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What makes the revival significant is that it began to shape up even before the festival season,generally the time when Indians plan to buy homes. Though other sectors of the economy are yet to offer clear signs of growth,the resurgence of housing finance is a leading indicator of revival in the financial sector. Some of the rise is,of course,a rub off from the demand for gold,which,along with housing stock,offers a sense of security to investors in a period of perceived high inflation.

Whether or not this growth can be spurred to higher levels will depend on the cues from the RBI in terms of its decision on rates at the end of this month. It will also depend on the possibility of a generalised price correction. The stickiness of prices points to the lack of housing stock that has kept demand largely undisturbed for real estate companies even as the economy decelerated sharply. For instance,within the National Capital Region,the Residex shows housing prices have eased in the Noida region,Gurgaon and Ghaziabad,besides the newly developing apartment zones of East Delhi where higher supply has sharply cut back prices. Other zones,including the poorer ones,have not been so lucky.