Given the problems faced by buyers due to the delay in real estate projects in the country, hardly a consumer would dare to invest in them again. Despite this, long-term investment in real estate is more secure and has better returns than stocks. This has been revealed in new global research.
No fear of high volatility: A report by the Institute of New Economic Thinking (INET) examines the stock market and real estate data for the last 150 years. Long-term returns in equities and real estate are almost equal. But this kind of risk is less in real estate than sharp fluctuations in stocks.
Market events due to global events: According to the data, during the First World War in the year 1920, investors lost 6.8 percent in the shares. While real estate lost only one percent. At the same time, investors in real estate gained six percent during World War II. While investors lost 2.6 per cent in the shares. After 1948, real estate has never had a minimum profit of less than 3.7 percent.
Investors
in India got good returns The report has taken data from the year 2010 in India. During this period, real estate in India was less volatile than the market. Investors in real estate and stocks received 20 per cent returns in the year 2010. Between 2010 and 2019 real estate profits never came down from 5% while stocks lost between 18 to 20% on two occasions.
Buying flats more choice In
the research paper of 2016, Ishan Anand and Anjana Thampi said that consumers in India spend up to 90 per cent of their income to buy houses or flats. However, after the rapid rise in real estate prices in 2010-12, the same boom is yet to be seen. The report states that the real estate situation in India is less satisfactory in the medium term.
1.54 lakh houses are stuck,
86 thousand 824 crore rupees are stuck in NCR area for eight years in these real estate projects
The
link between debt and price The report says that prices in real estate depend on the condition of getting loans, among many other things. Flat prices rise when real estate gets loans easily. Whereas, in case of difficulty in getting loan, prices fall. This has been observed in India in the year 2010-12.
