Forecast of the development of the residential real estate construction market in India
The relevance of research
In 2020, the number of events that affected the real estate market as a whole was a record. Of course, the main problem for the construction industry has become a pandemic coronavirus infection covid-19. This non-market factor, or rather, its indirect influence - the introduction of a self-isolation regime, the suspension of construction projects and restrictions on the entry of migrant workers to India, seriously affected the business of developers
Purpose of the study
Analysis of the state of the residential real estate construction market in India, assessment of the market size, analysis of competitors, as well as identification of factors affecting the residential real estate construction market
Content
Chapter 1. Key components of the residential real estate construction market
1.1. Market size
1.2. Growth rates of the residential real estate construction market
1.3. Residential real estate construction market trends
1.4. The main problems of the industry
1.5. Stage of the life cycle of the residential real estate construction market
1.6. Estimation of the number of buyers and their financial capabilities
1.7. Estimated consumption per capita
1.8. Analysis of sectoral indicators of financial and economic activity
1.9. Price analysis
Chapter 2
2.1. Economic components
2.2. Social Components
2.3. Technological components
2.4. Political Components
2.5. STEP-analysis of the residential real estate construction market
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
3.2. Number of competitors and relative market shares of the largest competitors
3.3. Compact location of industry companies in certain regions
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
4.2. Analysis of the impact on the state aid industry at the current date
4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the residential real estate construction market
4.4. Prospects and growth drivers for the residential real estate construction market
4.5. Forecast for the development of the residential real estate construction market in the context of the current economic crisis due to covid-19
Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
5.2. Sources of information for forecasting
5.3. Timing of forecasting
Research excerpt
Chapter 1. Key components of the residential real estate construction market
1.1. Market size
At the end of 2020, the volume of the residential real estate construction market in India amounted to … thousand m2 in physical terms and … billion rupees in monetary terms.
In India, all real estate objects, according to their origin and nature of use, are divided into land plots, residential and non-residential real estate. Residential real estate objects in accordance with the Housing Code of India are recognized ...
Residential property has the characteristics…
1.2. Growth rates of the residential real estate construction market
Consider the growth rate of the market - the volume of commissioning of housing construction - in the period 2016-2020. in kind and in monetary terms.
Growth rates of the residential real estate construction market in 2016-2020 are ambiguous: in 2016-2018. … residential construction projects were observed, then, in 2019, followed by …% compared to 2018 and in 2020, despite the difficulties and limitations, the market also showed … and reached … in the study period at … thousand m2.
Dynamics of the volume of the residential real estate construction market in physical terms has unequivocally … the development trend is the average annual growth rate of …%.
Diagram 2. Dynamics of the volume of the residential real estate construction market in monetary terms, 2016–2020
In 2020, despite the difficulties and limitations, the market volume reached … for the period under review and amounted to … billion rupees. The annual growth in market volume is primarily due to the annual increase in ... in India. In 2020, the increase compared to 2019 was …%, which, of course, is due to a sharp increase in prices and an increase in demand due to it ... Such market growth will be smoothed out by … growth in 2021 due to financial problems of the population and weakening … The minimum value of the market volume and the growth rate compared to the previous year for the study period is in 2016 with the indicators of … billion rupees and …%, respectively. The main growth drivers of the residential real estate construction market in India, according to market experts, throughout 2020 and subsequent years will remain …
1.3. Residential real estate construction market trends
...
1.4. The main problems of the industry
...
1.5. Stage of the life cycle of the residential real estate construction market
The residential property development market in India has reached the stage of ... The stage of ... represents the stage of stability in terms of ...
The … stage is characterized by … a level of sales with a slowdown … The product, in this case housing, has reached its …
Stage ... the longest of all stages of the life cycle. It is characterized…
1.6. Estimation of the number of buyers and their financial capabilities
Population. During 2019-2020 India's population shows … dynamics. … the population has a negligible impact on … at the moment, to a greater extent, demand is influenced by …
Rosstat predicts that the birth rate (the number of children per woman) will decrease from the current ... to ... by 2025.
