Property Prices set to fall

Are you one of those who had been looking to buy land or flat in you city, but could not but due to extremely high prices of property in your area. Well there is some good news for you as property prices may fall because of bribes for loans scandal involving many banks and real estate companies have hit the Indian markets.

This scam is mainly associated with reality companies and now as finance ministry and reserve bank of India will look to tighten the grip on loans given to such real estate companies, liquidity for the sector will dry up as bankers will not sanction fresh loans, forcing real estate companies to cut prices of real estate to improve the cash position of such companies, which in turn will help the buyers who have been holding cash and were looking to buy property but could not due to high prices.

While property prices may not fall immediately but as banks will turn more cautious in giving fresh loans to builders or real estate companies its effect on real estate prices will be seen over a medium time frame. It’s no coincidence that real estate index has been down almost 10 percent and many real estate companies are down between 20 to 30 percent since this scam has come out in public. So it is better to wait for a while on account of this development if one is planning his or her investment in property or real estate.

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