Hi members,

Jerry Rao has launched affordable housing project in Bangalore.

Location is said to be just 11 km away from Electronics city as per TOI.

http://timesofindia.indiatimes.com/business/india-business/Jerry-Rao-launches-low-cost-housing-plan/articleshow/6358403.cms

http://business.in.com/article/work-in-progress/jerry-raos-fourth-act/222/3


Look at the prices

studio apartment - ~350 sq ft
1 bhk - 450-470 sq ft
2 bhk - 620-640 sq ft

All priced between 4.5 to 10 lacs max.

He says low prices are very much possible because he aims to make only 25 per cent profit.

Why is this not possible in Pune? Only because of builder lobby's greed?

Murtaza
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  • Originally Posted by Murtaza_t
    Hi members,

    Jerry Rao has launched affordable housing project in Bangalore.

    Location is said to be just 11 km away from Electronics city as per TOI.

    http://timesofindia.indiatimes.com/business/india-business/Jerry-Rao-launches-low-cost-housing-plan/articleshow/6358403.cms

    http://business.in.com/article/work-in-progress/jerry-raos-fourth-act/222/3


    Look at the prices

    studio apartment - ~350 sq ft
    1 bhk - 450-470 sq ft
    2 bhk - 620-640 sq ft

    All priced between 4.5 to 10 lacs max.

    He says low prices are very much possible because he aims to make only 25 per cent profit.

    Why is this not possible in Pune? Only because of builder lobby's greed?

    Murtaza


    This happens because reckless, mindless buyers. And sellers will always cash in on the incompetence, of buyers. It would be naive to think that builders *should* take only X % of profit. If that is the case why are resale flats are almost equally costly as new flats.

    RE prices scaled peaks because there is no market mechanism going *short* on RE in India to gain profit. Something like what happened with *Abacus* deal in the US.

    Nevertheless Jerry Rao's effort has to be commended.
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  • affordable housing in pune

    jerry rao's company is apparently planning a nationwide rollout. including pune !! (http://www.vbhc.com/index.php?page=Project&act=Other). can't wait.

    although how he is going to pull this off is a big question. for the prices they have in mind and their construction quality (no bricks), they would need to get land at a max rate of 200 per square foot. that is about 20 kms outside pune (pirangut land is 550, talegoan is 500, ambegaon is 500 - and these are the outersmost fringes of pune).
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  • Just visit Bangalore and see if you like it. The BDA has dug up all roads all over the place for road widening, metro, flyover, flooding you name it. if you live in the location where jerry rao is building it will take you twice the amount of time in traffic to reach your workplace. same will happen to pune and other locations. if prices drop jerry rao's investors will be the first to run and leave the project hanging.

    be very careful in buying in outskirts in bangalore, pune where the infra is the worst. chennai, hyderabad and even Mumbai is much better if you want to bet on outskirts.
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  • Originally Posted by bung.aloo
    jerry rao's company is apparently planning a nationwide rollout. including pune !! (http://www.vbhc.com/index.php?page=Project&act=Other). can't wait.

    although how he is going to pull this off is a big question. for the prices they have in mind and their construction quality (no bricks), they would need to get land at a max rate of 200 per square foot. that is about 20 kms outside pune (pirangut land is 550, talegoan is 500, ambegaon is 500 - and these are the outersmost fringes of pune).


    bung.aloo

    That is possible. The psf in Jerry Rao's plan is about ~1450. The quoted price for 650 sq ft 2bhk is about 10 lacs. Now even if you count land price of 500 psf and cost of construction 600 psf, they are going to make a healthy profit. We are not considering higher FSI here too!!

    Views from senior memebers like pcpune and realacres are welcome:)

    Murtaza
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  • This sounds interesting.

    I would like to see their project coming up in Pune.
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  • I think this is good concept.More devnelopers need to build homes in the 5-10 lacs category, albeit smaller homes, they give a decent standard of living to people who earn like 1-2 lacs a year.

    However, it is a low margin business and most builders in India aviod it.
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  • Originally Posted by pcpune
    I think this is good concept.More devnelopers need to build homes in the 5-10 lacs category, albeit smaller homes, they give a decent standard of living to people who earn like 1-2 lacs a year.

    However, it is a low margin business and most builders in India aviod it.


    This concept could be groomed further by government steeping in.
    Govt need to provide faster roads and public transport from such outside destnations to the city centre. With this, people would buy at such places and can live there while doing daily commute to city.
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  • Originally Posted by pcpune
    I think this is good concept.More devnelopers need to build homes in the 5-10 lacs category, albeit smaller homes, they give a decent standard of living to people who earn like 1-2 lacs a year.

    However, it is a low margin business and most builders in India aviod it.



    Not only people who earn 1-2 lacs per year, in fact it would be good for the entire middle class - even for those earning in the range of 4-10lacs!! After all, there are lacs of people who just want a decent compact good quality residence and are not at all interested in funky fancy apartments that are being offered for exorbitant prices. Why would you burn your hard earned savings and live rest of your life under loan pressure if you can get a decent living in those reasonable prices?

    I guess we need more organized players in this field.
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  • Yes, well if we have more homes in this category - surely we will see larged sized - luxiorous homes in 10-20 lacs category - today in Pune or NCR or Mumbai, nothing is available below 25-30 lacs for a 2 BHK - which is artificalliay keeping the prices high - volumes low.

    Builders dont want to get into this business - as it means a imminet price fall, and also its a low margin high volume business - they dont want to take that trouble.
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  • Originally Posted by pcpune

    Builders dont want to get into this business - as it means a imminet price fall, and also its a low margin high volume business - they dont want to take that trouble.


    Just saw Jerry-Rao's interview. He keeps 25-30% profit margin on cost of 3-10L per apartment. Usually sells property as soon as possible.
    He has approach of product-manufacturer and not like sucker/untrust-worthy builders.

    The good news: He is planning to start similar projects in Pune and Mumbai (Panvel) :D
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  • Good luck to him. It will be very difficult to get this project completed I would say, just think of number of approvals required, govt officials, politicos involved (who control labour, txport, facilities, LAND etc)
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  • Yeh, I think once the builders in Pune know that he is planning something like this, they will use all their
    P(a)war..., to stop it. He really needs good connections with Deshmukh as they both now are at loggerheads.
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  • I am not surprised with the rates as these are indeed possible. Now only if Pune builders go on volume expansion, it is possible, but then Jerry Rao is a professional, do you see any Pune based builders in the same light??:bab (22):
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