Announcement

Collapse
No announcement yet.

What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

Collapse
X
Collapse

What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

Last updated: October 3 2017
42 | Posts
  • Time
  • Show
Clear All
new posts
  • #31

    #31

    Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

    Originally posted by maverick007 View Post

    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.
    Last edited September 8 2017, 01:12 AM. Reason: added a point

    Comment

    • #32

      #32

      Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

      Originally posted by harima7619
      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.
      There is a saying - life is too short to learn from *our* own mistakes only. These owners need to learn from others' mistakes. Seriously.

      Like the ones who bought for UDS in prime areas(Alwarpet, Nungambakkam) in Chennai (2012-14) are still nursing their wounds. They have learnt the lesson that UDS is not same as a freehold land in Nungambakkam and Alwarpet. Seller often uses that as a benchmark to push his sale - like Mahindra Timeshare uses Resort Per Diem rates to justify. Many fall for it. Then why does Mahindra Club quote at 50% discount on resale? .

      Do we want to learn from others' mistake or our own - which is more expensive?

      Today, there is still some juice left in freehold land - after 33% GV reduction. Black Ants are still chasing them for sheltering. Poor lemmings are using those prices for anchoring for UDS. Sheer lack of awareness on what is valued in the market. Once the land becomes UDS, it is laundered already to a great extent - why bank on to-be-laundered premium again? Who will give? Unless there is a substantial building rights increase through redevelopment.
      Last edited September 8 2017, 08:57 AM.

      Comment

      • #33

        #33

        Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

        Originally posted by maverick007 View Post

        There is a saying - life is too short to learn from *our* own mistakes only. These owners need to learn from others' mistakes. Seriously.

        Like the ones who bought for UDS in prime areas(Alwarpet, Nungambakkam) in Chennai (2012-14) are still nursing their wounds. They have learnt the lesson that UDS is not same as a freehold land in Nungambakkam and Alwarpet. Seller often uses that as a benchmark to push his sale - like Mahindra Timeshare uses Resort Per Diem rates to justify. Many fall for it. Then why does Mahindra Club quote at 50% discount on resale? .

        Do we want to learn from others' mistake or our own - which is more expensive?

        Today, there is still some juice left in freehold land - after 33% GV reduction. Black Ants are still chasing them for sheltering. Poor lemmings are using those prices for anchoring for UDS. Sheer lack of awareness on what is valued in the market. Once the land becomes UDS, it is laundered already to a great extent - why bank on to-be-laundered premium again? Who will give? Unless there is a substantial building rights increase through redevelopment.
        UDS is a feel good factor in an urban resale property Purchase if the building is in its mid life say 15-20 years old.

        All Resale are not comparable to first TNHB flat resale boom in Annanagar, Ashok Nagar, KK nagar which had great value as those TNHB properties were built in early 80's had high UDS share and with doubled FSI in 2007/13 all individual UDS shares got redeveloped and such bunch of lucky informed buyers got their dilapidated 40years old TNHB flats newly developed into brand new larger flats.

        But in urban areas no body will redevelop a 15year old property as the FSI has not doubled restricting real benefit of a higher UDS share.

        In 2017 Investing with the inflated prices on a 15-20 years old property purely as investment primarily based on higher UDS share and waiting for another 15-20 years makes the investment dead.

        I don't expect a 1100sqft 2BHDK flat will cost 3Cr in the next 15-20years given the down trend of economy.

        AllI expect is that the irrational spurt of indian RE price spike from 2004-2014 decade will get ironed out adjusted/corrected logically in this 2015-2025 decade.

        AnyRE be it land, flat, villa all those which got doubled/tripped in value will see a deep correction in the next 2-3years.

        By2020 chances are there for new flats to be sold at half of today price with FSI enhancement in the pipeline for most Metro cities, Chennai in particular.

        To me next two / three years, It is a wait, check and buy for consumption time for RE.
        Last edited September 8 2017, 09:35 AM. Reason: added a point

        Comment

        • #34

          #34

          Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

          harima7619; Your views seem to be on the same page as mine.

