Let us get to some pragmatic way of knowing the situation in chennai.
leave the faroff places of chennai the OMR.ORAGADAM,SRIPERMBUNDUR,
GST ROAD(beyond tambaram) Annanagar EXTN etc. members please post info on projects in good localities lying unsold -rates corrected beyond 25%-and . .
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  • Abk, You have asked a question which our friendly bears will not answer. You can expect lovebird with a generic unrelated answer, some others with incorrect data. Ofcourse some madmen will debate such data and make it look bearish. I know you yourself are looking to buy in the city and are not getting one worthwhile buy.
    Wait for Nabhishek if he does get any data. Otherwise your question will prove what we have been harping on, there just is no bear market now in RE. It is just a consolidation phase before a super duper breakout upwards.
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  • Originally Posted by abk
    Let us get to some pragmatic way of knowing the situation in chennai.
    leave the faroff places of chennai the OMR.ORAGADAM,SRIPERMBUNDUR,
    GST ROAD(beyond tambaram) Annanagar EXTN etc. members please post info on projects in good localities lying unsold -rates corrected beyond 25%-and . .


    Good Question abk.

    If you are asking if there is any builder who has reduced 25-30% within the city and still not able to sell?My answer is Yes.

    These are the quoted rates from what I remember(any inaccuracy blame my memory)



    Adyar(Gandhi nagar)

    Akshaya homes - 12500/sqft - under construction.
    Vijayshanthi builders - 11000/sqft - 80% complete
    Rushmore LLC - 11500/sqft - Upcoming
    Jones Foundation - 8500/sqft - 50% complete
    Fair deal Homes - 10000/sqft - Ready to occupy.

    Adyar(Shastri Nagar)

    Adroit Urban - 10500/sqft - 80% completed
    KGEYES - 8500/sqft - 80% completed
    Rakesh Constructions - 7500/sqft - ready to occupy.
    Limelight property - 8500/sqft - upcoming

    Anna Nagar(East)

    India Builders - 8500/sqft - Ready to occupy
    Firm Foundations - 7500/sqft - upcoming and ready to occupy
    projects

    Kilpauk

    Ganesh homes - 12000/sqft
    Sucons - 8500/sqft
    Praveen builders - 10000/sqft

    T.Nagar

    Lancor - 13000/sqft - under construction
    GRN - 8500/sqft - 80% completed
    Krishna constructions - 9500/sqft - 40% completed
    Soorya constructions - 10500/sqft - Ready to occupy.
    BSR builders - 9500/sqft - 80% completed.

    Abhiramapuram

    GRN - 11000/sqft
    Lancor - 10500/sqft

    Apart from the list there are so many other small medium builders who offer 1000-2000/sqft less for their projects.



    Upcoming/underconstruction projects in prime locations still have availability unlike a year back when it used to be booked immediately.They are today quoted 10-15% less than earlier and one can get another 10% less at the negotiation desk.

    The advertisement would say 9500/sqft.When called, The builder would quote 8500-9000/sqft and the deal can be closed at 7750-8000/sqft on further negotiation.

    Ready to occupy flats eventually gets sold at around 10% less than the rate quoted, because the supply is very less.

    On the surface the correction is 15% and below its 20-30%.

    Builders are adopting a strategy where they keep quoting the same rate, if not the first 199 enquiries the 200th person enquiring would buy at the quoted price.

    The builders have reduced their profit margin and offering near to the launch price even at completion stage.

    There is still no dearth of potential buyers and demand has not completely dried out from all sides uniformly.Demand has reduced only from people who are postponing taking home loans and are employed in IT/private companies.

    For prime properties within the city the builders target segment still remains NRI/R2I/Businessmens/Self employed people for whom this exorbitant price still remains affordable.

    It is in the current quarter only the industries are feeling the heat, jobs are getting lost, profits are coming down and sentiment is hugely affected.

    Things will be more clear only in the next two quarters subsequent to the election.By Year End I believe we will see a significant correction of 30% or more.

    It will be good time then for people who have money and have put off their purchase for self use to find good ready to occupy flats at attractive rates.

    Expecting prices to come down to inflation adjusted 2004 level in 6 months is not realistic.Do not be deterred by intermediate up and down moves.You will have to wait till the market bottoms out.The Boom Bubble has to burst someday right??

    Let the market take its time, During this uncertain period one should avoid buying or selling RE unncecessarily.

    Meanwhile keeping a one-two years horizon in mind start focussing on creating wealth by earning more and saving/investing more rather than borrowing more to invest more.
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  • Excellent analysis

    Superb,you have taken your valuable time and efort to write so well, wish you the best and may such contributions follow.
    Bye
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  • Dear friend,

    Good post. Only thing I feel here is, we may not get into a crash or bubble in the case of good within city localities in the time to come. Atbest, they may come down by 10 to 15 % and best flats even in any specific project will go with reductions in the lower range. Of course, increase in FSI can make a good difference. As I have been maintaining, no purchase even now in good localities with almost all facilities one looks for in a within city location, of course for self use, will be a bad proposition. In the long run, in addition to the enjoyment of the falcilities in the particular project in the specific selected locality, the prices are bound to go up, though not in the near future, but in a perspective of 5 or 10 years. Who can measure in terms of rupees, the over all convenience and satisfaction one will derive/enjoy living in a location best suited to them?

    ks2071746
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  • Originally Posted by nabishek
    Good Question abk.

