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Builders & RE Bulls Theory Proved Right !!!

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Builders & RE Bulls Theory Proved Right !!!

Last updated: June 15 2016
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  • Re : Builders & RE Bulls Theory Proved Right !!!

    Originally posted by stoxxx View Post
    demand is that price....at higher price demand may not be there....we need to ask BMW for that....they must have done market research....

    without further facts and figures we can only assume above than speculating...
    Same applies to RE as well.

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    • Re : Builders & RE Bulls Theory Proved Right !!!

      Originally posted by stoxxx View Post
      demand is that price....at higher price demand may not be there....we need to ask BMW for that....they must have done market research....

      without further facts and figures we can only assume above than speculating...
      The problem is when you try to sell an Alto at the price of BMW by spreading fear that demand is so high for Alto that tomorrow it will be available only at the price of a Ferrari.

      The rentals staying stagnant or even going down in some cases indicate that supply is plenty, mostly occupied by investors (high number of those with ample of black money to park). And builders are the best avenue to launder your black money in India.

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      • Re : Builders & RE Bulls Theory Proved Right !!!

        Originally posted by stoxxx View Post
        Oh yeah.....you are so good at commenting on people than posts....I give you that....



        You are actually making my point....if that is the case as you say that they cant be increased beyond affordability then why worry?....they will be within those limits by natural process...

        Some basics of economics....demand is not want....demand is ability and willingness to pay....

        So people want to own a castle....can they and will they....this is only a dream not demand......

        to your BMW example.....since there are people who want to own BMW and many of them......so there is this waiting period and prices are so high....

        so tomorrow does it mean that BMW prices should come down because a lot of people cant afford....no....as long as there is demand at that price point the price would hold......

        if tomorrow BMW produces billions of cars and there is not much demand....prices will come down.....

        so it is a game of demand and supply
        I don't know from where to start, but let me tell you straightway one thing that prices might get increased even when majority of people can't afford (which is paradox, and opposite of fundamentals), but that increase of price is just bubble, and you never know how long this bubble will sustain. It is valid in any kind of things, however in car industry this bubble can't even sustain for one week, whereas in RE it can sustain for years.

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        • Re : Builders & RE Bulls Theory Proved Right !!!

          Originally posted by shahkushan View Post
          The problem is when you try to sell an Alto at the price of BMW by spreading fear that demand is so high for Alto that tomorrow it will be available only at the price of a Ferrari.

          The rentals staying stagnant or even going down in some cases indicate that supply is plenty, mostly occupied by investors (high number of those with ample of black money to park). And builders are the best avenue to launder your black money in India.
          rental and buying are separate markets...

          you example of Alto only indicates that the inflation can bring on ridiculous valuations and that's why gold is going up....

          is gold affordable to everyone.....why can't gold correct?...if it is in demand then why can't be it infinite....why is gold more than double in last two years? has the end user demand for gold increased that much? does gold provide any operating revenue like rent etc?.....

          at any point for any product there are sellers and buyers......fear and greed....that makes the market.....and market decides the prices....not our whims and fancies....

          if everyone was a buyer with no sellers or all sellers but no buyers then there wont be a market.....
          When the facts change, I change my mind. What do you do, sir? - John Maynard Keynes

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          • Re : Builders & RE Bulls Theory Proved Right !!!

            Originally posted by BlotJab View Post
            I don't know from where to start, but let me tell you straightway one thing that prices might get increased even when majority of people can't afford (which is paradox, and opposite of fundamentals), but that increase of price is just bubble, and you never know how long this bubble will sustain. It is valid in any kind of things, however in car industry this bubble can't even sustain for one week, whereas in RE it can sustain for years.
            because car is seen as durable consumer goods and not as a long term self use / investment product....

            bubbles happen in assets / investments not in consumer goods.....

            do you know the concept of elasticity of demand....in consumer goods that is at highest point....that means the impact of any price movement is felt to a great extent and much quick in those goods....

            one really needs to understand basics
            When the facts change, I change my mind. What do you do, sir? - John Maynard Keynes

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            • Re : Builders & RE Bulls Theory Proved Right !!!

              Originally posted by stoxxx View Post
              because car is seen as durable consumer goods and bubbles happen in assets / investments not in consumer goods.....
              what is an asset or not is a matter of perception...

              Yesterday's asset might be todays consumable (I.e. Tulips)
              or asset of person A might be a consumable for Person B (I.e. Tulips)

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              • Re : Builders & RE Bulls Theory Proved Right !!!

