State of the Real (estate) Asset
Although today was a day of a 6% fall in the sensex (and Indian retail investors hold only 2% of their assets in stocks), I decided to write about something that is more dear to us - real estate! Most investment savvy people have invested in some form of a property over the last decade. A few lucky ones have even cashed out on their investment at returns unimaginable in the years since the economic liberalization of India (1991). Now that the talk of the town is a stagnating realty market, let us examine the actual state of affairs. The Boom Years From 2007 to 2013, property prices escalated so high that people were shunning all other forms of investment and going full steam on property. Although GDP growth was cited as a reason for the boom, the primary driver behind the maddening realty price was the QE (Quantitative Easing) carried out by the US Federal bank from 2009 to 2013. When QE eventually slowed from 2013, easy money vanished, leading to a stagnation in property prices