Bad news continues for real estate sector
As per recently-released National Housing Bank data, property prices in Mumbai and Bengaluru were increasing at a disappointing pace between 2013-17. Their annual increase was just about 7.50% and 5.75%, respectively, in Mumbai and Bengaluru.
This captures the essence of what is happening to realty prices in India. Investing in residential properties is unwelcome, say experts. Starting 2013, real estate hasn't been doing good. If someone tells you that the bad phase is over, don't believe, say experts.
There are as many as 1 lakh unsold residential units in Bengaluru and those many more in Pune.
Rising interest rates, high maintenance cost, high tax on rentals and capital gains make investment in physical real estate a bad proposition, says a wealth adviser. Also, there was an "irrational increase in property prices in the past (between 2001-07)", a report says.
With the Real Estate (Regulation and Development) Act being diluted by state governments, a turnaround is not in sight. Demonetization, too, continues to have a negative impact upon.