There is guarded appreciation and optimism in the real estate market, especially in the urban pockets as markets give many indications that are ambiguous at best about what it is going to look like in further the year of 2016, based on how it has been behaving so far in the fiscal year starting from April 2016. Towards the end of any year, it is a good idea to look at some emerging trends in certain sectors like the Indian real estate sector, so as to get an idea of what it is going to be in the coming year.
The outgoing Reserve Bank of India governor, Mr. Raghuram Rajan had said in a much publicized interview in Mint in the previous year that while the BRICs nations have been facing a lot of economic and stability problems, there seemed to be relative calm in the market of the Indian portion of the subcontinent, calling it the “an island of relative calm in a sea of turmoil”. However, the HSI index has indicated that in most urban sections across the country especially in places like Hyderabad and Bangalore, the two most fast paced emerging cities in India, there is negative sentiment about the prices of land with more and more people hoping for a steep decline in the prices of home realty in these sectors.
This is because the HSI index fell by almost 26 points to become steady at 90 in Bangalore and 89 in Hyderabad leading to an inference that most people would now find it very difficult indeed to sell their properties at requisite prices, without incurring very marginal profits or even losses, in some cases.
Furthermore, there is a steep rise in the number of new projects coming up in the suburbs of these cities and hence a lot of people are looking to buy flats in these new constructions and not in the old established colonies, especially the first time home buyers who have just moved to these cities in search of a livelihood in the booming software and IT sectors.
Tepid sale of residential housing, especially the luxury sector, rising levels of inventory leaks and bad financial attributions have led to many real estate builders and companies desperately searching for customers, says property experts at property.sulekha.com. This is especially in the urban pockets of Ghaziabad which has been one of the worst hit as more than 70% of the newly constructed flats are lying empty, according to a CREDAI study.