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 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 industrialization
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.
