The bubble bobble.

Real Estate bubble is a drastic blow that can soak up any gigantic economy. Almost all major countries have experienced the real estate bubble in their developing times. However, the bubble engulfs the economy in its vicious circle and eventually ends up with catastrophic implications. The Indian economy experienced the real estate bubble in the recent years. It caused the realty price to shoot up sky-high. But now, with the global meltdown, the bubble is on the verge of bursting. This may end up in the reality prices plunging dramatically with drastic implications on various other critical aspects of the economy.

A real estate bubble can be described as an economic upshot that comes up in real estate markets. This bubble is marked by speedy hike in the prices of realty, to an unendurable level with respect to the incomes and other economic elements of the society. This phenomena is referred to as a bubble in the sense that, it is short lived like the real world bubble. Initially there may be customers who can afford to purchase realty, and therefore the realty market will be moving ahead. Gradually, the realty market grows in leaps and bounds resulting in an all time high price for realty. Initially, even with such high prices, people may compete to get rights over their dream property. This happens because the customers fear that the prices may shoot up more in future. At the same time, there will be people who try to make hay while the sun shines. These greedy souls will purchase huge number of plots and flats and sell them off at twice their price after a short while, when the demand for property grows exceedingly. These activities create chaos in the realty business where on one hand, the real estate agents and constructors make millions at one fell swoop and on the other hand the honest customers pay through the nose and put up all their investment on one single piece of land. This is the time when the realty bubble forms up well.

Amidst such pell mell in the realty market, gradually it becomes very difficult for the middle class society to purchase even a mediocre property. The plans of the common public to own a property turns into a pipe dream. The public start compromising with the fact that realty has turned unaffordable and give up their dreams to own a hot property. When the majority of the customers start having such a notion, the demand for realty starts declining. With the passage of time the realty price plumbs the depths. This marks the bubble burst.

Eventually, when the realty bubble bursts, the realty prices decline rapidly to unbelievable levels and put the kibosh on the realty market's growth. The economies of several countries have tasted the bitter realty bubble. The remarkable realty bubble was the one experienced by Japan in 1990's. It resulted in Bankruptcy, commodity price hike and several severe damages to the public. Several people who had availed home loans faced the confiscation of their properties, but were still forced to pay back the interest of the loan that they had availed.

Indian realty bubble is now on the verge of bursting. So, If you have plans for purchasing a dream property, don't make haste. Put your plans on the back burner, until the realty industry faces a doom. In such circumstances, one can easily take hold of their dream homes at realistic prices.