It was looking like prices are up for correction, after RNA Exotica and few others

However last couple of weeks builders are lauching at higher prices:

Ekta Tripolis in Gorwgoan West 12700

L&T Powai 15500 SOLD OUT

BLUE MOON LODHA SOLD OUT

RNA EXOTICA ALL PREMIUM FACING(VASTU COMPLAINT) APARTMENTS SOLDOUT

Investor/buyers are grabing opportunities of some correction and jumping on it

It seems no major correction will be happening before 2015

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  • Perfect analysis,

    Builders are not even offering 2% discount even after putting token cheque.

    Another trend is setting up... for example, Kabra galaxy and Regency heights in Bramhand - They are building the units first and then selling in the end. Realising all profit in their own pocket. Kabra is coming up with 3rd tower with money coming frm Tower 1 and 2.

    Nothing wrong in that - but see how the industry is changing.

    Ultimately, the eager buyers in 2004 to 2008 have made the builders sitting on large cash and now they are not in need of any money.

    Sheth literally told me - they dont need money at this point of time.

    So where is the correction ?

    People are buying with or without smiling face. Once they make downpayment of 20 Rs for 100 Rs flat and 80 Rs loan, and if Interest for 1 year is going to be another Rs 10. How come property prices will go below 85 Rs ?

    Why the new buyers will sell at less than 85 Rs?


    So dont expect any price correction soon, unless sky falls.

    I am going to cease the deal in another months time, as mentioned in my earlier post.:(
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    1 Comments
    • sunita33292 years ago
      If anything, prices have only been moving upwards, if even marginally. According to a recent report by a global major, Mumbai is at number 24 position on the list of most expensive cities in the world, with luxury property prices growing at the rate of 0.8%
  • Lodha blue moon selling at 30-40% lower than market price and RNA exotica reducing prices by 30% and lodha giving a discoung of 5lacs in 5 of their projects in my opinion is a price correction..

    lodha guys are calling me every 2-3 day for different projects. builders have been creating artificial scarcity by using the sold out techniques. How much of the sold out is really true, no one knows....Not every builder might reduce prices..But there are examples of builders who are reducing prices...

    people can afford only until a certain amount..once the prices go beyond a point, people won't be elibigible to get the 80% loan..for a 3cr property, down payment is 60lacs and monthly emi is 2.5lacs...how many people can buy at that price...now consider that going to 6cr after 3 years, downpyament 1.2cr and monthly payment 5lacs ....do you think the salaries are going to increase at the same proportion...

    I don't know whether prices would keep going up or come down or remain at the same level...But, if they go up, I am not sure how long people can afford it...
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  • We all know about SOLD out strategies so that is not new. When I had been to see Lodha Luxuria (Thane) and Aqua (dare I say, in Mira Road) a few years ago a month after launch, I was told that most of the flats were sold out........ We now know what the inventory is like in these projects. just because they scream out SOLD OUT, that doesn't mean anything.

    I am based in the UK, and am regularly getting calls about pre-launches especially from Lodha.

    The ground reality about realty struck me last week when a known broker from Borivali West told me over the phone to avoid new projects. He said he has stopped recommending under construction projects as he believed these projects could take more than twice the time they quote. He said he could get me a deal if I insisted but warned me about new projects. I was enquiring about Parinee Adney and Happy Homes (both I.C.Colony). He said he was getting enough headache from previous customers who were blaming him for work being stuck.

    Was surprised that he actually told me to wait and watch for 6 months. Never ever thought a broker would say that in Mumbai. My cousin brothers had bought resale flats from him in the past so he kinda knows our family.

    These builders will continue playing mind games because it has been working for the last few years, don't think this strategy will continue working for long. Am sure they are going to find new mind games but the truth remains that there aren't enough people who can afford to buy all these these match box flats being built in every knook and corner.

    Correction is inevitable or should I say, imminent.
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  • have some patience

    Originally Posted by sanjeev1008
    It was looking like prices are up for correction, after RNA Exotica and few others

    However last couple of weeks builders are lauching at higher prices:

    Ekta Tripolis in Gorwgoan West 12700

    L&T Powai 15500 SOLD OUT

    BLUE MOON LODHA SOLD OUT

    RNA EXOTICA ALL PREMIUM FACING(VASTU COMPLAINT) APARTMENTS SOLDOUT

    Investor/buyers are grabing opportunities of some correction and jumping on it

    It seems no major correction will be happening before 2015

    Share your thoughts


    Originally Posted by sanjeev1008
    Heard the market condition is very bad, DB Realty is heard to offer 11500 per sft +50 floor rise for almost completed project Orchid woods. Anywbody had heard this?



