As per the report published in front page today(15-JUNE-2011) ... economictimes.com ----- REAL ESTATE SLOWDOWN has begun, brokers are running here and there due to paltry sales.

http://economictimes.indiatimes.com/markets/real-estate/realty-trends/brokers-hunt-for-jobs-as-sales-slump-hits-realty/articleshow/8856588.cms

Updated: 18/Jun/2011.
India's Homebuyers Gaining Upper Hand

India's Homebuyers Gaining Upper Hand - WSJ.com



NEW DELHI | BANGALORE: Yusufbhai has just opened a stationery shop in a Bangalore bylane. He has christened it 'Smart Shop', borrowing the name from the realty brokerage firm, Smart Properties, he ran from the same premises until about two months ago. Yusufbhai switched to retail after his property business hit a rough patch following a slump in home sales. About three-quarters of his revenues came from sale of apartments, the remaining from renting.

"With home sales plummeting, it doesn't make business sense anymore," he explains. It's the same story in other big cities. In Mumbai, Pranay Shah, a mid-size broker has set up a small fast food joint to make ends meet. In Nagpur, Sashinath Chinchole has quit the real estate business and set up an ice-cream parlour. Their worries are not unfounded. While the large and established players in the property business have managed to stay put even during the slump, thousands of smaller players like brokers and agents are being forced to look for other jobs.

Also hit are lakhs of people employed with such small outfits - each of which hires 5-15 people.With many brokers shutting shop or downsizing, these people are out in the market, looking for jobs in sectors such as retail, banking, insurance and call centres. The real estate industry employs about 10 lakh people across the country, the majority in the unorganised sector.

In the first quarter of 2011, home sales dropped 17% in Mumbai, 14% in Bangalore and 15% in Hyderabad. According to consultant Jones Lang La-Salle, unsold residential units in projects that are complete or are nearing completion in 6-12 months in Mumbai and Delhi-NCR are as high as 25% and 16%, respectively. In other big cities, including Bangalore, Chennai and Kolkata, the numbers range between 12% and 19%. Sales in tier-II and tier-III cities are steady, though there is some panic due to the increase in interest rates, which have climbed to about 11% from 8.25% a year ago.


"For smaller brokers, the impact of the current market factors is a lot more compared to the larger brokers," says Abdur Ravoof, president of the National Association of Realtors India . Ravindra Bramhe, chairman of the Maharashtra Property Brokers' Association, says, "Even for our members - who are fairly well-off - business is down 40% compared to 2009-10. But the smaller guys are in trouble and are setting up businesses that move on a daily basis. Many I know have asked their employees to look out."

Mrinal Chaudhary, 24, chose to work in the real estate sector in the National Capital Region after his MBA last year because it was booming. He worked with a small real estate brokerage firm, which sold apartments in Greater Noida. He made an average Rs 45,000 a month, sometimes even Rs 80,000. Then came the farmers' agitation on the Yamuna Expressway, and business disappeared. Chaudhary moved to a bank. He has vowed never to return to the sector.

For whatever business is left in the market, there are hundreds of agents in queue. For instance, there are pockets on the Noida Expressway, near large projects, where real estate brokers can be seen sitting inside small tents, under the sweltering sun, waiting for business. Those who can't afford to set up these tents can be seen on the roadside, running after every car that passes by, with brochures and flyers of projects in hand. Industry refers to them as the broker mandi. "All my friends and colleagues are now looking outside real estate before things get worse," says Chaudhary. Many have returned to the insurance industry and others have found jobs with small call centres. A few have found employment with retail stores, says Chaudhary.

Many other young sales executives still working with brokerage firms are struggling, not knowing whether they will get a salary at the end of the month, as most of these firms have switched from a fixed salary model to a revenue-based fee model for their sales staff. "This was required," says Sumit Joshi, director of Noida-based Capitol Realtors, a mid-size real estate brokerage that has downsized as well as started working on a revenue-based fee model. To tide over the slowdown in sales, his firm has also recently diversified into loans, both for real estate and business, and loan against property by tying up with multiple banks.

