Friends,

Pl discuss how much down fall is expected in IT sector and its impact on real estate.

2008 saw about 20 to 30" downfall. How much will be in 2009?
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  • 5 to 7 percent price drop every quarter

    There was a 20 per cent price correction last year and current year there would be a 5 to 7 per cent price drop every quarter.

    http://www.expressindia.com/latest-news/year-when-slowdown-burst-the-real-estate-bubble/404346/
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  • Most of these pages say 20% growth in a good year and 5% downfall in a bad year. In reality between 2004 and 2008 there has been probably 40 to 50% growth upwards. TO give an example land in Saligramam was quoting at 30L a ground in 2004 or even lesser and was at 1.5C a ground in the minimum case or 5 times. Infact in the best cases it was 20L becoming 2C and even more. So 5 times growth in 4 years means 50% CAGR.
    This fall is fictional, it is about people who quoted based on the 50% growth another 50% on top of 2008 Jan figures which did not fructify. So dont imagine a fall has happened so far.
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  • Originally Posted by kayaareem
    There was a 20 per cent price correction last year and current year there would be a 5 to 7 per cent price drop every quarter.

    http://www.expressindia.com/latest-news/year-when-slowdown-burst-the-real-estate-bubble/404346/

    BTW by quoting articles about Mumbai you cant talk about Chennai property prices. Guys like you are the reason for mild panic among Chennaites. You better move to the Mumbai section!
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  • The Forum knows who is nonsense

    Originally Posted by Natarajg007
    Well I can sell my property at any price I want to and this forum does not help me anyway. So your comment is highly prejudiced and shows u as an abject piece of nonsense.


    You can sell your property at any price ..You have the liberty to do that.

    But on hearing the price you quote , people will say 'Price is nonsense and is inline with the the guy'

    The entire forum knows who is nonsense ... Leave it to the forum.

    Cheers.
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  • Certifiable :)

    Originally Posted by Natarajg007
    Wiseman, I wont shamelessly create an account called as Wiseeman. So better reign in your silly coterie.



    When someone randomly picks up unrelated issues and ties them together, he is clinically certifiable! :D

    And the fact that, in every post Nats feels a need to pick at me shows that, deep down he is getting affected by wiseman (maybe having nightmares about price crashes).

    There is only one wiseman despite your wild aspersions, Nats! And that is certainly not you!!!! :D

    cheers
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  • wiseman real re prophet

    people will realise after re price crash, that WISEMAN is real RE PROPHET.
    I fully endorse views of WISEMAN. KEEP IT UP YOUR GOOD WORK WISEMAN.CONTINUE TO EDUCATE PEOPLE
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  • Originally Posted by badrig
    people will realise after re price crash, that WISEMAN is real RE PROPHET.

    badrig,
    you are trying to be the prophetpeople will realise after re price crash, that WISEMAN is real RE PROPHET.

    badrig,
    you are trying to be the prophet
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  • Before anyone gets the idea ...

    Originally Posted by abk
    Originally Posted by badrig
    people will realise after re price crash, that WISEMAN is real RE PROPHET.

    badrig,
    you are trying to be the prophet



    Good one abk!

    Btw, I'm not Badrig, just in case certain people get some ideas about coteries, etc.

    In any case Badrig, have you heard of the quote? ...

    "I appear tall because I stand on the shoulders of really tall people"

    I only reflect the thoughts of some really astute people who are in the business of figuring out where we are headed. So, praise them, not me!

    Nouriel Roubini, Mike Shedlock, Elaine Supkis, Catherine Fitts and so many, many more ...

    Check them out :D

    cheers


    Good one abk!

    Btw, I'm not Badrig, just in case certain people get some ideas about coteries, etc.

    In any case Badrig, have you heard of the quote? ...

    "I appear tall because I stand on the shoulders of really tall people"

    I only reflect the thoughts of some really astute people who are in the business of figuring out where we are headed. So, praise them, not me!

    Nouriel Roubini, Mike Shedlock, Elaine Supkis, Catherine Fitts and so many, many more ...

    Check them out :D

    cheers
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  • Originally Posted by wiseman
    Originally Posted by abk

    Nouriel Roubini, Mike Shedlock, Elaine Supkis, Catherine Fitts and so many, many more ...


    Woh wow awesome!

    Just found something interesting from "Nouriel Roubini" (Source Wiki)

    Current predictions
    As of January, 2009, he remains pessimistic about the US and global economy. He says "we have a subprime financial system, not a subprime mortgage market". And while he does not believe that the United States is at risk of another Great Depression, he expects it to be the worst recession since the 1930s. Looking at the global picture, he writes, "As the U.S. economy shrinks, the entire global economy will go into recession. In Europe, Canada, Japan, and the other advanced economies, it will be severe. Nor will emerging market economies—linked to the developed world by trade in goods, finance, and currency—escape real pain."
    His pessimism is focused on the short-run rather than the medium or long-run. In Foreign Policy (Jan/Feb 2009), he writes, "Last year’s worst-case scenarios came true. The global financial pandemic that I and others had warned about is now upon us. But we are still only in the early stages of this crisis. My predictions for the coming year, unfortunately, are even more dire: The bubbles, and there were many, have only begun to burst" In conclusion, he adds, "This will be a painful year. Only very aggressive, coordinated, and effective action by policymakers will ensure that 2010 will not be even worse than 2009 is likely to be."

