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Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

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Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

Last updated: December 26 2012
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  • Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

    Every now and then, I am reading in the forums that bubble will burst soon and RE will fall like in US etc.
    Here is 2 my cents:

    1. Wherever there is a demand, bubble will never burst. Take an example of
    West delhi like Uttam nagar. There is scarcity of plots in Uttam nagar. This place is very close to dwarka also. My personal experience, price are going north in this place. I dont see the reason to go south. If there are only 50-60 plots available for sale in such habitated place with metro near by, I dont see reason the reason for down. I myself noticed one way direction in price in last 12-14 years.
    2. # holds true even for illegal colonies. If colony is more than 70% habitated, bubble will just grow and grow.
    3. I agree places like sonepar where there is so much supply and not that great demand ( as of now), price acceleration will not be as fast in #1 and #2.

    Look at budh vihar, place is so congested but price are close to 1L/yard.

    Would like to get other experts opinion. Do you know the place where it is almost 100% habitated but price goes down in last 20 years??

    -Pradeep
  • #2

    #2

    Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

    Originally posted by tanisha001 View Post
    Every now and then, I am reading in the forums that bubble will burst soon and RE will fall like in US etc.
    Here is 2 my cents:

    1. Wherever there is a demand, bubble will never burst. Take an example of
    West delhi like Uttam nagar. There is scarcity of plots in Uttam nagar. This place is very close to dwarka also. My personal experience, price are going north in this place. I dont see the reason to go south. If there are only 50-60 plots available for sale in such habitated place with metro near by, I dont see reason the reason for down. I myself noticed one way direction in price in last 12-14 years.
    2. # holds true even for illegal colonies. If colony is more than 70% habitated, bubble will just grow and grow.
    3. I agree places like sonepar where there is so much supply and not that great demand ( as of now), price acceleration will not be as fast in #1 and #2.

    Look at budh vihar, place is so congested but price are close to 1L/yard.

    Would like to get other experts opinion. Do you know the place where it is almost 100% habitated but price goes down in last 20 years??

    -Pradeep
    My 2 cents to you first:

    Never start a thread without appropriate knowledge.

    Sonepat is one region that has the least supply and secondly Kundli- Sonepat region has yielded the best returns in entire NCR in last 2 years. Thirdly, regarding Kundli and Sonepat, nearly all projects are 100% sold reflecting more demand than supply.

    And with Delhi prices on peak, it is rather insensible to invest in unauthorized colonies. Only invest in unauthorized area if you have high risk taking potential.

    Comment

    • #3

      #3

      Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

      I guess you did not get the point
      It is not recommended to jump to conclusion.
      reference is habitated delhi place vs. not so habitated place like sonepat/kundli (compare to delhi).

      Anyways, I am still looking for honest opinion and not biases opinion.

      I am not against kundli/sonepat. This is one of the best potential NCR region.
      Dont get me wrong. Kundli will blossom but will take 6-8 years.

      Comment

      • #4

        #4

        Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

        Supply and demand is not only limited to real estate but to everyday product as well such as milk, gas cylinders. That's not something new you are quoting but the examples you quoted to prove your point were misleading and incorrect information.

        KUndli may be sparsely populated as of now but the prices there have tripled in last 3 years or have jumped 8 times since its launch in 2005.

        Prices in real estate rise because of development, location and to connectivity. That's the basic reason for increase in price in Kundli. Actually, if you are aware of recent trends, prices have dropped 10-15% in Budh vihar. Let me update you I am both invested in Rohini and Kundli but prices have not appreciated in Rohini sector 24 which is close to Budh Vihar but are steadily increasing in Kundli.

        Comment

        • #5

          #5

          Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

          And no country is resistant to recession. There is high possibilities of multiple job cuts in IT companies such as wipro, Hcl, infosys and if US stops outsourcing jobs to India which is a big agenda in US ( especially with Obama winning), then all these so called software engineers or IT people on bank loans or mortgages will be compelled to sell their properties at lower prices leading to price fall.

          In 2000-01, I am not sure if you remember that prices dipped down in Delhi by 30 percent in so called Rohini and other areas that I was not even able to sell a good location plot at price 20% lower than the purchased value.

          By saying this I am just saying that no place is recession proof, so one should be wise in investing at high premium places. If there is chance of 100% appreciation, then there is a risk of 50% depreciation as well.

          Comment

          • #6

            #6

            Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

            Originally posted by tanisha001 View Post
            Every now and then, I am reading in the forums that bubble will burst soon and RE will fall like in US etc.
            Here is 2 my cents:

            1. Wherever there is a demand, bubble will never burst. Take an example of
            West delhi like Uttam nagar. There is scarcity of plots in Uttam nagar. This place is very close to dwarka also. My personal experience, price are going north in this place. I dont see the reason to go south. If there are only 50-60 plots available for sale in such habitated place with metro near by, I dont see reason the reason for down. I myself noticed one way direction in price in last 12-14 years.
            2. # holds true even for illegal colonies. If colony is more than 70% habitated, bubble will just grow and grow.
            3. I agree places like sonepar where there is so much supply and not that great demand ( as of now), price acceleration will not be as fast in #1 and #2.