With opportunities opening up in other sectors, the number of resumes received by hiring services firm TeamLease Services from the real estate sector has shot up. Says Rituparna Chakraborty, co-founder and senior vice-president, TeamLease, "Employment in organised real estate is at a nascent stage. And that is why employees seek opportunities in other sectors whenever business is down." Brokers, who ran successful businesses employing people on their rolls, are turning employees themselves. Take the example of Bangalore-based Mustafa Sharif, who has been leasing and renting commercial and residential establishments for a decade. He had to shut shop a few months ago, and chanced upon a job with a local builder. He now earns Rs 35,000 a month and has given his shop to his cousin to run some business.

Uncertainty in real estate was hard to bear for N Darshan, who downed the shutters on his five-year-old brokerage in Bangalore recently. "There was a time when there were no sellers and only buyers. But things have changed. Now I have turned my real estate shop into a cyber cafe," he says. Across town, another broker Shiva Kumar has put up a photocopy machine to balance his real estate broking business. "There is no assured income in real estate anymore. The commission on selling homes too has shrunk with buyers willing to pay only half the brokerage," says Kumar.
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  • Let us wait and watch. There will be some drop in prices no doubt, whether someone likes it or not. I am sure people who already own don't want prices to fall. And people waiting to buy, want prices to fall. Interesting view from both sides of the fence. Let us see who wins.

    Any balloon that fills more than its capacity has to .....(no guesses there). :bab (45):
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  • There should have been an option for 2 years and 40% correction. We will revisit 2009 lows, at least in NCR region outside proper Delhi.

    Visited neher par faridabad earlier today with a relative to see some BPTP floors and flats that are near possession. A single broker was offering over 20 floors and 27 choices in flats at close to original booking rates of 2005 and 2008. How long will people hold on to such properties with zero appreciation amd keep paying interest/EMI to banks?
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  • i have counted about 50 project in construction stage as of today only in noida and most of them having more then 1000 flats each .All of them say that the project got sold out in a month or so.I today bought into pan oasis directly from builder but brokers were saying there is no availability but builder told me that u could choose in most of the tower also almost any floor.
    despite being a buyer today i think if rates are not going to fall they would definately would not give even bank FD rates for atleast next three years
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  • Originally Posted by ThePunjabi
    There should have been an option for 2 years and 40% correction. We will revisit 2009 lows, at least in NCR region outside proper Delhi.

    Visited neher par faridabad earlier today with a relative to see some BPTP floors and flats that are near possession. A single broker was offering over 20 floors and 27 choices in flats at close to original booking rates of 2005 and 2008. How long will people hold on to such properties with zero appreciation amd keep paying interest/EMI to banks?


    Punjabi Bhai,

    Can you please PM me the broker details ( M.obile number) of NP broker who is selling BPTP floors near possession at good discount, one of my relative is interested in NP Faridabad floor.

    Thanks a lot.
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  • Originally Posted by ra_bunty
    i have counted about 50 project in construction stage as of today only in noida and most of them having more then 1000 flats each .All of them say that the project got sold out in a month or so.I today bought into pan oasis directly from builder but brokers were saying there is no availability but builder told me that u could choose in most of the tower also almost any floor.
    despite being a buyer today i think if rates are not going to fall they would definately would not give even bank FD rates for atleast next three years


    This is the fact. It may be possible that rate will not be reduce much (on paper) but in some locations rate will not increased at all for next 3 years (same case like GN in last 3 years) or for few locations if rate increases then it will not be appreciate more than FD ROI. This situations will be in almost every area of NCR. Affordable housing will be least affected and in few affordable areas there are chances to increase the current 2000 PSF rate to 2700 PSF rate in next 3 years. If NE problem get solved in 1-2 years then rate appreciation in NE will also be quite good % wise. Maneser & CR affordable housing rates may increase total 25-35% in next 2-3 years. If Metro work started then RTM properties of NP , RNE affordable housing may get total 30-35% appreciation in next 2-3 years. Non affordable areas will face problem like very less rate appreciation for next few years. All are my own POV and knew it very well that most of members will not agree with me.
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  • Hi,

    My situation is very absured :bab (38):

    Whenever I purchase a property I saw a downfall or so called correction. Bhagwaan jaane kisa luck hai.

