What is the market price for a 15 year old 2BR flat in Anna Nagar, near Blue Star? The flat is in a pretty good shape. What is the per square foot rate I can expect on the UDS?
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  • Originally Posted by maverick007
    For consumption and end use, it is hard to debate.

    My point on earlier post was - there is not juice left to milk further upon redevelopment. Part of your rightful UDS 15 years ago (if complied) was given away to the other 4 flats.

    Compliant 15 year old flats usually have 10-20% room left for increased sq footage and it is a potential carrot or margin of safety.

    Assuming a compliant redevelopment based FSI of 2 will end up with a flat of 1000 sq.ft (new) with 25% loading. That's the only future potential you need to factor which I was driving at.

    For a 15 year old apartment, paying market value of UDS portion is one benchmark(past) for valuation. You are paying @5Cr/ground. My sense is, it could quote at discount at 20 yr mark and further discount at 25 year mark. If land value keeps up at the past growth rate, discounts may not affect you much as long as you are happy to stay there for next 15 years. For whatever reason, you decide to sell, IRR can shock you.


    Thanks Maverick.

    I understand 15year old 2002 built Appartments must offer a minimum of 50% Sqft. Now There is not much can be done on UDS. Maximum I can only leverage the low UDS and deviation to negotiate a bit hard on the final sqft price to get some compensation.

    Seller is aware of the downfalling price trend and equally he is aware of the key locational advantage as the flat is hardly 400m walking distance from Annanagar tower metro station & bluestar bus stop.

    Pushkar's New flat has just about 3-35% UDS but the common area is 25%

    Ideally 50% UDD must be around 525 sqft. Missing UDS is about 125sqft. for the missing 120 sqft UDS the value will be 12L.

    Say if I gain 10% discount to bring the final price to ₹7400/sqft that shall offset low UDS. If take 10K/sqft for the UDS (while open land market price @16-20k/sqft)

    Hard negotiation for Gaining a Discount of ₹800/sqft will be @ 8.5L along with woodwork it might be worth of ₹10-11L. Which will grow@ 6% in bank FD or I can grow this fund fast in equity stock.

    A 1300 sqft 3bhk resale flat is still hovering above 1.2C just for one additional room/250 sqft extra one has to face the burden of additional 30-40L which is not convincing and availability in a good location is elusive so far.

    Hence I have to accept a 2bhk as a compromise.
    It is for my own use. Perhaps I will use it for 15-20 years. Good location is the key as it is very rare.

    What is your opinion?
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  • I come to understand from my resale flat owner seller who is a business man having few hotels in Chennai and suburbs, Andhra told me that full white money land transaction price for land in Annanagar has fallen from 6Cr/ground to almost half.

    His Villa in 3rd main road P block built in One ground with 3.5K sqft builtup area has no takers for 4.5C as he wanted to sell and consolidate his properties in Annanagar.

    Resale Properties of Big value transactions say above 2C are not moving fast. Villas which have value of 4/5C finding difficulty in getting buyer and hence such transactions are now rare.

    However the seller told me that the flats below 1200sqft/ 2BHK flats are in demand and hence finding enduser buyers.though prices have corrected by say 15-20% from peak prices of 2013/2014.
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  • For consumption, affordability and opportunity cost of missing out should drive the decision. Decision should be beyond numbers. You have done enough and 10% either way do not make a buy a bad buy or a great buy. The owner seems quite-an-aware person unlike many with good exposure in RE generally bury their heads in the sand(denial mode) oblivious to the changing trend or reality. Thanks for sharing. Such on-the-ground reality is what readers need. Not the tarot reading that imminent bull is around the corner and 20% CAGR predictions.
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  • Originally Posted by maverick007
    For consumption, affordability and opportunity cost of missing out should drive the decision. Decision should be beyond numbers. You have done enough and 10% either way do not make a buy a bad buy or a great buy. The owner seems quite-an-aware person unlike many with good exposure in RE generally bury their heads in the sand(denial mode) oblivious to the changing trend or reality. Thanks for sharing. Such on-the-ground reality is what readers need. Not the tarot reading that imminent bull is around the corner and 20% CAGR predictions.


    Thanks Maverick.

    I have seen over 150 resale properties in Chennai in TNagar, West Mambalam, Ashok Nagar, Saligramam, Vadapalani, Velachery & Annanagar​.

