Inaccurate forecasts of future demand may affect the efficient allocation of land resources in Kerala.  For example, when putting up a building at a particular site, the developer has to estimate the extent to which demand is likely to grow through population expansion or a rise in the annual incomes of the local population. 
 
If he underestimates future demand, the site will not be developed intensively enough.  If he overestimates, it may be difficult to let out housing units at an economic rent.  Since planners control future growth, the relevant information if made available to the main players dominating the Kerala Real Estate scene, will certainly help them to avoid such mistakes – through a policy of density control.  The same applies to shopping spaces, with planning controls perhaps being inevitable to prevent too much of such spaces being provided to people who do not utilize them.
 
Imperfect knowledge may take the form of having to make decisions without being able to ascertain the investment plans of competitors.  This can result in over-supply by the industry concerned and the inability to sell at the expected price.  We can illustrate this by looking at the demand and subsequent expansion of the office spaces in the city areas.
 
Competition always leads to higher rents.  Office developers respond to this higher price, by starting to build offices irrespective of the fact that others are also doing likewise.  When all their building programmes have been completed, supply must have increased significantly.  In order to clear the backlog in the market, the final price has to fall, unless demand increases or inferior office accommodation is taken off the market.  Here again, planning can impose a scheme, which co-ordinates the proposals of separate developers.
 
Finally, it should also be noted that general regulations covering structure plans and assessments of building requirements also serve to eliminate much uncertainty, thus providing a framework within which developers can formulate their particular development schemes.