Earlier, Rosstat published a demographic forecast up to 2036. The most optimistic scenario assumes an increase in the country's population to … million people. by early 2036. The most pessimistic is …
According to the results of the crisis year 2020, real disposable money incomes of Indians decreased by …% in annual terms, follows from ... From 2014 to 2017. real incomes of the population in India were declining, in 2018 they showed a small …%, and by the end of 2019 …%. At the end of 2020, they are …% of the level of 2013, the last year of steady income growth.
The Ministry of Economic Development expects that real disposable income will grow by …% in 2021, and then will grow by …%. A number of economists do not expect ...
1.7. Estimated consumption per capita
The volume of consumption in the residential real estate construction market per capita in India as a whole, in contrast to the dynamics of the market volume in monetary terms, has ... the growth rate of indicators from year to year, which in this case depends on the change in ..., since the dynamics of the population for the studied period ... The indicator in 2016 is minimal and the increase compared to the indicator in 2015 is ..., as well as the change in the consumer price index for residential real estate in the primary market - the consumer price index in 2016 is ...% compared to the same indicator in 2015. In 2017-2020 observed … In 2020, the volume of consumption in the residential real estate construction market reaches its maximum value in the study period … Rs./person, which is primarily due to an increase in …
1.8. Analysis of sectoral indicators of financial and economic activity
Let's consider industry indicators of financial and economic activity of the residential real estate construction industry to determine the sustainability of the industry and the enterprises operating in it.
Gross margin is an economic indicator that characterizes the ratio ...
Gross margin of the commercial property rental industry in 2016-2020 …, but tends to …, the deviation from the similar indicator for all sectors of the Indian economy during this period …, the maximum value of the indicator in 2020 is …%, while the value of the indicator is …% … of the value of the indicator for all sectors of the Indian economy. The increase in the indicator for the residential real estate construction industry indicates ... The minimum value in …% falls on … years, during this period the deviation from the similar indicator for all sectors of the Indian economy …
Diagram 6. Profitability of profit before tax (profit of the reporting period) in the residential real estate construction industry in comparison with all sectors of the Indian economy, 2016–2020, %
Profitability before tax is an economic indicator that characterizes the ratio ...
Profitability of profit before tax in the residential real estate construction industry during 2016-2020 quite ..., this figure is much ... the same indicator for all sectors of the Indian economy.
In 2020, the return on profit before taxation of residential real estate construction increases and reaches …%, which is primarily due to an increase in the cost of … The minimum value of …%, close to the average for the period 2016-2019, is observed in ….
The current (total) liquidity ratio is a financial ratio equal to the ratio of current ...
The value of the coefficient ... is considered normal; in world practice it is considered normal from ..., depending on the industry).
Current liquidity indicator for the residential real estate construction industry in 2016-2020 remains stable at the same level in … except for 2018, when the indicator reached … times. The value of the indicator in ... in the construction industry has ...
Absolute liquidity ratio is a financial ratio equal to the ratio ...
The financial position of the industry is recognized as good when the absolute liquidity ratio ...
Despite the fact that the absolute liquidity of the residential real estate construction industry during the study period is … the same indicator for all sectors of the Indian economy, its value remains …, the financial situation in the industry can be assessed as …
1.9. Price analysis
The dynamics of prices for real estate construction in the period from 2016 to the end of the first half of 2021 had ... character - an indicator annually ..., as evidenced by the CPI indicators, ...%.
Prices grew most rapidly in … - the consumer price index amounted to …%, in 2020 the increase in prices for real estate construction was …%.
It is also worth noting that in 2018-2021. prices for real estate construction ... than the prices for the entire range of services. In the first half of 2021, the difference with the indicator for all services was …%.
