New Delhi: Institutional investment in Indian real estate fell 12 per cent to $4.48 billion (around Rs 33,800 crore) last fiscal year on lower economic growth and

Is real estate still a good investment in 2020?

What will the real estate market be like in 2020?

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The real estate market in 2020 is going to follow some developments that already pointed out in the previous two years and that seems to be consolidating. The evolution of the sector will not be the same in all countries and regions, but surely the trends will be the same and Mallorcan real estate must also be prepared to face the new challenges

Upon reaching the end of the year many wonder how the sector in which they are immersed will evolve. In recent years in the real estate sales sector there is always the question of a new real estate bubble, which we do not believe will occur at least in the catastrophic sense with which the term is usually referred to. However, we must be aware that we are facing a sector that is going to experience changes and whoever wants to remain in the sector must be prepared for it.

Next, we tell you the keys that will mark the pattern of the sector throughout the early stages of the second decade of this century.

The basic lines of the housing market in 2020

In the following lines we will explain some of the main characteristics of the sales of flats in 2020

Prices

In some large cities, prices have dropped 7% in the last 12 months, although they had risen 30% in previous years. According to Yolanda Barnes, who chairs the Barlett School of Real State (BRE) of London University College, the end of the era of property value growth is nearing .

Low interest rates mean that prices can only increase with inflation. This does not imply that prices are necessarily going down, but it seems that they will stabilize.

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Real estate as an investment

If property prices stabilize they will cease to be a coveted piece for speculators, although this does not mean that they cannot be a good investment, but not to get a high return in a short time but rather as a “stable investment” .

Another possibility to increase the profitability of these investments is to bet on rentals . Their prices in the central areas of the big capitals triple the ones that are requested in other areas. In order to moderate these prices, interventions by public institutions are expected.

The new technologies

The proptech sector , whose market share had stabilized at around 7%, will grow significantly in the coming times. It is the logical consequence of the 38% increase over last year. You should know that new forms of business exploitation will facilitate investments. The use of Big Data and blockchain technology in the real estate sector will change the way of analyzing the real estate market and the way of real estate transactions.

Housing for older people

The market must adapt to the general aging of society by fostering new forms of coexistence between generations that move away from the paradigm of the ghettos of older people in rural areas.

In the next decade the demographic characteristics will change considerably in the more developed countries. In most of them in 203o there will be 25% more people over 65 and 50% more people over 85 than now. Society must prepare for it and the real estate sector will not be oblivious to this evolution.

conclusion

In short, the real estate market in 2020 seems to have a stabilization of prices and optimize technology at the service of business and welfare.