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Property Price Trends in Chennai

Last updated: 3 weeks ago
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  • Re : Property Price Trends in Chennai

    Originally posted by Love4land View Post
    Past performance is not indicative of future returns. However 2012 data is better than 2011 data, that is why I picked projects launched in 2012.

    Radiance IVY terrace is one of underdog in OMR that performed quite well. I agree with that.

    Rupee has fallen more than 20% and FD will fetch 10%, people invest in real estate with faith that returns will beat FD and inflation.
    Projects that don't beat these percentages certainly let down their buyers.

    Some buyers may console themselves that we should wait until 5 yrs, 10 yrs, 20 yrs, etc.. to see actual returns.
    I like to take bull by its horns. I categorize a project as a success or failure based on data available at that point.

    The fact that Akshaya priced their Kovur project 4200 psf while they priced their Kelambakkam project 3000 psf shows their lack of faith in OMR and potential/demand in Porur extended region.
    Price does not signify strength. It is mostly valuation. Low price can hold high valuation then high price in many cases.

    I am not sure of plot rate and acquisition rate but here is an stock market similarity

    Wipro ADR priced at $9 and infosys at $46. Does it mean infosys is looking strong?

    If you see valuation of wipro it is trading at 25 P/E compared to infosys 15 P/E. Market see this low price stock valuation higher.

    I am not telling kelambakkam is great again. Even I am not positive on that area. But your way of comparing by price is not an right tool in investment. Poes garden is 25000 per sqft does that mean it will double faster then kovur.

    Even in mutual find return we see last 5 years return so 2011 is not bad. You need to look at annual yield and not the dates.

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    • Re : Property Price Trends in Chennai

      Originally posted by Love4Land
      I categorize a project as a success or failure based on data available at that point.
      Glad that you put words to your rationale. It shows your disrespect for data and how to make sense of data and when. Let me take your "bull" by the horns:

      Sobha Serene, Seneerkuppam: Aug'13 (5500 psft), Sep'13 (5500 psft) (Both are accurate data as of today..!!)

      One month appreciation: 0 CAGR: 0% Does it mean a thing? No.

      Your comparison of 1 year and 1.5 year data is as ludicrous as above. For RE as an asset class, anything less than 5 years, is pure noise . If you are building a castle from noise and want to judge projects, it is an affront to one's senses and IREF as a forum.
      Last edited September 2 2013, 08:23 AM.

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      • Re : Property Price Trends in Chennai

        Originally posted by Love4land View Post
        Past performance is not indicative of future returns. However 2012 data is better than 2011 data, that is why I picked projects launched in 2012.

        Radiance IVY terrace is one of underdog in OMR that performed quite well. I agree with that.

        Rupee has fallen more than 20% and FD will fetch 10%, people invest in real estate with faith that returns will beat FD and inflation.
        Projects that don't beat these percentages certainly let down their buyers.

        Some buyers may console themselves that we should wait until 5 yrs, 10 yrs, 20 yrs, etc.. to see actual returns.

        .
        "Past performance is not indicative of future return, Therefore I will not take 2011 as benchmark but I will take 2012 as benchmark"

        Very Smart statement.

        Back to basic Investment rule 1 - Investment time horizon.

        Certain investments like direct RE are for "long term" for a reason.

        Comment


        • Re : Property Price Trends in Chennai

          Originally posted by Economist View Post
          OMG!!!!!

          Kovur is like a stone thow from the Airport.
          Maybe if you are a bird, not for humans.

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          • Re : Property Price Trends in Chennai

            In suburbs, apartments >5 yrs old are hard to sell due to depreciation and competition from newer apartments. Long term hold doesn't apply for apartments in suburbs.

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            • Re : Property Price Trends in Chennai

              The real reason is there are very few operational ones. For resale the area has to stabilize first which is kind of happening now atleast till Siruseri and will take atleast 3 years to go into resale level. All depends on how well the infrastructure scales up with RE growth.

