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Property Price Trends in Chennai

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  • Re : Property Price Trends in Chennai

    Wiseman,

    Appreciate that you have accepted I have been right on RE; well means whatever bear views you held have not been right!! Fair enough.

    As for gold I did not mention on this forum. It was my prediction within family friends circle and I mentioned values in Rs not $ for 22carat gold and not for 24carat.

    As for your sale I noticed you mentioned it somewhere sometime back. I hardly visit this forum; maybe once in a blue moon. As for the price, I yet feel if you have stated the true price you sold it low. 12K white is nice to hear, something very difficult in Madras, where black is the basic colour! However I think today the price even if the place was a cheri in RK salai should be around 20K+ very conservatively.

    Finally I did see a post on the first page of yours (did not read it and dont know if you started the thread or you continue to write there!) of another bear spell in RE. While I dont like your another, as you quietly accepted you were wrong, I personally am not going to be a bull for long. Ideally I had predicted 2014 as the peak (I cant predict Rasi palan for Economist like kids, I dont believe in Astrology!). That was my prediction in 2006-8 time frame (again not on this board); and it sounded logical with this CON govt. likely to go to 2014. However I did not predict based on that but based on certain technical indicators. Now my view is it may not fall in 2014 but might start tapering.

    In summary if you sold at 12K you were not dumb, but you were not smart enough, but you can never know since it is difficult to hold on, and you might have other priorities. I yet hold, though I try to sell at a slightly higher price so that I make a killing and exit. However I will become a tame seller only around 2014. Even then I will not exit the market as I expect a steep fall is almost impossible. First the price will oscillate, then it will steady out and then it might start falling. That will give me time for atleast a couple of years is my guess. However personally I will move from bullishness to partial neutral state on RE and Indian growth in the next 2 years and will probably suggest Gold or USD or worse still US RE as investment avenues.
    bye.

    Originally posted by wiseman View Post
    Welcome back Natarajg.

    You have been correct about RE so far.

    I don't recall you ever talking about Gold and it going to $3000. Besides, like Economist said, is there any basis for $3000? Or is it just one of the figures you were so fond of pulling out of your hat!

    While introducing yourself, you might also mention the words you used on this forum (towards the end when you had lost control completely and had to be banned asap).

    I wonder why Almighty had to stop writing as well!

    Hope this third time around we will all maintain decorum and others on this forum could gain from your knowledge of outlying Chennai.

    Btw, that Cheri where we had property in RK Salai, it went for 12k+ all in white. So, I suppose it was not such a Cheri after all!

    Economist - Around the time you were born Natarajg had finished his Engineering (IIT, I believe) and I had completed ny MBA! No offense, just mentioning after seeing your DOB. I was 5 years younger than you are today and the whole world was ours to conquer!!! Somewhere along the way, we lost the plot!!!

    cheers

    Comment


    • Re : Property Price Trends in Chennai

      Panditji ki bol " LOL... Meena rasi is for Uthratadhi nakshatra, is it for Thiruonam also...If after 27 years you couldnt get a girl then you better become a sanyasi...Promotion for you is from worldly duk to eternal suk..You dont need a house as a sanyasi..Overseas is not important, try to go to the various levels of swarga from bhu to satya..Dont worry about your parents...they are another atma and all of you need to merge with the paramatma..."
      Hope it helps and I bet you are not economist any more...become Sanyasist!
      ROTFL.


      Originally posted by Economist View Post
      Panditji,

      DOB: 10/12/85

      Meena - rasi. Tiruona - natchatiram.
      Please tell will I get married with in 2 years.

      Will I get promotion this year.

      Will I build own house soon? Buy a car?

      Any chance for me to go overseas?

      How will be the health of my Parents?

      Comment


      • Re : Property Price Trends in Chennai

        Originally posted by ZeeEnn View Post
        Wiseman,

        Appreciate that you have accepted I have been right on RE; well means whatever bear views you held have not been right!! Fair enough.

        As for gold I did not mention on this forum. It was my prediction within family friends circle and I mentioned values in Rs not $ for 22carat gold and not for 24carat.

        bye.

        Good start by you - hope it continues that way!

        At least you are finally turning a bear by 2014, which gives us 2 years till 2016 when prices could come down.

        RK Salai has a wide price range going from Street to Street. Besides we wanted solid middle-class people (like my parent's generation) since they continue to own property there and live there. This means you avoid the 30%-60% black people who are also likely to be that kind of people you wouldn't want as your neighbor. 12k was perhaps the best given those conditions and for us these conditions are more important than getting the maximum money out of the sale (for some people there are many things more important than money, especially when there is more than enough of it ).

        As far as I'm concerned the bear case has only been postponed because of the liquidity deluge from the West (first time since Roman Empire ) and so you got lucky. But the flip side of it is that the crash would be so much more sudden and violent and this one needs to be careful about. So stop pushing your luck and sell early (instead of going on threatening to sell and not selling) because you could simply get stuck till the next boom when you would be 10-15 years older and not interested in RE anymore!

        My stock market experience tells me that its better to leave the top 15% on the table and exit a little early than wait for the last minute and suddenly find oneself in an illiquid market. RE can be notoriously more illiquid than stocks and therefore more dangerous. This illiquidity becomes more pronounced in outlying areas. Downtown is always the last to lose value as it has spent so many years gaining value compared to outlying areas where "value" is many times merely bubbly speculation (about upcoming airports, Walmarts, super highways, etc which may never come or may not have the impact expected).

