Indian property market to see price adjustments

  • 12 years ago
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Property in India is increasingly popular with British
buyers.  The country jumped into the top
ten of ‘most searched foreign destinations’ last month and a major
international property company has recently stated that they expect property
prices in the country to rise in 2012.

Probable interest rate cuts in India over the next few
months are also expected to help demand for property and to boost house
prices.  Keep reading to learn more.

Small ‘window of
opportunity’ for buyers looking for well priced property in India

Jones Lang LaSalle (JLL) India, a global property research
firm says that prices of residential units in India in the next six months
should witness ‘marginal appreciation’.

A report from the company says ‘over 60 per cent of
residential launches in the Top 7 cities…are priced in the range of Rs
2,000-4,000 per sq ft, which meets the demand of middle-income buyers.’

The property market in India is also expected to be boosted
in coming months by interest rate cuts. 
The Reserve Bank of India (RBI) has indicated that it expects to cut
rates in the second half of 2012.  This
will make mortgage costs lower as well as helping developers save money on
their borrowing costs.

This is because a number of builders have acquired huge land
banks using borrowed money.  The Economic Times reports that ‘as the
builders pay huge interest rates, nearly 15-18 per cent on the borrowed fund,
the servicing of debts has put huge strain on their finances.’  So, falling interest rates helps them manage
their debt.

If you are thinking about buying property in India, JLL
suggests that you move sooner rather than later.  The company suggests that property buyers
have a ‘small window of opportunity’ over the next six months where prices are
only seeing marginal appreciation.  The
research firm then says ‘a second wave of high appreciation is predicted.’

 

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