With most global/domestic IT companies going slow on hiring plans, we see this adversely impacting housing demand. In addition to job losses, we see increasing risks of pay cuts and low visibility on pay hikes weighing on near-term demand for homes.
Wednesday, March 04, 2009
IT Slowdown to Directly Affect Realty Market
Last 5 year data suggests that there a direct co-relation between the growth of Indian IT sector and the Real Estate Market. Data on strong housing loan growth of 32% CAGR during FY03-FY07, at a time when the Top 3 Indian IT majors' (a good indicator of the sector) employee base grew at 44% CAGR. The following chart by RBI and Citi shows the direct co-relation.
With most global/domestic IT companies going slow on hiring plans, we see this adversely impacting housing demand. In addition to job losses, we see increasing risks of pay cuts and low visibility on pay hikes weighing on near-term demand for homes.
With most global/domestic IT companies going slow on hiring plans, we see this adversely impacting housing demand. In addition to job losses, we see increasing risks of pay cuts and low visibility on pay hikes weighing on near-term demand for homes.
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