Hi Friends,

I had been to the FAIRPRO '09 Fair.My Impression after seeing, is that prices are stagnating for all ongoing projects and builders are trying hard to hold them up.

Prices are 10-20% lower for new projects in the pipeline and for ready to occupy flats.

The discount offered at the stall was very less and were in the range 150-500 Rs/sqft max.

For the benefit of fellow members I am posting the project/price details of some of the properties.



Akshaya Foundations

Adora - OMR - 3750/sqft
Aikya - Adyar - 12500/sqft

Alliance Group - Orchid Springs - 3199/sqft

Arihant Foundations

Heirloom - Thalumbur - 2499/sqft
Escapade - Thoraipakkam - 4150/sqft
Villa Viviana - Maramalai nagar - starting from 1 Crore

Asvini Foundations

Amarisa-phase1 - Ramapuram - 4500/sqft
Amarisa-phase2 - Ramapuram - 4250/sqft
Akshita - Madipakkam - 3800/sqft

Casa Grande

Riveira - Palikkarnai - 3450/sqft - before discount 3600/sqft
Silver Oak - Perungudi - 4300/sqft - before discount 4500/sqft
Madhuban - Madipakkam - 3300 /sqft - before discount 3500/sqft
Mylapore - R.K.salai - 12500/sqft
Plots
Ponmar -785/sqft - before discount 825/sqft
Maraimalainagar - 790/sqft - before discount 825/sqft

CeeDeeyes - Chenni Pattinam

Basic Rate - 1600/sqft All Inclusive - 2075/sqft

Chaitanya shanthiniketan

Sunnyvale - Ayanavaram - 4850/sqft
Serena - Rajkilpakkam - 2550/sqft
Gardenia - OMR - 1900/sqft
Green Park - Chitlapakkam - 3300/sqft

DLF

Gardencity - 3200/sqft - was told slash in prices expected in coming weeks.

Doshi Housing

Etopia I and II - Perungudi - 3895/sqft
Nakshatra - Tambaram - 2995/sqft - Completion May 2010
Tranquil - Velachery - 5500/sqft - Completion February 2010
Trinity park - Santhoshpuram,Vengaivasal - 3195/sqft - Completion April 2009
Serene Couny-Villas - Santhoshpuram,Vengaivasal - 2200,2600/sqft
LlanStephan - Chetpet - 9000/sqft - Completion May 2009
Sri Mahalakshmi - Ayanavaram - 4495/sqft - Ready to Occupy

ETA

Rosedale - OMR - 3100/sqft
Le Chalet - Villas - Sriperambudhur - 26 Lakhs - 37 Lakhs

Hiranandani Upscale - 4200/sqft

Hiranandani Palace Gardens - 3475/sqft

Indus Housing

anantya - Navalur,OMR - 2299/sqft + 400(other charges)
riviera villa - Navalur,OMR - 90 Lakhs onwards
habittera - urapakkam,GST - 2399/sqft + 400(other charges)
amber - Saidapet - 4750/sqft

Jain Housing

Ankush Prakas - Kilpauk - 7500/sqft - Ready to occupy
Amrit Kailash - Strahns Road - 4500/sqft - Ready to occupy
La Gardenia - Nungabakkam - 7500/sqft - Ready to occupy
Ansruta - Valluvarkottam, nungabakkam - 10000/sqft - Ready to occupy
Antariska - Kodambakkam - 4500/sqft - Ready to occupy
Eiffel Garden - Vadapalani - 4250/sqft - Ready to occupy
Saagarika - M.R.C Nagar, sea facing - 10000/12500 - Ready to occupy
Green acres - Pallavaram - 3900/sqft - Ready to occupy
Abhishek - Selaiyur - 3500/sqft - Ready to occupy.

