In this episode of PanchaMantra, we discuss the housing market.
Housing is one of the highest value needs of a family. In India, structural demand growth should persist for at least two more decades if not longer. Why then did a prolonged down-cycle in dwelling construction shaved more than one percent a year from GDP growth for the last eight years?
We explore five questions in this video:
- How many houses does India need to build annually? How important is this for the economy?
- Why then was construction so weak in the last 8 years?
- What is changing now?
- What does this revival mean for the economy?
- What are the risks?
93% of houses are in (mostly) self-built buildings of 1-2 stories. Contrary to the image many have of houses meaning apartments in skyscrapers, only 0.2% of houses are in buildings of more than 10 storeys. India’s houses are also growing 2% a year, and the quality/value of construction is growing.