India’s real estate industry is on a transformational path, with projections indicating a market size of $5.8 trillion by 2047, contributing 15.5% to the country’s GDP, up from 7.3% today, according to a CIRIL report. The sector, which stood at $200 billion in 2021, is expected to hit $1 trillion by 2030, driven by rapid urbanisation, infrastructure development, and increased investor confidence.

The expansion spans key segments, including residential, commercial, logistics, hospitality, and retail, with a compound annual growth rate (CAGR) of 9.2% between 2024 and 2028. As India continues to urbanize, rental markets are witnessing steady price appreciation, further fueling sectoral growth. “The real estate market is set to maintain strong investment momentum in 2025, backed by robust domestic economic fundamentals and a strategic focus on technology and ESG (Environmental, Social, and Governance) integration in investment decisions,” the report noted.

Government initiatives are expected to extend infrastructure development beyond metro cities to achieve Vision 2047, a long-term economic roadmap. Investment in commercial real estate is surging, with growing demand for Grade A office spaces, coworking hubs, and mixed-use developments catering to businesses across industries. The retail and hospitality sectors are also experiencing a strong resurgence as consumer spending and travel rebound.

India’s economic growth is forecasted at 6.6% in 2025, driven by increased private consumption and capital expenditure on infrastructure. This investment surge is anticipated to generate multiplier effects, stimulating employment and demand across related industries. “Increased capital expenditure on infrastructure is expected to have strong multiplier effects on economic expansion,” the report highlighted.

Investor confidence remains high, particularly among Domestic Institutional Investors (DIIs), whose market share reached a record 16.46% in September 2024, up from 16.25%, with net inflows of ₹1.03 lakh crore. Despite foreign institutional investor (FII) outflows in October 2024, DIIs continued to sustain market stability, a trend expected to persist through 2025.

As real estate moves towards a more technology-driven and sustainable future, the sector’s long-term trajectory remains strong. With policy reforms, urban expansion, and rising investment, India’s real estate market is poised for a historic transformation, reinforcing its role as a key pillar of the nation’s economic growth.