Jamals

Orchid - Palikkarnai - 3500/sqft
Palazzo - keelkattalai - 3700/sqft
Grandeur - Velappanchavadi(near saveetha dental college) - 3200/sqft

KGEYES

3 Projects on L.B.Road, Thiruvanmiyur - 6650/sqft
Delmare - Beach road,Thiruvanmiyur - 7000/sqft
Carolina - Velachery,Taramani - 4500/sqft
Swathi - Sastri Nagar,Adyar - 8500/sqft
Kalakshetra - 8000/sqft

Landmark Constructions

Tiara - Perungudi - 4000/sqft - Completion on August 2009
Aston Ville - Vadapalani - 5500 sqft - Completion on July 2009
Tudors Place - K.K.Nagar - 6500/sqft
The Address - Adyar - 11500/sqft
The Grange - Palavakkam - 7500/sqft
Cenralia - Chrompet - 2950/sqft - prelaunch
Gem Towers - AnnaNagar - To be launched.
Mahalakshmi Heights - Ashok Nagar - To be launched

L&T Estancia
Construction in Progress
1st-3rd Floor - 3950/sqft
4th -12 floor - floor rise charge of 20/sqft for each floor
13th - 17th - 4450/qft

L&T Eden Park - 3600/sqft

Mantri Synergy - OMR
2800/sqft - with 20/floor rise
Special offer - First Floor - all inclusive
1140 sqft - 33,67,000
870 sqft - 28,50,000

Navin Housing

Dayton Heights - Nelson Manickam road - 6500/sqft + 30/sqft floor rise from 2nd floor
Subha Mangala - Ramapuram - 4200/sqft
Brookfield - Nanmangalam - 3500/sqft
Merrylands - Medavakkam - 3500/sqft

Olympia Opaline - 3441/sqft - spl budget flats available

PACE Builders

Anna nagar west - 4195/sqft - before discount 4495/sqft
Selaiyur - 3195/sqft - before discount 3495/sqft
Valasarvakkam - 2795/sqft - before discount 3295/sqft

PS Srijan

The Grand - Velachery - 5250 sqft - before discount 5500/sqft - Floor Rise applicable from 4th floor

Rajparis

Harmony - Medavakkam - 3100/sqft

Rajarathnam Constructions

RC Prince Gardenia - Perambur redhill road,Kolathur - 3600/sqft

Rajkham

Independant houses - Ayyapathangal - 2600/sqft

Real Value

Sai Skanda - Velachery - 4200/sqft
Sai Surya - Palikaranai - 3800/sqft
OMR opp SIPCOT - 13.20 Lakhs onwards

Shriram Properties

Trishakti - SIPCOT - 2750/sqft
Shankari - 1990/sqft

Sidharth foundations

Tulip - k.k.nagar west - 4800/sqft - completion march 2009
Natura - medavakkam - 3100 /sqft - completion july 2009
Visvaleela - Annanagar - 8500 /sqft - to be launched
Dakshin - Urapakkam - price TBD - to be launched
upcoming projects in porur, thoraipakkam, rajkeelpakkam, mogappair.

SIS

Safaa - Urappakam - 3150/sqft

SSPDL

Crescent - Kelambakkam - Vandalur Road - 2500/sqft
Upcoming 2 villa project one in OMR and one in Sriperambathur.

Sumanth & Co

Thiruvanmiyur - 6000/sqft
Besant Nagar - 11500/sqft

TVH

Lumbini square - Pursaiwalkam - 5500/sqft + 30/sqft floor rise from 5th floor
Ouranya Bay(Premium) - OMR,Padur - 3100,3200 + 25/sqft floor rise from 5th floor
Ouranya Bay(Budget) - 2bhk - 20 Lakhs
3bhk - 30 Lakhs
Ekanta - Coimbatore - 3100/sqft
Revata - Mogappair east - 4500/sqft
Kamya - K.K,Nagar - 7000/sqft
Metro Golden Nest - Sriperambathur - 1bhk - 15 Lakhs
2bhk - 22 Lakhs
3bhk - 28 Lakhs

VGN Group

Minerva - Mogappair,Nolumbur - 2975/sqft
3 in 1, 4 in 1 - 3800/sqft
Mahalakshmi Nagar,Thiruverkadu - 3500/sqft
Plots
Mugalivakkam - 52 Lakhs/grnd
Selaiyur - 50 Lakhs/grnd
SPKoil - 34 Lakhs/grnd
Katankulathur - 22-27 Lakhs/grnd

Yuga Homes

Shem Park - chemmenachery - 3300/sqft
Upcoming in Koyambedu, R.A.Puram(8000/sqft)



There are lots of properties and also lots of potential buyers.There is sure a sense of uncertainity among the builders and also the buyers on when to make the next move.It was evident that correction in RE prices have started to happen.

Requesting members to respond with their thoughts on the current trend.
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  • Originally Posted by k11
    RE market will remain the same despite the increase in building costs. Land owners - JV guys are going to get screwed. Builder's profit margin will also get hit.


