soniseema

Hi Friends,

I am yet to come across price reduction in RE in Punjab for investment purpose. What is the general outlook for RE in Punjab in 2009? What would a 250 sq. yd plot in a posh locality of Ludhiana cost?

Cheers!!

wiseman

Hi,

Punjabis are very hardworking, eternally optmistic and can squeeze oil from oilseeds with their bare hands .

Maybe the fact that much of Punjab's wealth has come from the soil (and not digitally dependent on the West) and the fact that Agricultural Commodities are in a boom and will continue to be so throughout this depression, is a likely reason for RE in Punjab to not decline much?

Just wondering. Seems to be a good reason for the rest of India to diversify their sources of wealth. Engineering, Industrial Production, Agriculture as well as IT/ITES along with seems to be a good way to ensure that life is comfortable in a steady way. And of course, low inflation (especially in salaries) along with steady growth will ensure we don't have American Style Booms and Busts. Of course, low-cost education, adequate drinking water, roads and other such essentials ensure that there is enough surplus for all to keep the growth in RE going steadily.

Keep it coming from other regions as well.

cheers

soniseema

Hi Wiseman,

Thanks for replying. I think I should wait for a few months before deciding to a property in Punjab. There have been a few articles in the newspapers that there is a slowdown in sale and purchase of RE in the region but the prices have not really decreased. There are less ers and lesser sellers. Moreover, there aren't many builders here and the culture is to own an independent house. So, perhaps there is less pressure to reduce prices.

Anyway, keep coming with your comments and analysis. This goes for the other forum members too.

Cheers

can

Wiseman
The US also has low inflation, unlike Indians the people in US are not wealth
builders so when they loose their jobs all hell breaks loose.
The other point I wnt to make is that 1 1/2 Billion of Chinas funds are in US
T notes so when Ms Clinton was in China to help borrow for its &00 M
bail out the Chiniese were on their knees to beg that their value on T Bill investment did not go down in other words if they did not lend money for the bail out their T Bills will be a piece of scrap paper. Your views on this

Can

can

Dear Wiseman Nats here's a quote from
http://www.financegurukul.com/2009/0...ate-from-1998/
According to this the property value should settle at around ! 1/2 times its

1998 value
For calculating the value of the property in 2008, i also take into account the increase in house prices (thanks to nabishek) and not just assume that prices rise just inline with inflation rate.
I am basing this increase in house price to be equal to the per capita income in india. Why do i assume that on a long term basis house price increasee on inflation adjusted basis is equal to per capita income growth?
“As house prices tends to increase at an inflation adjusted rate equivalent to the per capita income - According to Karl Case, an economics professor at Wellesley College whose name adorns the S&P Case-Shiller home-price indexes, has studied U.S. house prices going back to the 1890s. He thinks that long-run pattern is likely to continue, despite the recent choppiness.”
So you can see that this assumption that house price increase is inline with per capita income has historical data going back to 1890 to back it up. So i will go with this assumption.
Now the question becomes what is the per capita income of India in 1998. According to the Atlas calculation method of World Bank. India had a per-capita income of $430, unadjusted for purchasing power parity (PPP). In 1998 Rs/USD exchange rate was 35. So $430 x 35 = Rs. 15,050 was the per capita income.
National per capita income is expected to stand at 38,084 rupees (784 U.S. dollars) in 2008-2009, 14.4 percent or 4,801 rupees (99 U.S. dollars) over the previous fiscal year, said the release of the Central Statistical Organization. Source:Central Statistics Organization. The 2008-2009 fiscal year started on April 1, 2008 and ends on March 31, 2009.
So for my Compound Annual Growth Rate (CAGR)[IMG]file:///C:/DOCUME%7E1/spdell/LOCALS%7E1/Temp/moz-screenshot-2.jpg[/IMG] calculation i used the following value.
ending value is Rs. 38, 084
beginning value is Rs. 15,050
No. of years 11 years (1998-2008)
38084/15050 = 2.53 raised to 1/11 power (2.53^0.09)
CAGR = 8.81%
So a house costing Rs. 1,00,000 Lakh in 1998 would cost cost 2.58 Lakhs in 2008 assuming that house prices increase at an inflation adjusted equivalent to the per capita income
According to the IMF India’s Inflation rate over the years is given below
Year Inflation, average consumer prices Percent Change
Year Inflation, average consumer prices Percent Change 1980 11.365
1981 13.115 15.40 % 1982 7.887 -39.86 % 1983 11.869 50.49 % 1984 8.322 -29.88 % 1985 5.556 -33.24 % 1986 8.731 57.15 % 1987 8.799 0.78 % 1988 9.385 6.66 % 1989 6.159 -34.37 % 1990 8.971 45.66 % 1991 13.87 54.61 % 1992 11.788 -15.01 % 1993 6.362 -46.03 % 1994 10.212 60.52 % 1995 10.225 0.13 % 1996 8.977 -12.21 % 1997 7.164 -20.20 % 1998 13.231 84.69 % 1999 4.67 -64.70 % 2000 4.009 -14.15 % 2001 3.779 -5.74 % 2002 4.297 13.71 % 2003 3.806 -11.43 % 2004 3.767 -1.02 % 2005 4.246 12.72 % 2006 6.177 45.48 % 2007 6.372 3.16 % 2008 5.18 -18.71 %

