Real Estate Sentiment Score Signals Balanced Outlook for Q2 2024: Knight Frank-NAREDCO Real Estate Sentiment Index Q2 2024

Delhi, August 14, 2024: The 41st edition of the Knight Frank – NAREDCO Real Estate Sentiment Index Q2 2024 (April – June 2024) report cited that the Current Sentiment Index Score has moderated to 65 from its all-time high in Q1 2024 indicating a measured outlook among stakeholders. Future Sentiment score for this period also recorded a recalibration in Q2 2024 and was recorded at 65. While both current and future sentiments remain firmly in the positive zone suggesting a continued belief in the sector’s long-term prospects, the scores reflect a more tempered view on recent real estate growth, influenced by election and budget speculations.

The Future Sentiment Index has adjusted from 73 in Q1 2024 to 65 in Q2 2024, reflecting a positive yet more conservative outlook for the near term. This recalibration may be attributed to anticipatory caution around potential macroeconomic developments, including fiscal policies and geopolitical events, that could influence market confidence. Despite this decline, the sentiment remains in positive territory, showcasing the sector’s resilience with notable activity in residential and office markets.

The residential market outlook in Q2 2024 sustains optimism with 63% response rate for an expected rise in residential prices while 51% of the stakeholders anticipate an increase in sales with a significant portion of 24% respondents expect stability.

The office market outlook exhibits buoyancy on all key parameters – leasing, supply and rent as the stakeholders remained confident of the performance of this asset class in the next six months.

The quarterly Knight Frank-NAREDCO report captures the current and future sentiments towards the real estate sector, the economic climate and funding availability as perceived by the supply-side stakeholders and financial institutions. A score of 50 represents a neutral view or status quo; a score above 50 demonstrates a positive sentiment; and a score below 50 indicates a negative sentiment.

Current and Future Sentiment Scores 

Source: Knight Frank India 

Sentiments of Developers and Non-Developers

The Developer Future Sentiment Score moderated from 72 in Q1 2024 to 61 in Q2 2024, indicating a more measured outlook. While remaining optimistic, developers have demonstrated caution, having experienced strong sales since the beginning of 2023. Even as markets initially seemed poised for sustained growth with significant tailwinds, the extended uptrend in the industry cycle has led to a more cautious stance.

The Non-Developer Future Sentiment Score (which includes banks, financial institutions, PE funds) adjusted from 73 to 68. This shift reflects stakeholders’ careful evaluation, considering the macroeconomic concerns that are weighing heavily.​