    If you are asking if there is any builder who has reduced 25-30% within the city and still not able to sell?My answer is Yes.

    These are the quoted rates from what I remember(any inaccuracy blame my memory)



    Upcoming/underconstruction projects in prime locations still have availability unlike a year back when it used to be booked immediately.They are today quoted 10-15% less than earlier and one can get another 10% less at the negotiation desk.

    The advertisement would say 9500/sqft.When called, The builder would quote 8500-9000/sqft and the deal can be closed at 7750-8000/sqft on further negotiation.

    Ready to occupy flats eventually gets sold at around 10% less than the rate quoted, because the supply is very less.

    On the surface the correction is 15% and below its 20-30%.

    Builders are adopting a strategy where they keep quoting the same rate, if not the first 199 enquiries the 200th person enquiring would buy at the quoted price.

    The builders have reduced their profit margin and offering near to the launch price even at completion stage.

    There is still no dearth of potential buyers and demand has not completely dried out from all sides uniformly.Demand has reduced only from people who are postponing taking home loans and are employed in IT/private companies.

    For prime properties within the city the builders target segment still remains NRI/R2I/Businessmens/Self employed people for whom this exorbitant price still remains affordable.

    It is in the current quarter only the industries are feeling the heat, jobs are getting lost, profits are coming down and sentiment is hugely affected.

    Things will be more clear only in the next two quarters subsequent to the election.By Year End I believe we will see a significant correction of 30% or more.

    It will be good time then for people who have money and have put off their purchase for self use to find good ready to occupy flats at attractive rates.

    Expecting prices to come down to inflation adjusted 2004 level in 6 months is not realistic.Do not be deterred by intermediate up and down moves.You will have to wait till the market bottoms out.The Boom Bubble has to burst someday right??

    Let the market take its time, During this uncertain period one should avoid buying or selling RE unncecessarily.

    Meanwhile keeping a one-two years horizon in mind start focussing on creating wealth by earning more and saving/investing more rather than borrowing more to invest more.


    Very well said.
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  • Originally Posted by nabishek
    Good Question abk.

    If you are asking if there is any builder who has reduced 25-30% within the city and still not able to sell?My answer is Yes.

    These are the quoted rates from what I remember(any inaccuracy blame my memory)

    Adyar(Gandhi nagar)

    Akshaya homes - 12500/sqft - under construction.
    Vijayshanthi builders - 11000/sqft - 80% complete
    Rushmore LLC - 11500/sqft - Upcoming
    Jones Foundation - 8500/sqft - 50% complete
    Fair deal Homes - 10000/sqft - Ready to occupy.

    Adyar(Shastri Nagar)

    Adroit Urban - 10500/sqft - 80% completed
    KGEYES - 8500/sqft - 80% completed
    Rakesh Constructions - 7500/sqft - ready to occupy.
    Limelight property - 8500/sqft - upcoming

    Anna Nagar(East)

    India Builders - 8500/sqft - Ready to occupy
    Firm Foundations - 7500/sqft - upcoming and ready to occupy
    projects

    Kilpauk

    Ganesh homes - 12000/sqft
    Sucons - 8500/sqft
    Praveen builders - 10000/sqft

    T.Nagar

    Lancor - 13000/sqft - under construction
    GRN - 8500/sqft - 80% completed
    Krishna constructions - 9500/sqft - 40% completed
    Soorya constructions - 10500/sqft - Ready to occupy.
    BSR builders - 9500/sqft - 80% completed.

    Abhiramapuram

    GRN - 11000/sqft
    Lancor - 10500/sqft

    Apart from the list there are so many other small medium builders who offer 1000-2000/sqft less for their projects.
    .


    the table you have given abhishek is not at all oversupply this was so even during boom period .
    The chennai market for flats is diff from gurgaon,NCR, Blore,MUMBAI,etc where most of the flats where booked as 'soft launch' as most of it was speculator and investor driven. wheras the chennai market has always been user driven (i dont know about the township projects) and was always booked during the course of completion and inevitieably few flats were lying ready for occupation, i have been associated with builders since 1996 and have seen this difference between chennai and other markets.
    only after the advent of pan india builders like HIRCO,DLF,PURVANKARA etc i have info about soft launch offers.
    i appreciate your data but my view says this is not oversupply.its no different from the boom period.i have given a general scenario in chennai market for flats, some builders may have sold on bhoomi puja itself.
    Even during the boom there were umpteen number of projcts in advanced stages of construction & completed lying unsold,this can be verified by checking the hindu's advt during the boom.
    this is one more reason that no chennai builder has grown as big as Bglore,Mumbai,Gurgaon,etc
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  • Dear friend,

