Is the Real estate market worst crash on the way?

India’s real estate market is about to crash? Yes, you read it correctly.  We are on the verge of the biggest crash in real estate markets. Let's have a look at the overview of commercial and residential properties.

Commercial Properties

It all started back in 2014-2015 when online stores and e-commerce players got a free hand. In the past 3 years (from 2017 – 2020) more than 2 lakh shops across India have shut down and moved to online retailing.  98% of these shops were used on a rental basis.  Though online retailing has decreased the expense & costing significantly, it has also changed the dynamics of rental income generated from these shops.

Almost all these shops and properties are lying ideal and owners of these shops are ready to take 50% cut in rents but still, there are no buyers. This situation is just the tip of the iceberg.  With more and more people opting for online shopping, local shops are either been forced to shut or are forced to reduce staff and other offline facilities.

As per current estimates, we will see a further reduction in offline stores and a further downfall in commercial properties.  This in return will affect commercial rental income.

Commercial property prices are expected to fall 20-25% in and around major cities in India and around 35-40% across other small towns and cities.

Residential Properties

In the past 5 years (from 2016 – 2020) the supply has exceeded the demand for residential housing. Currently, there are more than 3.5 lakh house units lying vacant in and around the Mumbai-Thane-Navi Mumbai belt. In other states and small towns, the situation is far more depressing.  Investment in Property has failed to deliver returns in past 5 years.

There is a strong fear that the sale of residential properties will further fall and living on rent will become the new lifestyle.

We at Market Mantra 99 have always delivered the best outlook in all sectors and investments. Our vision and thought process has helped us in knowing the outlook far before other experts in the investment and finance industry.

We fear a fire sale happening in property investment (commercial & residential ) and a crash coming in the next 2 years. (Before March  2023). We expect prices to collapse in the range of 35-40% in both sections (commercial & residential).

Any investment in property should be avoided for the next 3 years.  This expected fire sale might affect the overall economy and stock markets as well. We hope the above input will help you make a planned decision in your dream home & business projects.

Note – A fire sale is a flash crash in prices.  Prices can drop 15-20% overnight and the market might be flooded with only sellers with no buyers on the other side.