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Property Price Trends in Chennai

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  • Re : Property Price Trends in Chennai

    Hi every one, i have joined newly with the forum. I feel it is not correct to work out the costing of any product to take a decision as in the fisrt instance. As all the members of the forum is having right knowledge on the issues, things like prominance of the location, immediate future developments in pipe line, present basic amenities, lay out feature like multi connectivity to the building, road width, present average market price of comparable project with comparable feature and quality, present status of other projects completed by the builder atleast 3yrs befoer, traveling time from the work place, nearby good school, hospital and provisional and veg stores, possibiltiy of immediate renting and sales(normal market condition), decent neibours, safety and security of ladies and elderly persons, economical balance of co owners in case of small projects having 4 to 12 units,etc., are also forms reason for price.

    We can get products at diffrent rates for many reason. quality with reasonable price is to be seen.

    Any development for a location can come only if govt undertakes infra development. Roads, Bridges, EB, water drainage, etc. cannot be made / done by any one.

    Land prices are only playing a key role in deciding the price of a flat. People are so informative in arriving the cost of construction. The replacement of land in a demand oriented area will grow where the developemts are more. Land are sold as more than gold.

    i believe many land sales are made only at future price and not on todays value. this is for the comfort. Principle of average land banck cost is also taken into account for deciding the land price.

    Mount road in chennai cannot be replaced with any other road even if the new road is wider and more attractive like IT Express way. We cant change egmore or central from its place. What happened to koyembedu vs Kothavalsavadi market. Every one can agree that Kothavalsavadi is still the option no.1 to decide the market. Broadway cannot be replaced by any one with any new best infrastructure. There are many hiddenn unknown reasons for locations.

    Coffee ranges from Rs.3 to 12/- and takers decides based on the need and not based on the costing. The reason for the price diff is not only profit but quality and comfort is also involved. I feel Rs.12/- coffee is best than the Rs.3/-. I dont want to stand in a Q in front of a doctor for this. Preventive is better than cure.(it doesnt mean all the Rs.3/- coffee are bad)

    One liter water cost Rs.12/- and a kilo of rice is given at Re.1/- (with lot of inside trading). Govt says they subsidise this. Like this many goes like. Oil, Gas, Diesel, Petrol and many more. It is u and me who subsidise for others. People below poverty line are taken care first not for their poverty but for the vote. Politicians keep them in the same status by providing frees. The real people who strugle in this world are neither the poor nor the rich. Only middle and upper middle class.

    For buidlers Undisclosed cost like Approval, Brokerage, EB, Drainage, Water connections through paid officially many goes as un official part. Many donations to all the political parties on various occassions.

    It is not correct to blame the builder alone as if they take the margin to their home. How many of us first compare the price difference as last one? For many, this goes as first option.

    For quality we can pay more nothing worng. Facilities which are needed to be paid for. Many venture with unregistered builders who will never look back after the sale. It is we the people, who drive every thing.

    Now the suburbans are like city and we could not c any high raised building inside the city(chennai). Big companies and FDI made all mess up in the setup. Govt wanted money for running their party and purchaing the MLAs and MPs. Why the outskirt projects are approved for more than one plus one. What is the need? If the govt can approve the projects why they cann,t form the layout and sell it to all individuals. How many houses are running at low voltage? Is there any replacement for the damages? Where the money paid for development expenses have gone?

    IT professionals who changed their job more frequenty till last year now keeping quiet even at reduced salary and facilities and every day they pray god for their job security.

    There are many more behind everything. It is a race. Not all wins. It is the era where the race is only for money.

    Proper analysis wold always help even sucess is not guaranteed. Not more than this.

    No weightage / importance are is given for Good, Sincear, Straight forward People. Those who shout for rights are fools nowadays. Only money drives all and we are not driving it.

    The decision for taking a house property can be made like this in terms of budget:-

    Your present take home * 75% * 60% = 45% of your take home for paying the housing loan emi + (60% of your present savings in hand) = Over all Flat Cost

    To illustrate:

    Your present savings in hand is 5 Lakhs
    Your Present take home is say 35k

    Your safe house budget should be (35k * 45%)/emi per lakh + (60% of 5 Lakh)

    ie. 15750/(900 appx) + 3 = 20.5 Lakhs

    Thanks. If any one disagree advance sorry for that.

    Comment


    • Re : Property Price Trends in Chennai

      Originally posted by vmggb1972 View Post
      Hi every one, i have joined newly with the forum. I feel it is not correct to work out the costing of any product to take a decision as in the fisrt instance. As all the members of the forum is having right knowledge on the issues, things like prominance of the location, immediate future developments in pipe line, present basic amenities, lay out feature like multi connectivity to the building, road width, present average market price of comparable project with comparable feature and quality, present status of other projects completed by the builder atleast 3yrs befoer, traveling time from the work place, nearby good school, hospital and provisional and veg stores, possibiltiy of immediate renting and sales(normal market condition), decent neibours, safety and security of ladies and elderly persons, economical balance of co owners in case of small projects having 4 to 12 units,etc., are also forms reason for price.

