Indian Real Estate Market and Potential of House Price Indices as an Indicative Tool : Cases and Concepts

Movements in prices of real estate, particularly residential housing, is of vital importance to the macro economy as well as to individual households. A House Price Index (HPI) in this context will not only give an indicative trend of the prices of properties in different cities but also serve as a benchmark for different users and a useful tool for monitoring real estate bubble. The absence of a strong database on the real estate sector is well recognized and considered critical in the context of on-going reforms in India. Information system and data need to be strengthened to enable better understanding and management of financial flows to enhance the sectors' contribution to GDP and revenue base of governments to monitor and formulate policy to minimize economic slump due to burst of real estate bubble