Reliable industry data helps real estate stakeholders understand demand-supply dynamics for long-term healthy growth of the sector.
Authentic and credible real estate data holds the key to reliable demand- supply and pricing predictability for various industry stakeholders including developers, brokers, investors and buyers, to ensure a transparent stable and healthy real estate market. It has greater significance in the case of residential real estate which forms about 80% of the overall real estate market in India.
Unlike some matured global real estate markets, India lacks a centralized mechanism to compile and share comprehensive and reliable data amidst lack of standardized mandatory reporting. This is clearly evident from the conflicting data dished out by leading IPCs and data analytics companies from time to time including the 2024 housing market data. As many transactions, especially high-ticket transactions still involve cash, the data pertaining to Home Price Index of IPCs and even RBI doesn't show the real picture as it doesn't capture real transaction values. The absence of fair data leaves scope for price manipulation.
Several regulatory reforms in the real estate sector including RERA, Benami Property Act and Demonetization have made the real estate market more transparent, professional and organized. RERA has even made it mandatory for developers to upload the data pertaining to housing projects launched by them, on RERA websites as well as on their company websites. However, despite these reforms, cash transactions have not been completely stamped out.
In the absence of credible and reliable real estate data, there's no real assessment of demand-supply dynamics into play. As a result of this, we have often seen many developers adopting a herd mentality with regard to demand and supply, leading to inventory glut in the market. Even today in the NCR market we find that despite all the hype about the spurt in luxury housing sales, some developers are struggling with their unsold inventory, sweetening the deals with discounts and other sops even for ready-to-move homes which are otherwise preferred by homebuyers, compared to under-construction homes. So much so that some developers are forced to offer easy payment plans to offload their inventory - like subvention schemes where payment of 70-80 percent of home price is to be made at the time of possession.
Reliable industry data helps real estate stakeholders understand demand-supply dynamics for long-term healthy growth of the sector. It helps developers and their marketing and sales teams to effectively market and sell their projects. It also empowers investors and buyers by way of taking informed decisions, especially when credible and comprehensive data provides a reliable outlook for capital values and rental yields.
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