Prices for construction services as a whole are reflected in prices in the primary real estate market. Consider prices in the residential real estate market across the Union Territories in 2016-1H 2021.
...
According to …, the highest prices for residential real estate (on the market of new buildings) are observed in … the federal district, which is due to the high rate of … Also high prices in the … federal district, which is mainly due to the maximum cost of housing … – on average … thousand Rs. / sq. m in 2020. On average, in the … federal district, according to the results of the first half of 2021, the price amounted to … thousand Rs./sq. m. The top three also includes ... the federal district, where the cost per sq.m. according to the results of the first half of 2021 amounted to … thousand Rs.
On average in India, residential real estate cost … thousand Rs./sq. m in 2020, which is …% higher than in 2019 and by …% higher than in 2016, in the first half of 2021 the average cost per square meter of housing amounted to … thousand Rs.
In 2020, residential real estate prices grew fastest in the … federal district – by …% and in the … federal district – by …%, the slowest in …
Chapter 2
2.1. Economic components
Gross domestic product (GDP) is one of the most important macroeconomic indicators.
It reflects the market value of all final goods and services intended for direct consumption, which were produced for ...
GDP is expressed in national currency, or (if necessary) converted into foreign currency at the exchange rate, and can also be presented at purchasing power parity.
The decrease in the index of physical volume of GDP for 2020 was affected by the fall of …
Decreasing global demand for energy resources has affected the reduction of value added in the mining industry (…%).
Significantly reduced...
...
The final consumption of the general government sector and non-profit organizations serving households increased compared to 2019 (…%) mainly due to an increase in public spending on health care and other activities related to the fight against the covid-19 pandemic.
...
2.2. Social Components
...
2.3. Technological components
...
2.4. Political Components
...
2.5. STEP-analysis of the residential real estate construction market
Table 6. STEP-analysis of factors influencing the residential real estate construction market
Based on the results of the analysis of factors influencing the Indian residential real estate construction market, there is a prevailing … influence of the main number of factors on the market, while a high degree of positive influence on the demand of a group of … factors.
Significant limiting factors include…
The following factors have a stimulating effect on the analyzed market…
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
...
3.2. Number of competitors and relative market shares of the largest competitors
According to the rating of …, compiled at the end of 2020, 10 companies are the leaders in terms of rental housing in India, let's consider the TOP-5 of this rating.
In the real estate construction industry as a whole, according to GidMarket analysts, there are ... organizations. The largest of them can be called five organizations listed in table 6. All of these enterprises have the main activity of ...
The market shares of the largest market operators are calculated based on the volume of housing commissioned in 2020.
Diagram 10. Shares of the largest competitors in the residential real estate construction market in 2020, %
The leader of the Indian residential real estate construction market is the group of companies … with a share of …%, the second place with a share of …% is occupied by the holding …, and the group of … closes the top three with a share of …%. On the fourth and fifth places with equal shares of …% …
Today, … organizations are working on the Indian residential real estate construction market, while the largest enterprises have relatively low market shares – in total …% of the market. The remaining …% of the market share more than …
GidMarket analysts suggest that in the coming years, the list of market leaders is most likely to …
The net revenue of the TOP-5 companies according to the annual reports of these companies in 2020 totaled … billion Rs., the total revenue of these companies increased by …% compared to 2019, while the market volume increased in 2020 by …% compared to the same indicator in 2019. At the same time, the revenue of each company included in the TOP-5 increased in 2020 compared to 2019, the growth rate fluctuates from …%. Market leaders annually increase the volume of housing commissioning, …
In the period 2016-2019 the revenue of TOP-5 companies showed a stable annual positive growth by …% on average, taking into account a sharp increase in 2017, which is associated with an increase in the cost of …
3.3. Compact location of industry companies in certain regions
To determine the compactness of the placement of companies in the residential real estate construction industry, let's consider the volume of housing delivery by the states of India.
