Will there be slumps in chennai real estate in 2007?

Question

Due to economical reasons, RBI has increased rate of interest. This resulted in all banks increasing their rate of interest for loans. This might slow down the real estate purchases.

Answer 1

Well, apartment prices and land rates have risen

astronomically mainly due to the influx of IT companies and

their highly paid employees.

land rates around these companies will continue to grow

until they reach a plateau.

prices inside the city like kodambakkam, nungambakkam,

north chennai will actually stop rising if not decline due to

scarcity of takers.

who will buy a 50lakh flat in otteri?

Rise in land rates are also mainly fuelled by speculators and they will run away once they realise IT companies are also governed by budgets and cannot shell out more money  than

a fixed limit.

Well these are largely my inspired guesses!!!

Answer 2

The abnormal level in real estate prices, especially IT centered cities was already due for correction.Quite good  percentage of speculation has also bolstered this market.With Reserve bank increasing the REPO rates it could work as pin prick on the bubble and the rates in Chennai also will shrug off the extra flab and settle at realistic level .But it cannot be termed as a slump.

Answer 3

No, not at all, at least for another decade. You can expect growth beyond Mahabalipuram, shortly.