52% of flats in city held by investors
If you’re waiting for real estate prices to fall before you buy your dream home, you just might have to wait a long time.mumbai Updated: Dec 07, 2011 00:33 IST
If you’re waiting for real estate prices to fall before you buy your dream home, you just might have to wait a long time.
A survey conducted by real estate research firm Liasas Foras shows that a huge 52% of homes have been bought by investors and not by those who need them.
This means that most of the flats in the city are being held by those who want to make money from real estate. The figure is more than twice that in 2009 when the number of investors was just 22%.
Pankaj Kapoor, CEO, Liasas Foras, said the trend where investors tend to bag a share of more than 20% in any realty market was a bad sign.
He said the huge number of investors was forcing builders to keep the prices high. “Builders have promised investors great returns and cannot afford to reduce prices now,” Kapoor said.
Data shows that investors, who comprise the business class and stock markets investors, have paid, upfront, 50% to 100% of the total cost of apartments, which have been acquired at discounted rates.
Advocate Sanjeev Kanc-han, who deals in real estate matters, said the builder-investor arrangement was harming genuine buyers.
“Here the builders even create an artificial shortage to facilitate higher profits for investors to encourage them to invest in future projects,” Kanchan said.