Why real estate prices soar in India? A finfluencer breaks down country's property trap

Akshat Shrivastava, founder of Wisdom Hatch, offered piercing insight into the financial undercurrents driving India’s real estate market. According to him, black money fuels property prices while white money heads to stocks. His post on X sheds light on why unaccounted wealth finds a home in real estate and how this impacts everyone, even those who think they’re untouched by the issue.

Shrivastava explains the grim mathematics of inflation. If ₹1 crore of black money is hoarded under a mattress, its buying power drops to ₹50 lakhs in 10 years. In 15 years, it’s worth ₹36 lakhs, and in 20 years, only ₹25 lakhs.

With inflation at 7%, idle cash is a ticking time bomb. To preserve its value, black money must be "invested." But where?

Stocks, bonds, and even legal car purchases are off the table for black money, leaving real estate as the only viable option. Shrivastava points out that this is why unaccounted wealth has a direct and ongoing impact on property markets.

And it doesn’t stop there. As black money floods into real estate, it inflates property values, driving up the cost of living for everyone.

“Even if you don’t buy property with black money, it affects you,” Shrivastava says. The rent you pay for housing or the fees in commercial spaces are often linked to properties purchased through unaccounted funds.

Shrivastava concludes with a sobering observation: as long as black money exists, real estate prices in India are unlikely to stabilize.