Unlocking Value In Proptech: Emerging Trends That Will Shape The Indian Landscape

Emerging Trends That Will Shape The Indian Landscape

File photo
File photo

Real estate is a unique asset class - one of the oldest and largest, one which reflects economic health, and one that has buyer emotions deeply tied into it. We’ve now been through multiple cycles of innovation within the segment since the early days of classifieds, and we’ve seen how the industry has slowly evolved towards better symmetry of information and buying experience.

There have been structural changes over time from multiple directions.

With the emergence of a whole new class of the first-time wealthy (AKA new money) as India marches to become an upper-middle-income economy, investing in real estate is becoming a large opportunity where innovative models are coming up to attract these value pools.

The introduction of the RERA Act has strengthened regulation and buyer safety, enabling more transparency in the process of home buying. This has meant developers need to better their tooling to track and document the construction process.

There has been support in the form of lower interest rates in recent years that has pushed for more investments within real estate (although rates are now inching upwards). The pandemic also re-induced the desire to own a home (and maybe a second home) across a large set of people.

At Elevation Capital, we’ve been a part of the incredible journeys of defining PropTech companies like PropTiger, NoBroker, and Strata which each represent different stages and sub-markets where innovations within real estate have occurred over the last decade.

As a team, we continue to feel displeased by the depth of pain points that still plague the industry and feel excited about the opportunities that are building up.

The market, however, does not reflect this opportunity. While real estate makes up 7% of India’s GDP, in recent years, the number of startups in the PropTech space has been a mere ~1-2% of overall startups created.

Keeping this in mind, we are laying out what we are seeing as emerging trends and themes in the space to help guide entrepreneurs who are building within it.