.