tsongt

number of jobs created this year in India

]http://business.rediff.com/slide-show/2009/jun/30/slide-show-1-indiasbiggest-job-creators-this-year.htm[/URL]

contra

But Kanchipuram is not Pune.

Pune itself is a large city (among the top 10 cities in India) and than it is closer to Mumbai (the financial capital of India). So comparing the Mumbai-Pune success combination to Chennai and some Kanchi will not hold any water.

wiseman

Folks

I frequently use the Edit feature whenever I need to add more stuff to my posts.

cheers

wiseman

Shekar,

Nope. The Stock market is full of nervous guys with a hair-trigger. When they see a trend emerging 6-9 months before it happens, they will take action. So, you saw RE stocks fall 95% many months ago.

Builders are the other end. They hang on to their "hawa mahals" (as someone said) with a lot of misplaced hope - hoping that buyers will continue to be suckers well after their salary is cut or job is gone, hoping that govt will force banks to lend to unworthy people, hoping that there are enough fools in the market to listen to them.

6-9 months after everyone has realised that prices have crashed 30%, they will belatedly come to market to dump their inventory when their creditors finally come calling to wind up their company!!!

Big difference of around 12-18 months

cheers

realacres

As tsongt rightly said that Mumbai rates have fallen to even 50%. What makes Pune immune, especially when prices are already falling? Few months back, bulls were saying that RE prices would remain constant, then said drop of 5-10%, then 10-15% max. It is now down more than that.

Also you need to understand that Mumbai rates fell despite having no IT or large number of speculators unlike Pune.
54% of flats in Pune are unsold. Add to it investors or rather speculators inventory. Supply is more than demand. Visit the following link:-

]http://www.businessworld.in/images/stories/infrastructure/massive_pile_up.gif[/url]
For full story:-

http://www.businessworld.in/index.ph...Of-Realty.html

RE Prices in Pune will crash as they have pan-India.

shekhar7

It seems Pune Realty prices have started to fall...
If darode-Jog builder is reducing prices on fort-nightly basis, you can safely say so

Crtossover County Project was started last year.. with bang..
I've been to that place then, Builder was quoting something around 3700+
Last Month I got a call, to visit with price... 3300

I went there last week & found, it exceeds my budget with that rate also (because total package comes with 6 lacs extra on top of basic price !!)

Just now, got a call from their Mrktg head, saying that, he is ready to offer below 3000

Realty Market is really happening !!!

What would be realistic rate for us, from this side of table ???

realacres

The biggest problem for Crossover County (CC):- Nanded City. Nanded city has reduced the prices to INR 2500/sq ft & is located just a stone throw away from CC. Will you prefer a township or regular building project that too if township prices are lower than regular project? Hence, prices of CC should be less than INR 2000/sq ft in any case.

Btw, avoid Nanded City too. Farmer problems are yet to be sorted out & project has been delayed.

tsongt

tried that. Edit feature works like a charm. Thanks

avickey

realacres,
The demand for affordable housing is huge and the supply is non-existent.

I can think of any number of reasons why a crash could potentially bypass Pune, with various probabilities of likelihood:
1. Huge drop in interest rates.
2. Borrowing from hawala system to stay solvent.
3. Governments continuing to offer lifeline by permitting debt restructuring
4. Sharp recovery in stock markets.
5. More outsourcing to India due to dwindling profit margins worldwide.
6. Builders cartel financing vulnerable projects to maintain Pune prices at a premium level.
7. Continuing one sided narrative from the builders. It 's unfortunate that we are unable to team up with brokers, regulatory bodies or RE consultancies to argue the consumer side of the price debate.
8. Sharp increase in rentals.
9. Irrational expectations, obsolescence reducing demand for resale apartments.
10. Successful appeal to Indian snobbery and emotions. I.e. Builders discover a successful marketing strategy or mind control tricks which persuades consumers to buy at crazy prices.
11. Increased in tax incentives for home owners.
12. Reduction/removal of HRA benefits.
13. Gold/Oil/Uranium ore discovery in land banks

At least of few of the above factors could conspire to keep the prices high for consumers.

realacres

The demand for affordable housing is huge and the supply is non-existent.

I can think of any number of reasons why a crash could potentially bypass Pune, with various probabilities of likelihood:
1. Huge drop in interest rates.
>> What about salary cuts? Will you buy a 2BR for 1Cr at interest rate of 1%? Banks are not lending more than 50-60% of total amount. Forgot this factor?

2. Borrowing from hawala system to stay solvent.
>> Mafia in Mumbai is asking the builders, "Please give us money". Look at the word Please. D-company requires over 300Cr/month just to carry out regular functions including bribes to customs, police, judges, politicians etc. D company has lost over INR 2500 Cr is stocks & falling land prices. Where will new money come from? Had this been the case why the need for DLF to reduce prices by 50%?

3. Governments continuing to offer lifeline by permitting debt restructuring
>> Against shares as collateral. How many Pune builders are listed companies? 80% of Pune RE is from pockets of politicians especially from NCP. Why did Lallu Jain sell off Kumar Builders to RMD of Manikchand?

