Just An Observation:

As we could see decent decrease (percentage may vary from location to location) in RE, I am wondering why still the house rent (even for residential purpose) is keep increasing (especially within chennai). I don't see any down trend / stabilization in terms of house rent.

Is there any other factors (school, college, hospital, etc) plays major role which OVERRIDES present RE trend ? Do we need to consider "HOUSE RENT" as different scenario ?

Suggestion are welcome :)
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  • Who said RE prices are falling? THat is what Wiseman claims...full stop. As for rent it has to go up to justify the price of RE.
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  • House rent

    Originally Posted by Natarajg007
    Who said RE prices are falling? THat is what Wiseman claims...full stop. As for rent it has to go up to justify the price of RE.


    The logic is simple. When the demand is more than the availbility ( supply ) the price ( rent ) goes up. If the availability is more than the demand. it has to come down. Examples are: Arun Excello in GST Road- the rent is not more than Rs. 5000 PM for a very good 2 bed flat. Where as in areas like Saidapet or West Mambalam a 2 bed flat with a lower plinth area may fetch Rs. 8000 min. PM. In these areas, the availability is very very less.

    ks2071746
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  • Originally Posted by ks2071746
    The logic is simple. When the demand is more than the availbility ( supply ) the price ( rent ) goes up. If the availability is more than the demand. it has to come down. Examples are: Arun Excello in GST Road- the rent is not more than Rs. 5000 PM for a very good 2 bed flat. Where as in areas like Saidapet or West Mambalam a 2 bed flat with a lower plinth area may fetch Rs. 8000 min. PM. In these areas, the availability is very very less.

    ks2071746

    Demand and Supply define everything in our capitalistic world. However the same pulls both Price of House as also Rent for the house. Unfortunately the return from rent for a house is worthless in our Indian financial conditions. So many buy houses as assets, to live (landlord/landowner problem which you can repeat again!) and some because they dont know where to park their money!
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  • If you open the house or apartments to rent column in the newspapers or websites you find that there are some places that has so many advertisements and some are not at all listed. Places like Adayar has many to rent places but when you look at Madhavaram, Thirumullavoyal you can hardly find. But the rents are so much higher in Adyar but so low at the outskirts. But when you look at the population they are all saturated. So time I wonder if suppy and demand theory really works accordingly. I know there such thing prime areas fetching high rental by the takers are so much lesser and yet the rentals are high.
    How is the rental movement now? Are the houses/apartments immediately taken once put up for rental.?
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  • Thanks for all your replies...

    As house rent can influence most percentage of the people, compare to the buyer / seller in the economy. It would be great helpful, if we can focus our thread towards House Rent as key factor and also other parameters which controls the same as secondary one. (by limiting the argument about RE trend in terms of selling / buying the property).

    I do live in Mogapair, paying around 8000 Rs rent (suppose to pay additional 10% from this year begining) for around 1000 sqt independent portion in a house. As there is significant increase in the rent and also down trend in earning, I planned to move to other area where the house rent suppose to be low compare to present one and also ready to comproming few facilities in order to save some money. But, surprisingly I could see only the high price for house rent in any part of the chennai (with in city limit). CAN I WAIT FOR SOME MORE TIME (may be , I can promise my house owner that I will be vacating his house and also request him not to increase my rent for next six month) ? WILL IT MAKE ANY DIFFERENCE AFTER SIX MONTH ?

    Is there any general trend to make more money out of tenant to compensate the loan interest which has been increased from 8 to ~13 %, but not significantly reduced.

    As I mentioned earlier, Is other stable key factors (reputed school, hospital, safety, transporation, etc.,), which keep minimizing the negative impact / down trend. If not, can we expect any change ?

    Would like to hear other's experience, real time statistics and stratergy (pls try to avoid own guess).

    Sorry for the lengthy message. will try to minimize in future :)
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  • Rent

    Originally Posted by vpsureshkumar
    If you open the house or apartments to rent column in the newspapers or websites you find that there are some places that has so many advertisements and some are not at all listed. Places like Adayar has many to rent places but when you look at Madhavaram, Thirumullavoyal you can hardly find. But the rents are so much higher in Adyar but so low at the outskirts. But when you look at the population they are all saturated. So time I wonder if suppy and demand theory really works accordingly. I know there such thing prime areas fetching high rental by the takers are so much lesser and yet the rentals are high.
    How is the rental movement now? Are the houses/apartments immediately taken once put up for rental.?


