Real Estate India – Regaining the Lost Shine
It is possible that business domains like IT and Retail are enjoying great attention as many big names in the corporate world are regarding India as potentially-rich market. But in the country alone, there is one more sector which draws an equal amount of attention as the above-mentioned domains. Needless to say the industry is none other than the real estate domain of the country.
In prominent cities of country, people hail real estate business as an extremely lucrative option owing to its staggering profit-churning ability. Cities like Delhi, Mumbai, Noida, Kolkata and many others in India have a huge asset-bank of real estate properties and with the influx of luxurious corporate culture and massive industrialisation drive taking place, the infrastructure development is definitely looking high on cards.
People who have properties to their name in above-mentioned Indian cities also earned the huge monthly or annual rental revenue as the buildings, factories and shops of big corporate entities need land through which the owners of land get the benefit. The cost of homes such as flats, duplex or plots are high in these cities due to the massive growth in population levels thus demand for residential habitats in these cities have also shot up thus, giving booster to the home loan and home insurance business.
But overall the business firms which hail from real estate India sector are facing several problems owing to the global liquidity-shortage nemesis. Right from the time it has started, almost every company operating in this sector had clocked losses (and even staggering losses) mainly because of the failure at stock exchange which is why major Indian real estate players such as Unitech and DLF have gone down big time.
Thanks to crisis, the sale graph of new homes has dropped down steeply forcing the realty companies to come up with the different kind of huge discounts, free gifts and various other kind of schemes. More recently, the rental values in the metropolitans have also dropped further as Mumbai alone has registered a drop of 38% in its average rental value. Meanwhile, Bangalore, the IT hub of country has also witnessed a correction within the range of 6-28 percent. Delhi too has recorded a declination of 25% while Hyderabad has seen a drop between 25% to 28%.
The real estate in India slowdown has also affected the home loans portfolio of banks because of the declining demand of residential properties presently. Some of the public sector banks like PNB (Punjab National Bank) and SBI (State Bank of India) have already slashed down the home loan interest rates on their products which is now leading to ultimate resurgence.
Even the home insurance business is now slowly resurging as a sharp growth has been observed in the sale patterns of home insurance products.