Is the Real Estate Bubble Big Enough to Naturally Burst in 2014?

One of the primary concerns for the real estate sector in the coming year is very clearly this: Will the much talked-about asset bubble inflates further or will it burst?

Cosmic India

2013 was mired in existing challenges such as subdued sales, piles of unsold inventory and builders going bankrupt. These problems will continue in 2014 as well, and, given economic instability, matters could become worse. However, it is very difficult to forecast anything in India as the real estate market is not subject to a fixed pattern. A great degree of political uncertainty, liquidity issues, high interest rates and cautious sentiments are expected to underpin the real estate sector in 2014 too. The only positive energy in this sluggish sector springs from the fact that the sales, though slow, are not stagnant. 

India’s real estate market has been faltering for quite some time as the economy remains under stress. Realty prices have been surging in an unprecedented manner unlike income levels which are not rising. The price increase is mostly speculative and can be attributed to the predominantly capital-driven nature of the sector.

While the cause might be the same at home, the movement of capital across the various geographies in India needs serious analysis. Let us look at each of the significant markets to understand the creation of the asset bubble.

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Tags : Increasing Trends of real estate market,Property balloon to bursts,Growth in real estate business