'Real estate won’t make you rich': Wealth advisor exposes flawed math hurting Indian investors

The Indian obsession with real estate is financially flawed, says Chennai-based wealth advisor and value investor Anand Srinivasan, who calls it "The great Indian real estate delusion."

In a LinkedIn post, Srinivasan dismantles the long-held belief that housing prices in India only go up — and that rental income is irrelevant in the face of promised appreciation.

“Rental yields in India are a dismal 2–3% annually,” he writes — a figure that trails even basic savings accounts. Global markets, by comparison, offer 5–6% returns. “At this pace, it could take you 35 to 50 years to recover your investment from rent alone,” Srinivasan points out.

Despite this, most Indians continue to pour money into residential properties, banking solely on price appreciation. That, he says, is a gamble with fading odds. “Prices rose spectacularly in the 2000s, but many markets have since gone flat—or declined in real terms after inflation,” he notes.

And inflation isn’t the only risk. High transaction costs — including stamp duty, brokerage, and registration — eat up 6–10% of the property’s value upfront. Add to that real estate’s notorious illiquidity, where selling a property can take months or even years.

Then there’s the concentration risk. “You're locking lakhs or crores into a single asset,” Srinivasan warns. “If the local market crashes, your wealth crashes with it.”

So why do Indians keep investing in a low-yield, high-risk asset? “Cultural conditioning, tax breaks, black money parking — and a whole lot of FOMO,” he explains.

Srinivasan’s advice is blunt: if the rent doesn’t justify the price, think again. “Appreciation is a hope, not a promise.”