Real Estate is a very popular form of investment all over the world and in Nepal as well. It is divided into different categories such as homes, residential lots, vacant land, commercial buildings, decks, etc.
From traditional techniques of buying and selling to now a more systematic approach, the growth of the real estate business in Nepal has been on the rise. But, should you invest in real estate in Nepal?
What is the Current State of Real Estate in Nepal?
Over the last decade, Nepal’s real estate market has been on a rise. According to the data of Statista.com, the real estate market in Nepal is projected to reach a value of $0.38 trillion by the end of 2024. Furthermore, this market is expected to be on a continuous rise with an annual growth rate of 5.46% from 2024 to 2028 and reach a staggering value of $0.47 trillion by the end of this time frame.
For the current fiscal year of 2023/24, the contribution of real estate to Nepal’s GDP is projected to be 8.33% whereas during last year, it contributed 8.24% to the GDP of Nepal. This is according to the data of the latest Economic Survey published by the Ministry of Finance.
Foreign Investment
The growth of real estate in Nepal at present is also due to the rise in foreign investment in this market, mainly in the hospitality and commercial segments.
Moreover, there has also been an increase in remittance providing liquidity in the market.
Development of Infrastructures
There has been significant developments of infrastructures in Nepal over the years. Kathmandu-Terai Fast Track will soon connect Kathmandu to Terai by a 76-kilometer motorway after completion.
Mid-Hill Highway: The Mid-Hill Highway (1,700-kilometer) and East-West roadway(1,024-kilometer) are also expected to make transportation better.
Similarly, Gautam Buddha International Airport and Nijgadh International Airport are also ambitious projects expected to bolster the economy.
The development of infrastructures are undoubtedly going to have a positive impact on the economy of a nation which directly contributes to the growth of real estate.
Increasing Middle Class Families
The growth of the middle class plays a crucial role in increasing real estate investment. With more families achieving middle-class status, there is an increase in the demand for both residential and commercial properties. Nepal has experienced notable growth in its middle-class population recently which has contributed to the growth of real estate investments in the country.
In conclusion, the real estate market in Nepal is booming due to a variety of factors and it seems like now is the right time to invest in this particular market. Also, history suggests that investment in real estate is a reliable option for profit generating.
Continue reading: Fixed Deposits vs. Real Estate: Which is the better choice for Nepal?
