India’s real estate sector is so close to making the shift from the semi-transparent category to the transparent category. The improvement that the industry has undergone in the past few years are reportedly higher than some highly transparent markets around the world.
The real estate market in India is in the top 10 most improved global markets, according to JLL’s 2022 Global Real Estate Transparency Index released in July 2022.
The increase in transparency intensifies the interest of investors in the sector and ensures confidentiality of occupiers. There will be more capital flow to the country, as well. Greater transparency broadens market data and brings more professionalism in the transactions and procedures within the industry.
The regulatory changes in the Indian real estate sector such as the Real Estate Regulation and Development Act, GST, Benami Transaction Prohibition Amendment, Insolvency and Bankruptcy Code and the digitisation of records turned the sector become more sanitised and have transparent data availability required for transactions.
The improvement in transparency is also strengthened by the increased real estate institutional investments (REITs). REITs attract the interest of institutional investors.
Every industry in the entire world is working towards this same goal. Sustainability is the biggest driver of refining transparency in markets. Indian real estate should also keep improving its sustainability tracking. Mandate green certifications because there is an increased need for healthy buildings and many countries are committed to this.
Other than that, transaction procedures in the country was found to have massive improvements. Regulatory initiatives and availability of informed data and easy access gave the industry the necessary push towards improving transparency.
The recent reforms set professional standards for real estate agents and worked immensely to reduce money-laundering. The country should only move forward from this point to climb higher in transparency ranking.
Additionally, many investors prefer diversifying their real estate investments now and so, expectations for transparency have grown across niche property types.
To sum up, market transparency improves through accessibility of data, better corporate governance practices, increased publicly listed REITs and enhanced sustainability agenda. Betterment in these aspects will help India to further earn higher rankings.
Not only that, the need for sustainability is also and more importantly defined by its importance for decarbonising the built environment and mitigating the risks of climate change in the world.
Transparency and sustainability together can create huge trends in the real estate market.
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