World’s Second Largest Road Network – What Does This Mean for Real Estate India?
Posted On January 10, 2024
India has achieved an infrastructure milestone – It now has the second-largest road network in the world, just behind the USA. This remarkable feat reflects the country’s commitment to infrastructure development and has far-reaching implications for various sectors.
Table of Contents
The Growth of India’s Road Network
Over the past decade, India has made tremendous progress in expanding its road network. With the addition of a staggering 1.45-lakh km of road network since 2014, the country has now secured the second spot globally, just behind the United States.
This growth signifies the government’s dedication to improving connectivity and facilitating smoother travel for its citizens. Expanding the road network has opened new real estate development and investment avenues.
Infrastructure Development and Real Estate
There is no denying that the development of a robust road network directly impacts the real estate sector in any economy.
Transportation networks play a crucial role in improving accessibility, connectivity, and overall infrastructure, thereby driving the growth of residential, commercial, and retail complexes.
Good road connectivity encourages all-around regional development, attracting investments in schools, community centers, markets, and green belts. Improved transportation infrastructure reduces vehicle pollution and travel times, promoting good health and well-being.
Major Investments and Developments
India’s road network expansion has already created numerous opportunities for real estate developers and investors.
The real estate sector has also witnessed substantial private equity investments, totalling US$ 1.92 billion in the second quarter of 2023. This increase in private equity investments reflects investor confidence in the market. Institutional investments in the office sector have grown by 2.5 times year-on-year, reaching US$ 2.7 million in the first half of 2023. These investments are a testament to the positive outlook of investors towards the Indian real estate market.
Housing prices in India’s top eight cities have risen 7% year-over-year, driven by strong housing demand and favourable borrowing rates. In addition, the sale of luxury homes in India has witnessed a significant increase, with a 130% rise in the first half of 2023 compared to the previous year. This surge in demand for luxury homes, priced at Rs. 4 crore and above, indicates a positive trend in the real estate market.
The Role of India’s Road Infrastructure in Real Estate Growth
The expansion of India’s road network directly impacts real estate growth, particularly in regions with improved connectivity. The development of expressways and national highways has enhanced accessibility to previously isolated areas, increasing demand for residential and commercial projects. Completing projects such as the Delhi-Mumbai Expressway, India’s longest-ever, has further boosted connectivity and facilitated the movement of goods and people.
The National Highways Authority of India (NHAI) has played a crucial role in developing the road network. The NHAI has set impressive world records, showcasing its efficiency and dedication. It constructed 100 km of expressway within 100 hours, demonstrating India’s prowess in executing large-scale infrastructure projects. These achievements have attracted the attention of both domestic and international investors, creating opportunities for real estate development along these key road corridors.
Regional Impact and Promising Future
Several regions in India have experienced significant real estate growth due to the expansion of the road network.
Real estate in Gurugram, for instance, is a prime beneficiary of the 29 km long Dwarka Expressway. This project, scheduled to be fully operational in 2025, will ease traffic congestion and reduce air pollution in the Delhi-NCR region. The Dwarka Expressway is being developed as the first elevated urban expressway in the country, providing direct access to major destinations and improving connectivity to the Indira Gandhi International Airport.
Other cities, such as Mumbai, Pune, and Hyderabad, have also witnessed a surge in real estate activity due to improved connectivity. The launch of a total of 517,071 units in 2023, a 20% increase from the previous year, indicates the positive impact of the road network expansion on real estate development. These cities have emerged as frontrunners, attracting investments and contributing to the sector’s growth.
Road to Prosperity
The world’s second-largest road network has profoundly impacted the real estate industry in India. Expanding the road network has improved accessibility, connectivity, and infrastructure, creating residential, commercial, and retail development opportunities. Significant investments, world records, and increased private equity inflows have further boosted investor confidence in the sector. As India continues investing in its transportation infrastructure, the real estate market is expected to witness sustained growth and contribute significantly to its economic development.
The seamless connectivity provided by the road network will attract more investments, stimulate economic growth, and enhance the overall quality of life for the citizens of India. As the real estate sector continues to evolve with the expansion of the road network, it is poised to play a significant role in India’s journey towards becoming a global economic powerhouse.
Should You Invest?
The symbiotic relationship between India’s real estate and infrastructure development promises a bright future.
The government’s firm commitment to expanding the road network signifies a robust focus on infrastructure and ample opportunities for the real estate sector. As India’s roadways connect regions easily, urban sprawl becomes a key factor for investors and homebuyers to consider properties along these routes. This way, you invest in a home and make an intelligent investment in the future.