    The land owners may not necessarily get screwed if the demand persists. ie. the cost of construction will go up, but the rate of increase is not what we see as from the rate of increase of the buying rates. Builders/developers borrowing funds/working capital will have that hard cost adding to their pricing, however for owners/developers have good cash flows/reserves the pricing is still within their own control. So in the later a owner can still develop/build his land and maintain a lower pricing to sell in the market.
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  • Land owner's return should get affected. Demand is slow, operating costs are highs.
    Today builders do not pay cash to land owners because of lack of cheap funding. Most do JVs. Even the big ones, look at the Blore based builders, almost all their projects are JV. Land owner will naturally get lesser share (as do Builders).

    Delaying new project launches more will reduce opportunity costs. Who knows, the land owner itself could be leveraged. He might be paying high interest costs. What if it is a political guy and he needs money for the 2014 election. There are lot of factors.

    Biggest question - What about projects that are already launched and undergoing construction. Builder cannot increase rates in between.

    Construction cost increase directly affects the builder and land owner (JV) bottom line.
    They cannot pass the costs to buyers in slow market. People will not pay higher prices now. Demand is not there today in suburban projects which are very heavily based on construction cost and having a very low UDS value.
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  • Originally Posted by SRajagopalan
    USD can always buy much more if you wait down the line from today to 5 years from now or from 5 years prior to today, thats a given.
    RBI's stance is a bit surprising the widespread rumour yesy was that RBI will intervene when 58 is yet, but yet no real signs of it, i feel they are a bit too late to the party. like our indian police in movie climax
    But i want to point out some good hard numbers to ponder upon
    as much as INR devaluing is an alarming fact as perceived , let me know if your views are any different after you see the numbers.

    To make it more interesting i took the lowest point 39.11 and extrapolated over 10 years to make the worst case
    IF you would want you should consider the 10 year with 2003 pricing at 46 and change

    EDIT - added the chart for 39.XX pricing for 5 years still 8%



    The fall of INR is more so due to the strength of USD against all majors.

    The past 10 year comparision period includes 7 years of GFC impact.

    we all know US was the prime victim of GFC and USD has devalued considerably from 2007 to 2013 (7 Years) due to QE messures of printing/flooding USD.

    In the past 7 years India was relatively unaffected by GFC.

    USD has just started its rally and it has a long way to go to make up for the losses in the past 7 years (provided US has turned the corner with GFC impact)

    I am bullish on USD, US Equities & US RE. There will be correction & False starts but it will eventuate.
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  • Seeing past the effects of currency swings, the RE market is opening up great arbitrage opportunities to people who are in position to exploit it. The beneficiaries need not be only NRI's, it could also be businessmen earning windfall profit from service/export linked industries. Domestic market will also start attracting renewed interest and provide opportunity for retailers to target new segments/markets. Generally we can expect inflation to be high due to the unavoidable fuel price hike and tighetening liquidity by means of further increase in interest rates which could hit affordability of several people..It will mean less buying/conversion..but not necessarily reduction in prices. We will see builders put off or delay projects till it becomes viable to them and try reaching out to different pockets of investors/buyers. We are once again in a situation which could have a spiralling effect of pushing the baseline benchmark of everything. It may appear things have improved on broad scale including better GDP growth for the government including increase in RE prices rates. Whether one profits/loses is going to depend on how they are poistioning themselves. Unless one is hedged for the situation and move their cash to hard assets/stronger currency they may lose to erosion of rupee value. For several years now, The government and many companies have been dependent only on inflation and increasing valuation to show profit. I think that trend will continue due to vested interest. Liquidification of assets doesnt seem likely to happen unless all hell breaks lose due to another global crisis. The more this continues, I believe Stagflation is going to be unavoidable in India. I feel we already are seeing the effects.
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  • Minor point here is that FIIs when they investin equities or debt in any market will hedge the underlying Fx value to their base currency. So in India they will book forward hedge or INR/USD and hence there is no Fx depreciating risk to them - the only cost the forward premium.


    Hedges to protect the full Fx risk will reduce the yield substantially. If the USD is hovering around 48-50, they may hedge at 53-54 (unlikely number based on their projections or thesis and will lower the hedging cost as well ) and buying hedges at 48-50 will have steep protection cost and it undermines the very thesis of your investment.