    In Noida, Ghaziabad, I believe the correction won't happen since the rate are still affordable for end users.

    Yes correction would be there but in luxury segment. As per my POV, in affordable segment the pricess will be constant and won't further increases for bla bla time till any positive news come.

    Always remember one fact that property won't give you negative returns if we invest for time horizon of 2-3 years :D :D

    So stick to your property and wait for any positive news to come and I believe the wait can't be more than 2 years.

    BR,
    P
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  • Originally Posted by Prabal_India
    Hi,

    Whenever I purchase a property I saw a downfall or so called correction. Bhagwaan jaane kisa luck hai.



    Just like all 50 students of a class room teach by same teacher & textbook but none of them got same marks, same as in property several factor counts. I have seen several of my friends and for me also that few got appreciation and few got loss in same area (and even same societies some times). Main differences was the time of booking (pre launching booking some time is good and several times is bad) , broker discount (some takes 4% and some manage it upto 10%) , good flat layout (3 BHK of 1275 SF will always give better return then 1275 SF 2 BHK) , good facings , floor height , genuine society rates as per the area.

    Purchasing right property at right place at right time is not easy to judge but who judge it they at-least do not face loss. LUCK also plays a major role.
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  • Price CRASH is a delicious subject... everyone love to discuss this. If you look at different sections like Pune, Mumbai, Chennai, you can find out many hot threads are running there and few are running for years... means expert predicted market crash few years back and we are still waiting and discussing ..)

    Without going into details once again (as we discussed this in Noida section also many times).... just ask a very basic question

    Will you be able to, daring enough to, equipped to, well connected to en cash a CRASH?

    Whether you like it or not, the answer is NO for most of the people for different reasons.
    Only few Smart, Daring, Deep pocket people make money in CRASH... anyway, those people make money in all seasons.
    People like you and me keep on talking!! ... so enjoy discussing :bab (24):
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  • Hi G-Bhai,

    I know this is irrelevant to the thread but still wud appreciate your views.

    I saw in some of your post in GN wherin you were looking for a plot / villa in GN area. Do you any recommendations in terms of area and the pricing.

    I have gone thru all posts / discussion (including of Zohaib) on GN but i am totally confused in terms of which area to select as there are many options.

    Option I - In and around pari chowk (Alpha / beta rates are not less than 45K per Sq meter)

    Option II - Upcoming Omnicron / Zeta (26-27 K per sq meter for a plot -32K - For Built up houses)

    Would you be able to throw some insight of yours.

    Regards,
    Prashant


    Originally Posted by ondabhai
    Price CRASH is a delicious subject... everyone love to discuss this. If you look at different sections like Pune, Mumbai, Chennai, you can find out many hot threads are running there and few are running for years... means expert predicted market crash few years back and we are still waiting and discussing ..)

    Without going into details once again (as we discussed this in Noida section also many times).... just ask a very basic question

    Will you be able to, daring enough to, equipped to, well connected to en cash a CRASH?

    Whether you like it or not, the answer is NO for most of the people for different reasons.
    Only few Smart, Daring, Deep pocket people make money in CRASH... anyway, those people make money in all seasons.
    People like you and me keep on talking!! ... so enjoy discussing :bab (24):
    CommentQuote
  • Quite agree to it & at most times, land/apartments ( the most tempting one's ) r picked by the Big & not so big Brokers themselves to make a killing later & some by the Big/small Sharks . The common man normally hears on the correction ( that it has come - take benefit from it... & LOL:D, it is over now ) . He hardly benefits from it ( until, he is very lucky, has ample of cash & is at the right place, at the right time ).

    Originally Posted by ondabhai
    Price CRASH is a delicious subject... ........

    Without going into details once again (as we discussed this in Noida section also many times).... just ask a very basic question

    Will you be able to, daring enough to, equipped to, well connected to en cash a CRASH?

