In July 2023, India witnessed a significant surge in bank credit outstanding to the real estate sector, reaching an all-time high of Rs 28 trillion, as per data released by the Reserve Bank of India (RBI). This impressive growth was driven by both housing and commercial real estate segments, with annual increases of approximately 37.4% and 38.1%, respectively. This surge indicates a robust revival in demand across the real estate sector, despite challenges such as rising interest rates and property prices. Let’s delve deeper into the details.
Housing Segment Flourishes:
- Housing credit outstanding saw a remarkable 37.4% annual growth, surpassing Rs 24.28 lakh crore.
- This robust performance in the housing sector suggests a strong demand for residential properties.
Commercial Real Estate Surges:
- Credit outstanding for commercial real estate soared by 38.1% to reach Rs 4.07 lakh crore.
- The revival in this segment can be attributed to the return of employees to offices, driving demand for quality commercial spaces.
- Despite a steady rise in home loan interest rates, housing sales across India’s top seven cities increased by 63% compared to the previous year.
- The sustained demand is also anticipated to continue during the upcoming festive season.