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Kandivali Prices Plunge to 3k as Stock Crashes

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Kandivali Prices Plunge to 3k as Stock Crashes

Last updated: November 25 2009
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  • #11

    #11

    Re : Kandivali Prices Plunge to 3k as Stock Crashes

    BSE -- below 10K. What is the property value in Mumbai
    Either land or AIR and FOOD. Choice is yours.

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    • #12

      #12

      Re : Kandivali Prices Plunge to 3k as Stock Crashes

      Arin, you are quite right, but may eventually turn wrong!

      Originally posted by arin_12 View Post
      BSE -- below 10K. What is the property value in Mumbai
      Mr Ram said that one cannot make a blind thumbrule that if Sensex is so-and-so, a specific price in a specific area for RE will be so-and-so. ABSOLUTELY AGREE since this would be a rule based on fantasy!

      I stated that RE Stock prices are very accurate indicators of what is coming in RE prices. Therefore, if most RE stocks come down to 80% of their peak, RE prices will have similar falls from their peak. This is true (in my experience in ANY industry with widely held stocks be it Chemicals, Paper, Retail, whatever). There are some SOUND REASONS for this we will discuss later.

      Now Arin goes on to conclude that what it means is, when RE Stocks goes down to 20% of peak, IMMEDIATELY RE prices also should go down similarly. And if it doesn't, the rule is wrong!!!

      SORY FOLKS! Shows a fundamental misunderstanding of the 2 markets. Stocks are very well regulated, have a transparent and continuous price discovery system (market trading), has fine granularity (meaning I can sell shares one at a time, but cannot sell land 1 SqFt at a time ) and is not as emotional a purchase as shares. RE has exact opposite characteristics. RE purchases also generally happens only once in our lifetime for many of us (of course, now-a-days speculators trade in RE but they are in for nasty surprises like speculators in any market!)

      RE cycle time is longer and cycle shape is different. But, end result will STILL BE THE SAME. Prices will crash similar to RE stock prices.

      Please be patient. Ecotimes has already run an article yesterday about how, when the assets of RE companies (land banks, flats, etc) are mortgaged to raise emegency loans at 30% or higher and when the sales (hoped for in next 3-6 months) do not materialise, AND when increasing job losses in our export sector leads to distress among home owners and banks starting to reposses more homes which they will want to sell ASAP, you will see a RUSH TO THE DOOR by too many "homeowners" with too few buyers.

      Then the real price declines will start. That should start happening pretty soon now, maybe even post Diwali when Banks and RE companies realise that buyers are not coming in anymore.

      In Bangalore I hear that a leading quality builder who has built flats at a raw cost of 1600 per SFt is having a hard time selling it at 1750. So prices in some cases are already below cost.

      cheers

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      • #13

        #13

        Re : Kandivali Prices Plunge to 3k as Stock Crashes

        I think if people just stop purchasing for 2-3 Months then only the RE price will come to the actual Realistic price.
        Because of the High Margin In RE the No of Crime is also High. But at the end we end-consumer are paying the Money from our own pocket. This people had made 300-500% profit in each project. So the price has gone up. Now Re Dev dont wanna to digest the avg profit margin...
        I see in bangalore no Infrastructure in Many places but the land price are sky rocketing. I wish this Greedy Investor to suffer as our economy is slowing down.
        Today every ones jobs are in Risk. IT/AIRLINES/FIN/PHARMA/AUTO ...
        Its better to be safe.
        Either land or AIR and FOOD. Choice is yours.

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        • #14

          #14

          Re : Kandivali Prices Plunge to 3k as Stock Crashes

          People are not investing/Buying in RE in Mumbai . they are just waiting for the bubble to burst. As now the stock market has gone below 9K. Just someone this or other forum was saying that in 2009 the market will go down till 8700. it has happen now, in 2009 you will see it will be going down to a new level of 6000. and if you go to buy a flat with the builder he will only show you 2 flats in the whole building, wether all are empty he ll say all are sold out only these two are availaible. so dont bother about it. just wait. Cheers.

          (2009 will get lot of peoples their dream home.

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          • #15

            #15

            Re : Kandivali Prices Plunge to 3k as Stock Crashes

            better to buy completed prop?

            do u think its better to buy comepleted prop or under const from a financing view.also all this fuss abt prices coming down by any % doesnt hold much sense if one is an end user.if one bought a apt as end user at 4000 after correction and after 5 year even goes to just 6000 or 8000 one will not sell it bcoz then one will have to buy at 6k or 8k.so this so called uplift is only notional gain.same with prices going down today after 20% correction,if u can get a grade A apt in the right location with good quality and infra and can negotiate with the developed for another 5-7% drop and if its only apt makes sense to go ahead.lemme know yoour views

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            • #16

              #16

              Re : Kandivali Prices Plunge to 3k as Stock Crashes

              Knowing the current situation of the stock market is crucial especially if you have stocks invested in it. It is better to be up to dated to the situations so that you could know the actions to be taken if some changes in the stock market occur as to secure your stocks to lose. Today, the stock market is unstable so we need to be vigilant to the current market conditions.

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