Dear friends

Since there is slump in the sales of RE properties in Chennai, the bull writers are not accepting the fact that prices are crashing.

But a valid proof for this has appeared in todays newspaper.

According to Times of India, Udhayam theatre property's (1.2 acre) base price for auction sale has been brought down from Rs.100 Cr to just Rs.29 crore.

This price is arrived after analysing all the possibilities.

The reason: There is not even a single bidder for this prime property which abuts two arterial roads.

I hope a clear picture is emerging regarding the price of chennai properties.

Here is the link : ]http://epaper.timesofindia.com/Daily/skins/TOINEW/navigator.asp?Daily=TOICH&showST=true&login=default
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  • Originally Posted by abk
    chennai prices from the link above

    FINALLY, property rates have fallen!

    Elda Christy April 21, 2009
    ="http://wealth.moneycontrol.com/sendtofriend.php?id=12822&flag=c&url=/showstory.php?
    Property rates in Chennai (Rs)

    LocationMarch '08
    March '09
    difference in %

    Egmore/Kilpauk5500
    5250
    -4.55

    Boat Club
    16000
    16000
    0

    Poes Garden
    14500
    13750
    -5.17

    T Nagar
    7150
    7000
    -2.10

    RA Puram
    8750
    8500
    -2.86

    Ashok Nagar
    5500
    5500
    0

    Guindy
    4500
    3750
    -16.67

    Vadapalani
    4400
    3750
    -14.77

    where is the 80% fall bigbear????


    I have never written in this forum that price had already fallen 80%.
    What we are saying is saying is price have started to decline and this just a starting.

    You yourself have accepted that all the industries have been affected by slowdown.Most of the economist are predicting the economic growth to recover only by mid 2010 and for the people to feel the real effect of recovery will take 1 more year after that.

    If prices have declined around 15% in a year expecting atleast 50% correction from the peak around 2010-2011.Again depending on the area correction percentage will increase or decrease.

    See the correction in posh areas of bangalore
    M.G Road
    12500
    9500
    -24
    Koramangala
    6500
    4950
    -23.85
    Indira Nagar
    8250
    5150
    -37.58

    Chennai lagged Bangalore in boom so expect the same behaviour in bust also.

    Legendary value investor Benjamin Graham once said “You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”
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  • Originally Posted by contra
    Big Bear,

    Where is that apartment 10-12 km from Devanhalli International Airport in Bangalore whose price has dropped from 75 lakh to 30 lakh in last year.

    Is it in Yelahanka, Vidyaranyapura, Hennur Road, Malleshwaram, R.T Nagar please tell I am curious :D

    Contact author of Business-standard article.:D
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  • Dear friends,

    The undisputable truth is that the RE prices have reduced and will continue dwontrend till such time the economy recovers. The fall may be low in some cities in specific localities and more in some cities and localities depending on the demand and supply position on a dynamic basis.

    ks2071746
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  • Originally Posted by ks2071746
    Dear friends,

    The undisputable truth is that the RE prices have reduced and will continue dwontrend till such time the economy recovers. The fall may be low in some cities in specific localities and more in some cities and localities depending on the demand and supply position on a dynamic basis.

    ks2071746


    Dear KS

    What you said here is absolutely true.

    Thanks

    chataara
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  • hi KS
    what happens if rentals come down,what impact will it happen on real estate,i know many houses in annanagar are vacant,what kind of effect will it happen to RE.
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  • Originally Posted by BigBear
    I have never written in this forum that price had already fallen 80%.
    What we are saying is saying is price have started to decline and this just a starting.


    the other bears did, since you are the big(read eldest) bear......:D

    i am not saying prices have not fallen. I am saying as 'your' data shows good localities will face a lesser fall,20% at the most, is my contention.

    bears(i am not a bull) here contemplate across the board(read geographies) crash of 50-80% and had implied a ground in Tnagar at 50L (80% fall of current 2+c).
    last week went to book a flat for my friend at TVH lumbini square amidst reports of drastic reduction to my surprise he did not come down below 4750/- the price quoted at the recent FAIRPRO exhibition. the peak rate was 5100/-
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  • Originally Posted by BigBear
    Contact author of Business-standard article.:D


    When you don't know something accurately why do you confuse people by posting some article written by some sensationalist journalist.
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  • on the back side lumbini square,there is a burial ground,the main road is the only way to the burial ground so think twice before you book in lumbini square,and also there burning smoke and smell will reach lumbini square.this is my personal opinion.
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  • RBI governor says RE comp (top 10) repayment of debts of no concern

    in an interview today subbarao on asked about the real estate sector replied that they had analysed 10 companies(read top 10) their debt and liquidity and their capacity to repay debts was not of concern ,he did not guarantee the payback but saw no room for conceren.he said if there were uncertainities then they would have initiated regulatory procedures.

    for all those who were too worried about liquidity of the DLFs UNITECHs and HDILs...................RIP
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  • Originally Posted by newboy
    in an interview today subbarao on asked about the real estate sector replied that they had analysed 10 companies(read top 10) their debt and liquidity and their capacity to repay debts was not of concern ,he did not guarantee the payback but saw no room for conceren.he said if there were uncertainities then they would have initiated regulatory procedures.

    for all those who were too worried about liquidity of the DLFs UNITECHs and HDILs...................RIP


    This definitely talks of the solvency and the creditors of these companies can have little peace. Again it depends on whether these are secured loans or non-secured.

