Residential property prices in India have a possibility to reduce
Residential property prices in India have a lot of scope for reduction as supplies are sufficient, a top RBI official said on Wednesday.
SS Mundra the deputy governor of Reserve Bank of India stated that he believe there’s enough scope for housing prices to come down from the higher perch because of huge inventory piled up in several markets while nudging builders to reduce property prices.
The unsold inventory across top six cities in India, including under construction and complete properties, currently stands at around 760,000 apartments as on June end as against nearly 734,000 apartments in the previous quarter, according to property research firm Liases Foras.
He stressed on reduction in housing prices while acknowledging that there can be a counter argument by builder that around 30 per cent of their realization is going towards taxes. With more progressive construction practices and several other measures, it should be possible to make housing less costly than it is today the central banker said. He also voiced concern against the practice of loans for a second and third house, adding the bank credit must be used for productive purposes and not for speculation.
Source: Economic Times
