The announcement of demonetization and implementation of the Benami Properties Act for unregulated properties took place in the same year. Economists predicted the growth rate of the real estate sector to slow down more than ever as a result.
The Indian real estate sector has come a long way since the 1990s’ by becoming one of the fastest growing markets in the world. It is not only successfully attracting domestic real estate investment but foreign investments too.
The real estate demand in India was subjected to fluctuations since 1991, when economic liberalization took place. The period between 2001 and 2008 saw high growth in the real estate sector while it experience drastic slowdown from 2008 to 2014. At present, this sector is again witnessing decent growth in some parts of the country even after demonetisation.
Bengaluru is known as the “Silicon Valley” of India because 40% of all companies are in the service sector and is a hub for Information Technology (IT). The city has consistently ranked among the top 20 destinations for investment in South Asia Pacific (SilliconIndia 2015).
Supply of formal affordable housing has continually lingered behind household projections. Furthermore, the Technical Group on Urban Housing Shortage (2012-17) has pegged the aggregate housing shortage at 18.78 million staying units.
The real estate market has been undergoing changes due to recent policies of the government and other initiatives. The move of demonetisation which involved currency ban was initiated by the current Government.
The real estate sector is one of the most dynamic and globally recognized sectors today, owing to a number of factors like population spurt and increased purchasing power of consumers. India is one of the biggest real estate market. It comprises of four subsectors namely housing, retail, hospitality and commercial. Growth of these sectors is highly dependent on the growth of the corporate environment and the demand for office space and residential projects (IBEF, 2016).