Can

Indianil

lolzzzzzzzzzzzzzzzzzzzzzzzzzzzz .....economics ke fundae RE me n that too like this ?

Can you give me a case study or live example ?

Well, in reply to the tpk, I will say that the prices do have corrected to the tune of X percent but the problem is that if there are 10 sellers in the market, 8 are not excepting it and still demanding the old price or a little less. So, as a buyer, you have to keep on looking for the rest of the 2 sellers, who actually needs or require money. In RE market, we ppl call it desperate sell.

hmmn.... n the prices have already corrected ... n at least I don't expect a steep fall from the present level.

So, my advise is to KEEP HUNTING.

amit_2009

Hold back. enjoy life.. most of the sellers at the present are just investors/speculators afraid of loosing the boom period prices.

The smarter sellers sold and exited the market when they could. The existing remaining sellers in the market are the greediest of all. If they wanted to sell they could have sold in the bull run in the last 5 years.. but they held on.. hoping even higher prices.

You can not expect to realistically negotiate with them. They already have very high expectations... just a waste of your time and theirs...

MANOJa

CHANDIGARH: Former Deputy Commissioner of Patiala, Vikas Garg, has been charged for illegal sale of 6,000 sq yards of government land worth Rs 250 crore.

Financial Commissioner, Navreet Singh Kang set up an inquiry and held him guilty for selling the government land. Divisional Commissioner SR Ladhar had indicted Garg, former Divisional

Commissioner GS Grewal for illegal sale of the land that houses the offices of the civil surgeon, district town planner and district education officer.
Garg claimed that the land in sale had been allotted to Kanwar Barjinder Singh, who belonged to Patiala’s royal family. The Financial Commissoner checked that revenue records pertaining to demarcation for the period 1970, shows land as private property, but recent revenue records shows it as government’s property and the final decision has been left on the CM to decide.

As per the inquiry report, the previous Patiala Deputy Commissioner, Deepinder Singh, had refused to register the property in 2010, saying that the land was actually owned by the government. The former DC’s objection became a ground for rejection of the sale deed in 2010. But this fact was overlooked in September 2011 and Garg went ahead and allowed the sale of the land.

The inquiry has taken account of the fact that Naib Tehsildar Gurinder Singh Walia, who had executed the sale deed in September 2011, had told the earlier inquiry conducted by Ladhar that the deed was executed “by mistake”. The CM will decide and ask the Vigilance to register an FIR or take action against those guilty.





Former Patiala DC indicted for illegal sale of government land | www.punjabnewsline.com

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