chataara

Dear friends

Since there is slump in the sales of RE properties in Chennai, the bull writers are not accepting the fact that prices are crashing.

But a valid proof for this has appeared in todays newspaper.

According to Times of India, Udhayam theatre property's (1.2 acre) base price for auction sale has been brought down from Rs.100 Cr to just Rs.29 crore.

This price is arrived after analysing all the possibilities.

The reason: There is not even a single bidder for this prime property which abuts two arterial roads.

I hope a clear picture is emerging regarding the price of chennai properties.

Here is the link : ]http://epaper.timesofindia.com/Daily/skins/TOINEW/navigator.asp?Daily=TOICH&showST=true&login=defaul t[/url]

ks2071746

Dear friend,

This Udhayam theatre complex is basically a commercial type. I am not defending that the RE prices are not coming down. But, they are reducing, higher percentages in out skirt areas and lower extent in the within city areas. Unless the FSI is increased substantially, say from 1.5 to 3 or so, I feel, large reduction within city limits for residential may be a distant dream.

ks2071746

nabishek

WOW! This shows how much business and consumer confidence has been affected.

Most of the malls, hotels all are empty.The per-day business have come down by more than 50% everywhere.

One of a retail shop owner in spencer's mall was asking me when IT will bounce back, he was saying that earlier his perday business used to more than 50K, and now he hardly sees 15-20k and is finding it hard to even pay the rent.

He said people nowadays are not preferring brand, they want value for money.I think this sentiment is for everything and RE is no exception.

Ks, whether FSI will be increased or not depends on what the government wants to do.Whether they want to scale the city horizontally or vertically.

FSI increase seems unlikely, seeing the Second master plan and the proposed township plans, looks like the current government wants to expand horizantally.I also support that as it will decongest the city and people can move near to their workplace and there will be good ecosystem and equilibrium.

Having said that, The flat prices within the city has to correct minimum 30-50% even at the current FSI.There is a huge difference between the current market value of the land and the flat price quoted that amounts to 20-30% already, for the remaining we need just 10-15% correction in land price which is very possible.

lovebird

No recruitment. No increment.No bonus

Lay offs.

So no business.

All flat prices/RE prices are getting corrected

ks2071746

Dear friend,

As told, it is not happening to the extent what the buyer expects to happen in the correction in prices for flats within city limits. Let us hope it will happen soon.

ks2071746

chataara

Dear Abishek

I know one friend who was running an IT centre at T.Nagar where animation and other s were imparted. His monthly turnover was Rs.5 lakh per month.

These days are gone. His monthly earning came down drastically. His final month income was just Rs.5000. A total collapse.

Now he is striving to sell off his computers and other things and wants to give his place for rent. He is giving advts regularly in The hindu and TOI. But no takers.

Because of heavy loss in his business he has sold his flat at kodambakkam for Rs.22 lakhs (which was quoted Rs.30 lakhs during peak time).

This is the real scenario all over chennai.

Thanks

chataara

chataara

Dear KS

As far as Udhayam property is concerned, they auctioners have brought down the base price from Rs.100 cr to Rs.29 Cr.

Dont you see any fall in this matter. Our BIG BULL had already written once that for prime properties there are great buyers like Rahul dravid, Sachin tendulkar who would never see any slowdown in their revenue.

Why such bigwigs did not come forward to bid?

Simple reason is, If big amount is dumped in real estate it cannot be realised within another 5 years. More over there will not be any appreciation in the coming years. Its just dead investment.

Thanks

chataara

abk

to justify your claim you have to first prove that the price of 100 cr was arrived after analysing all possibilities, it does not appear so.apparently the agent meghraj would have inflated the price to get more commision
(greed) now he tells the court about guideline value which is 29 cr.
i remember me telling that the price was a 'hike' in another thread
when somebody claimed it was a crash (i will retrieve the thread).

it is the fixation of the base price and it was fixed again bcoz there was a litigation in the family and that is why someone has gone to court.
otherwise to fix a base price you dont have to go to court.
since there is a dispute in the family and apparently some one is not willing to sell and hence the high quote of 100crs.and someone among 58 in dire straits(may have lost in the bourses) who is willing to sell at any price.(distress sale).

all these are guesses as good as yours when you assume 100 cr to be fair price in the first place. it is a case of misquote or a disputed property.
may be a politician with lot of blackmoney wants to buy it at a good price but wants to reduce the white component and hence the litigation ....

s

chataara

Dear ABK

Many assumptions in your post to keep the chennai RE price upwards. Good story.

But if a politician wants to intrude in BIG properties... all these should go for mean price.

If someone of the owners of Udhayam is unwilling to sell, this property cannot be sold. First of all, it will not come for Auction.

Regarding the base price... yes ofcourse it is base price only. When somebody purchase this for certain price, then it becomes market price for that area. Untill then we have to wait. It may go upwards... or may come downwards.

If someone among 53 partners is in distress mode, Others will not allow to sell it that cheap. So, this is not distress sale. Because there is no taker... and as this is the buyers market now... they dont have any other way out other than selling for price like this.

Mr. ABK ... You know one thing, DLF the great name in RE world, is planning to sell its windmills to generate more money in a bid to complete its projects.

thanks

chataara

abk

[quote=chataara;17212]Dear ABK


chattara there are many other factors which would deter a buyer

an auction means all white

it means immidiate payment and many times it is as is where is basis and
no guarantee of possesion most of the DRT auctions are so.

generally a person who buys such big props will
finalize the price pay a token- get legal clearance-give a newspaper ad-
and then pay an advance sign a MOU or agreement and then settle the money within reasonable time as agreed(3 to 9 months).
here he has to pay within 15 days.

58 people for a property is rarest of rare case. most RE expierienced buyers would not even look at properties with so many owners.who knows who has encumbered his share and then face litigation which would drag the entire property.

the biggest concern is possesion it is not vacant .
courts when the matter goes into court it by itself kills many would be buyers.there are hundreds of litigated properties.one big example is hotel dasaprakash.
what do you expect just bcoz it is in a prime location it will sell just like that.
you know raptakos property in velachery,prime location it is in dispute for past 8 yrs and is still unable to sell.

and i am not trying to keep prices ,nobody can. i am only debating and if you want all to say yes then there is no need for this forum.