                Originally posted by stoxxx View Post
                rental and buying are separate markets...

                you example of Alto only indicates that the inflation can bring on ridiculous valuations and that's why gold is going up....

                is gold affordable to everyone.....why can't gold correct?...if it is in demand then why can't be it infinite....why is gold more than double in last two years? has the end user demand for gold increased that much? does gold provide any operating revenue like rent etc?.....

                at any point for any product there are sellers and buyers......fear and greed....that makes the market.....and market decides the prices....not our whims and fancies....

                if everyone was a buyer with no sellers or all sellers but no buyers then there wont be a market.....
                Most of the demand right now is sitting on the fence . Demand vs Supply theory applies in free economy ; right now what we're witnessing is artificial price manipulation .
                There will be tremendous resistance to lower prices . For individuals , its time to watch rather than risk ur lifetime investment by buying under pressure .

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                • Re : Builders & RE Bulls Theory Proved Right !!!

                  Originally posted by stoxxx View Post
                  because car is seen as durable consumer goods and not as a long term self use / investment product....

                  bubbles happen in assets / investments not in consumer goods.....

                  do you know the concept of elasticity of demand....in consumer goods that is at highest point....that means the impact of any price movement is felt to a great extent and much quick in those goods....

                  one really needs to understand basics
                  Kya baat hai mere dost, you have shown that how little you know about economics. PED (you may need to search in google for full form) has nothing to do with creating bubble. Even you will be surprised to know that PED can be positive in some kind of goods ( Veblen and Giffen goods, as usual search in google for more details).

                  Bubbles can be created in any kind of things, what it needs is greed of like minded investors in one particular area which is directly related to common man.

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                  • Re : Builders & RE Bulls Theory Proved Right !!!

                    Originally posted by stoxxx View Post
                    rental and buying are separate markets...

                    you example of Alto only indicates that the inflation can bring on ridiculous valuations and that's why gold is going up....

                    is gold affordable to everyone.....why can't gold correct?...if it is in demand then why can't be it infinite....why is gold more than double in last two years? has the end user demand for gold increased that much? does gold provide any operating revenue like rent etc?.....

                    at any point for any product there are sellers and buyers......fear and greed....that makes the market.....and market decides the prices....not our whims and fancies....

                    if everyone was a buyer with no sellers or all sellers but no buyers then there wont be a market.....
                    You are contradicting yourself here, if you say that inflation can bring the ridiculous prices, that means you acknowledge the fact that current RE prices are owing to inflation (which can go up and down if RE prices are a result of that).

                    Look at historical prices of gold, it has always gone up and down. If you really want to compare Gold with RE than RE should also go down at some point just like Gold has (and will).

                    Rentals and buying are separate markets? really? One would get a sense looking at the posts here that people who do not like the current (jacked up) prices prefer to rent. Those who can not afford to buy, rent too. Unless renting refers to something else, not a housing property, they compete in the same realm. Very vague statement to make.

                    Coming back to your gold analogy, it is completely incorrect in terms of liquidity both RE and gold offers. Gold is used for liquidity. Gold can be sold bad economic conditions, try selling your inflated priced house. RE is not a currency substitute, gold is.

                    Comment


                    • Re : Builders & RE Bulls Theory Proved Right !!!

                      Originally posted by shahkushan View Post
                      You are contradicting yourself here, if you say that inflation can bring the ridiculous prices, that means you acknowledge the fact that current RE prices are owing to inflation (which can go up and down if RE prices are a result of that).

                      Look at historical prices of gold, it has always gone up and down. If you really want to compare Gold with RE than RE should also go down at some point just like Gold has (and will).

                      Rentals and buying are separate markets? really? One would get a sense looking at the posts here that people who do not like the current (jacked up) prices prefer to rent. Those who can not afford to buy, rent too. Unless renting refers to something else, not a housing property, they compete in the same realm. Very vague statement to make.

                      Coming back to your gold analogy, it is completely incorrect in terms of liquidity both RE and gold offers. Gold is used for liquidity. Gold can be sold bad economic conditions, try selling your inflated priced house. RE is not a currency substitute, gold is.
                      show me where I said that RE prices will never go down....it can and wll at some point...

                      in fact it is the perma bear camp on this board that is only taking one view that prices will always go down and they have not yet....but there will be correction in the market at some time no one knows when and usually it comes when it is leas expected.....thats why the saying that bubble bursts when last of the bears throw the towel.....

                      point is no one knows 'when'.....you could either be ahead or before the market in predicting the fall or rise....timing is extremely difficult....

                      RE is not gold is clear....it is a different asset class....so lets not confuse that....point was all assets can go up or down.....


                      rental and RE are different markets in short term is proven by the divergence in rents and prices in the market....

                      problem with permabears is that they are always saying prices will go down...and thats where the broken clock being right twice a day analogy comes in to picture....

                      but I can assure one thing that one day you will be right if you just keep saying that prices will go down.....so keep that up
                      When the facts change, I change my mind. What do you do, sir? - John Maynard Keynes

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