Real Estate Sentiment Moderates but Remains Positive: Knight Frank-NAREDCO Report

The Indian real estate sector maintains a hesitant but optimistic stance throughout Q4 2024 based on the Knight Frank–NAREDCO Real Estate Sentiment Index. The residential market exhibits stable conditions but the office segment shows substantial confidence.

Supply-side stakeholders alongside financial institutions now have less positive views about real estate market outlooks than they had during the last quarter of reporting. The drop in sentiment remains positive since scores continue to exceed 50. 

The current sentiment index score decreased to 59 in the current quarter after reaching 64 during the last period indicating that the change took place in a controlled manner. The sentiment index shows its measurements through a scale where 50 represents neutral sentiment with higher numbers reflecting optimism and lower numbers indicating pessimism.

Shishir Baijal, Chairman and Managing Director of Knight Frank India, noted that the real estate sector is navigating a nuanced environment characterized by resilience and moderated growth. "As we navigate these dynamic times, it is crucial to understand the shifts in sentiment, enabling stakeholders to make informed decisions for a prosperous future," he said.

Property prices will experience upward trends according to 59% of stakeholders in the residential real estate market. Businesses expect both a rise in residential launches and higher sales according to 41% and 38% of respondents respectively. A significant portion of 28% from stakeholders anticipate the segment will experience no change.

Hari Babu, President of the National Real Estate Development Council (NAREDCO), emphasized that the report highlights cautious optimism in the residential sector. "The moderation in residential launches, sales, and prices reflects the prevailing economic and market conditions. We must focus on creating sustainable and affordable housing options that cater to evolving homebuyer needs. Despite short-term challenges, we remain optimistic about the long-term prospects of the Indian real estate sector," he stated.

As India’s real estate sector moves into 2025, stakeholders must adapt to evolving economic conditions while identifying opportunities in a dynamic market environment.