Indian Housing Sector Expected to Contribute 13% to National GDP by 2025: Report

According to a report issued on Friday, the real estate sector in the country is expected to account for 13 per cent of the national GDP by 2025, reflecting its resilience and potential.

Projected to grow into a $1-trillion market by 2030, the sector evolves with demographic shifts, policy reforms and global trends, says a report by leading global commercial real estate and investment management company, JLL.

Tier 2 and 3 cities are emerging as pivotal growth hubs, with smaller urban centers like Jaipur, Indore, and Kochi driving more than 40 per cent of new housing developments by 2025.

The urban homeownership rate is expected to increase to 72 per cent by 2025, from 65 per cent in 2020, supported by affordable financing options and a younger demographic entering the housing market.

According to the report, millennials and Gen Z buyers are expected to make up 60 per cent of new homebuyers by 2030.
Sustainability, once a luxury, is now a necessity in the housing market. Green-certified buildings are expected to account for 30 per cent of new residential projects by 2025, doubling from 15 per cent in 2020.

There were 2024 sales of residential units, translating to about 85 per cent of the total units sold during the entire year 2023.

2024 witnessed an impressive 17 per cent sales growth compared to the same in 2023. This upwards trajectory in demand set the stage for continued growth in the country's residential asset class, according to the report.

Mixed-use developments are gaining importance, marking the global trend toward creating live-work-play environments.

"These kinds of developments combine residential, commercial, and recreational spaces within a single project, providing residents with the convenience of everything they need within walking distance," the report mentioned.

The demand for smart homes and tech-integrated living spaces is also soaring, it added.