If the current economic conditions have proved nothing else, they certainly prove that investment in Indian residential real estate is impossible to write off, ignore or find an alternative to.
While the world buckles under seemingly unsustainable pressures and chinks develop in several property markets, Indian residential real estate presents a buffeted, battered but largely resilient front.
Why is this so? In every second advice column and market analysis we come across, investment gurus disparage the Indian residential real estate sector. Housing prices in the metros are astronomical and beyond the common man's affordability, they say. Indian developers should have read the writing on the wall, and now they're facing the day of reckoning, they say.
A correction is just around the corner, they say. Rising home loan lending rates have put further pressure on housing affordability and it simply does not make sense to avail of one anymore, they say.
And yet... While demand slows down in the city centres, it trickles over into the suburbs and satellite towns. Home buyers are being pragmatic in their expectations about location, connectivity and even basic social and civic infrastructure. While Bandra loses its sheen, Navi Mumbai's star ascends. While the prime areas of Pune take a beating, Kharadi and Hadapsar emerge in force. South Delhi is an impossible dream, but Noida's residential market booms.
Is this logical? Are gold and silver not much more lucrative investment propositions? Are certain stocks not geared to overtake everything else on the market before too long? Who will infuse sense into the people? Where is the investment expert with a voice loud and determined enough to convince the Indian population that they are in error?
Indian residential real estate remains in subdued maintenance mode, but it is certainly not in its death throes. Homes continue to sell. Indians still consider owning a home of their own as the ultimate investment and goal in life. From the corporate world's C suite down to the back office teams; from the manufacturing sector's board of directors set down to the blue-collar ranks; from the up-and-coming entrepreneur in Mumbai down to the fruit vendor on the streets of Surat, everyone wants a home of their own.
There are, of course, fundamental reasons for the unrelenting popularity of investing in one's own home in India. One cannot live in a gold bar. One cannot rent out a stock portfolio, hang a name plate on a mutual fund or state a fixed deposit as address proof. These vehicles may protect from financial disaster, but they offer no shelter from inclement weather.
While market conditions fluctuate, the fundamentals of the human condition remain constant. And therefore, for both traditional and practical reasons, the desire and need to own a home is hard-wired into the Indian psyche.
It should be borne in mind that the concept of home ownership as an investment route is a far more recent phenomenon than the need for shelter and basic security. In India, we take pleasure in knowing that the value of our home has appreciated, but we would not consider selling it because prices in our area are now so high. Nor would we move out of our home because property prices in our neighbourhood have taken a beating. When we say that there is a shortage of 26 million dwelling units in India, we are not merely stating dry statistics - we are saying that there are 26 million families who are either homeless or living in rented properties, slums or with their extended families.
When we talk of buying a home in India, we are not talking pure investment - we are talking about something that has a prominent place on Maslow's Pyramid of Human Needs. Here, then, is the question - should you invest in a home now, while there is so much uncertainty on where the Indian residential real estate market is going?
Would it not be more prudent to wait until developers come down on their prices and the RBI assumes a more benevolent stance on home loans? We already know what the analysts would say - but what is your answer?
The author is Chairman & Country Head, Jones Lang LaSalle India