The aspiration for millions of middle-class Indians to own a home has seemed like an elusive dream, primarily due to skyrocketing prices and a tendency among builders to concentrate on exclusive gated communities, effectively excluding this demographic from the market landscape.
However, a shift may be on the horizon as lower bank loan rates emerge. In the year 2009, an increasing number of middle-class Indians could find themselves taking steps toward owning a home. Some builders are starting to reduce their prices in order to sell off unsold inventory and construct more affordable living options.
Over the past few years, the perception of houses has morphed into just another financial asset. Wealthy investors, enlivened by booming stock market results, have flocked to the real estate sector, fully convinced that house prices could only trend upward. Their optimism was validated, as real estate prices soared to extraordinary levels. Builders, in turn, were eager to accommodate this frenzy, primarily focusing on high-margin exclusive developments, while seemingly neglecting the accessibility of these properties for the overwhelming majority of India’s immense middle class, which numbers around 300 million.
Yet, a dose of reality struck the realty sector last year. Elevated prices combined with interest rates in double-digit territory deterred genuine buyers, leading many families to abandon their home searches. A collapse in the stock market ultimately turned the tide on speculators, causing ripples throughout the construction and real estate industries.