    Mav
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  • My point exactly if you need to cover full Forex risk and still yield a 4 to 5% yield i can gurantee most pension funds in US will move their money to india
    Credit worthiness is in question that i agree, may be they can invest in our gold loan companies or micro finance companies :-)
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  • Originally Posted by Economist
    The fall of INR is more so due to the strength of USD against all majors.

    The past 10 year comparision period includes 7 years of GFC impact.

    we all know US was the prime victim of GFC and USD has devalued considerably from 2007 to 2013 (7 Years) due to QE messures of printing/flooding USD.

    In the past 7 years India was relatively unaffected by GFC.

    USD has just started its rally and it has a long way to go to make up for the losses in the past 7 years (provided US has turned the corner with GFC impact)

    I am bullish on USD, US Equities & US RE. There will be correction & False starts but it will eventuate.


    Eco , this is long over multiple beers philosophical debate, i agree the strength of USD exists due to theory of lesser evil and export economies continuing to devalue their currencies or pegging it to USD by letting USD be the reserve currency.
    INR will devalue due to inherent issues in India, welfare spending, CAD crisis, gold imports, diesel subsidies higher oil cost etc to name a few
    USD rally is happening not bcos of US economy strength , as much as the market is priced in on that, i just dont beleive it,
    I can categorically say the day when BEN comes out says QE is over, ALL HELL WILL BREAK Lose,
    The way QE is employed is a shame, giving money to big banks and not to credit unions while piling debt risk on american public is insane. Who is quantifiying the risk, ABS, MBS packages are being sold at 85B to FED every month by leading banks why so, why cant fed distribute the funds to smaller credit unions, branch bankings regional banks to foster small business they wont
    The act is no different than Dept of State using USPS to distribute Passport, what has POST office got to do with issuing passports to people, only reason they had the branch network, this is the lamest excuse from FED that they want to trickle it down through big banks as they have the infrastructure to spread it into the larger economy, its pathetic.
    Big banks make big deals with big corps who restructure debt, acquire other corps or invest overseas for cost reasons but dont promote local employment
    Education , higher ed/college/ technical training are totally undermined and no investments made there while college fees are at all time high
    Govt pulled the funding line from Sallie Mae why ? POLITICS >
    Sorry to go on this, the simple thought that Fed did this QE and economy magically works stinks, i benefit out of it , not by small, but by large large extent, all portfolios have ran up 30-40% in a very short term but racking 16T debt in 10+ years when Clinton left us in SURPLUS is a collosal shame.
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  • Based on purchasing power and inflation, USD should be at 65+ for India. Full convertibility will see the true value emerge and it is unlikely and what you see is what GOI made you to see. Currency rates and inflation rates between the two countries makes it a zero sum game in theory - but it is our GOI artificial support which keeps the game alive.

    Sustainable way to make money on currency is to bet on a country on the throes of becoming stronger with lower inflation and you make a bundle on the differential as the market discovers and adjusts. Masses were fooled in 2007 by BRIC reports and GS prediction of INR 10 to a USD in 2050. Playing on INR strength sans the true economic growth/artificial prop ups is living on borrowed time and we should enjoy till it lasts.

    Mav
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  • I agree with Rajagopal. INR fall against USD is not a surprise to me. India has had such a large and unsustainable CAD, that this is so obvious...

    Our Indian Media is never known to work anything more than propaganda arm, so they never saw this coming...

    I think we will have a rough time for next 6-12 months and we will surely cross Rs 60 per USD. But the results of this fall will do lot good for us in long run...

    As far as RE Investing, the cost of construction will continue to rise in next 12 months, courtesy diesel price rise (which will also hit rs 60 per liter) and this is election year, expect more profligate spending by UPA2 govt, all in all get ready for rolller coaster ride.

    Me think - all this will lead to slowdown in sales of built apartments by early 2014 (Esp in Chennai). Those who disagree , welcome to put your views , will be most happy to hear a bullish case...
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  • Originally Posted by maverick007
    Based on purchasing power and inflation, USD should be at 65+ for India. Full convertibility will see the true value emerge and it is unlikely and what you see is what GOI made you to see. Currency rates and inflation rates between the two countries makes it a zero sum game in theory - but it is our GOI artificial support which keeps the game alive.

