Realty sector must adjust to new reality:It is still hoping that the general decline in interest rates or the government measures would somehow miraculously revive demand and take prices to bubble levels. Much like other asset classes, the real estate boom was largely liquidity / exuberance-driven. In the financial meltdown nearly every asset has crashed to the extent of 40-50%; over 50% for shares in the case of India.
Real estate, at least the top end investment/ speculative segment, should have seen that much correction. That has clearly not been the case, as price declines in most areas have been in the range of 15-20%. While new projects are generally at lower price points, inexplicably, builders have been loath to cut prices of existing unsold stock.
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