adhdec01

Hi,

I am planning to buy a semi-indepent duplex house (2 houses with one common wall in 1 ground land) in perumbakkam. The land area of one house is 1200 sq.ft nad built-up area is 2050 sq.ft. 3 bedrooms with wardrobes/3 bath, 2-living room and a modular kitchen with service area. The house is ready to occupy. All the door has iron gates outside. Even the balcony door. In addition to this the builder has promised me to add inverter and security video phone. This is very near to the medavakkam-OMR road. The builder initially quoted Rs. 3100 psft in october and now we negotiated to Rs.2700 psft which comes to 55 lacs and 2 lacs for Vale added tax (VAT and registration). The house has 2 sump and 2 bores. He has laid the foundation 4 ft above the road and the locality is calm and surrounded by lot of individual houses.

My question is can I go ahead and finish the deal. How good the rental value will be there? I am expecting minimum Rs.10,000. Anyone from perumbakkam area? Your inputs are appreciated.

Thanks

Natarajg007

IF you are buying a house to get rental you must be the most decadent idiot in the world.57L invested in the stupidest savings bank at 3% rate of interest will get you more money and a 10% FD will get you 6L approx.
Better find out why you are buying the house?

adhdec01

I will be occupying this house in another 2-3 years...My question is is this a good rate to buy at this time?

vpsureshkumar

adhdec01,

I think the whole deal is an expensive deal. With half ground land you should be able to work out the most 40 lacs if you aquire a land and then get a builder to build to your taste and design. For a 1200 sqft land, G+1 building will cost 20 lacs for the current building cost. So the variable cost is the land price. It depends on the area. In the suburbans half ground should go to about 15 to 20 lacs. If you look into prime city area then it is another story. I think you are looking at the suburban areas. In this way if you want to rent out initially your ROI is better. Think about it

strongsville

Nataraj,
For the first time you gave a good/honest opinion.

strongsville

I think this price is too much.

ks2071746

[quote=adhdec01;11972]Hi,

I am planning to buy a semi-indepent duplex house (2 houses with one common wall in 1 ground land) in perumbakkam. The land area of one house is 1200 sq.ft nad built-up area is 2050 sq.ft. 3 bedrooms with wardrobes/3 bath, 2-living room and a modular kitchen with service area. The house is ready to occupy. All the door has iron gates outside. Even the balcony door. In addition to this the builder has promised me to add inverter and security video phone. This is very near to the medavakkam-OMR road. The builder initially quoted Rs. 3100 psft in october and now we negotiated to Rs.2700 psft which comes to 55 lacs and 2 lacs for Vale added tax (VAT and registration). The house has 2 sump and 2 bores. He has laid the foundation 4 ft above the road and the locality is calm and surrounded by lot of individual houses.

Dear friend,

An all inclusvie price of a little less than Rs. 50 lakhs may be a good deal. Rental value may not be much at this juncture, but your plan to go and live in the house in the next 2 to 3 years will make good reasoning for this purchase, if otherwise you are satisfied with the location and the existing facilities.. Please release the payments based on the actual progress of work and always keep last 10% against the handing over of the flat in all respects.

ks2071746

lovebird

Investment in the house should not be compared with rental incomes.

House price will go up ove ra period of time. But for flats, it is not so in general

ks2071746

I agree. The increase in prices are more in the case of plot than the flats. However, seen from a long term perspective, even the flat prices go up much more than the FD interest. This is my own experience in buying a flat ( 850 sq. ft.) in Saidapet West in Chennai, which I bought for Rs. 8 lakhs in 1996 is now Rs. 27-30 lakhs being indicated by the wanting buyers, though I do not intend selling the flat now. Regards.

ks2071746

abk

when i said the same thing wiseman had put a long story saying property's value is based on the rent it fetches some p/e or r/e ratio and so on. I havent seen anybody calculating property value based on rents.
maybe it can be quoted as an USP when selling the property.
all thru 12 years in RE invstmnt. I have sold and bought props with neither a single buyer or seller discussing this point(rentals).
bcoz never were rentals as high as FD intrest returns.
this was in thread when i differentiated stocks and RE.
stocks are priced on discounting 20-40- times the profit it is currently making. P/E ratio.
I will try and fetch the thread.