    Sustainable way to make money on currency is to bet on a country on the throes of becoming stronger with lower inflation and you make a bundle on the differential as the market discovers and adjusts. Masses were fooled in 2007 by BRIC reports and GS prediction of INR 10 to a USD in 2050. Playing on INR strength sans the true economic growth/artificial prop ups is living on borrowed time and we should enjoy till it lasts.

    Mav



    At Rs 65 per USD, we will see quite some fall in domestic sales of all imported items - from Galaxy smart phones to Gold winner Oil...

    Diesel price also will shoot (along with LPG) and this means a nasty slowdown in Indian consumption story.. Surely all this together will impact RE (built RE/flat) sales and also rentals..

    OTOH, call centers from Manila should start relocating to here !!! (good for employment)
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  • at 65 USDINR=X many of the chemical industries can pretty much stop manufacturing , if you are importing AlF3 or Bauxite or any other ores from china or brazil, your cost of raw material plus inflation plus labor cost will shut most businesses, thats precisely why GOI is shadow strong arming to keep it under control
    the news the RBI will intervene will let the forex traders on the short side to flee the trade which will make INR to stabilize expect that action this week
    Hindalco,Grasim,Nalco to name a few, include car manufacturers as well
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  • Originally Posted by SRajagopalan
    at 65 USDINR=X many of the chemical industries can pretty much stop manufacturing , if you are importing AlF3 or Bauxite or any other ores from china or brazil, your cost of raw material plus inflation plus labor cost will shut most businesses, thats precisely why GOI is shadow strong arming to keep it under control
    the news the RBI will intervene will let the forex traders on the short side to flee the trade which will make INR to stabilize expect that action this week
    Hindalco,Grasim,Nalco to name a few, include car manufacturers as well


    Nalco is a net exporter of Bauxite and should only benefit...Grasim is complex case, hindalco has large dollar revenues as well (Novelis)..

    A number of blue chips, including likes of Reliance have lot of dollar denominated revenues and will only celebrate falling rupee...

    Quite some SMEs which are facing brunt of dumping by ASEAN/China will celebrate, even as they keep quite in public , otherwise the labourers will start asking higher wages (our IT Companies are also like that, see the silence of NASSCOM when rupee devalues).

    It is mainly consumers, consumer related businesses and those with large dollar borrowing which will get hit by falling rupee...
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  • Originally Posted by SRajagopalan

    I can categorically say the day when BEN comes out says QE is over, ALL HELL WILL BREAK Lose,


    That sentance is the key.

    That sentence "QE is over"

    To me is a big positive sign for US & USD.

    That sentence would confirm that the patient does not need medication he can get back to normal duties.

    I think that day is not very far.

    All the gains USD made in May (not June) is the strength of USD.

    USD gained against most majors in MAY. It gave up some of MAY gains against a handfull of currencies in June.

    INR 53.6 to INR 56.6 was USD strength.

    INR 56.6 to INR 58 is Indian weakness in June.
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  • Originally Posted by Economist
    That sentance is the key.

    That sentence "QE is over"

    To me is a big positive sign for US & USD.

    That sentence would confirm that the patient does not need medication he can get back to normal duties.

    I think that day is not very far.

    All the gains USD made in May (not June) is the strength of USD.

    USD gained against most majors in MAY. It gave up some of MAY gains against a handfull of currencies in June.

    INR 53.6 to INR 56.6 was USD strength.

    INR 56.6 to INR 58 is Indian weakness in June.


    Looking over a Longer term - if BEN stops his medication no doubt hell will break loose, but will not Crude Oil and Gold also significantly correct or drop?

    India's biggest import items are Crude Oil and gold, and with falling rupee (due to Dr ben's possible announcement) we may very well set the foundation for a complete recovery say in an year or two after BEN does it...
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  • Originally Posted by Economist
    That sentance is the key.

    That sentence "QE is over"

    To me is a big positive sign for US & USD.

    That sentence would confirm that the patient does not need medication he can get back to normal duties.

    I think that day is not very far.

    All the gains USD made in May (not June) is the strength of USD.

    USD gained against most majors in MAY. It gave up some of MAY gains against a handfull of currencies in June.

    INR 53.6 to INR 56.6 was USD strength.

    INR 56.6 to INR 58 is Indian weakness in June.


    My predicament is that it wont be in BEN's tenure, and he is not planning to work with the next president, he will drag it out and leave like Greenspan
    I hope they wont push a QE4
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