        Another way to be defensive is to sell in outlying areas and buy in Central Chennai where you will see less growth but also less volatility.

        Let us see what happens from here on ...

        cheers
        Last edited October 8 2012, 05:06 PM.

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        • Re : Property Price Trends in Chennai

          Originally posted by wiseman View Post
          Another way to be defensive is to sell in outlying areas and buy in Central Chennai where you will see less growth but also less volatility.
          This is what happened post 2010. City outperformed suburbs rapidly.

          DLF in Egmore went from 8.7K to 16K now. DLf is just an example, there are many that gave crazy reuturns.

          Did any suburb generate this kind of return?

          Hira did very good in OMR. But apart from it, most suburbs severely lagged behind CBD.
          Last edited October 8 2012, 09:23 PM.

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          • Re : Property Price Trends in Chennai

            Originally posted by wiseman View Post
            RK Salai has a wide price range going from Street to Street.
            Is this place near the MA Jacob or near VM Street outlet.

            Comment


            • Re : Property Price Trends in Chennai

              This is what happened post 2010. City outperformed suburbs rapidly.

              DLF in Egmore went from 8.7K to 16K now. DLf is just an example, there are many that gave crazy reuturns.
              Wiseman is suggesting something different than the above. Defensive positioning is aimed at having a better protection on the downside rather than outperforming the suburbs on the upside. Outperformance and not getting trapped by lack of liquidity are the goals for the move but the accent is on the downside. Wiseman's suggestion is more analogous to avoiding small caps at the height of the bull run or around peak economic cycle and getting into wide moat blue chips in the stock market parlance.

              On K11's observation above, it is more of a class that did not participate in the run because it was on a tear in the previous 5 years. Apartments are not a good way to compare as they are "sold" in the suburbs and "bought" in the city. Land is the asset which is "bought" both in the suburbs and city and hence makes a meaningful comparison when we talk about out performance.

              Maverick

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              • Re : Property Price Trends in Chennai

                Originally posted by k11 View Post
                This is what happened post 2010. City outperformed suburbs rapidly.

                DLF in Egmore went from 8.7K to 16K now. DLf is just an example, there are many that gave crazy reuturns.

                Did any suburb generate this kind of return?
                K11,

                You are indeed right that City (CBD) has much outperformed the Burbs in last 24 months. Maverick is right in that land should be compared (rather than flats) but even land has done too good in city (last 2 years) But past trends are not indicative of future IMHO and my view is in next 3 -4 years, Burbs close to CBD (read as newly added areas to City Corporation) should do better than rest. The one sign i see is - supply is starting to increase in "City" even as cost of construction is Going up and purchasing power will start muting once the economic/wage inflation slowdown effect(which is indeed there) rolls down.

                Now over to those disagreeing with me !!

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                • Re : Property Price Trends in Chennai

                  Originally posted by wiseman View Post

                  As far as I'm concerned the bear case has only been postponed because of the liquidity deluge from the West (first time since Roman Empire ) and so you got lucky. But the flip side of it is that the crash would be so much more sudden and violent and this one needs to be careful about. So stop pushing your luck and sell early (instead of going on threatening to sell and not selling) because you could simply get stuck till the next boom when you would be 10-15 years older and not interested in RE anymore!

                  cheers
                  IMHO - Whenever we talk about Slowdown or Fall in RE prices across city/across India, we should refer to one period in recent history when we had such a fall..

                  I am referring to the period 1997-2002, when RE prices were sluggish, fell in many places across city and the market was dead/stagnant..

                  In 2001, new apartments were sold in Mylapore/Alwarpet for Rs 1800 psqft, whereas the rate was Rs 2000 psqft in 1998.

                  The reason for the 1997-2002 slowdown, was real interest rates (bank FD rates minus inflation rate) were much on high side, so it made perfect sense for a investor to stay on sidelines and earn risk free return of 12%..

                  That is not the case right now for sure. Real interest rates as of now are effectively negative, since Government is publishing false figures on inflation.

                  With rampant populism and free for all democracy in place, there is total resistance to any governance that avoids subsidies and fiscal deficit, so don't see any sound case for lower inflation..

                  Which means, irrespective of what happens externally, in India, it does not make sense to ditch hard assets for cash - at least till next year....

                  Comment


                  • Re : Property Price Trends in Chennai

                    Originally posted by ramki830 View Post
                    Maverick is right in that land should be compared (rather than flats) but even land has done too good in city (last 2 years) But past trends are not indicative of future IMHO and my view is in next 3 -4 years, Burbs close to CBD (read as newly added areas to City Corporation) should do better than rest.
                    I agree with you and Maverick, Land prices are a better barometer.

                    But the problem is Land in CBD is always sold/bought with a huge premium and colored money. So people are expected to overpay.

                    I know a Bungalow listed near my place went for 1.5-2C per ground above the market price, it was a 2G plot so the buyer payed 4C net over the value. So there is huge demand, so when a house comes in with a right location and size, people fight over it and thus gets sold higher. I am sure our market value would get redefined by such transactions.
                    What builders pay is a decent estimation as they have to fork out most in white through auctions.

                    Land prices in suburbs and even outskirts of city can be determined, but CBD is pretty much a black hole, close to impossible to give a range.

                    I agree with @ramki, outskirts are the next best opportunity. I think the western part of the city would be the next bet as the prices are low there.

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                    • Re : Property Price Trends in Chennai

                      ramki830

                      Can you pls list the newly added areas in City Corporation?

                      Thanks

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