Bulbaru
Excuse me I was talking..
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posted March 10, 2008 12:49 AM
The India’s real estate market is in news. And for all the good reasons. In India, the world’s second-fastest-growing economy, after China, changing government policies and a focus on infrastructure are driving up the demand for housing developments, malls and offices. This growing demand has resulted in the rising prices. Although the prices have been rising, it has not stopped the global investor from investing in the Indian property. This is mainly because the profits are so high that the investors want to take advantage while the prices are within reach. Some buyers take advantage of the spiraling prices to book say, 3 apartments when they want just 1. As the price increases, they sell off the first one, and then the second effectively getting their third (and the one which they intend to own) apartment nearly free of cost.
The rise in India Real Estate Prices is also ignited by huge growth of the IT (Information technology) and BPO (Business Process Outsourcing) industry. As the IT industry grew, employees got onsite and get paid in US dollars and thus many employees earned a lot of money. As a result the average income of the middle class of India has risen. Now the youngsters are able to afford a house much early in life, unlike their forefathers. On the other hand, the burgeoning outsourcing and information technology (IT) industry and organized retail has also increased the demand for commercial space. This has also led to a rise in the price of commercial real estate.
In the past, the investment from abroad was not so forthcoming. The investors were wary of the opaque business practices in Indian real estate. The land laws were archaic, mortgage financing was expensive and the quality of the developments was poor. But all this has changed for the good. The policies of the Indian government have become quite liberal. The pro-active policies of the government now include looser credit policies and financial liberalization. There is also an increase in mortgage lending and price increase that has helped in reinforcing this investment spree.
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