          Gave the road map in a post dated Mar 27, 2017 in the other thread 'Busting Real Estate Myths'..

          Originally posted by maverick007
          Apartment prices in prime and hi-growth areas in Chennai

          1990-2002: 2.5 times [Past history..reality check]
          ............
          2002-2010: 4 times [Too much of inebriation and hallucination] [Paper announcements discounted as reality -ORR, 6 lane, Airport, Shipyard,IT Parks, ..]

          2010-2017: 0.2-0.4 times [Hangover] [Value trap]

          2002-2025: 6 times [ Normalization of abnormality] [Validation of Stupidity]

          2025: No free lunch.Don't be a herd and get slaughtered [Inner voice of gullible RE investors]

          PS: Multiples based on the prices seller will realize if he held/holds it during the period.

          Comment

          • #35

            #35

            Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

            Originally posted by maverick007 View Post
            harima7619; Your views seem to be on the same page as mine.

            Gave the road map in a post dated Mar 27, 2017 in the other thread 'Busting Real Estate Myths'..
            Most importantly IT sector jobs/salary fantasy has ended and is in deep turmoil now and IT job uncertainty is bringing young/careless buyers and investors to their senses resulting in much required RE slowdown coupled along with extraordinary greed exhibition by Builders & Govt.

            In the next 2-3 years Slowly & steadily RE market and its price trend will get back to predictable normal linearity rather driven by prices spiking, spurting, and bursting irrationally as in the by gone decade 2004-2016.

            In marketing demand decides price. Demand in market is decided by buyers job stability and tax certainty.

            Demonitization, Black money hunt, consistent Tax chase by Govt, IT job uncertainty will be the factors bringing back normalcy to RE prices to correct and stabilize at reasonable levels which might be giving room for yet another 20-30% deep correction in 6-12months.

            Comment

            • #36

              #36

              Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

              I am not so positive about 20-30% correction in 6-12 mos. It would be a time correction with price remaining still and inflation eating it 6-7% a year type. With > 80% of our country assets in RE, broader intelligentsia is guided by sunk cost fallacy. They will not get out till they see the price they paid - they will be so happy getting out 5 years from now at the same price than 20% down at the first year . Hence no sudden correction and they pride it as the attribute of the RE asset class.

              Comment

              • #37

                #37

                Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

                Originally posted by maverick007 View Post
                I am not so positive about 20-30% correction in 6-12 mos. It would be a time correction with price remaining still and inflation eating it 6-7% a year type. With > 80% of our country assets in RE, broader intelligentsia is guided by sunk cost fallacy. They will not get out till they see the price they paid - they will be so happy getting out 5 years from now at the same price than 20% down at the first year . Hence no sudden correction and they pride it as the attribute of the RE asset class.
                Central Govt's1% TDS for property values above ₹50L and TN Govt's recent 300% increase in registration charges only add costs further as in and around 40kms radius of Chennai it is difficult to find a 1000sqft flat below ₹50L price.

                Purchase Prices of OMR specifically Akshaya Adair at Padur was sold at ₹4500/sqft basic price by builder in 2009/10 but now buyers/investors after spending registration, woodwork done costs, Resale prices in 2017 are ₹4200/sqft negotiable.

                Prices will not be be still, it will fall by some percentage given negative trend causing factors in the next few years.

                Comment

                • #38

                  #38

                  Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

                  In RE if you are happy with property & paying equivalent or below current market value, then you should buy.

                  no point in considering potential future correction.

                  it is a long term investment . It will all wash out in the long run.

                  Go for it.

                  Comment

                  • #39

                    #39

                    Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

                    my 2 cents is Cash is the King.so it is always better to liquidate the asset if it is not yielding any better returns then sitting on it hoping it will dramatically increase

                    Comment

                    • #40

                      #40

                      Re : What is The Market Price For a 15 Year Old 2BHK Flat In Anna Nagar, Chennai?

                      Updation

                      Comment

                      Have any questions or thoughts about this?
                      Working...
                      X