real estate value rising due to IT.WILL IT LAST?

Answer 1

It is true that IT sector fuelled the growth, but now IT sector has been complimented by ITES, Pharma, Telecom, Insurance, Infrastructure, Retail, Entertainment, Automobile etc...
More importantly the Real Estate sector in India has been very recently opened to FDI(Foreign Direct Investment). The current outlook for India looks good. Atleast 2007 is not a year where some one expects the economy to fall, unless something extra ordinary happens.
It is true, as Anu, had mentioned that you cannot actually predict the exact duration till which the Boom can last or when a bubble can burst.
In general the economic outlook for India looks positive and good. So in this background, more demand is expected to be created. When there is demand, naturally the chances of a fall is remote.
Now looking at the Global Market, India is highly dependant on US and if something extra ordinary happens in US, where already Dollar is weakening against Euro, changes can happen.
Yet Real Estate is a safe investment, if you plan to invest. May be the rate of returns may vary if the bubble burst.
All the best....

Answer 2

A real estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real estate markets. It is characterized by rapid speculative increases in the valuations of real property such as housing until they reach unsustainable levels relative to incomes and other economic elements, followed by decreases (also known as a house price crash or a market correction) that can result in many owners holding negative equity (a mortgage debt higher than the value of the property). Just like any type of economic bubble, it is difficult for many to identify except in hindsight, after the crash.

The Economist magazine said that "the worldwide rise in house prices is the biggest bubble in history" [1], and real estate bubbles are believed to exist in many parts of the world, especially in many areas of the United States, Great Britain, Australia, New Zealand, Ireland, Spain, South Africa, India and China. U.S. Federal Reserve Chairman Alan Greenspan said in mid-2005 that "at a minimum, there's a little 'froth' (in the U.S. housing market) … it's hard not to see that there are a lot of local bubbles" [2]. The crash of the Japanese asset price bubble from 1990 on has been very damaging to the Japanese economy and the lives of many Japanese who have lived through it [3], as is also true of the recent crash of the real estate bubble in China's largest city, Shanghai [4].

Unlike a stock market crash following a bubble, a real-estate "crash" is usually a slower process, because sellers just decide not to sell. Historically due to inflation, prices do not fall in nominal terms, rather they stay "flat" for a period of 3-5 years. In select markets though, housing prices have fallen in real and nominal dollars, such as Los Angeles during the early to mid 1990s. Due to low inflation in most countries, future corrections may result in a fall in both real and nominal house values.

Other sectors such as office, hotel and retail generally move along with the residential market, being affected by many of same variables (incomes, interest rates, etc.) and also sharing the "wealth effect" of booms. Therefore this article focuses on housing bubbles and mentions other sectors only when their situation differs from housing.

Answer 3

Bubble has busted,,,but real estate is a good investment if you have money to wait out the market zand a great tax write off

Answer 4

i grew to become into purely making plans on living in squatters' city on the slopes of the beer volcano. with a bit of luck i will snag a refrigerator field next to a budvar sluice. it incredibly is, of direction, assuming that christain hell is pastafarian heaven.

Answer 5

Yes, but it will not last

Answer 6

no it is going evey moment

Answer 7

its all about rental property!