Originally Posted by jhaashish

Guys,

The fact of the matter is that while real estate prices have already come down in cities like Bombay (by almost 30%) and Bangalore (by almost 30 - 40% at some places), Pune prices have not come down yet. That is partially due to the fact that the builders have already earned much higher margins and can hold out much longer without people ing their flats. They're still playing the waiting game, waiting for our patience to break. And with our herd mentality nowadays when it comes to real estate, " now or else the rates will go higher", who can blame them..

The prices in Pune have gone up by nearly 200% which is clearly a bubble, similar to the stock market which has come down from 21000 last year to 8000 this year. The reason real estate prices in India have shot up so much as also because of foreign companies investing in real estate here.

The current real estate prices are too high for even foreign companies have already started withdrawing their money from the real estate market. Which is also the reason that real estate prices have already fallen by as much as 40% in the above-mentioned cities. Which is also one of the reasons that INR is so low with respect to USD.

Speaking of bubbles the rule of thumb of rule is that "A bubble must burst". You don't believe me? Check out the following article (]http://www.iht.com/articles/2005/12/25/business/bubble.php[/URL]) about the real estate bubble burst that happened in Japan no less, a country which is a much smaller in terms of real estate availability.

In real estate the bubble takes longer to break, unlike the stock market.

So, my request to all of you is (and to tell as many people as you know) to HOLD HOLD HOLD and NOT ANYTHING for the next 1 year. Builders HAVE to bring prices down. Expect prices in Pune to come down to 1400 - 1800 levels in the next year or so. Till then hold onto your money!!!!

Regards,
Ashish