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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 mymarji View Post
    Following is right from todays Sunday TOI Bangalore Edition:

    Input costs rise; real estate to be dearer
    Bangalore: Property analysts wisdom is that with less demand property prices will drop in the next few months. But developers say rising costs of borrowing and construction input has put pressure on their margins that a 10-15% increase in property prices by year-end is possible.

    Normally the price escalation is about 3-4% per annum. But in the past six months, the input costs have risen by 7%. "The average cost of construction has increased by Rs 150 per sqft due to sharp increase in cement and steel prices. We have to pass on the cost to customers" said Sushil Mantri, president of CREDAI-Karnataka on the sidelines of a two-day Credai Realty Expo that began here on Saturday.
    .....
    ....some blah blah...by MDs of some RE firms......
    .....
    Some visitors to the expo appeared to be in no mood to make a quick purchase. "Though there are some options in the Rs 50-60 Lakh bracket, I'm not sure I want to buy right now. I'm hoping to see a price correction," said Ms Poonam, an IT professional.
    For folks like Ms Poonam, Raj Menda, MD of RMZ Corp, raises some hope: The real estate market has a six months lag effect. If the so-called pain continues, developers who are not able to hold out may indulge in price correction by early next year.
    -----------------------------------------------------

    I can wait for 6 months and more.....

    Every weekend there is some or other RE expo in Bangalore. This shows how desperate these guys are getting. Till about last year, they were so very arrogant, now if they get your number, they will keep calling you daily and literally pleading.
    Irrespective of what developers say, I think the cost has to eventually be governed by Demand and supply. If the buyer (In general) cannot pay or does not want to pay at the price, does it matter whether the builder has borrowed money at 10% or 25%? I think it is their last ditch effort to scare people into buying.
    Last edited September 23 2011, 10:57 AM.

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

      Investment of the Decade in India

      1970s: Gold
      1980s: Real estate
      1990s: FDs
      2000s: Stocks (RE and gold come second and third only in returns)
      2010s: ? Real estate?/ remains to be seen.
      Venky (Please read watch a or before posting)

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

        1980s for Stocks

        Originally posted by Venkytalks View Post
        1970s: Gold
        1980s: Real estate
        1990s: FDs
        2000s: Stocks (RE and gold come second and third only in returns)
        2010s: ? Real estate?/ remains to be seen.
        Best time to get into stocks would have been mid-to-late 1980s.

        Then came the Harshad Boom which saw my 80k portfolio shoot to 8 lakhs in only 1.5 years (in those days when practically no asset would give that kind of return, this was a much greater bonanza than it would be today).

        1990s was a fairly up-n-down period. 2000s say a 7 times increase in stocks but the real beneficiary would've been those who bought in 80s or even 90s and rode the 2000's bull.

        cheers

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

          Originally posted by Venkytalks View Post
          1970s: Gold
          1980s: Real estate
          1990s: FDs
          2000s: Stocks (RE and gold come second and third only in returns)
          2010s: ? Real estate?/ remains to be seen.
          Even RE gave extremely handsome returns, just depends on location.
          Eg: My maternal side had a property in Delhi (Karol Bagh) side on main road and they sold that in 75 lacs in late 2004. Today the property is worth 7+ crores.

          And i'm pretty sure that later part of 2010s and then entire 2020s would belong to RE. Though the best part of Future is its Unpredictable.
          The knowledge of what to do in a Recession or Boom is more important than predicting a Recession or Boom.

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

            Originally posted by bhuvang View Post
            Even RE gave extremely handsome returns, just depends on location.
            Eg: My maternal side had a property in Delhi (Karol Bagh) side on main road and they sold that in 75 lacs in late 2004. Today the property is worth 7+ crores.

            And i'm pretty sure that later part of 2010s and then entire 2020s would belong to RE. Though the best part of Future is its Unpredictable.

            "The difference between stupidity and genius is that genius has its limits. - Albert Einstein"

            We had a similar situation. Back in 2000 Central Chennai property we have was 1.5C. Today, it is 7.5C.

            If we were stupid, we would assume that these prices would keep on going up for ever and ever.

            Thankfully the Good Lord above intervened twice. First he brought about a litigation which ran till 2008 and stopped as soon as the other party realised that such high prices should be taken advantage of. So, in the period prices shot up, we were prevented from being stupid and selling too early.

            Today, He intervenes by getting us to sell of part of it. Again preventing us from being stupid looking for more and more without limit.

            As I maintain, much of our sucesses are because of external causes. Much of our failures are because of US!

            cheers

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

              without doubt theory is proved right. in 2009 i did not have enough cash for downpayment...nd now prices have almost doubled.

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

                Originally posted by puser View Post
                without doubt theory is proved right. in 2009 i did not have enough cash for downpayment...nd now prices have almost doubled.
                Which location in Pune saw appreciation of ~100% (or even 80-90%) in last 2 years??

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

                  well uncle....perhaps i exaggerated by saying they doubled but 2bhk expected cost were below 40 lakhs in 2009; people were feeling 30-35 were ideal cost for it but now...after 2 years u will have to keep 50 lakh+ for 2bhk in a livable areas...add to it 100% terrace and increased loadin

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

                    Originally posted by wiseman View Post
                    As I maintain, much of our sucesses are because of external causes. Much of our failures are because of US!
                    cheers
                    Mast hai....
                    The knowledge of what to do in a Recession or Boom is more important than predicting a Recession or Boom.

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

                      Look at it another way: What to avoid over the decades:

                      1980s: Gold, followed by FD (negative inflation adjusted return)
                      1990s: Gold followed by RE
                      2000s: FD - everything else gave good returns
                      2010s: ? Gold - Rest still not so sure.

                      2000s, RE gave more stable returns than stocks. But timing it wasnt so easy.

                      1992-1994 in stocks was a manipulated bubble. Rest of the decade it gave dismal returns. Also, trading was very difficult without internet.

                      Over 3 decades, stocks have outperformed RE and FD most of the time. Gold has always underperformed except in 70s and 2000s
                      Last edited September 25 2011, 01:43 PM.
                      Venky (Please read watch a or before posting)

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