Shares of real estate companies were buzzing in trade on December 16 as investors bet on hopes strong housing demand in 2025, driven by new launches, imminent rate cuts, and favourable demographic trends. Players like Oberoi Realty, Prestige Estates, Macrotech Developers led gains within the sector and surged 3-5 percent.
Other stocks including Mahindra Lifespaces, Phoenix Mills, DLF, Brigade Enterprises, Godrej Properties and Sobha also rose 1-3 percent. Gains across these real estate stocks also lifted the Nifty Realty index close to 3 percent higher, emerging as the best performing sector in trade today.
Recently, a slew of brokerages have also rolled out positive views on the real estate sector, further bolstering investor sentiment. Brokerage firm UBS anticipates the sector to maintain its growth momentum, supported by record-high affordability, favourable regulatory reforms, increased developer consolidation, and stabilising interest rates
Aside from this, UBS also feels favourable demographic trends, including increasing urbanisation, higher disposable incomes, and a shift towards nuclear family structures, will likely sustain demand for residential properties in the near-term.
The brokerage forecasts a continuation of this uptrend over the next three to five years, with residential pre-sales expected to grow at a compound annual growth rate (CAGR) of 15 percent between FY24 and FY29.
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Along similar lines, HDFC Securities also holds a positive outlook on the overall residential real estate market, driven by robust end-user demand and the strong execution capabilities of established players. "Grade A developers are likely to sustain their dominance, particularly those with extensive land reserves and proven delivery track records," the brokerage stated.
Meanwhile, Nuvama Institutional Equities anticipates a strong launch pipeline in H2FY25, increased focus on business development and potential rate cuts to boost sales for real estate companies going ahead.
Moving on, UBS does take notice of the possibility of near-term market softness in the real estate market due to macroeconomic uncertainties but advises investors to view such dips as strategic buying opportunities.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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