    I understood it is a very rare luck to get a combination of good location, quality construction, Vastu compliance, proximity to school, colleges, hospital, super market etc along with good price & UDS etc.

    One has to trade off a economical or feel good factor over majority of factors/convenience a resale property can offer for a rejuvenated, upgraded living.

    I even tried a good resale property in Bangalore in Malleswaram, Vijayanagar, JPnagar, Jeyanagar, Nagarbhavi, paid 15% advance in 2016 but cancelled due to Bangalore Cauvery riots and unfriendly to Tamils.

    I had been a silent reader of this forum.

    Just wanted to put my real time live experience as a purposeful market reference.

    Surely I Will post the final deal price information in this thread. Should happen in a month.
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  • Originally Posted by maverick007
    May appear reasonably priced. But, 38% (400 sq ft) UDS shows just not a deviation alone; must have some unauthorised apartments to make the UDS so low. Just check what is the FSI allowed for a new building on the same street, you will understand the head room to gain/lose when it comes to redevelopment.


    The new buildings have an premium FSI of 1.95 for buildings built on abutting roads of 40-60'width as per CMDA rule amended in 2013 (which is 30% high FSI on ordinary below 30'wide road 1.5FSI).

    While calculating actual builtup area in all G+4 floors for This subject resale flat appartment building the actually achieved FSI is @ 2.8.

    During my FSI Calculations found This standalone Appartment builder has already used future FSI in 2002 itself. Redevelopment @current 1.95 FSI has no great scope unless CMDA after 25-30 years amends FSI rules that upto seven floors / upto 30meter height buildings can be built on plots abutting roads wider than 45 feet.

    While reviewing my other considered resale flats @Turnbulls road-Nandanam, Brindavan Street-west Mambalam, I am surprised that even 34 years old Appartments built in good premium locations have an actual builtup FSI of 2.3 and hence a moderate UDS of 48%.
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  • Are you saying the total saleable area of all the flats put together is at 2.8 times the Land area?

    If yes, it still means only 2.4 FSI and with common area load of 15% gets to 2.8. If 1.5 (with out premium FSI) is the present FSI they accord, then you can see how much of a hole it leaves when you redevelop. When a builder constructs a extra floor in a S+2 or G+1 set up, you lose 33%.

    Your builder did not avail the premium FSI instead he sold it as premium FSI through unauthorized flats :)

    Premium FSI even if availed to take it to 1.95 do not come free - you need to pay the GV equivalent land price for that. So, it is very clear that the juice usually left for redevelopment is zero or negative in this case.
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  • Originally Posted by maverick007
    Are you saying the total saleable area of all the flats put together is at 2.8 times the Land area?

    If yes, it still means only 2.4 FSI and with common area load of 15% gets to 2.8. If 1.5 (with out premium FSI) is the present FSI they accord, then you can see how much of a hole it leaves when you redevelop. When a builder constructs a extra floor in a S+2 or G+1 set up, you lose 33%.

    Your builder did not avail the premium FSI instead he sold it as premium FSI through unauthorized flats :)

    Premium FSI even if availed to take it to 1.95 do not come free - you need to pay the GV equivalent land price for that. So, it is very clear that the juice usually left for redevelopment is zero or negative in this case.


    Yes. I agree. Unless Bombay's current FSI 4 comes to Chennai in the next 15-25 years for residential redevelopment projects. That time too builders will violate for another floor.

    In Annanagar Shanti Colony, Only TNHB housing has good FSI and UDS but you know TNHB flats are undesirable for the location, building condition, construction quality and occupant quality matrix.

    Good private builders like Golden, Firm, Pushkar, India builders etc even though they give minimum deviations, they charge 25-30% as common area, also new 30% premium FSI @1.95 for 48feet road reduces UDS by 23%.

    I can only leverage these prevailing FSI flaunting, deviations to negotiate hard on final price. But from initial April 2017 published asking price of ₹9400/sqft the seller has revised it considering downtrending property prices, for my full white money transaction.

    My bad luck brought me 3%hike in registration charges which itself is about ₹3L which is useless. The present TNgovt is full of buffoons. I was hoping by end of August govt might rollback increased hike in registration fees.

    Ours is a society where rules are made only to be violated left, right and centre.

    Every stand alone building is home to violation of FSI rules, plan deviations first, buyers looking for new/resale flat buy violations for a premium.

