Tips On Investing in India’s Real Estate Market

The Indian real estate market is completely driven by Capital. The real estate capital enters a really vicious circle as capital will push prices and land costs while also elevating construction costs. At the same time, the price pushes will move the consumer away and investors will have a surplus of money while the constructions are delayed. Capital does not currently generate the desired returns on the investments made.

Almost everyone agrees with the fact that the entire Real Estate market in India has prices rocketing to the moon, way far away from the affordability. We basically have a widening gap between affordability and prices. The speculative market practice is nowadays really common. We may see interest rates going down to 9% but prices have to end up with a correction of up to 33 percent in order to reach the efficiency level we saw in 2009.

In India we can say that the Bull period is over and we will see a recovery of the real estate market after the elections. No matter what happens though, earning good income from real estate investments will not be possible this year. Price rises will not be present but we are still faced with a huge problem since  a lot of money moves away from the estate market as it is used for funding the elections.

We clearly notice that there are far more sellers available at the moment in India’s real estate market when comparing to the number of buyers. In the year 2012 we say that over half of the sales were sold to interested investors. When this happens, it always follows a downtrend in prices and sales.

Unfortunately, we can say that the year 2014 was a really bad one for the entire real estate market. It is not a good idea to make investments at the moment and you may want to wait for the elections to be over and then see exactly how the market evolves. There is a possibility for prices to go down and that means that purchases may be great then but at the moment we have too many properties under the ownership of investors.