Interest Rates
Interest rates also have a major impact on the real estate markets. …show more content…
Tax credits, deductions and subsidies are some of the ways the government can temporarily boost demand for real estate for as long as they are in place. Being aware of current government incentives can help you determine changes in supply and demand and identify potentially false trends. For example, the government might give tax credit to homeowners in an attempt to jump-start home sales in a sluggish economy as done by US in 2009.
Favourable Business Climate
Favourable Business Climate spurs the demand for Real Estate projects. The liberalisation of Indian economy in the 1990s brought a rapid influx of FDI in India. The entry and growth of IT and BPO industry generated rapid employment growth which increased the demand for housing.
Unemployment
As unemployment rises, people who have either lost their job or fear losing their job do not move to a larger rental apartment and do not move from a rental unit to purchase a residence whether it is a single family home, co-operative apartment or a condominium. As unemployment rises, companies do not increase their need for office space and may shed excess space adding to the vacancy and availability rates. It is easy to see how the fundamentals of real estate are most stressed when unemployment reaches its