4. Sharp recovery in stock markets.
>> Yet the RE stocks are not even 1/3rd of their peak. Stocks are driven by FIIs due to p-notes.

5. More outsourcing to India due to dwindling profit margins worldwide.
>> Perhaps, you did not read about tax benefits by the Govt. of home states? Add to it competition from Vietnam & East Europe. We can't compete here as Indioans hardly know any European language & business is based solely on US which is giving tax breaks to companies here.

6. Builders cartel financing vulnerable projects to maintain Pune prices at a premium level.
>>

7. Continuing one sided narrative from the builders. It 's unfortunate that we are unable to team up with brokers, regulatory bodies or RE consultancies to argue the consumer side of the price debate.
>> Is anyone accepting this? Had this been the case why 54% of builders' properties are unsold?

8. Sharp increase in rentals.
>> They have dropped. Where do you stay? Many people from IT & auto have left or are asking for low rentals now. Brokers are charging just about 1month rent as against 2 months earlier.

9. Irrational expectations, obsolescence reducing demand for resale apartments.
>> Lets see how long they can survive.

10. Successful appeal to Indian snobbery and emotions. I.e. Builders discover a successful marketing strategy or mind control tricks which persuades consumers to buy at crazy prices.
>> Why isn't buying taking place then? More than emotions, you need money for RE. It is like filmi dialogue that house in built on only love. What would you do when baniya comes knocking you door?

11. Increased in tax incentives for home owners.
>> Can it compensate for the current RE rates & salary cuts & high interest rates?

12. Reduction/removal of HRA benefits.
>> Read this:-

1. You can claim HRA if you fulfill these three conditions:

~ You have an HRA allowance as part of your salary package.
~ You are staying in a rented accommodation and paying rent for it.
~ The rent exceeds 10% of your salary.
2. You can claim rent given to your parents. Let's say you live with parents and pay them rent. This makes your parents the landlords. One of them will have to declare it in his/ her personal income tax return to prevent litigation in the future.
3. You cannot claim rent paid to spouse. The relationship between a husband and wife is not commercial in nature; a husband and wife are supposed to stay together. So payment of rent to a spouse will not be accepted by the income tax authorities.
4. You will need to keep all your rent receipts since it is the only proof that you are paying rent. HRA exemptions are only available on submission of rent receipts or the rent agreement. However, if the HRA is upto Rs 3,000 per month, then receipts/ agreement is not mandatory. It is only when your HRA exceeds this amount that you will have to keep the receipts.
But it is wise to still keep them because, at the time of assessment, the Income Tax Officer may demand the receipts/ agreement.
5. The actual HRA you will be entitled to will be the least of the following.
~ Theactual amount of HRA received.
~ 40% of salary. This increases to 50% if you are renting out the house in Delhi, Mumbai, Chennai or Kolkata.
~ Rent paid minus 10% of salary (basic component + dearness allowance)
6. The HRA that does not get exempted is taxed. Let's see how it works with an example.
Assumptions

HRA per month = Rs 15,000
Basic monthly salary = Rs 30,000
Dearness Allowance = Nil
Monthly rent = Rs 12,000
Rental accommodation is in Mumbai.
Exemption
Actual amount of HRA = Rs 15,000
50% of salary = 50% x (30,000 + 0) = Rs 15,000
Actual rent paid - 10% of salary = Rs 12,000 - [10% of (30,000 + 0)] = 12,000 - 3,000 = Rs 9,000
Rs 9,000 being the least of the three amounts will be the exemption from HRA. The balance HRA of Rs 6,000 (15,000-Rs 9,000) is taxable.
7. If you took a home loan for a home in one city but reside in another, you will be entitled to:
~ Tax benefit on principal repayment under Section 80C
~ Tax benefit on interest payment under Section 24
~ HRA benefit
Or, even if the home is in the same city but is not ready forcing you to rent a place, you will still be entitled to all the above benefits.
Of course, you can claim tax benefits on the home loan only if your home is ready to live in during that financial year. Once the construction on your home is complete, the HRA benefit stops.
If you took a home loan, got possession of the house, have rented it out and stay in a rented accommodation, you will be entitled to all the three benefits mentioned above.
However, in this case, the rent you receive would be considered as your taxable income.

8. Let's say you took a home loan and have bought a home but are not residing in it for genuine reasons.
It could be that the home is at a considerable distance from your work place. Or, it could be that the home is rather small and your parents are living in it so you have to stay elsewhere.
Though your rental accommodation and home are in the same city, you can still get all the benefits.
~ Tax benefit on principal repayment under Section 80C
~ Tax benefit on interest payment under Section 24
~ HRA benefit
However, it is necessary you have some of your belongings at your home (the one you own) and you stay there on and off on during weekends and holidays.
Despite this, if your employer does not agree and denies your tax benefits, you will have to claim it at the time of filing your tax returns.


13. Gold/Oil/Uranium ore discovery in land banks
>> Hey, I want to become a builder!!