    Real estate predictions
    Roubini's predictions are generally based on historic fundamentals. In September of 2006, he clearly saw the end of the real estate bubble: "When supply increases, prices fall: That’s been the trend for 110 years, since 1890. But since 1997, real home prices have increased by about 90 percent. There is no economic fundamental—real income, migration, interest rates, demographics—that can explain this. It means there was a speculative bubble. And now that bubble is bursting." When asked whether the real estate ride was over, he said, "Not only is it over, it’s going to be a nasty fall."
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  • Originally Posted by whatheheck
    With Satyam corporations fraud, its just a tip of an iceberg for corporate india especially for Indian IT industry down turn. As predicted before, this will lead to huge crash in indian RE Industry. Lets sit and watch how it develops this year. This will wipe out the false growth and false RE appreciation and bring the price to original value.

    Even after so many hurdles, last week satyams net worth was valued at 3 to 4 billion dollars. Today Satyams worth is just 600 million.


    satyam was valued by some 'expert' on the info which was a lie.samething applies in reverse all predictions are not true.I am not saying RE will not fall, I am saying there will be a correction 20% max in chennai(i am not aware of others)
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  • 20% fall from the current market price would mean that, it has to move up again by 25% if it has to reach current market price again. If the prices were to fall by 30% from current price, then it has to move by 43% again to reach the current price. So, if someone is buying at current prices has to wait for it to move by 25% again (or 43% - if it falls by 30%) to recoup his initial investement, leave alone any profit!!!!!!
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  • location,location and location

    Originally Posted by ajithpkl
    20% fall from the current market price would mean that, it has to move up again by 25% if it has to reach current market price again. If the prices were to fall by 30% from current price, then it has to move by 43% again to reach the current price. So, if someone is buying at current prices has to wait for it to move by 25% again (or 43% - if it falls by 30%) to recoup his initial investement, leave alone any profit!!!!!!


    this thread is about how much downfall in RE from peak prices(obviously).
    everybody can calculate "if it falls by 20% it has to gain 25%".
    my point is if you want to buy a house(for living) you should buy if your preferred location has corrected by about 15%. living is not about the price alone it includes your preferences,fancies,your dear ones near,temples,schools,entertainment,established neighbourhood,security etc.
    a diff of 10-15% is overlooked for places of preference.
    you should look for 3 things when buying a house

    1)location 2)location and 3)location
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  • I have put in this for the benefit of those who are investing only for investment purpose, specifically in plots at far away places where the fall will be much more than a good locations in the city. I agree that anybody with basic schooling can calculate the above but practically lot of people miss this point when they consider returns from investment.

    I agree with your point that 10-15% does not matter when somebody buy a property for living.
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  • Originally Posted by ajithpkl
    I have put in this for the benefit of those who are investing only for investment purpose, specifically in plots at far away places where the fall will be much more than a good locations in the city. I agree that anybody with basic schooling can calculate the above but practically lot of people miss this point when they consider returns from investment.

    I agree with your point that 10-15% does not matter when somebody buy a property for living.


    and i agree with your point of fear about 'far away places' from city
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  • I witnessed the downfall

    Hi,

    This is Raj, very new to the forum and I would like to make a comment on my experience (very recent) on the Downfall market of RE. I was in a search of a land or an good apartment (I mean to say with better landscape) but was finally not Convinced to go for an apartment in and around Velachery. 2 months back we saw a piece of land very close to the Velachery By-pass as well as to the Vijaya nagar bus stand which was over priced as 110 Lakhs for a 3950 Sqft land (3 of us were planning to share the land and construct in it) but then we realized that we are in the verge to enter into the recessionary period and the idea has just stepped out of our mind in the whole thinking about the financial difficulties. Now after more than 2 Months we got a call from broker with an asking price of about 75Lakhs who roughly said it more than 1.5 grounds near to 1.75 Ground and gave a different address (brokers address). So we again had a thought of visiting their which made us to get surprised that we were visiting the same place which we visited before 2 months(To exactly say it was on October 18th or 19th) because the broker gave us his address we didn’t have any clue that we are heading towards the same land. We are again considering the purchase :) but seems like we are officially going to enter the recessionary period only after the second Quarter of 2009 .


    This really shows the downtrend of the RE and the brokers boost up value in the RE. I have myself witnessed at least of 32% down trend :D:D:D towards the plot cost.


    My kind advice for some of the well wishers here would be, please wait for a year or so and then think of buying an asset let it be house or an appartment or an Plot. From a reliable source of mine I have got an information that the Flat promoters (Big ones) have plans to increase 100rs/sqft just to fakely cook up the notebooks so that they can falsely and even if it takes a Little more time to sell the apartments this extra 100/sqft will help them in paying their excess Interest towards the bank loans caused towards the delayed sales. So They think they will get the same amount on money what they were planning to get earlier as well as the excess interest will be pushed on to the heads of the Buyer.

    Only if there is a No Buyers Sign to this cooked up price for a handsome period (Say for about a year) can bring the cost down to earth, until then there will be many buyers loosing their hard earned money to the Greedy RE or Brokers.
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