            Look at budh vihar, place is so congested but price are close to 1L/yard.

            Would like to get other experts opinion. Do you know the place where it is almost 100% habitated but price goes down in last 20 years??

            -Pradeep
            1) u said "wherever there is demand". thr is a demand but its related to prices. u cant hav "demand" if people dont hav salaries corresponding to the prices and if they cant afford it. still this "demand" is over-hyped in india i think. thr is demand but not as much as builders want u to believe.
            2) if we pick up areas and show how the land is restricted then thts the case all around world. uttam nagar has limited number of plots agreed, every place has limited number of plots. how many times hav u visited uttam nagar ? next time when u r around the area do pay a visit thr. see the gentry thr. thr is a reason why prices r comparatively low thr.
            3) reason given by brokers for dwarka prices increasing was its closeness to inhabited regions of delhi and now reason for uttam nagar u r giving is closeness to dwarka ?? pls let dwarka get inhabited first. dwarka houses r still more than 60% empty !! where is the demand ? owners looking for people on rent over thr .. not getting any.. rents same in last 2 years.. this is the actual demand.
            4) to ur question "Do you know the place where it is almost 100% habitated but price goes down in last 20 years??" do u expect the answer to b restricted to india or can i quote other places. in india jaipur is one of the examples where price index is falling. around the world look at japan, US, dubai, polland, iceland, etc etc etc..

            Comment

            • #7

              #7

              Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

              Ruchika,

              Good point. I would like to confine to delhi at this point.
              I visit uttam nagar almost every month.
              I noticed 60-70% price increase in last 6 months in areas like raja puri. This is not on papers but actual.
              Agree or not, kundli price like in kundli are on papers. When I say on papers, I mean ground reality is different. I have seen people quoting 24-26K for H, I, J,K plots. I did check my self recently, ground reality is quite different. 24-26K is for buy, sale price is not even close to 24K. Same is true for A,B,C block.

              Rohini1,

              I dont know who quote you the budh vihar price, price increased by 20-25% in last 5 months and I am quoting based on real experience. Go check.


              -Pradeep

              Comment

              • #8

                #8

                Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

                Originally posted by tanisha001 View Post
                Ruchika,

                Good point. I would like to confine to delhi at this point.
                I visit uttam nagar almost every month.
                I noticed 60-70% price increase in last 6 months in areas like raja puri. This is not on papers but actual.
                Agree or not, kundli price like in kundli are on papers. When I say on papers, I mean ground reality is different. I have seen people quoting 24-26K for H, I, J,K plots. I did check my self recently, ground reality is quite different. 24-26K is for buy, sale price is not even close to 24K. Same is true for A,B,C block.

                Rohini1,

                I dont know who quote you the budh vihar price, price increased by 20-25% in last 5 months and I am quoting based on real experience. Go check.


                -Pradeep
                hi tanisha/ pradeep ??

                i dont know why u have brought kundli in between ? u wanted to talk abt delhi. right ? i dint mention kundli or any other place in india even once in my msg. if u want to talk abt other areas, we can do tht in relevant threads too.
                meanwhile, instead of trying to show ur knwldge abt kundli i wud hav felt better had u replied to my post, point by point, related to delhi !!

                Comment

                • #9

                  #9

                  Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

                  Ruchika,
                  FYI. my daughter name is Tanisha.
                  I brought kundli to prove the point how scarcity of land/plots make difference.
                  coming to point: I agree dwarka is 50% occupied as of now but close proximity of dwarka and uttam nagar make price north for uttam nagar.
                  I agree with UN gentry. My whole point is where there is scarcity of land, price will go just north.

                  Comment

                  • #10

                    #10

                    Re : Supply-Demand Is The Name Of The Game In Delhi Real Estate Market

                    Pradeep bhai,

                    How come with Kundli with such a land availability has shown 200% increase in prices in last 2-3 years.

                    You may find it difficult to explain as it defies your logic of land availability and price increase.

                    Let me explain: Kundli is bang on National highway, 2.5 kms from Delhi border, with 100% projects sold out and with gradually improving infrastructure. Demand is high in Kundli because of its location and most importantly because of 20 fold price difference from Pitampura.

                    North Delhi people who have 1 crore budget can either choose to live in areas like pitampura/ rohini where they will not even get a 700 sq ft flat or would prefer areas like Kundli where they can get a plot of 350 sq yard.

                    If you have to buy a house for your end use, considering you have no assets, which one would you prefer? 700SQ feet apartment or 350 sq yard plot??

                    Comment

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