      We can get products at diffrent rates for many reason. quality with reasonable price is to be seen.

      Any development for a location can come only if govt undertakes infra development. Roads, Bridges, EB, water drainage, etc. cannot be made / done by any one.

      Land prices are only playing a key role in deciding the price of a flat. People are so informative in arriving the cost of construction. The replacement of land in a demand oriented area will grow where the developemts are more. Land are sold as more than gold.

      i believe many land sales are made only at future price and not on todays value. this is for the comfort. Principle of average land banck cost is also taken into account for deciding the land price.

      Mount road in chennai cannot be replaced with any other road even if the new road is wider and more attractive like IT Express way. We cant change egmore or central from its place. What happened to koyembedu vs Kothavalsavadi market. Every one can agree that Kothavalsavadi is still the option no.1 to decide the market. Broadway cannot be replaced by any one with any new best infrastructure. There are many hiddenn unknown reasons for locations.

      Coffee ranges from Rs.3 to 12/- and takers decides based on the need and not based on the costing. The reason for the price diff is not only profit but quality and comfort is also involved. I feel Rs.12/- coffee is best than the Rs.3/-. I dont want to stand in a Q in front of a doctor for this. Preventive is better than cure.(it doesnt mean all the Rs.3/- coffee are bad)

      One liter water cost Rs.12/- and a kilo of rice is given at Re.1/- (with lot of inside trading). Govt says they subsidise this. Like this many goes like. Oil, Gas, Diesel, Petrol and many more. It is u and me who subsidise for others. People below poverty line are taken care first not for their poverty but for the vote. Politicians keep them in the same status by providing frees. The real people who strugle in this world are neither the poor nor the rich. Only middle and upper middle class.

      For buidlers Undisclosed cost like Approval, Brokerage, EB, Drainage, Water connections through paid officially many goes as un official part. Many donations to all the political parties on various occassions.

      It is not correct to blame the builder alone as if they take the margin to their home. How many of us first compare the price difference as last one? For many, this goes as first option.

      For quality we can pay more nothing worng. Facilities which are needed to be paid for. Many venture with unregistered builders who will never look back after the sale. It is we the people, who drive every thing.

      Now the suburbans are like city and we could not c any high raised building inside the city(chennai). Big companies and FDI made all mess up in the setup. Govt wanted money for running their party and purchaing the MLAs and MPs. Why the outskirt projects are approved for more than one plus one. What is the need? If the govt can approve the projects why they cann,t form the layout and sell it to all individuals. How many houses are running at low voltage? Is there any replacement for the damages? Where the money paid for development expenses have gone?

      IT professionals who changed their job more frequenty till last year now keeping quiet even at reduced salary and facilities and every day they pray god for their job security.

      There are many more behind everything. It is a race. Not all wins. It is the era where the race is only for money.

      Proper analysis wold always help even sucess is not guaranteed. Not more than this.

      No weightage / importance are is given for Good, Sincear, Straight forward People. Those who shout for rights are fools nowadays. Only money drives all and we are not driving it.

      The decision for taking a house property can be made like this in terms of budget:-

      Your present take home * 75% * 60% = 45% of your take home for paying the housing loan emi + (60% of your present savings in hand) = Over all Flat Cost

      To illustrate:

      Your present savings in hand is 5 Lakhs
      Your Present take home is say 35k

      Your safe house budget should be (35k * 45%)/emi per lakh + (60% of 5 Lakh)

      ie. 15750/(900 appx) + 3 = 20.5 Lakhs

      Thanks. If any one disagree advance sorry for that.
      Nice view expressed here vmggb1972.

      Thanks for the math to estimate the loan eligibility.I am noting it down for future reference.

      Agree with you that land transactions happen taking future price into consideration, and more importantly the type of use that land can be put to use.If its for a commercial complex, multi storied building of 2.5 FSI or a stilt + 4 flat, G+1 building of 1.5 FSI also plays a role in deciding the price.Opportunity cost is also considered.

      People pay high premium cost for the kind of ambience and amenities they want for living.Posh areas are priced high because the price tag screens away people aspiring to be rich from those who are really rich.People buy in posh places only for self use and seldom for renting purposes.

      When one pays 50 rupees for a cup of coffee/tea at a cafe, its not just for the quality of beverage its also for the time one gets to spend there and kind of non invasive environment thats extended.The extra cost is for the luxury, not necessity.

      I believe thats a niche segment, and their spending and investment do not reflect the sentiment of rest of the people.

