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Bangalore Price Fall

Last updated: December 22 2009
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  • Bangalore Price Fall

    Bangalore: If you are planning to buy a house, perhaps now is the time to do so. After three years of unprecedented growth between 2003 and 2006, property prices across much of Bangalore are now falling. And falling sharply in many areas.

    A survey by real estate consultancy Asipac finds that residential prices in south east Bangalore (around Sarjapur Road) have dropped 10-20% in the past one year — with prices now in the range of Rs 3,600-4,600 per sqft against Rs 4,000-5,300 a year ago.

    South Bangalore including Jayanagar and J P Nagar (except Koramangala) prices are seen to have dropped 8-15%.

    East Bangalore, which was the first to see corrections, as TOI reported earlier, is estimated by Asipac to have witnessed a further price drop of 6-12% in 2007.

    The city centre and parts of North Bangalore (especially between Hebbal and Yelahanka) are the only areas seen to be still holding up, the former because of lack of fresh supply of property, and the latter because of the proximity to the upcoming airport.

    “In many cases, the quoted prices may be higher, but developers are throwing in a lot of freebies that effectively bring the price down,” says Asipac chairman Amit Bagaria.

    The price drop is the result of the enormous gap between demand and supply. Average sale volumes are seen to be down 10-40%.

    “Developers who were selling 60 flats in a quarter a year ago are today selling barely 6,” says Mayank Saksena, VP in property consultancy Jones Lang LaSalle Meghraj.

    Asipac estimates that against a total sale of about 33,500 homes by the entire organized sector in 2006, this year will end with a sale of no more than 26,000 homes. At the same time, the number of properties under construction has increased manifold.

    Irfan Razack, CMD of the Prestige Group, admits property prices in the city’s peripheral areas are at an “all-time unrealistic high”.

    Geetha Naresh, a property consultant, says investors who had blocked their money on prime properties in Whitefield and Marathahalli two years ago paying between Rs 1,600 and Rs 2,000 per sqft are today willing to sell at the same price.

    “There are instances where investors are even willing to sell below their purchase price, at rates like Rs 1,500 per sqft,” she says.

    Many speculators and investors had entered the market in 2005 and 2006, booking multiple flats, thinking they would be able to dispose them of once prices reached a certain higher level. “They only paid the initial amounts and they did not have the capacity to pay the full amount. But now they are all stuck. Neither can they pay the instalments nor can they sell the flat because of poor demand. And since they have to pay off bank loans, there is large-scale distress sales happening,” says an analyst.
    Last edited December 11 2007, 02:58 PM. Reason: Formatting
    Either land or AIR and FOOD. Choice is yours.
  • #2

    #2

    Re : Bangalore Price Fall

    Rentals too are down in the city

    Now atleast for some time we can Enjoy the Sweet Home.

    Bangalore: It’s not only apartment prices in Bangalore that are falling. Land prices and rentals too are.
    Mayank Saksena, VP in Jones Lang LaSalle Meghraj, says land prices in Whitefield have dropped 25-30% in the past six months alone, and about 10% in other parts. “Developers are not keen on picking up land since they think prices will fall,” he says.
    One industry observer notes that the two Reliance groups (Mukesh and Anil Ambani) and HDFC together had picked up nearly 100 acres near the Devanahalli airport in January this year at Rs 2.25 crore an acre. “They thought it would hit Rs 3 crore by December. But I know a neighbouring plot that’s today going for Rs 2 crore an acre,” he says.
    Mukesh Pradhan, who picked up a second flat (a premium three-bedroom place) on the outer ring road, was hopeful of getting a monthly rental of at least Rs 25,000. But even after months, he has been unsuccessful in finding a tenant to pay that figure.
    Hardly surprising, considering there are hundreds of flats lying vacant in what is described by some as “ghost complexes”.
    Property consultant Geetha Naresh says a three bedroom villa at a prime residential property that went for Rs 1,30,000 a month last year today fetches just Rs 75,000.
    So is it a good time to buy property? Most analysts advise some more waiting. Real estate analyst Ankur Srivastava says some time in 2008 may be a good time to buy. So does Saksena: “It will take 6 months to 1 year for the excess supply to get absorbed.”

    Source : TOI
    Either land or AIR and FOOD. Choice is yours.

    Comment

    • #3

      #3

      Re : Bangalore Price Fall

      Good Information is being shared here by Arin. I too have similar views on both the posts by him on Bangalore property market. To provide a bit of introduciton about myself, I am a software engineer workign for a MNC in Bangalore.

      I can currently afford(obviously on Housing loan) to buy the falt but wont really look at buying currently as I feel that there is still a time for Bangalore real estate to touch the bottom price. I see a lot of appartments comming up/buit in south bangalore (BTM, N.S.Palya, Bannerghatta road/Jaynagar/JPNagar). The one which are already ready to occupy and completed have put up huge advertisements/hoarding for the sale, from a long time but not really getting sold, which is a clear indicative of the Bangalore real estate market cooling off !!

