During 2003 nobody expected realestate to go up especially folks in Chennai. Having seen the super boom in late 2003 I advised relatives in Chennai to buy realestate in 2004. That is the reason my close relative has a house to live today with his retirement savings. Today for that money 20L he wont get a flat in the outskirts of Chennai. When prices went up people went mad in 2007.
That was irrational exuberance. Now folks on this board are talking bearish day in and day out. Their reason is comparison of US with India as if they are TIGHTLY COUPLED. This is exuberance on the bear side. This can be equally dangerous.
As far as I have seen realestate price in Chennai has gone up regularly every decade. The first rise in my memory was in late 70s between 78 and 82. Then there was a boom in 85s. In one such occasion my family could triple their investment in a plot on the sides of Mount road in just 1.5years. The next round of upmove was in 94-98. The current trend is 2003 till now.
After all these rises never did the price fall to the old low. Not even to half the rise, not even by 30% from the peak. The price of land in Abhiramapuram in 1996 at the peak was around 80L to a crore. In 2000 the prices were quoted around 60L but that was desperate sales. In reality nobody was selling then unless they were in trouble.
I am not stating that prices cant fall. All I want to tell you is dont assume prices are going to fall just because somebody tells you so. Did the same folks tell you to buy in 2004? If they did, then listen to them, not otherwise.
I think most of the bear thought and negativism for realestate on this board is because NRIs who sold out in 2007 and those of them who never entered before 2006 are left high and dry both in their countries and in India as they thought they knew everything when they probably knew nothing. Their advice based on USA is nothing but worthless. Talk to the local Chennaite who stayed in Adayar, talk to the Chennaite who will say ECR is far away, not to these new bees who know not what Chennai is. Finally such a person is going to say Madras not Chennai.
In net, if you have the money better buy worthwhile property to live. I am not bothered about speculators and traders. I am talking about genuine buyers. Folks who want a place to live. Go and buy before you are caught in the next upmove. In 2003 nobody wanted to buy a flat in Mylapore for Rs 1000psft. Suddenly in 2007 they were buying flat in Urapakkam for Rs 3500psft. So be careful before you take the advice of NRIs and NRI spokespersons on this board like Wiseman. They know not what they are saying.
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