    Well my thoughts are that you need to wait for some time.

    Just a few weeks back you were saying that market condition is very bad?:(

    Don't be so fragile man and have some patience.;) ;)
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  • ‘Price drop in Mumbai is inevitable’

    The residential real-estate market in Mumbai stagnated in 2011-2012, as buyers put off purchases due to non-affordability and atrocious rates quoted. :bab (59):
    Most of the under construction projects are stalled or moving at a very slow pace, liquidity crunch is clearly visible.

    My take;

    ‘Price drop in Mumbai is inevitable’

    Cheers.:)
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  • Price drop in Mumbai inevitable

    Developers will have to cut prices to reduce inventory, says a Knight Frank study.

    The residential real-estate market in Mumbai stagnated in 2011-2012, as buyers put off purchases on hopes of a drop in prices in the near future.

    According to Knight Frank Research’s study of the residential market for June, the wait could pay off.

    Read more at:
    http://www.google.com.sg/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=3&cad=rja&ved=0CEEQFjAC&url=http%3A%2F%2Fwww.thehindubusinessline.com%2Ffeatures%2Finvestment-world%2Farticle3613621.ece%3Fref%3Dwl_companies&ei=xPUSUZqwJMKmrAfQyoCYAQ&usg=AFQjCNHCCaTb7HHoMEQzDeOmdNF-qVf8cw
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  • Mumbai: Is a property price correction in order?
    http://www.google.com.sg/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=5&cad=rja&ved=0CE4QtwIwBA&url=http%3A%2F%2Fwww.ndtv.com%2Fvideo%2Fplayer%2Fthe-property-show%2Fmumbai-is-a-property-price-correction-in-order%2F262739&ei=xPUSUZqwJMKmrAfQyoCYAQ&usg=AFQjCNFlYRGILxg6xgPewiTe4FC6GfKfDw

    Correction in the housing market may be round the corner

    NEW DELHI/MUMBAI/BANGALORE: Home prices in Mumbai softened in the December quarter while price growth in other Indian cities slowed, two real estate consultancy firms have said, reinforcing speculation that a correction in the housing market could be round the corner.

    According to property consultancy CBRE, prices of new homes in India's financial capital Mumbai were down 2-5% in the October-December period from the previous quarter.

    Read more at:
    http://www.google.com.sg/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=7&cad=rja&ved=0CF4QFjAG&url=http%3A%2F%2Farticles.economictimes.indiatimes.com%2F2013-01-28%2Fnews%2F36596188_1_cbre-liases-foras-prices&ei=xPUSUZqwJMKmrAfQyoCYAQ&usg=AFQjCNGZQBzpB_MlsE0hmIjyjiWSiyHaoA
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  • Originally Posted by nidhu299
    Perfect analysis,

    Builders are not even offering 2% discount even after putting token cheque.

    Another trend is setting up... for example, Kabra galaxy and Regency heights in Bramhand - They are building the units first and then selling in the end. Realising all profit in their own pocket. Kabra is coming up with 3rd tower with money coming frm Tower 1 and 2.

    Nothing wrong in that - but see how the industry is changing.

    Ultimately, the eager buyers in 2004 to 2008 have made the builders sitting on large cash and now they are not in need of any money.

    Sheth literally told me - they dont need money at this point of time.

    So where is the correction ?

    People are buying with or without smiling face. Once they make downpayment of 20 Rs for 100 Rs flat and 80 Rs loan, and if Interest for 1 year is going to be another Rs 10. How come property prices will go below 85 Rs ?

    Why the new buyers will sell at less than 85 Rs?


    So dont expect any price correction soon, unless sky falls.

    I am going to cease the deal in another months time, as mentioned in my earlier post.:(


    Please do so and let us know at which project and at what rate?
    Thanking you in advance.:):)
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  • Home sales could rebound in 2013 helped by quicker approvals and lower finance cost

    Home sales could rebound in 2013 helped by quicker approvals and lower finance cost - The Economic Times

    BANGALORE | MUMBAI: Home sales in India could rebound in 2013, helped by quicker project approvals and lower cost of finance, according to analysts.


    "Residential markets have entered CY13 on an encouraging note, with robust offtake seen in new launches across markets over the last three months," global financial services group JP Morgan said in its January report. "We expect volumes in residential markets to improve over the next 12 months on pick-up in pace of new launches coupled with price discounting and mortgage rate cuts."

