MUMBAI — India's property developers are facing the heat. Their debts are high, and they are offering discounts, free parking spots and gifts like gold coins and iPhones to sell apartments says a Reuters report.
Normally, such a market should mean buying a house is easier than before, as property rates plunge with excess supply. But for most Indians, that has not happened.
The answer to this puzzle is that most of such unsold homes are expensive, located in upscale societies and in cities like Delhi and Mumbai, where residential property prices more than doubled from 2009 to 2012. Instead of cheaper housing, most developers built apartments that cost over Rs 1 crore on average, as these include a hefty margin and are targeted at richer buyers. But the average Indian cannot afford them. Their demand is in a far lower range of Rs 5 lakh to Rs 20 lakh. So while apartments remain empty, India's middle class is faced with a housing crisis for a lack of affordable housing.
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