With USD 1.3 trillion housing boom ready to kick in, India’s residential housing sector shall be the next growth driver. The housing sector’s contribution to overall GDP is expected to double to 11% CAGR by 2020; thus creating a significant impact on the country’s economy. The realty sector is estimated to touch USD 180 billion by the same year.
Residential sales in 2019 saw a decent 4-5% annual growth with over 2.58 lakh homes sold during the year. New residence launches in 2019 saw an 18-20% annual increase with new launches in the region of above 2.3 lakh units (1.95 lakh units were launched in 2018).
The growth will predominantly be on account of a huge number of people living in slums and temporary homes who are waiting to be housed through the Indian government affordable housing scheme and various other initiatives. The introduction of RERA has also come as a great relief to home buyers who can now put more trust in the system with unscrupulous developers no longer a part of the industry. GST has also added to the momentum. Other aspects that will endure being an important part of the growth story are rapid urbanization that is generating a huge demand for new homes in Tier 1 cities and metropolitans and an increasing preference for the concept of nuclear families.
Having established the housing growth, one thing that remains persistent is the need for insurance for these homes. The residential property faces the risk of damage due to natural or man-made disasters, theft of content, and you may also need to protect the people living within. In few cases, you might also need someone to insure you against the relocation expenditures till the time your home is being rebuilt and recouping from damage. Act of war and terrorism may also cause you to vacate the house and you should be insured against such possibilities.
