The recent report by FICCI and Anarock Property Consultants has revealed that real estate has emerged as the top investment choice for 59% of Indians in the first half of this year.

This surge in interest is driven by a rise in rental rates in cities, with 57% of investors purchasing premium properties to generate rental income. The report also highlighted a significant shift in homebuyer preferences and market dynamics in India's real estate sector.

The report found that 51% of respondents prefer 3 BHK units, indicating an increased demand for larger homes. This trend is further supported by the fact that 67% of buyers are seeking property for end use, while 33% are purchasing for investment purposes.

Pramod Rao, Executive Director, SEBI, emphasized the importance of investor confidence for the long-term success of the industry. He stated, "Investor confidence is vital for the industry's long-term success, and SEBI's focus on transparency and governance has been key in building this trust."

Shift in Homebuyer Preferences

The report also noted a significant shift in consumer preferences away from ready-to-move homes towards under-construction properties. This shift, according to Sandip Somany, Past President, FICCI, indicates growing confidence in developers and the regulatory environment.

However, the demand for ready homes has declined significantly. The ratio of ready homes to new launches is now 20:25, compared to 46:18 in the first half of 2020.

The most popular budget remains between Rs 45-Rs 90 lakh, but there's a shift towards premium properties. About 28% now prefer homes priced between Rs 90 lakh and Rs 1.5 crore. Apartments continue to be the most preferred property type (58%), but residential plots are gaining popularity, especially in southern cities.

Top homebuyer demands include timely project completion (98%), improved construction quality (93%), and well-ventilated homes (72%).

Challenges in Affordable Housing

However, over 53% of homebuyers are dissatisfied with current affordable housing options, citing issues with location, construction quality, and unit sizes. Anuj Puri, Chairman and Founder of Anarock Property Consultants, said that the survey provides all industry stakeholders with critical insights into the Indian property market from a consumer perspective.

On the other hand, affordable housing is struggling to meet expectations, as over 53% of homebuyers express dissatisfaction due to issues related to location, construction quality, and unit sizes. The survey also indicates that home loan interest rates below 8.5% would have little impact on buying decisions for 71% of respondents, but rates exceeding 9% would significantly influence 87% of potential buyers.