      Let me try to explain todays scenario with an analogy

      A person owns a tea stall adjacent to a 5 star hotel.Seeing the fascination people are having for 5 star status, and the spendthrift nature of the people coming there(floating demand), He decides to use the opportunity and names his shop "5 star tea stall" does some minimum alterations by taking bank loan and pegs the price of 50 rs for a cup of tea.

      Initially the tea stall owner was lucky to find few Foreigners who bought from him thinking its just $1 for them, thus encouraging him to hold on to the exorbitant price.

      The regular customers(local demand) who would have bought from the tea stall if the price was Rs.10, realize If they had Rs.50 they would rather walk into the five star hotel pay some extra and enjoy the ambience than have this tea outside at unjustifying cost.They begin to look and go elsewhere.

      Slowly with the sales coming down,profit diminishing, cost of inventory and debt growing the owner realizes that he aint as big as the shop's name and locality.The owner is stuck in a position to make a choice whether to resort back to value based pricing and attract the old customers or to be doomed without trace.Its a matter of survival.

      Similarly today, builders fail to provide value for money in terms of monetary worth or in terms of ownership/living experience.This is the reason why pricing is being looked first and debated so much.
      Last edited May 4 2009, 05:07 PM.

      Comment


      • Re : Property Price Trends in Chennai

        Originally posted by vmggb1972 View Post

        Coffee ranges from Rs.3 to 12/- and takers decides based on the need and not based on the costing. The reason for the price diff is not only profit but quality and comfort is also involved. I feel Rs.12/- coffee is best than the Rs.3/-. I dont want to stand in a Q in front of a doctor for this. Preventive is better than cure.(it doesnt mean all the Rs.3/- coffee are bad)
        Hi vmggb1972,

        Sometimes high price does not guarantee quality. It is always important to do research and arrive at a value/price equation yourself.

        At Tiruvanmiyur, an apartment with good builder will be charged Rs.8500-Rs.9000/sq.ft. However these problems are there in Tiruvanmiyur a) some fishermen huts will be very near the apartment b) heavy road traffic particularly not safe for retired people c) higher population density with many old houses converted into bachelor mansions d) unclean main roads.

        Did Rs.9000/Sq.ft provide you quality?

        On the other hand,
        At Egmore in Casa Major road near Don Bosco school, an apartment will cost Rs.6500/sq.ft. Egmore is fantastic a) Its posh b) heart of chennai c) ideally located between spencers, central, egmore station, nungambakkam and chetpet. d) some of city's best colleges and schools c) low population density e) located far away from IT corridor maintaining the old south madras charm.

        Rs.6500/Sq.ft in Egmore (less then Tiruvanmiyur) gave you quality.

        Parts of West Tambaram at less than Rs.4000/sq.ft are posh, calm and peaceful residential suburbs. Population density in West Tambaram is less then Tiruvanmiyur and is a good locality with independent bungalows, smaller apartments. Unlike Tiruvanmiyur which is noisy with high population density West Tambaram is calm residential suburb.

        At less then Rs.4000/sq.ft West Tambaram gave you quality.

        Comment


        • Re : Property Price Trends in Chennai

          Many of the objections and issues are discussed in detail and there should be an end for to take a decision. I belive nothing can be achieved over text or oline. If u want something to happen go and work on the spot. Realise the ground reality over there. Come to a conclusion. If we have doubt and analysis we never do anything other wise than to think always. What ever be the findings one shuld achieve it via negotiations. One cannot work hard for what he cannot get. The best say by Cho Ramasamy " we should find an option which is least damaging. There is no point in expecting everything perfect. If so we get nothing". Our friends should keep this in their mind and come to a conclusion.

          Comment


          • Re : Property Price Trends in Chennai

            Originally posted by madrasi View Post
            one of my friends finalised everything then took one of his relative to see his previous projects, this friend works in CMDA and said 'NO' point blank on inspection of his projects says he deviates blatantly. the setbacks of 5 ft from the boundary are not even 3 ft.
            Dear friends,

            More views about Ruby Builders especially on the current rates settled/under negotiation in their projects are welcome pl. In small/medium projects of G+1 floors, hardly any promoter is maintaning 5 ft. gap/setback from the boundary. It is seen between 3 to 4.5 ft. mostly and very rarely 5 ft.

            ks2071746
            Last edited May 5 2009, 04:08 PM. Reason: spell and add on.

