The Rise and Fall of Real Estate
The Nifty Realty Index tells a very interesting story about how markets can change with time. From 2006 to 2016, the index saw a massive fall of almost 86% (see the image below). The sector was hit so badly that very few people believed it could ever recover. Real estate was seen as a weak sector and was left behind by most investors.
A Surprising Comeback
But what looked like the end turned into a new beginning. From 2016 to 2025, the same sector delivered a mind-blowing 600% return.
The sector that had been completely written off in one decade turned out to be one of the best performing sectors in the following years. Markets are always full of surprises, and no sector can be ignored forever.
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Big Years of Growth
Post 2016, real estate gave some of the strongest yearly returns.
There was one year where the index rose by 101%, another year with 79%, followed by years of 25%, 33%, and even 53% (see the image above). These five years of strong gains changed the image of the entire sector. What was once at the bottom of the performance table suddenly jumped to the top.
Lessons from the Returns Quilt
If you look at the returns quilt of different sectors, real estate often appeared at the bottom for many years. But later, it made its way to the top and stayed there for multiple years. This is a reminder that the worst performing sector of today can be the best performing one tomorrow. The key is not to get stuck with old ideas about what is good or bad.
Why Guessing Does Not Work
Trying to predict which sector will do well is close to impossible. The better approach is to follow the sectors that are already showing strength. When you move with the momentum, you remove a lot of guesswork from your portfolio. This way, you stay aligned with what the market is rewarding at that point of time.
Final Thoughts
The journey of real estate over these two decades is a clear example of how markets change. From being completely demolished to becoming a top performer, the sector showed that patience and flexibility are very important in investing.
