India’s
real estate market has been under a ‘time correction’ since a decade. Time
correction is a fancier way of saying that the prices are stagnant. After some
time, this stagnation is expected to end and the real estate prices will head
upwards again. There are several reasons behind the stagnation.
The major
one is that prices rose way too fast and too far on the strength of investors
who had more money than sense. These investors kept selling apartments to each
other at higher and higher prices until finally the prices got too high for the
real buyers – those who actually want to live in those houses. This stagnation
is a phase when the buying capacity of the real users in catching up to these
prices.
Another
factor has been the tremendous distrust that buyers have for real estate
developers for known reasons. As time goes on, a greater portion of potential
buyers will turn into actual buyers. Real estate is unique unlike other
investments in that one house is a necessity for every family and it’s only
from the second house that the buyer becomes an investor with the risks and
baggage it attracts.
The problem
is that buying a dream house is very different from buying a dream vacation or
car. Housing is different because of the
scale of the expense behind it. The financial hole due to the dream house can
cause financial damage and might take years to repair during which, the family will face many hardships.
