Realty sector struggles as funds stay away
India's troubled property developers are seeing early signs of a rebound, but high debt costs and a lack of private equity funding suggest a sustained recovery is unlikely for some time. Enquiries for homes and offices remain strong in Asia's third-largest economy as it grows at an annual clip of 6-7 per cent, but buyers are staying away as developers dither over sharp price reductions that could turn pent-up demand into sales.
Foreign investors, scarred by the global sub-prime crisis, are wary of investing in a property market beset with red-tape, land disputes and unclear titles. And with no clear sight of prices bottoming, like home buyers, they are staying away.
Major developers, who have seen their share price slide by up to 90 per cent from last year's peak, expect the market downturn to last another 3 to 4 quarters even as property markets elsewhere in Asia show signs of turning a corner.
More: http://in.biz.yahoo.com/090511/50/batjxb.html
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