Indian real estate sector overview

Most of the Indians dream of owning a house. They use to save money and then buy it in the past. But now with everyday a new company in the town and banks chasing to give away home loans, things have changed drastically. They are far more affordable but they still remain one of the most sought thing in India.

Indian real sector is one of the fastest growing sectors in the country. It is growing at a very high rate and you will find many new companies in the sector. There are many real estate projects in every town and they are growing like mushrooms. With numerous projects and companies in the sector, it has become extremely tough for these companies to grow.

These companies are surrounded by lot of challenges. Real estate sector is largely driven by liquidity and it is extremely difficult for these companies to generate that kind of amount to fund their large projects in the current economic situation.  Along with that, even land prices are also increasing very sharply and therefore future expansion for these companies is getting tougher.

It is often seen that to overcome these kinds of hurdles these companies are compromising their ethical standards. For example, to make sure that they have enough land for their future projects, they put their funds in acquiring new sites where as they depend upon bank funding to develop their ongoing projects. They have also inflated the prices unnecessarily.

At the moment, most of the real estate companies are going through lot of pain, their stock are down and they are not able to fund their projects. It’s mainly because the customers do either not trust them or simply they have inflated the prices so high that it is becoming exceedingly difficult for them to sell these projects.

Given the current global economic situation, raising funds is gradually becoming an extremely tough task and most of these companies are not able to complete their projects on time. They will initiate a huge project, sell flats even before a brick is placed there and after that, client would run after them to get delivery.

Indian Real estate sector is still largely unorganized. There is a desperate need for a regulator who can check these malpractices in the sector.  There are still lots of buyers in the market, it is just that market should be regulated and sellers should follow the ethics.