Property prices rarely crash. Why?
Property prices have always served great purpose even after the economic collapse. Property prices rarely crash and it is predicted that they will always be beneficial even in the future. Properties are not stocks and the sale of an apartment which is sold by a person in times of difficulty will fetch him a great amount unlike the shareholders.
Most of the residential properties have micro markets within them wherein the apartment owners are the end users and henceforth the property prices there are quite rigid. Also various cities like Mumbai and others have properties which are priced high and will always remain high due to the excessive demand. The high priced properties are the residential properties wherein the builder will have completed the construction with multiple approvals in place. In such cases, the apartments are priced in a rigid manner.
However, with the clearance process being quite a hassle, most of the investors prefer having the properties which are already cleared. There are a large number of constructions which are awaiting the clearance and are in the delayed pipeline. Perhaps, in most cases, about 10 per cent of the property projects get approvals on time. Also there are projects which are in the process of being approved and buyers opt for them while in the pre-launch stages.
How should a buyer get himself the best deal?
There are various chances wherein a buyer can negotiate with the developer and get the property for the least. The developer will be convinced if he sees that you are a serious buyer rather than just wiling his time away. Perhaps before negotiating and making a deal the buyer should also think about the project delay, possession date and so on.
With the fast pace in the real estate market, there will be a hot rush for properties in the coming months. Many developers have kept the projects on hold so as to expose them at the right time.
Indian property bubble 2012:
What is a real estate bubble?
A real estate bubble/property bubble is a kind of economic bubble which occurs periodically in local or global real estate markets. It is categorized by rapid increases in valuations of real property like housing, until they reach unsustainable levels and then decline.
With an increased demand in the Indian real estate market, various cities in India like the Mumbai and others will witness a great demand in the 2012-2013 based on the increased launch of new projects especially when the sales are really slow. Mumbai, being one of the most populated cities of India, will witness a fall in the property by about 35 per cent. The same will be followed in Delhi as well.
This is because most of the Indian property developers had initially bought lands at a very high price and are now forced to reduce the price for the sale. The residential sales of about 65 per cent of flats in Delhi and 35 per cent in Mumbai have gone to the investors. It is believed that the Indian property market should be looked at in context of the overall economic situation In India. However, the Indian economy is booming with an annual growth rate of about 8.5- 9 per cent which in turn is leading to the increase of potential investors with disposable income.
Since housing in India is a major concern in major cities, there are sufficient demand generators for the residential units for about a decade and the price rise is expected to increase about 10-15 per cent.
