India has been ranked as the most preferred real estate destination in the Asia Pacific region as foreign investors still consider the country to be extremely viable, according to a report released today.
"India, and particularly Mumbai and New Delhi, are ranked the foremost real estate market destinations as the residential properties have maintain the growth momentum, and foreign investors still consider this market to be extremely viable," the ULI-PwC report, 'Emerging trends in Real Estate in Asia Pacific 2011', said.
Going forward, the report forecast that India will continue to maintain a GDP growth momentum of 9-10 per cent by 2015, as Asia's third-largest economy will witness new private equity in capital markets which will inject capital in infrastructure projects.
The survey has ranked Mumbai at the third position, two notches higher than its previous position, as the most promising investment market and first as the most favoured development market.
The development potential for real estate remained vibrant and promising in the financial capital of the country due to buying opportunities in retail, apartment and industrial sectors, it said.
"Mumbai is clearly the best performing and most active real estate market."
Despite some concerns about oversupply, development potential for most real estate segments remain promising in India's commercial hub, the report said.
"India continues to enjoy a significant demographic dividend by virtue of millions of additions to the working population every year. Most of these will translate into first time home buyers," PwC India Executive Director - Real Estate and Infrastructure - Tax and Regulatory Practice Jai Mavani said.
"Needless to say, this will continue to stimulate construction activity, particularly for residential units in cities like Mumbai."
Foreign investors are also upbeat about Delhi for commercial real estate investment as the national capital is expanding to Gurgaon and Noida, the report maintained.
New Delhi is ranked second for development prospects, and fifth for investment prospects. The driving forces are the government's plans to boost infrastructure with new roads, railways and airports.
"The government's plan to boost infrastructure with new roads, railways and airports makes Delhi a hotter real estate market destination."
Incidentally, the government has already approved development plans for tens of thousands of acres of land for urban development, it added.