    With very high bursting population There is always a less informed buyer next in queue ready to get a loan to invest / buy the properties in prime location giving a hoot to the inherent FSI violations, plan deviations.

    I am really tired of trying a proper, quality property.

    I remember in 1992 for honestly getting Electricity connection to our newly built independent home in Urapakkam, we waited over 9months, but after paying ₹250/- bribe @Guduvanchery EB office we got it in a week. We wasted 9months rent staying in rented home.
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  • Maverick,

    Surprised to see How TN govt's Registrar office allows Registration of properties when they see low UDS reflecting FSI violation?

    How TNEB connection, Metrowater connection are given and Govt property taxes are collected for FSI flaunting, plan deviating properties?

    Is this the new normal for property buyers?

    Other than low UDS resulting in reduced/nil redevelopment benefits after 25years is there anything to be checked in this case?

    what is Your opinion?
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  • Maverick, As per plan the structure must be S+3 but builder made it a G+4 structure with 15m max height. Now actual UDS 403sqft =(1065/16085)*6088
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  • Hi RE Veterans,
    ​​​​
    After three rounds of hard negotiation, arrived at a Final unregistered price of ₹ 7400/sqft.

    Including 7% stamp duty 4%Registration, mandatory reconditioning works like interior painting, plumbing & bathroom fittings Replacement, Electrical works , Safety metal grills for balconies, car parking gates modification, safety metal grill door for the main entrance door, and polishing of entire flat marble flooring, etc final cost to be @8250/sqft for the well maintained, good quality construction, 15year old 2BHDK 1050sqft flat with 403UDS, carpet area 852 sqft, with lift, Wood work done at both bedrooms and Kitchen, and one reserved open car parking located on 48feet wide 9th main Road,Shanti Colony, Annanagar.

    Key positive advantages:
    Blue star bus Stop, Anna tower metro station are just 450meters walk, SMF hospital is 300meters, Anna tower park is about 600meters walking distance, surrounded by many schools, colleges, many veg eateries, shopping area.

    Main Dis Advantages:

    1)​​​​​​FSI violations by builder Top floor is extra built resulting in low 38% UDS.
    2)Cooum river north bank is * 300meters

    Registration must be done before end of September,2017.

    How the veterans find this deal? Your opinion please.
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  • When building has violation then I would doubt your portion of UDS as well. Did you make sure that all the UDS add up to right lot size of the complex
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  • Valuation of your purchase is tricky as the flat building has unauthorised floors (two extra floors)

    That means there are occupants/owners claiming share of the property UDS where technically they are not eligible.

    well everything has a sale value approved or not.

    Given that India is moving towards more transparency The under market is getting bogged down often.

    example Recent Unapproved plot debacle.


    yes there are some risks but you are paying cheaper price for taking on the risk.

    The bottomine, in another 10-15 years when it come to sale for redevelopment if all owners concur with UDS share issues then all is well.

    Good luck.


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    1 Comments
    • harima76193 months ago
      Excluding 15% common area Final FSI achieved by builder is 2.2, Asper 2013 premium FSI for 40-60feet road is additional 30% on 1.5 normal FSI which is @ 1.95 FSI. Yes in this appartment,All 14 flats get pro-rata UDS & one reserved open car parking share including those in extra floor(s). Those extra floor flats have even paid the required penalty fine money to Govt depts for regularising their flats under a Govt Special drive scheme. Only risk is how much FSI CMDA will allow after 20years
  • Originally Posted by Economist
    Valuation of your purchase is tricky as the flat building has unauthorised floors (two extra floors) That means there are occupants/owners claiming share of the property UDS where technically they are not eligible. well everything has a sale value approved or not. Given that India is moving towards more transparency The under market is getting bogged down often. example Recent Unapproved plot debacle. yes there are some risks but you are paying cheaper price for taking on the risk. The bottomine, in another 10-15 years when it come to sale for redevelopment if all owners concur with UDS share issues then all is well. Good luck.
    The builder's 2.583 FSI, after Excluding 15% common area Final FSI achieved by builder becomes 2.2, Asper 2013 premium FSI for 40-60feet road is additional 30% on 1.5 normal FSI which is at 1.95 FSI. Yes in this appartment, Each of total 14 flats in G+4 building get pro-rata UDS share plus one reserved open car parking each including those in extra floor(s). Those extra floor flats have even paid the required penalty fine money to Govt depts for regularising their flats under a Govt Special drive scheme. Key risk for adequately benefiting redevelopment will depend on how much FSI CMDA will allow after 20years and CMDA rule on the maximum permissible height of building on 48feet wide road. I hope the population density will force FSI levels get doubled in the next 15-20years from where I it is in 2017. In the year 2035 if CMDA approved FSI is enhanced from 1.95 to 3 and on 48feet wide road building height is enhanced from 15meters to 25 meters
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  • How the veterans find this deal? Your opinion please.


