Property prices in India have been on a tear for quite a while now. One of the condos I bought in Ahmedabad in 2006 doubled in just over a year. While the growth has been pretty tame since then, I was nonetheless quite surprised.

But in other parts of India the market has actually begun to correct. After the housing downturn of America, UK, Spain and Australia, it’s finally India’s turn to feel some pain. According to the Economic Times of India, prices are cooling down. The real estate prices in some cities have come down as much as 25%.

Land prices in the national capital region (NCR), Mumbai suburbs, Bangalore and Hyderabad have corrected by up to 25% as property developers slow down their land purchases. Poor sales and lower availability of credit at higher cost have prompted property developers to end the mad rush to acquire land. Some of the developers have even backed out of land deals which were agreed upon as the slowdown hit the sector.

Prices have come down by up to 25% in Mumbai’s distant suburbs, including Thane and Belapur, and pockets of Hyderabad and Bangalore, according to property consultancy firm Knight Frank India.

I think the reason why Ahmedabad shot up so fast between mid-2006 and mid-2007 might have been because it was declared a mega-city and thus suddenly popped up on everyone’s radar. Despite being invested in the market, I wasn’t entirely happy to see prices shoot up so much. I guess that was because we had paid cash – if I had been fully leveraged with 10% down, I might be singing another tune!

Regardless, property prices still seem exorbitantly high in many places in India. Hopefully the 25% correction will bring some much need relief to the average middle class family.