The southern city of Bangalore, once a favorite of foreign investors, saw real estate values jump threefold between 1992 and 1994. Today there are few takers at those lofty levels. Prices are flat, but most owners are holding out in the hope that the market will bounce back. New Delhi has seen prices stagnate since '94. Still, few experts would call it a crash.
Steel asks that the slump be put in perspective.
People are comparing this to the spectacular growth of a few years ago, when land simply turned to gold. Bombay's real estate market is a jungle of contradictions. Expatriate executives can't find suitable housing, while as many as 4,000 apartments in the city's toniest neighborhoods like Malabar Hill and Cuffe Parade lie vacant. That's because India's laws are so stacked in favor of tenants that landlords prefer to leave apartments vacant for fear of losing them if the tenant refuses to move out. The reason, he says, is that the Tokyo-level prices often quoted are valid only in south Bombay, where multinationals have tended to congregate.