    Dear vpsureshkumar,

    One need not have to fully go by the advertisements. So many flats for rent do not get into news paper advertisement. Many are by reference, some are with "to let" boards hung in the gate, some are through brokers etc. Supply- Demand theory will work always for any commodity or service and is applicable for RE also including rentals.

    ks2071746
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  • Dear Wiseman, It would be great if you can throw some light on this issue. I could see most of your discussion make more sense.
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  • There is another factor. Most people are contemplating between investing in a property to get returns through rental and parking their money in FDs. So when banks gives higher returns more than 7% or 8% then the wiser choice would be putting in FDs. However people who already have houses/apartments/shops would want to be at par with the bank returns and thus pushing their rental returns higher. Sometimes the rental rates does not justify with the quality of the environment/surrounding of the house. Roads are bad no proper drainage and others. But because they are in prime areas the rentals are should be high.
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  • Originally Posted by middleclass
    Dear Wiseman, It would be great if you can throw some light on this issue. I could see most of your discussion make more sense.

    Maybe Wiseman's company did the Satyam game and is in trouble now. So he wont have time to write now...he will come back once his company is closed for good. ROTFL.
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  • Rental rates are also decreasing due to more lay offs
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  • Originally Posted by Nataraajg007
    Rental rates are also decreasing due to more lay offs

    They havent laid you off yet...to rest I mean!
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  • Originally Posted by Nataraajg007
    Rental rates are also decreasing due to more lay offs


    Poor guy. Only man expecting price will go up now. Fool
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  • Originally Posted by Nataraajg007
    Poor guy. Only man expecting price will go up now. Fool

    What a pity, someone mimicking my name talks all the nonsense possible. Let me pass him!
    Incidentally the realestate price in Bangalore seems to be going up not down, though builders try to offer complex marketing tools (rather clauses!). Sobha the reputed builder is selling flats deep on Kanakapura road for no less than 2100psft in Bangalore where FSI might be anything even 4 or 5. The same Sobha is selling for 3.2 crores a villa a little beyond Devanahalli airport and specs are 3200sqft building on 5000sqft land. Let us say Sobha is building at a super cost of 2000psft, so 3200sqft building is worth 64L. That means 5000sqft of developed land in what is not really Bangalore but rather Devanahalli (let us say the equivalent in Chennai is Sriperumbudur) is 3.2C-64L, i.e. around 2.5C. Or each square feel in far away Devanahalli is 5000psft. So a good builder in Sriperumbudur can sell developed land for 5000psft...right?
    In Chennai a bunch of bear clowns are trying to BEG prices to go down. What is the result? Those who wanna buy are getting them at old, rather rising prices. Those who are believing these bears are going to be left in the cool once these BEAR TALKERS who are rather OPERATORS jack up the price. So if you dont buy your land in Sriperumbudur for 1000psft you will be given a slightly better developed land in the next few months for 5000psft, like Sobha does.
    Finally please dont be confused by the id. Nataraaaaaaaj... That is not mine. That guy is a fraud and is on the board to try to confuse readers.
    Cheers.
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  • What a pity, someone mimicking my name talks all the nonsense possible. Let me pass him!

    Incidentally the realestate price in Bangalore seems to be going down, though builders try to offer complex marketing tools (rather clauses!).

    Sobha the reputed builder is selling flats deep on Kanakapura road for no less than 2100psft in Bangalore where FSI might be anything even 4 or 5. The same Sobha is selling for 2 crores a villa a little beyond Devanahalli airport and specs are 3200sqft building on 5000sqft land. Let us say Sobha is building at a super cost of 2000psft, so 3200sqft building is worth 64L. That means 5000sqft of developed land in what is not really Bangalore but rather Devanahalli (let us say the equivalent in Chennai is Sriperumbudur) is 2c, i.e. around 2.5C. Or each square feel in far away Devanahalli is 3000psft. So a good builder in Sriperumbudur can sell developed land for 5000psft...right?

    In Chennai a bunch of bear clowns are trying to BEG prices to go down. What is the result? Those who wanna buy are getting them at old, rather rising prices. Those who are believing these bears are going to be left in the cool once these bull TALKERS who are rather OPERATORS jack up the price. So if you dont buy your land in Sriperumbudur for 1000psft you will be given a slightly better developed land in the next few months for2000psft, like Sobha does.

    Sp prices are falling every where

    Finally please dont be confused by the id. Nataraj..single a That is not mine. That guy is a fraud and is on the board to try to confuse readers.
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  • Originally Posted by Nataraajg007
    Rental rates are also decreasing due to more lay offs


    It is true in certain areas. May not be true in all areas.
    I have a practical case here. There is a project at Saidapet West with 12 flats, constructed about 10 years back, good construction. You will not believe, the rent being paid by the respective tenants for a 1 bed, 2 bed and 3 room flats, were surprisingly, in the same range of Rs. 3500 to Rs. 3800 PM, which was found out late. The main reason has been that none of the flat owners did talk with each other to find out what rent they have been getting in the last 2 or 3 years. Now the 2 bed and 3 room owners are increasing their rent to Rs. 6000 and 8000 and there are good responses.

    ks2071746
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