Top Trends in Residential Real Estate and Proptech
We just completed 2021- 2022 at YourOwnROOM and as we step into 2022-2023, there are some very interesting trends that I have been observing especially in the residential real estate world as well as in the Proptech world.
There continues to be a distrust in the Residential Real Estate space. There are 6.5 lakhs ready and unsold units worth about 50 billion and then there are about a million apartments that are under various stage of construction. There is about 150 billion worth of apartments, houses, units which are either on the shelf or are going to get into the self. There are 11 million vacant houses. But the good news is that the housing market is picking up. 2021-2022 saw an increase in the sales as well as initiation of new projects by almost 75 – 80%.
There is an increasingly new trend, where real estate is being looked at – not just about owning an asset. It’s about looking at it as a financial product or as an investment product. There is a lot of focus on what I would say is rental yields and capital appreciation. REIT has become the defacto institutional vehicle for investors to invest in Real Estate and get good returns out of it. The significant interest in alternate assets – now this includes co-living homes, senior living homes, student housing and so on. People now look at it as an opportunity to get a much higher rental yield that could 2x or even sometimes be even 3x.
PropCo’s, developers and all these institutional investors are looking at partnering with companies like us and other Proptech companies to deliver some of these projects and to manage these assets and get good yields out of this.
Fractional ownership seems to be a hot topic today and I think that can revolutionize the way investors are going to buy real estate assets and transact real estate assets.
Work From Home (WFH) is the fulcrum of decision making when it comes to buying or renting a home. People are now looking for WFH friendly units. They are looking for places in gated communities that comes with safety, security and some of the other conveniences. There is a big trend now – companies have been recalling employees. The employees are now coming back from Tier 3 and Tier 2 cities to Tier 1 cities and are now looking for WFH friendly homes.
Lastly, Proptech is going to be the defining force in Residential Real Estate. Thus changing the way investments are being done and the way assets are being managed and so on and we feel extremely fortunate that we are one of those early companies in the Proptech space.