    You are buying this at 2012 price of Rs 6000 psft (discounted backwards)

    You are buying this at 2014 price of Rs 6600 psft (same as above)

    If you anchor the above at market prices of 2012 and 2014, it may look like a deal or even a steal. But, the fact is you would have made zilch at 2017 even at those prices adjusted for 7-8% of risk free bond returns.

    I can cite many instances of above even in most prime locations of Alwarpet today.

    My guess is, these 'great deal' occurences are going to be even more common in the coming years - if you plan to live, just bite the bullet. If you truly look at valuation adjusted for opportunity costs or even past bubble reversion to mean, your wait may turn out to be golden. My 2 cents.
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  • Originally Posted by maverick007


    You are buying this at 2012 price of Rs 6000 psft (discounted backwards)

    You are buying this at 2014 price of Rs 6600 psft (same as above)

    If you anchor the above at market prices of 2012 and 2014, it may look like a deal or even a steal. But, the fact is you would have made zilch at 2017 even at those prices adjusted for 7-8% of risk free bond returns.

    I can cite many instances of above even in most prime locations of Alwarpet today.

    My guess is, these 'great deal' occurences are going to be even more common in the coming years - if you plan to live, just bite the bullet. If you truly look at valuation adjusted for opportunity costs or even past bubble reversion to mean, your wait may turn out to be golden. My 2 cents.


    Thanks Maverick​.

    Well. The seller has already sold his 3600sqft 5bedroom villa with swimming pool built on a 2400 sqft land has sold it for 4.25 Cr in P block, 3rd main Road, Annanagar with 23% discount on asking price of 5.5Cr.

    Seller is buying 2grounds of land in Annanagar and has quoted 5Cr for 4800 sqft land in full White transaction. Up until demonitization land price in Annanagar was 5Cr per ground, land costs have halved.

    I as a buyer am happy that from published asking price, got 20% Discounts as the seller was aware of market trend as he was consolidating his Annanagar properties to buy 2grounds of land.

    Furtherthree rounds of hard negotiation got me additional 4% Discounts.

    Personally I cannot wait for more time as it has been a intensive 3-4years search to get a resale flat in Annanagar in a prime, clean location​.

    Moreover for resale 2bhk flat size of 1100sqft, in prime locations, large middle class buyers compete for their own enduse. In my case after my negotiated final price there was another person offering 5% more. Hence I couldn't wait or prolong the hard negotiation further.

    As a buyer I like market further correcting by 10% which can cover my registration costs. But the middle class end-user buyers competition will hold the price correction of properties below 1Cr. But seeing RE as the investment is not at all worth in urban properties as the trend is very negative.

    HoweverBig ticket properties in prime area will correct further due to adhar PAN linking with property Registration.

    I have witnessed how prices of resale flat has been behaving in the past 3-4years. Earlier during recent 2013/14 peak price time maximum price negotiation would not be more than 5% or 5L from asking price this trend has certainly changed.

    Still owners of 15years old resale properties having 60% UDS are expecting ₹10500/sqft but not ready to accept trend of price correction with continuous falling prices of their properties.

    I as a buyer need to be content and happy to have partially availed the falling prices . I cannot take chances to miss this opportunity of a reasonable Resale property at a prime location as the probability is very rare and good end-user buyer competition will pop up for below 1Cr Resale property due to high population and migration to Chennai.

    Hence I went ahead and paid 10% advance payment and looking forward to completing registration before Pooja holidays.

    Price trends will continue to fall /rise. I need to implement my long awaited upgraded living in a prime location as I planned.

    If I buy anything, immediately the prices will fall due to some reason. In this case, I waited for atleast 3years and some benefit of falling prices have partially availed.

    I intend to live in this property for 15-25 years, I also want it to become my prime permanent address in Chennai and would like to see how redevelopment pans out for this property by 2040.
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