Will the Indian Property Bubble Burst?

People who have a dream to buy their own house can make their dreams fulfilled if the present scenario of the real estate sector continues for a few years. This is because the real estate sector is in a very critical state and can crash anytime. It is said that recently the effective sales of the real estate sector has slowed down highly and the list of unsold flats are increasing in a huge amount. Market analysts are also confused about the present scenario of the real estate. The people who invest in property on a large scale are also facing several issues due to this slowdown in sales. In the recent news it has come up that in many metropolitan cities the property prices have raised at a very slow rate and this is a major concern for the investors. According to the real estate experts it is said that among eleven cities there has been a very less growth annually in property prices. Hence people can understand the present situation in property prices.

The real estate experts have feeling that there is more pain to come for the people who are involved in the real estate business. These is also affecting the flats in hyderabad as this city has developed a lot. The residential segment is also likely to face major issues in the market than other segment in the real estate business. As suggested by a big personality in real estate that the transaction prices have seen a great fall in the recent years. The discount rates are increasing without any limitations and hence people in this sector is suffering big time. The major question now is whether prices will fall more or not and nobody is prepared with the best answer for the same. Presently there has been correction in prices but that doesn’t mean it will continue to happen. As far as the economy of India is concerned it is doing well with a good increase in GDP and huge investments from foreign are also seen. It should be noted that all real estate’s investors are not rich people and hence people who have invested for very short time are selling their houses at cheaper rates to builders.

There are many people who are offering big discounts to attract more buyers but still the sale is low as the prices are not suiting all customers. The RBI governor has said that the industry should look after the price factor as the sale of property is not much happening. The main reason of the slowdown in sales in property is due to the government’s intervention in the black money market. In the real estate business transactions were mostly made in the form of cash and hence unaccounted money in this business has been there. But due to the new government’s action against black money has lessened the generation of black money in this business. The consequence of this policy will have major effect in the real estate business in the coming years and hence investors or policy makers should do something about it.

Real estate companies have approached the Prime Minister regarding the proposed changes in the tenancy law in India. Developers can rent out the properties which are lying vacant. Government is seriously looking into the issue.