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Property Price Trends in Chennai

Last updated: 4 weeks ago
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  • Re : Property Price Trends in Chennai

    Friends,

    We are witnessing a repeat of 2009-2010, Rupee has devalued, inflation is high, builders are facing liquidity crunch, banks are reeling with NPA, government is not able to bring in reforms, high petrol, onion and commodities price, high intrest rates, we are also looking at early elections.

    Let me share my experience during then..I was looking to buy during that time and encouraged by the stagnation in the market and 20-30% price correction already to 2008 peak price was expecting another 1-2 years lull and better bargains..This is what I saw

    1. Market was very slow, no new mid housing projects were launched.
    2. Ongoing projects still had flats available, but price was steady.
    3. Ready to occupy projects were available close to launch price, but choice was less.
    4. Land sales were at a bargain mostly distress sales, land were cheaper compared to the flat prices in the locality.
    5. Builders started focussing on Luxury housing and targetting only the rich (HNI/NRI/Expats).

    I see the same happening all over again.

    When the market was about to collapse, government intervened asked banks to restructure the loans and with the infusion of liquidity in the market and global recovery, RE market in chennai recovered sharply and made up the losses for the stagnant years.

    I invite members to share their views on whether have we reached the top finally? or will we see another artificial bubble propped up pushing prices even higher in couple of years? Thank you.

    Comment


    • Re : Property Price Trends in Chennai

      Originally posted by nabishek View Post
      Friends,

      We are witnessing a repeat of 2009-2010, Rupee has devalued, inflation is high, builders are facing liquidity crunch, banks are reeling with NPA, government is not able to bring in reforms, high petrol, onion and commodities price, high intrest rates, we are also looking at early elections.

      Let me share my experience during then..I was looking to buy during that time and encouraged by the stagnation in the market and 20-30% price correction already to 2008 peak price was expecting another 1-2 years lull and better bargains..This is what I saw

      1. Market was very slow, no new mid housing projects were launched.
      2. Ongoing projects still had flats available, but price was steady.
      3. Ready to occupy projects were available close to launch price, but choice was less.
      4. Land sales were at a bargain mostly distress sales, land were cheaper compared to the flat prices in the locality.
      5. Builders started focussing on Luxury housing and targetting only the rich (HNI/NRI/Expats).

      I see the same happening all over again.

      When the market was about to collapse, government intervened asked banks to restructure the loans and with the infusion of liquidity in the market and global recovery, RE market in chennai recovered sharply and made up the losses for the stagnant years.

      I invite members to share their views on whether have we reached the top finally? or will we see another artificial bubble propped up pushing prices even higher in couple of years? Thank you.
      in 2009-10 it was possible for the market to recover because there were lot of Fx investment due to low confidence on western developed countries and FDI in indian RE. A common man in Chennai did not buy much, majority were investments.while i am not against it, my point is market kept the price stagnant and then increasing just because of this support from investors.

      Now, the scenario is different from 2009, now only India is facing economical issues, the US is into growth mode. Fx reverse has happened and will happen more if instability in India continues. i am not an expert to put a strong point or conclude here, my view is recovery was possible in 2009 and my question is the RE in distress now? what are the proofs? still projects are increasing its prices, how it is possible with these scenario? are the builders trying to hold their breath for long? if so this time they dont have FX support.. so they cant hold breath longer..

      Comment


      • Re : Property Price Trends in Chennai

        Booked a 2bhk at akshaya republic in kovur at 4250. Is it a worthy investmrnt?

        Comment


        • Re : Property Price Trends in Chennai

          In my personal opinion, 4250 for that location is too much for Kovur locationwise, especially since the Porur flyover is stalled and the Porur-Kundrathur road is chaotic. Anything around 3700 could have been a decent price. But since Akshaya has put up a lot of amenities in republic, it could be worth if you use them once you occupy. For rental purpose, it could be a bit difficult to find people for rent > 10k as there are cheaper options available near Porur/Bai Kadai itself.

          Akshaya being the first established player to enter Kovur RE has sadly put up a higher benchmark for this area jacking up the prices. I could see that Navins might have already got a sizable land bank by looking at Wikimapia. So, much depends on how Republic works out.

          So, if Akshaya delivers this project on time and if this is for self-use, the investment is not bad. But for rentals, you may need to wait and watch.

          Comment


          • Re : Property Price Trends in Chennai

            Akshaya, is always the trend setter with regard to setting pricing always on higher side & others follow suit.Thats exactly happened at OMR too!They launched Adora at a higher entry price and they had huge success.Infact people who didnt get at Adora booked with their next project Adair!They are always known to set higher price whenever they are the first to launch a project in that particular area.

            Comment


            • Re : Property Price Trends in Chennai

              I think their only flop project is Akshaya Today, price is refusing to budge. Looks like they feel confident that Kovur is much better than Kelambakkam.

              Comment


              • Re : Property Price Trends in Chennai

                In case of Kelambakkam, the target customers are purely those who work in IT but incase of Kovur, it could be combination of people who work in IT(DLF+Olympia) and non-IT. So, its success mostly depends on its pricing and we need to see how well people receive it.

                One reason Akshaya had to go so far could be due to lack of such big land parcels on the main road before Bai Kadai junction/Gerugambakkam junction and better margin since the land acquisition cost is lower since this property which is in the tail-end of Kovur (more towards Kundrathur side).

                Comment


                • Re : Property Price Trends in Chennai

                  How successful the builder is in selling apartments at higher price is one thing. How many who invested at those trend-setting prices made money over a 5 year period is another.

                  Classic example: Akshaya Metropolis. They had a huge marketing campaign with talk-of-the-town TV commercial, but it has not made money for those who bought. Akshaya's track record has been very poor in making money for the investors in the last 5 years - especially large community development in suburbs and many are sucker bets which did not meet the expectations. If anyone made money ( > 12% pa) in any of the Akshaya projects, please share the project names.

                  Comment


                  • Re : Property Price Trends in Chennai

                    appreciate your comments guys..
                    was floored by their governance levels and disclosure standards..so ended up with a spot booking..now rethinking if i should cancel..so appreciate objective feedback..

                    more on the deal..920 sqft..2BHK..all inc cost is 48lac. UDS is 52% which i thought was very impressive considering g+7 floors..4250/sqft..no extra floor rise or spl view charges which i again liked..so went for 6th floor..

                    My concern was only pricing and location
                    Prestige Bella Vista at over 6000, Siddharth Upscale at 5100 and Navin's Eden at 5500 all admittedly in Porur and closer to the jn. Republic would be 6km from the jn and maybe 3km further from Eden's. And to me Republic at 4200 seemed reasonable..

                    views welcome..can atleast cancel now and avoid throwing good money after bad..it is an investment purpose only for me..

                    Comment


                    • Re : Property Price Trends in Chennai

                      Newbie101,

                      I feel it is not a bad deal. I do not know about the area a lot.
                      48L for a 2-bHK is fine if it includes all extra charges. 45L would have been good deal but extra couple of laks might not make big difference if you like floor plan, location, etc.

                      52% for a S+7 (1.5 FSI) is also bit above avg but not too much. Even carpet area should be decent.
                      1.5 FSI buildings are generally around 50% UDS. We should not compare against 2.5FSI buildings on main roads.

                      Comment

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