    But this does not mean that they have the operating capital to service even the interest portion of the debt these companies leave alone the other working capital .......
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  • Originally Posted by newboy
    in an interview today subbarao on asked about the real estate sector replied that they had analysed 10 companies(read top 10) their debt and liquidity and their capacity to repay debts was not of concern ,he did not guarantee the payback but saw no room for conceren.he said if there were uncertainities then they would have initiated regulatory procedures.

    for all those who were too worried about liquidity of the DLFs UNITECHs and HDILs...................RIP


    UNITECH would have gone bust already if not for that norway telecom deal with Telnor. They will still crawl for another decade.

    DLF have been managing the situation much better then others....they are pulling out of SEZs and projects like Bidadi township in Bangalore which are not feasible. They are also getting out of Hotels business by selling Hotels. They want to concentrate only on their core business that is building residences, offices and malls which has good potential in young and rapidly urbanising India. No doubt they are the best listed real estate stock with P/E ratio of 15 which is decent while the rest of the listed RE companies were battered.



    .
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  • Originally Posted by vijai5
    hi KS
    what happens if rentals come down,what impact will it happen on real estate,i know many houses in annanagar are vacant,what kind of effect will it happen to RE.


    Dear friend,

    Rent going down will definitely affect the owners either by way of lower return or difficulty in servicing the EMIs. However, considering a lower percentage of return even before the downtrend, when compared to the high EMI, it may not have any appreciable impact on the RE market either sell or buy.

    ks2071746
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  • Originally Posted by sethugm
    This definitely talks of the solvency and the creditors of these companies can have little peace. Again it depends on whether these are secured loans or non-secured.

    But this does not mean that they have the operating capital to service even the interest portion of the debt these companies leave alone the other working capital .......



    if they have analysed and find no room for concern dont you think a regulatory body like RBI wouldnt have looked at all aspects.no concern apparently means no problems whatsoever. and banks in india generally to RE companies who do not enjoy industry status(correct me if i'm wrong) would not give unsecured loans.
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  • Originally Posted by vijai5
    on the back side lumbini square,there is a burial ground,the main road is the only way to the burial ground so think twice before you book in lumbini square,and also there burning smoke and smell will reach lumbini square.this is my personal opinion.


    Dear friend,

    A very important aspect to be given due consideration by those booking in this project.

    ks2071746
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  • Originally Posted by vijai5
    hi KS
    what happens if rentals come down,what impact will it happen on real estate,i know many houses in annanagar are vacant,what kind of effect will it happen to RE.


    Already started. More To-Let boards. No takers

    Souce;THE HINDU



    More facilities for the same rental value
    Aloysius Xavier Lopez
    Landlords preferring to deal with tenants on their own


    “Many people are opting for smaller two-bedroom houses at a lower rent”

    — Photo: R. Shivaji Rao

    ANY TAKERS?: ‘To Let boards’ are back.

    CHENNAI: Summer is usually the time when house rental business is brisk. But this year it is not so.

    The increasing number of ‘To Let’ boards in various residential areas in the city seems to be one of the facets of the state of residential property rentals.

    T. Joseph Madhavaraj, who runs a house broking agency in Vadapalani, said there were large numbers of houses with ‘To Let’ boards in the area.

    As brokers are finding it difficult to find tenants for the residential units, landlords have started to display such boards.

    “Rentals are remaining the same despite a limited supply of high-end residential units in some areas. However, tenants are able to get high-end residential property with more facilities on the same rent they paid last year,” said Ramesh Nair, Managing Director-Chennai, Jones Lang LaSalle Meghraj.

    One of the reasons for this is the reluctance of the landlords to reduce the rental value of their residential property, says S. Jayaseelan, a broker.

    Mr. Jayaseelan adds that Thiruvanmiyur is one of localities where a large number of houses are sporting ‘To Let’ boards.

    Many of the houses are continuing to remain vacant in various parts of the city, say brokers.

    The number of enquiries has reduced drastically, says Mr. Jayaseelan.

    However, many of the enquiries are from tenants who are paying higher rent in order to find a house with lower rental value, he says.
    Dhadresh P.Mehta, President of Chennai Real Estate Agents’ Association, says, “There is a slowdown in the market as more number of companies are becoming cost conscious.”
    Generally in many areas of the city the absorption has dipped by more than 30 per cent, he said.

    According to brokers high-end rentals are not encouraging either.
    As company lease transactions are being renegotiated and the vacancy levels are continuing to rise, growth of rentals of many high-end residential units which had experienced a steep hike in the past has stopped.

    In areas such as Alwarpet, Adyar and Nungambakkam the rental values for high-end residential units have stagnated, according to brokers.

    Relatively affordable
    In areas such as T.Nagar residential rentals have become relatively affordable. The poor response to the methods used by landlords to find a tenant has been one of the reasons, say brokers.

    Residents say the situation is similar to the condition in the city a few decades before with a large number of ‘To Let’ boards.
    The slump in the IT sector has reduced the number of people looking for new rental accommodation using advertising tools of new media. “Many people are opting for smaller two-bedroom houses at a lower rent,” said Mr.Jayaseelan.

    The number of people willing to settle quickly for high rent homes has come down as a consequence of less recruitment and salary cut in some private companies.

    People, both landlords and tenants, take unusually more time to decide on residential rentals and growing number of ‘To Let’ boards is a clear reflection of this, he said.
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