New Delhi: Recession-hit Indian real estate sector is crawling towards recovery with the return of end-users as well as institutional investors in the market, consultancy firm Ernst & Young has said.

"The real estate sector is generally looking positive now. End-users are back in the market. Several developers are announcing new projects. Institutional investors, particularly private equity funds, are starting to look at projects for investment," E&Y Associate Director (Real Estate Practice) Chintan Patel told reporters.

The sector fell into a deep crisis after the economic meltdown and coming back to buoyancy was delayed as buyers` preferred to "wait and watch" before taking the buying decision.

Patel said that end-users are no longer shying out of the market as the fear of further economic slowdown and job losses have subsided. Developers are also now more focused on the need of the consumers and a few of them have announced new projects, particularly in the affordable housing segment.

"Price-wise, there is some upside, though that is not significant," he said, declining to hazard any guess on when the prices would reach its 2007-08 peak level.

PE players are scouting for projects for investments too, but they are looking at right valuation to make investment.

"PE players are looking for investment. As they say, once bitten, twice shy, PEs are cautious on their approach," Patel said.

Stating that realty firms could do well in the on-going quarter than the immediate past one, Patel said that the margin of the real estate firms would surely be squeezed if input prices, primarily cement and steel and the cost of land continue to escalate.