Real Estate Inflation and Housing Finance in India : Mapping the Correlation between Raising Property Prices & Increasing Home Loans among Indian Cities
Year: 2024
Type: article
Abstract: Focusing specifically on India — a country that has recently faced recessions partially due to housing bubbles, like many other nations around the world — this research explores in depth how development of real estate linked financing sector have fuelled mortgage led asset price inflation across different cities (both metros & Tier II/III) over decades. Drawing upon a variety of market statistics, policy and economic indicators, the research identifies strong relationships between housing loan availability — by way of loosening mortgage regulations — and property price growth. The study shows that metropolitan cities have witnessed growth in housing loans at a CAGR of 10-12% over last decade (2010–2020) resulting into similar annual price appreciation for real estate standing between 010-15%. Tier II and III cities alternatively, exhibited slower but more stable growth trends in property prices of 6-8% driven by government push & infrastructure developments. The research emphasizes how this relationship has been altered by a number of variables, including as urbanization, demographic changes, government housing programs, and regulatory reforms like RERA and GST. The results imply that although housing financing has played a significant part in promoting the expansion of the real estate market, the influence varies greatly depending on local market dynamics, infrastructural development, and the state of the local economy.
Author: Asikni Garodia -
Language: English
Topic: Housing Market and Economics
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4404187010