    According to CRISILBSE -1.80 % Research, absorption of new residential units across six key cities - Mumbai, the National Capital Region, Pune, Bangalore, Chennai and Hyderabad - is expected to increase at a compound annual growth rate (CAGR) of 7% to 251 million sq ft in the next two years. During this period, Mumbai is expected to record the highest CAGR of 14% due to pent-up demand, while capital values across regions are expected to rise marginally in the second half of 2013, the research body said.

    The projection is a contrast to numbers reported for last year. According to JP Morgan, sales of residential units across major markets like Mumbai and NCR had dipped between 7% and 38% in first three quarters of 2012. Only Bangalore and Kolkata bucked the trend, recording growths of 3% and 6%, respectively.

    "Sales at new projects are showing signs of recovery and a lot of new launches are being worked based on customer responses. Prices may not see any major uptick, but demand is certainly better than last year including in Mumbai and NCR," said Lalit Kumar Jain, president of developers association CREDAI, which has about 10,000 members.

    Backing the estimate is state-run lender Punjab National BankBSE 0.14 %, which has seen a 14% growth in home loans in the last quarter. "In the last four to five years, property price escalated steeply in major metros, but now it has stagnated. The next six months will be a turnaround time for the housing industry with inflation easing and chances of the cash reserve ratio coming down," said SS Bhatia, its general manager for retail.

    Last month, the Reserve Bank of India reduced the repo rate by 25 basis points to 7.25%, fuelling hopes that home loans will become cheaper.

    "Further reduction of interest rate will lead to higher offtake of property. Loan disbursal has been reasonable, but actual recovery will depend on the economy," said VK Sharma, chief executive of LIC Housing FinanceBSE 0.27 %.

    Ashish Puravankara, joint managing director of Puravankara ProjectsBSE -0.49 %, said, "Last year was a consolidation phase for builders but this year the market will recover, riding on new launches across various geographies. Markets like Chennai and Bangalore have outperformed other bigger real estate markets."

    The Bangalore-based builder saw about half its stock in a newly launched property in the city being snapped up in 10 days. "We have already sold 2.14 million sq ft in the current fiscal and expect to exceed three million by the end of the year."

    Similarly, Mumbai in last few months has seen a rise in the number of launches on the back of approvals and response to new projects. Property sale registrations in the city rose to a 24-month high in December, reflecting a jump of 5% from a year ago and 42% from the previous month.

    "Market has started to respond and there is a change in sentiment, especially after the interest rate reduction. For long, there was only anticipation of fall in prices, but now customers are acting upon it," said Gaurav Gupta, director of Omkar Realtors and Developers.

    Omkar Realtors has sold 150,000 sq ft in the last 15 days at its nearly 2-million-sq ft premium residential project at Worli, Mumbai, taking its total sales across three Mumbai projects to nearly 0.5 million sq ft in the last two months.

    According to some property brokers, engineering firm Larsen & Toubro's realty arm has sold nearly 300 apartments in a recently launched residential project at its campus in Powai. "We have done a soft launch of L&T Emrald Isle at Powai. The response was very encouraging, and bookings will resume shortly," a spokesperson for L&T said.
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  • You are absolutely correct however most people are allergic to logic. They think prices will continue to rise exponentially and will continue to buy causing the little demand we see. However we have reached a point in price where number of sellers vastly outnumber the number of buyers ( i know many listings which are being renewed on daily basis at exorbitant prices but have no takers so far) so a price correction is around the corner. Just wait and watch which fool gets caught up at the top.

    Originally Posted by wildfire

    people can afford only until a certain amount..once the prices go beyond a point, people won't be elibigible to get the 80% loan..for a 3cr property, down payment is 60lacs and monthly emi is 2.5lacs...how many people can buy at that price...now consider that going to 6cr after 3 years, downpyament 1.2cr and monthly payment 5lacs ....do you think the salaries are going to increase at the same proportion...
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  • Just because something should happen doesn't mean that it will happen.

    Due to population rise and poor infrastructure in old areas,
    Long-term trend of RE prices will be up ( on inflation adjusted basis ) due to severe pent-up demand, especially for newer developments.

    At the same time, everything is cyclical. RE is no exception.

    Every so often, brief down cycles will be obviously felt in form of price-stagnation in old buildings in certain areas.

    If somebody is waiting for a massive inflation-adjusted-price-correction (to buy a primary home) in Mumbai metro RE......what else can I say....Gooooooood Luck !
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  • lodha guys are offering 5L and trip abroad, a car and god knows what else since a long time. It has nothing to do with price correction. Its like clothing stores / showrooms offering sale/discounts on products round the year with new new festive names. Its all marketing tricks.
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  • i was literally bored of waiting for correction to happen hearing the same reasons for correction, finally book one which suited my pocket. As an end user, its simple, u can afford it, go for it.
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