      I see the same advertisement/horading from past 1 yr or so for many appartments. Many of the upcomming appartments have stopped/slowed down their construction because of the scracity of the buyers. Those category of ppl/investors really denied a right of 'A house for everyone' in India by creating an artifical boom.

      Looking at these situatiuon, I really feel good that the greedy investors / NRIs who has lot of money in $$$s artifically created a big real estate boom in Bangalore as well in other cities, are being punished now by the people to whom they had denied their right. And so many of them are really forced to sell at the price that they have bought or even below, as they can not at all afford to hold those extra property that they had blocked to make a huge money out of real estate boom.

      My advice to poeple like me, who really need an own house to live a decent life, and do not want to deny right of a good living to others, Wait and watch for atleast 8-12 months further to see a price fall.
      Last edited December 17 2007, 09:08 AM. Reason: Formatting

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      • #4

        #4

        Re : Bangalore Price Fall

        Still Many to come down

        You may find Good amount of fall. I am also a IT Eng. Becos of our poor Tax valuation we tend to go for a house. So that we can save some tax. The amount that is again enjoyed by big Politicain/Developer etc. This time I think there is a talk going on to increase the Tax bracket, below 500000 Lks it is 20% only. If this implemented then a good amount of Home Loan taker will again reduce. So now its the time for the FAKE booming of the real estate in India to come down.
        As you know US/UK housing also coming Down, So India is no far. If US get Cold India will Sneez.
        No more Good days for DLF/Purva/Mantri... They have looted Common peolple anough.
        :p
        Either land or AIR and FOOD. Choice is yours.

        Comment

        • #5

          #5

          Re : Bangalore Price Fall

          https://www.indianrealestateforum.co...n-07-08?t=1855

          This is a good post, which kind of confirms what we are discussing on this thread.

          Comment

          • #6

            #6

            Re : Bangalore Price Fall

            Good for you guys in B'Lore ... Hope this has a domino effect in Mumbai and other parts of India as well. In Mumbai, if one is in the vicinity of newly constructed buildings at around 8.30 - 9 pm (by which time most ppl are usually home), you will observe no lights in atleast 60-70% of the flats.

            If your circumstances allow you to .. please hold off your purchases .. even if you can afford these prices, pls do not put your family to risk by buying at a price which will entail a major part of your salary going towards an EMI -- think about how the loan will be serviced when these high paying jobs vanish .. remember 2001- 2002.

            Basic economics of demand and supply will take care that prices gone down to those 3 years back. I have seen the same happen in the US ... it will happen here too.

            Greedy investors and builders have just made life misarable for everyone wanting a roof over their heads. Economically, nothing dramatic has happened in the past 3 years for prices to go up three times, our incomes have not gone up 3 times nor has the population gone up 3 times nor is there a sudden influx of crorepatis into our cities. Only the rich are making more money, feeding politicians and builders.

            Builders are also desperately trying to create a hype by splashing news paper ads, doctored articles, organizing mega events etc .. While they seem to have borrowerd a lot of this from classic Marketing books .. they seem to forget that marketing mix comprises of Price as well not just Promotion.

            Comment

            • #7

              #7

              Re : Bangalore Price Fall

              See market coorection soon !!!

              See how the US market is falling down. And I people have seen the Sharp fall in Stock Market also. These Builder and the Developer earns in 100-500%, Drives a Benz/BMW. And this stupid Media is the biggest culprit for this hype. One day they say it is falling, in another 10days they are screeming that the price is increasing. They have really some deal with the Developer.
              A major percentage of hike in this is because of the IT indus. And see if your Job is going tomor u will be under soup. I think every one now knows about the US recession.
              And if you are so fond of buyng Burgain to the extreme. Dont just give your money simply to this people putting your familiy into trouble.
              Either land or AIR and FOOD. Choice is yours.

              Comment

              • #8

                #8

                Re : Bangalore Price Fall

                DLF Bangalore Projects

                Hi,

                May anyone advise me on the exact locations of DLF projects in Bangalore? I am from Gurgaon and exploring options to invest in DLF projects in Bangalore. Also, is anyone aware of the prices of DLF projects as well as their competitors?

                Many thanks!

                Cheers.

                Comment

                • #9

                  #9

                  Re : Bangalore Price Fall

                  white field

                  Comment

                  • #10

                    #10

                    Re : Bangalore Price Fall

                    Dlf Share 800

                    VALUE FALL 30-40%.
                    BIDADI - 30 KM AWAY. DONT THINK OF INVESTMENT. IT WILL TAKE 2/3 HRS TO TRAVEL TO OFF. AND 4-5 HRS TO iNT aIR pORT
                    Either land or AIR and FOOD. Choice is yours.

                    Comment

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