            Comment


            • Re : Property Price Trends in Chennai

              Originally posted by ks2071746 View Post
              Dear friends,

              More views about Ruby Builders as well as the current rates are welcome pl.

              ks2071746
              Dear Friend

              Pl provide us the following info.
              1. Total land extent
              2. UDS to be conveyed
              3. Carparking Frontage
              4. No of Flats constructed
              5. No of floors
              6. % of comon charges loaded on the selling area
              7. Present stage of Construction
              8. Time required for delivering the possession
              9.Distence from basic amenities
              10. Road width and is there more than one conectivity to the project.
              11. Other basic features of the project like flooring, joineries, plumbing, electircal and painting.
              12. if u have anything to highlight as the project feature other than in 11 above the details
              13. Present offer price by the builder
              14. Have u seen the previous project completed by the builder (i know they have done enough in these location) and have u interacted with any of the flat owners to decide the committment of the buidler in fulfilling their promise
              15. Facilities like EB, Water, Drainage / Septic tank etc
              16. Any other info as u wish

              Then we can work out the normal price

              Thanks

              Comment


              • Re : Property Price Trends in Chennai

                Originally posted by ks2071746 View Post
                Dear friends,

                More views about Ruby Builders especially on the current rates settled/under negotiation in their projects are welcome pl. In small/medium projects of G+1 floors, hardly any promoter is maintaning 5 ft. gap/setback from the boundary. It is seen between 3 to 4.5 ft. mostly and very rarely 5 ft.

                ks2071746
                there are umpteen no of good builders in tambaram area look around dont go with a mindset of r--y .scout the area you will find a lot of options.
                and dont tell me he is the only good builder (who also deviates,strange knowing that he deviates you recommend him)

                Comment


                • Re : Property Price Trends in Chennai

                  Friends,

                  Now that we are discussing how the trend could be in the coming months, I feel its of paramount importance that we should try and understand how the value of land appreciates in the course of time and how important are the plot size, location, FSI allowed etc for getting good returns.

                  Most of us seem to agree investing in RE is productive in long term and everyone would enter whenever one finds the market inviting and suitable.

                  Opinion is divided only on whether there will be an impending correction/crash (or) whether stagnation/stabilization phase would extend before the price bottoms out and starts rising again.

                  The fundamental of RE investing seems,its how much you invest in Land share and more importantly in which location and at what price.

                  Generally people buy flats inside the city because, land is not affordable to everyone.Even if land is affordable many prefer flats for various reasons such as less risk of encroachment,Rental income from tenants/corporate lease,Collective responsibility for maintainence,Better security,Better socializing prospects,Better provision and easy access to infrastructure,amneties,shops,schools etc.

                  Irrespective of whether one is investing in flat/independant house/individual plot the appreciation is directly tied and proportional to how the locality develops and how the demand for land increases.

                  I would like to invite opinions and advise from fellow members on some basic questions while buying and identifying a plot/location.

                  please assume that the locality has all basic infrastructure and amenities and good future growth prospects and the plot is CMDA/DTCP approved.

                  1.Whats the ideal plot size, extent, frontage etc to look while buying keeping in mind future prospects like possibility of joint venture, part sale etc?

                  2.Does a larger plot mean more returns because of more FSI allowed? or less returns because its comparitively difficult to sell?

                  3.What should be the road size preferred?Is it advisable to look for a corner plot?

                  4.Is a plot on the main road better or one thats peacefully inside on one of the cross streets?

                  5.After buying a plot, what precautions needs to be taken to prevent encroachment and being misused by others, like being sold to someone else etc.

                  By raising these questions I am trying to understand if there is any pattern why different plots in the same locality sell at different rate?why one area in a locality becomes posh while others attract middle and lower income people?Why does some area become a commercial hub while other becomes residential?

                  I am sure it will be useful to all, If we could get some answers.

                  Thanks all of you in advance.
                  Last edited May 8 2009, 01:32 AM.

                  Comment


                  • Re : Property Price Trends in Chennai

                    Originally posted by madrasi View Post
                    one of my friends finalised everything then took one of his relative to see his previous projects, this friend works in CMDA and said 'NO' point blank on inspection of his projects says he deviates blatantly. the setbacks of 5 ft from the boundary are not even 3 ft.
                    Dear friend,

                    Which is the project and what rate did he negotiate and the size of the flat, though ultimately he has not booked the flat?

                    ks2071746

                    Comment


                    • Re : Property Price Trends in Chennai

                      Originally posted by madrasi View Post
                      there are umpteen no of good builders in tambaram area look around dont go with a mindset of r--y .scout the area you will find a lot of options.
                      and dont tell me he is the only good builder (who also deviates,strange knowing that he deviates you recommend him)
                      Dear friend,

                      I am not telling he is the only good builder. I agree there are somemore in the Tambaram area. This builder sticks to his delivery commtment with least delay. Irrespective of the booking in a project, he proceeds with the construction. Only thing is, he is a little costly, up by 10% depending on the exact location of the project as compared to others.
                      He uses good quality materials and have continuous supervison. But I gather now, like others, he is also giving contracts for the construction
                      in some of his new projects and I am afraid, the quality and schedules may undergo change.

                      ks2071746

                      Comment

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