    I agree with your comments above on Chennai buiders who have not grown like the ones in the North or West.

    ks2071746
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  • Interesting info from Nabhishek and equally pertinent answer from ABK. Now the truth is number of impulsive buyers has reduced obviously as they have been brainwashed by the bears as much as the bulls brainwashed them in 2006.
    In 2006 fools bought houses they could not afford. In 2009 fools with money are not buying trying to time the bottom. Reality is that RE market moves up and then halts for sometime and moves up again. THat is Indian, in particular Chennai and Bangalore RE. In particular Chennai buyers are mostly non speculators while in Bangalore I know of speculators. At best some silly NRIs have tried to speculate in Chennai projects during 2005-7.
    So to put it simple, better buy before it bounces up as the same builder who quotes 9K in Adayar now will hold on and give it you for 15K in a year if market moves up and will probably reduce it to 8.5K if it moves down. However at 8.5K he would have done other cost cutting measures so u will get what you pay for only!
    Well god save these foolish bears!
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  • When someone evaluates the real worth of money & understand that RE is heavily inflated they wait for the corrections. The wait cant be called as bearish rather rational buying.Some may call it bearish & foolish . Lets not get carried away by this.
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  • Dear friend,

    It is quite natural and that bears and bulls come often unsolicited taking the investors for surprises. None will be able to predict when either a bull or bear will come into spoiling sport for many, some times in the same day.

    ks2071746:D
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  • Originally Posted by sethugm
    When someone evaluates the real worth of money & understand that RE is heavily inflated they wait for the corrections. The wait cant be called as bearish rather rational buying.Some scoundrels may call it bearish & foolish . Lets not get carried away by the bullshit of these scoundrels.

    You are cent percent right.We are not trying to time the market as some dumb guy in this forum write.We are saying this is not the correct time to enter as price have increased beyond affordability of buyers and bound to correct in few years time.Again these dumb guys confuse people about the term "timing of market".Noted investors usually say not to time the market and that market is stock market and not RE.Because stock market moves very fast anticipating things in advance whereas RE market is slow to respond to macro economics.

    These guys cannot give valid reasons why real estate price will increase whereas bears have already given ample reasons.Even though we call ourself bear it is to distingush ourself from senseless people who expect 25% CAGR every year .
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  • Dear friend,

    Makes interesting reading.

    ks2071746
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  • Originally Posted by abk
    the table you have given abhishek is not at all oversupply this was so even during boom period .
    The chennai market for flats is diff from gurgaon,NCR, Blore,MUMBAI,etc where most of the flats where booked as 'soft launch' as most of it was speculator and investor driven. wheras the chennai market has always been user driven (i dont know about the township projects) and was always booked during the course of completion and inevitieably few flats were lying ready for occupation, i have been associated with builders since 1996 and have seen this difference between chennai and other markets.
    only after the advent of pan india builders like HIRCO,DLF,PURVANKARA etc i have info about soft launch offers.
    i appreciate your data but my view says this is not oversupply.its no different from the boom period.i have given a general scenario in chennai market for flats, some builders may have sold on bhoomi puja itself.
    Even during the boom there were umpteen number of projcts in advanced stages of construction & completed lying unsold,this can be verified by checking the hindu's advt during the boom.
    this is one more reason that no chennai builder has grown as big as Bglore,Mumbai,Gurgaon,etc


    It is a myth that Chennai's real estate market is user driven as opposed to other cities which are more speculator driven.I know at least a dozen high worth individuals known to me personally who have invested in the last real estate boom in OMR and are repenting today.One of the person's who is a granite exporter invested in Purvankara's first project on OMR Swan Lake at Rs.5500 sq ft ,money diverted from his business.

    Today he needs the liquidity in his business but he is unable to off load this property at Rs.2200 per sq ft.
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  • Well using scoundrel to describe others and then going to the mod and saying others are abusing them is the style of the above scoundrel! LOL!
    Now corrections are inevitable in any market and I never denied it, but falls in RE market in particular in CHennai or BLR is a myth yet to be broken and our above scoundrel might be waiting on the side line forever expecting 2004 bus to arrive even in 2040. Such scoundrels might like to call themselves smart but might actually make you a fool waiting for 2004 to reappear!
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  • Originally Posted by BigBear
    You are cent percent right.We are not trying to time the market as some dumb guy in this forum write.We are saying this is not the correct time to enter as price have increased beyond affordability of buyers and bound to correct in few years time.Again these dumb guys confuse people about the term "timing of market".Noted investors usually say not to time the market and that market is stock market and not RE.Because stock market moves very fast anticipating things in advance whereas RE market is slow to respond to macro economics.

    These guys cannot give valid reasons why real estate price will increase whereas bears have already given ample reasons.Even though we call ourself bear it is to distingush ourself from senseless people who expect 25% CAGR every year .

    One more classic example of calling others dumb when the person missed the bus in 2004.
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