India’s real estate market shows resilience against a crisis like China’s Evergrande due to stronger regulations and sustained demand. Experts highlight key differences in scale, governance, and economic impact.
Evergrande Crisis Overview
China’s Evergrande defaulted in 2021 with over $300 billion in debt after overbuilding and pre-selling unfinished flats, eroding buyer confidence. A Hong Kong court ordered its liquidation on January 29, 2024, amid broader sector woes where real estate contributes 30% to GDP.
India’s Past Challenges
India faced its own scare with the 2018 IL&FS collapse, triggering an NBFC liquidity crunch that stalled projects. Unlike Evergrande’s global exposure, IL&FS issues stayed domestic, allowing recovery through government interventions.
Key Differences
India’s sector, at 7% of GDP, benefits from RERA since 2016, mandating escrow for buyer funds and transparency to prevent fund diversion. Chinese developers defaulted on $114.6 billion of dollar bonds by 2024 due to strict “three red lines” policies, while India’s debt-to-equity ratios for listed firms stay below 1x.
| Aspect | China (Evergrande) | India |
|---|---|---|
| Debt Scale | $300B+, global bonds | Lower, domestic focus |
| GDP Contribution | ~30% | ~7% |
| Regulations | Lax pre-sales, recent curbs | RERA escrow, buyer protection |
| Demand Resilience | Weakened by delays | Steady, even in downturns |
Positive Outlook for India
Housing sales in top seven cities rose 26% YoY to 2.71 lakh units in 2023, with tech hubs like Bengaluru leading. Average flat sizes grew 11%, signaling demand for larger homes amid urbanization.
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