I have been in India for nearly a week now and am simply amazed to see the growth and development that is taking place at every nook and corner. I have been tracking India’s growth sitting thousands of miles away from other side of the globe for few months now, but being here on ground is a completely different experience!
Quite a few readers (especially who are settled abroad) have mailed requesting me to write about my India experiences. I plan to do a series of posts in coming weeks that will present my unique experiences about being in India and how different India has got over last few years.
The real estate boom
Indian Real estate boom has to be seen to be believed. I do not have words to describe the real estate phenomenon that India is experiencing right now. Since the time I landed at Mumbai airport I have seen every road, every newspaper and every TV channel literally overflowing with real estate commercials / ads.
The structures coming up are ultra-modern and super expensive – and there is no dearth of buyers! I recently read that a 2100 sq. ft apartment in Nariman point, Mumbai was sold for a whooping 34 crores (nearly 9 million US dollars).
You may say that places like Nariman point have always been one of the most expensive places in the world…granted, but real estate prices in places like Pune (Tier II city) are no different.
If you want to buy a 1000 sq. ft apartment in a decent locality, you have to shell out close to $200,000 (about 75 to 80 Lac rupees), and chances are you are still living on the outskirts of the city.
I had an interesting discussion with a real estate developer friend of mine yesterday. I asked him a simple question –
How can people afford it? From where is the money coming to pay builders such astronomical prices?
His answer was quite simple –
Only two segments are buying houses right now. Software professionals (those have lived abroad and come back) and Businessmen. Only they can afford it!
So what about the rest?
They have to wait till this boom is over
Do you think the real estate boom will be over anytime soon?
I doubt…
Do you think the housing prices will come down?
Not for next 5 years at least!!!
Essentially, less than 3% of overall urban population are able to afford such astronomical real estate prices. Others have to just dream about it!
I stumbled upon an interesting video yesterday showing the divide between rich and poor in India. I highly recommend you watch the video.