Over the past two years, housing prices in Mumbai, India have soared, in some cases leading to costs of $2,000 per square foot. However, analysts say that all the warning signs of a correction are present in that region now, and Jones Lang LaSalle is predicting that prices might fall 10 to 15 percent by the end of 2011. Investors and homebuyers are moving to the sidelines, explains a report by the investing firm, with home registrations down 30 to 35 percent in 2011 compared to the previous year. As activity in the residential space slows, developers and home sellers are starting to feel the pain as well. One real estate investor put a highly desirable apartment in central Mumbai on the market three months ago and “hasn’t received a single inquiry.” A lack of affordable housing and rising lending rates are likely to cause this trend to continue, said Shobhit Agarwal, Jones Lang LaSalle’s managing director of capital markets.
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