As the real estate bubble in the USA progressed from 2002 onward, it also gripped Indian Property markets. Indian property markets became a "get rich quick" ponzi scheme similar to prior bubbles in the history such as tulips and dot.com.

Real estate prices in some cities of India like Delhi NCR and Bangalore stopped having any fundamentals attached to them. Everybody became a investor in real estate. Builders appeared in the market like mushrooms. Rupee 1 crore which used to be a huge sum of money in India until only few years back, is now only good for buying a earthquake prone dingy 2 bedroom apartment in Gurgaon region. You could put that same 1 crore in the bank fixed deposit at 10 % and make 10 lakhs per annum, but renting that same apartment will get you max 2 lacks even in the best areas. In short, property buying and selling became an end in itself.

Starting 2007 onward it dawned on the market participants that prices have no relationship to fundamentals anymore and a bubble was in progress. Just like Indian stock market bubble which popped in 2008, Indian real estate bubble is in early stages of a crash. Unlike stock market where liquidity is high, popping of a real estate bubble will take a long time, perhaps upto 5 to 6 years. When property prices again start showing some relation to fundamentals, buyers will return. Alas that is still few years away.