Real Estate boom: Is it a boon or a bane?

India is a vast country where plenty of land is available for different uses. For a long time up to the independence and a short while later, the country depended on agriculture to earn its livelihood and it occupied the major chunk of Gross national Income. Ever since independence, the founding fathers laid stress on Industrialization and automation of various jobs in order to lessen and divert the burden on agriculture and to generate employment opportunities to various sections of the population, which included both rural and Urban India. The quantity of land available for sale was quite less, until the advent of Software boom from the year 2000 onwards.
With the advent of software industries and their sparklingly well laid out wage structure, there was a huge surplus for young minds and their parents. Besides this, with the increase in overseas job opportunities, there was a lot of inflation of the pockets of these people. All these meant that there should be some place where the surpluses can be parked and the interest rates were very low for them to invest in banks and therefore, converting the liquid asset into fixed asset was the best option .Thus whenever two people met, whether it be in a public place or a moving train, the first topic or the starting point for discussion was about either sale or purchase of land or news relating to it in the town. Thus with each and every day, the cost of land increased in a spiral fashion. This tendency is both a boon as well as a bane.
Real Estate boom is a boon:-
1) The real estate brokers and landholders benefited a lot from this new found avenue of income and from their seemingly poor living conditions earlier, most of them became millionaires with the passage of time and they started purchasing new vehicles and constructing posh houses for the display of their newly acquired wealth. This led to lateral increase in production activity and generation of employment opportunities by leaps and bounds, thus leading to spreading of wealth to some extent.
2) Real estate sale led to an exponential increase of construction activity and the poor Agriculturist had a chance to earn money even in un-season as he participated in construction activity and some of his urgent needs could be met with in style.
3) Wide roads were laid for better inter-connectivity and this indirectly helped in increase of business through transportation.
4) The image of the country as predominantly rural, medieval, non aesthetic and poor changed dramatically to that of Modern, Urbane, wealthy and wonderfully aesthetic and revived the golden images of the past. This led to a huge tourist influx as they had a number of beautifully constructed houses to stay upon their visit to the country.
5) People started thinking in terms of earning money by burying petty differences and some of the previous quarrels began to subside by and large.
6) For many, the long cherished dream of having a house in cities and towns for their own convenience got realised, as the apartment culture increased with the increase in real-estate costs.
Real estate boom is a bane:-
1) The cost of land increased so much so that, it became virtually impossible for the vast majority of middle-class to purchase land and most of them, due to low salary structures, had little capacity to go for loans either during their service or even after retirement, given the high cost of land.
2) With the increase in purchasing power of the investors, even agricultural land was being sold away to meet the urgent needs of the rural landlords like their son’s education, daughter’s marriage or to meet the hospitalization expenses. So deforestation on a major scale is a looming threat and even hillocks are not being spared from being sold or auctioned!
3) Competition fuelled enmity between real estate brokers and landowners and some of them did not desist from maintaining huge armies of personal guards which in turn was a very frightening situation- law and order wise.
So to decide whether real estate boom is a boon or a bane is Hobson’s choice.

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