The housing bubble of 2008 in US was fueled by a strong belief that Real Estate prices can only go up, all the time. Similarly, India had an housing crash in 2012. China saw it in 2013. Australia is going through one such real estate crash right now. The understanding has always been that that there is acute shortage of land for fast growing economy. They would often quote Mark Twain : “Invest in Land. They don’t make it any more.”
I am in total agreement with Mark Twain that we cannot expand the land mass on this planet. However, do we really need as much land that it will ever be in short supply. It is worth noting that every real estate bubble bursts when there has been way too much over supply than real demand. And, it will always be so in future. The suppliers of real estate will always find enough land to feed the greed of investors. There is plenty. How can i say so ? Read on…
In India, the second most populous country (going to be No.1 over next 5-10 years), the land mass available is only 2.40% percent of the world. This is looks woefully small when we read that 16.70% of the global population lives in it. Even then, we need only 1.21% of the entire Indian land mass to make Indians live & work respectfully. Let me repeat. India needs only 1.21% of its landmass (not of the world)…to live a respectable life. Surprised ! Why not ! It speaks contrary to popular belief. It is an eye opener. As a proof, read the table below I prepared. It shall reveal the numbers