Diagram 12. Compactness of location of companies in the industry in certain regions
The largest share of commissioning of housing construction objects falls on … and amounts to …%, in second place is … with a share of …%. It is here that active construction is carried out and several largest market operators work, in addition, these regions always remain ... In third place ... with a share of ...%, the region is attractive to residents of ...
Based on the facts considered, it can be concluded that the operators of the residential real estate construction market in India are compactly located in the bulk in ... - the total share of ... is ...%.
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
In 2020, many markets felt the impact of the pandemic and the onset of the economic crisis, the residential real estate construction market was no exception.
Let us consider the impact of recent crises (the global crisis in 2008 and the currency crisis in India in 2014) on the industry and the residential real estate construction market in India.
Table 8. Assessment of the impact of recent crises on the industry
...
4.2. Analysis of the impact on the state aid industry at the current date
Forecasting the development of the residential real estate construction market in India is impossible without understanding the economic situation in the country, as well as the impact of the spread of the covid-19 virus and the measures taken to support the population and business. For businesses in the affected industries, additional ... Note that the residential real estate construction industry ..., nevertheless ... companies involved in the construction of residential and non-residential buildings, were included in the list of backbone. Table 8 discusses the support measures related to the affected industries, these measures are designed to …
...
4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the residential real estate construction market
...
The crisis of 2020 affected …% of developers. Wherein, …
4.4. Prospects and growth drivers for the residential real estate construction market
...
4.5. Forecast for the development of the residential real estate construction market in the context of the current economic crisis due to covid-19
...
Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
...
5.2. Sources of information for forecasting
...
5.3. Timing of forecasting
...
Diagrams
Diagram 1. Dynamics of the volume of the residential real estate construction market in physical terms, 2016–2020
Diagram 2. Dynamics of the volume of the residential real estate construction market in monetary terms, 2016–2020
Figure 1. The life cycle stage of the residential property construction market in India
Diagram 3. Population dynamics in India, as of 01 Jan. 2012–2021
Chart 4. Dynamics of real income of the population of India, 2012-2020, available period 2021
Chart 5. Consumption in the residential real estate construction market per capita, 2016–2020
Diagram 6. Profitability of profit before tax (profit of the reporting period) in the residential real estate construction industry in comparison with all sectors of the Indian economy, 2016–2020, %
Diagram 7. Current liquidity (total coverage) for the residential real estate construction industry for 2016–2020, times
Chart 8. India's GDP evolution, 2012-2020, available period 2021
Chart 9. Monthly dynamics of the US dollar against the rupee, 2016-2021 available period, Rs. for 1 US dollar
Diagram 10. Shares of the largest competitors in the residential real estate construction market in 2020, %
Diagram 11. Dynamics of the total revenue of the largest operators in the residential real estate construction market (TOP-5) in India, 2016–2020
Diagram 12. Compactness of location of companies in the industry in certain regions
Chart 13. Problems faced by construction companies during the 2020 crisis, %
Diagram 14. Forecast of the volume of the residential real estate construction market in 2021–2025 in kind
Diagram 15. Forecast of the volume of the residential real estate construction market in 2021–2025 in monetary terms in 2021–2025
Tables
Table 1. Gross margin of the residential real estate construction industry in comparison with all sectors of the Indian economy, 2016-2020, %
Table 2. Absolute liquidity of the residential real estate industry in comparison with all sectors of the Indian economy, 2016-2020, times
Table 3. Consumer price indices in the residential real estate construction market in India in 2016–2021 (available period), %
Table 4. Average prices in the residential real estate construction market in the Union Territories
Table 5. Producer price indices for construction products in 2017 - 2020, % compared to December of the previous year
Table 6. STEP-analysis of factors influencing the residential real estate construction market
Table 7. Main companies participating in the residential real estate construction market in 2020
Table 8. Assessment of the impact of recent crises on the industry
Table 9. Analysis of the impact on the industry of the state aid proposed to date
Table 10. Forecast indicators of the development of the Indian economy
All reports