              Too early to talk about resale IMO now. RE is for long termers and patience is the key.

              I have personally sold mine in a so called suburb without any issues and with a good average return.

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              • Re : Property Price Trends in Chennai

                Originally posted by Love4land View Post
                In suburbs, apartments >5 yrs old are hard to sell due to depreciation and competition from newer apartments. Long term hold doesn't apply for apartments in suburbs.
                What happened to your recommendation about Callexpress Euphoria at 8K.

                That will hit 5 years soon aswel.

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                • Re : Property Price Trends in Chennai

                  For flats, we look at appreciation between prelaunch to launch, launch to completion, completion to handing over, handing over to resale, resale after tenancy/self occupation etc and finally till redevelopment. The first three stages are the appreciation thats a virtue of project positioning, inflation and premium due to scarcity in supply and increased demand. It maynot necessarily reflect the infrastructure growth or fundamentals..In a multi tower multi phase project its natural that newer towers are priced higher than the old ones, but once its completed the premium on resale will be minimum unless the tower offers something unique like seaview or bigger flats etc..for a project like prestige bella vista the 4-bhk tower or 1 BHK tower will be priced differently and similarly in a project like HIRA Upscale a sea facing flat will give better returns than a OMR facing one..The same yardstick cannot be applied to a single phase project where there isnt any scope for differential pricing across units..in such projects the appreciation one sees is uniform and across all kinds of flats. So for an investor who is looking to invest to make profit and exit within 2 years, a large multi phase project should be an obvious choice..whereas for an enduser who is buying to maximum affordability and looking for stable uniform but slow appreciation a single phase project would be the best. I believe the latter would hold better in resale because of the simple reason the future appreciation post handover is still not factored in whereas in the large projects it is done by the builder himself while launching new towers..the resale price cannot be more than new tower price.

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                  • Re : Property Price Trends in Chennai

                    Originally posted by Love4land View Post
                    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.
                    Again you are wrong.

                    Launch price was 2800. Current price is from 3200 to 3400. Out of 2000+ apartments, around 1600+ released and 1200+ is already booked. ( Release of Block A which is OMR facing is yet to be done and slated for still much higher rate)

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                    • Re : Property Price Trends in Chennai

                      Originally posted by Love4land View Post
                      GST and OMR have poor prospects of appreciations, especially in areas that are already flooded with apartments and are going to be flooded with more apartments (Shols to Thiruporur on OMR & beyond Tambaram on GST). Porur is relatively much better at the moment.

                      Some interesting data:

                      Olympia Grande Pallavaram - Launch rate 4800 (Jan'12), current rate 6600
                      Prestige Bella Vista - Launch rate 4200 (Jan'12), current rate 6000
                      Sobha Serene, off Porur - Launch rate 4600 (Jan'12), Current rate 5500 psf

                      Other apartment projects with excellent returns in the past year:
                      Ruby Paradise, Selaiyur
                      Vishwakarma skypark, Pallavaram

                      Let us compare with low growth area:
                      Appaswamy Greenville - Launch rate 4900 psf (Jan'12), current rate 5200 psf!!

                      Some may give following lame excuses:
                      -Resale prices will be lower than launch price for both Prestige Bella Vista and Olympia Grande.
                      -Prestige launched interior blocks for lower rates, blocks closer to main road for higher price.

                      These are just sour grape syndromes of people who booked in other projects. They refuse to think rationally. Logic dictates that when there are buyers desperate enough to buy new apartments for 6000 psf, won't the same buyers be willing to pay atleast 5750 psf when existing owner puts out for resale? There are already resale units available in Prestige Bella Vista for 5750 psf. I would prefer those if I intend to buy a unit there.

                      I feel your decision is much safer than those who booked in OMR or GST based on available data of appreciation figures in the past 1 yr.
                      Those figures are totally wrong and made & twisted just to promote shobha project and Olympia for obvious reasons

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