Knight Frank's Gulam Zia says real estate's GDP contribution could rise from 8-9% today to 15-20% by 2047, but warned affordability and shrinking FDI remain real constraints.
Speaking at ASSOCHAM's National Conference on Real Estate for Viksit Bharat on Tuesday, Gulam Zia, Knight Frank's International Partner and Senior Executive Director for Research, Advisory, Infrastructure and Valuation, projected that real estate's share of India's GDP could climb from its current 8-9% to somewhere between 15% and 20% by 2047, India's 100th year of independence. "The challenges that we are talking about are also multifold," Zia told ANI, framing the projection alongside the constraints that would need to be resolved to get there.
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Zia sized the current real estate sector at roughly USD 600 billion. To hit the higher end of his 2047 projection, he said India should be aiming for a real estate sector worth USD 8-10 trillion once the broader economy reaches USD 25-30 trillion in GDP, a scale-up that assumes expansion well beyond residential housing into office, warehousing, logistics, education and healthcare real estate. He put the sector's plausible long-term annual growth rate at 9-10%, while acknowledging real estate's inherently cyclical nature means that growth won't be a straight line.
The most pointed part of Zia's remarks wasn't the topline number, it was what's happening beneath it. He said organised developers have increasingly shifted toward premium and upper-end housing because the economics simply favour it. In his words, selling a hundred premium apartments takes considerably less effort than selling the equivalent revenue in twenty lakh-rupee units. That shift is precisely why affordable housing remains, in Zia's framing, one of the sector's biggest unresolved challenges even as the industry's headline numbers look strong.
Zia flagged that foreign direct investment into Indian real estate has been shrinking for a couple of years now, and that REITs, despite recent regulatory moves to widen their appeal, still have considerable room to grow before they become a mainstream capital channel for the sector. Combined with the affordability gap, this points to a sector that's expanding in value terms while narrowing in terms of who it's actually built for.
Zia specifically named Mumbai, Delhi and Bengaluru as markets where premiumisation is putting real pressure on ordinary homebuyers, and NCR's own price data backs that up. Indirapuram alone has seen prices climb 73% on the back of new connectivity, exactly the kind of appreciation that widens the gap between what's being built and what an average buyer can actually afford. Zia's national framing and NCR's own recent price moves are describing the same underlying dynamic from two different altitudes.
For context on where things stand right now rather than where they might be in 2047, Zia pointed to roughly 175,000 apartments sold across the top eight cities in the first half of this year, broadly in line with the same period last year. He was explicit that this doesn't yet signal the start of a downturn in the property cycle, a useful data point given how much commentary this year has focused on softening sales volumes.
