Inflation has slowed down real estate investments!

Inflation has slowed down real estate investments!

Inflation has slowed down real estate investments!

In the presence of factors like job insecurities, building dependency on foreign markets and high property rates, many people consider realty investment to have a financial stability and a secure future. However, the increasing cost of purchasing a tangible or intangible service or a product, in everyday terms, inflation has impacted the purchase of groceries, the expenditure incurred on travel, vehicles, apparels etc. Makaan.com asked the existing and aspiring homebuyers whether inflation has slowed down the real estate investment. Maximum number of homebuyers said that it has as with the existing high cost of living, people cannot shell out money for installments.

In the real estate market, builders/ developers push their costs onto the consumer; thus increasing the property prices for those looking to buy. It inevitably slows down the housing market quite a bit. Inflation becomes an important factor even when renting a new home. It is proving to be a curse that is limiting the growth of real estate sector; it has resulted in rising rates, tightening of liquidity and lowering of aggregate demand. Many areas for example, the Mumbai real estate market has very limited supply that stems not from the unavailability of resources but from the escalating property prices making it unaffordable for many homebuyers; thereby, creating a huge mismatch in demand and supply ratio. The Indian real estate sector, which is mainly a supply lead sector, can benefit with further lowering of interest rates and providing adequate liquidity to deal with the existing fund crunch.

Buying a home is one of the most significant financial investments that one ever makes; therefore, it is only advisable to do a proper market research and survey prior to finalizing anything. For more of such poll reports and to cast your vote in a poll, visit MakaanIQ.

Last Updated: Mon Aug 19 2013

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