    .................
    CommentQuote
  • Originally Posted by prashant004
    Hi G-Bhai,

    I know this is irrelevant to the thread but still wud appreciate your views.

    I saw in some of your post in GN wherin you were looking for a plot / villa in GN area. Do you any recommendations in terms of area and the pricing.

    I have gone thru all posts / discussion (including of Zohaib) on GN but i am totally confused in terms of which area to select as there are many options.

    Option I - In and around pari chowk (Alpha / beta rates are not less than 45K per Sq meter)

    Option II - Upcoming Omnicron / Zeta (26-27 K per sq meter for a plot -32K - For Built up houses)

    Would you be able to throw some insight of yours.

    Regards,
    Prashant


    No worries dost.

    I had closed my deal in an under construction apartment around Pari Chowk area in GN in Dec. This is purely for our own stay without any investment consideration. We are absolutely OK with delays, more the delay, better for my cash flows.

    I will not reveal the details but I can say that it is one among NRI residency, Kings Park and Stellar Sigma. NRI city was out of my intended budget.
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  • Originally Posted by MANOJa
    Quite agree to it & at most times, land/apartments ( the most tempting one's ) r picked by the Big & not so big Brokers themselves to make a killing later & some by the Big/small Sharks . The common man normally hears on the correction ( that it has come - take benefit from it... & LOL:D, it is over now ) . He hardly benefits from it ( until, he is very lucky, has ample of cash & is at the right place, at the right time ).


    Yes Manojbhai, there is a very closed knit circle or cartel in RE market, who are very quick enough to snap all those so called distressed sale. It is not so easy to enter those circle ... bilkul bhai chara.... non members are not allowed. People who knows RE in depth are fully aware of such cartels... novice may not know all these details.

    I tried very hard in 2008/9 to get a decent deal and I was not successful... and ended up buying similar property in mid 2010 at 600 psf higher price (not in NCR).
    CommentQuote
  • Originally Posted by ondabhai
    Price CRASH is a delicious subject... everyone love to discuss this. If you look at different sections like Pune, Mumbai, Chennai, you can find out many hot threads are running there and few are running for years... means expert predicted market crash few years back and we are still waiting and discussing ..)

    Without going into details once again (as we discussed this in Noida section also many times).... just ask a very basic question

    Will you be able to, daring enough to, equipped to, well connected to en cash a CRASH?

    Whether you like it or not, the answer is NO for most of the people for different reasons.
    Only few Smart, Daring, Deep pocket people make money in CRASH... anyway, those people make money in all seasons.
    People like you and me keep on talking!! ... so enjoy discussing :bab (24):


    Candid comments:)
    I had asked a Q in 2010 that if price of RE crashes and comes down by 20-30% and if rental increase by 10-15% in 2011, what will u do, max responses said that they will still not buy and continue to rent. Hence the point is very clear. those who want to buy will buy any which way and those who dont want to buy will continue to comment and argue and keep waiting for the right opportunity.:D
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  • Except for the media rhetorics, where are the signs of Realty Sector Slump?
    In NCR, except for the NOIDA area, which is under distress because of the litigations and not because of so said slump, where are the prices going down?

    If the prices are not the criteria, then just what is the criteria?

    Please quote some distress sales by builders in Gurgaon to prove your point. Otherwise, there is no slump.
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  • Originally Posted by vkumar1
    Except for the media rhetorics, where are the signs of Realty Sector Slump?
    In NCR, except for the NOIDA area, which is under distress because of the litigations and not because of so said slump, where are the prices going down?

    If the prices are not the criteria, then just what is the criteria?

    Please quote some distress sales by builders in Gurgaon to prove your point. Otherwise, there is no slump.


    thats true. visibily there is no slump. it will be a time-based slump. if price of a property in Noida stagnates for 6-12 months, its as good as a 8-10% slump due to cost-inflation index, expenditure and maintenance towards holding that flat. we are not going to see prices of new launch to reduce suddenly by 20-30%. Prices of over heated project in the upper and middle segment may come down by 15%. AFfordable and Ultra affordable segment will continue to see demand as usual as there is a shortage of 25 million units in that segment.
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