Between 2003 and 2007, the real estate sector, both commercial and residential segments, had a boom, seeing a runaway rise in price, growth and profits. Realty companies were focusing more and more on luxury apartments. The base sizes of houses became larger. Small house segment was ignored completely. High consumer confidence, low interest rates and a belief that the prices will only one-way, led to this euphoria.
Several construction companies raised large sums of money through IPOs. After the January 2008 crash, the real estate stocks are among the worst affected.
Whereas, the stocks were down, the prices of houses and real estate have not seen any appreciable corrections, although precise information is hard to come by on this sector. Business World reports that in Mumbai recently, Bandra Kurla complex, a piece of commercial estate got only Rs 15,000 per square feet against Rs. 40,000 for a similar property in 2007.
One visible indication of the slowdown in the residential segment is the announcement of affordable housing projects by the big builders, who were hitherto only concentrating on the luxury segments. With rising prices and interest rates, the demand for luxury apartments (Above Rs 50 lakh per apartment) has dramatically come down.

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