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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 compuwalah View Post
    Basically what it shows that earlier sought after places are now more strongly sought after, while earlier second choice places are now becoming sought after places. Places like Pisoli also have appreciated.

    Now 2xxx range RE can be found in places like Wagholi annex or Anandgram.
    Why are you wasting time on the forum? Please go and buy in those places,prices will appreciate 200%.

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

      Guys so many people keep saying that we guys keep shouting bubble burst hoga, bubble burst goga. They say, we have heard this time and again and aisa kuch nahin honey wala. Abhi to property ko bahut grow karna hai. Well i was one who invested even in 2008 when property prices were either stagnant or were falling down. At that time i did not think India will start crumpling as fundamentals still pointed that there were avenues for further growth. From then on, there has been a mania of construction all around. Since FDI has been on hold, maximum construction has been in the residential markets. Even in a small town which never had a chance to see any multi-nationals investing there (generating jobs) could at least build a residential dream to attract investors. Today price of a 2 bed flat in small towns around Delhi or any other big cities is only 15-20% lower than their counter parts. So it has become more lucrative for anyone and everyone in construction business. Now some smart builders have started gearing up towards FDI opening up (in big cities and larger towns) but most of the big ones cannot afford to do that with their hands tied at the back. They have no source of funding with Indian investors market drying up with each passing day. I agree with wiseman that property will become discounted (hugely) in next a few years as initially there will be stagnation, then slide and then massive fall.

      I had started a thread in Feb 2012 predicting a fall.

      http://www.indianrealestateforum.com...tml#post425777
      This was after my trip to India and comparing all the fundamentals to not only the markets around the world but also to the realities on ground.


      What is the state of real estate (RE) today, with companies still shouting hoarse that prices will go much higher than where they are today? Let’s analyse this from RE company’s point of view.

      Are any RE companies raising fund through IPO today? If they feel RE prices have still a way to rise, why do they not float IPO’s to raise money? Instead it is seen they chose to beg foreign investors for keeping themselves together at this time? They know even though some black money flows in to buying large chunks of land within India (scam money from Indian investors which seems to be drying up too), there will no takers for the stock option which is a true reflection of the situation. 90-95% of the people who invest in the stock options are well informed individuals who do their ground works and study fundamentals before investing in a company. A clear picture of this emerges when you look at how RE stocks have fared compared to other verticals. RE stocks jumped before the 2008 slowdown. There was a time when investors had a choice to either invest in RE directly or RE related stock options. People who liked instant cash release made their investments using stocks. Most of the first time investors invested money on the RE directly. Even though the number of people who invested in RE stocks were less compared to RE investment directly, there was no dearth of investors.

      After 2008 when the reality hit the Indian economy and some RE scam were unearthed, a clear picture emerged. It gave an insight into how weak the Indian RE market was and how it was being inflated to get the maximum return out of a dead cow. From then on RE stocks have been either been flat or sliding down and RE companies have been afraid to raise money using this option. Instead gullible investors are sold dreams of very high returns (there is no dearth of investors in such a high population country where even NRI’s from all over the world have taken a shot at RE). Prices are escalated with every tick of the clock, which has become a very dangerous game now. Investors, who have made substantial amount in last 7-8 years, will be able to take a hit on some of their investments. They can wait for the next wave of bubbles 6-7 years down the line. Naïve investors who have jumped the bandwagon in last 1-2 years will be seen jumping around like headless chicken when this mania comes to a complete halt. Which actually points to how the greed shuts the eyes and minds of people who in normal circumstances and for any other investment would have done their research before investing. Today RE has become like a Ponzi scheme where one investor tries to make the money by selling a dream to the next in line. A flat flows down from developer to investors on a pyramid which has reached a dangerous proportion. All along property dealers make their own killings with no respect for young and old. They seem to be the only ones who can run on the first sound of a gun shot, leaving the blood bath.

      It is time investors understand the first signs of the killings to come and start protecting themselves from the mania, which will be on the other side of the river bank. A side which has never been seen in the history of Indian greed game called “real estate”.

      Comment


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

        Good analysis, but One thing is that , for me, I am yet to buy my first property so these bear calls give me hopes and feels positive while hunting. But I am damn sure that once I get my first property , after some years, I will myself turn to become bull looking for appriciation to my property or buying another property.

        So even if the fall of prices/softening occurs, there will not be huge advantages for beginers. Today people can afford 90L flats in Wakad, 65-80Lacs flat in Kharadi, 3K rate in Somatane! It's like gold, whatever the prices rise, people will always buy gold, as it's safer. Similarly, for me at least, for my next generation's sake I will be booking assets in RE as well.

        Yes, we need to shell extra amount, savings get hampered, but over long term, we adjust (had to). No matter what secure future, is priority. RE gives that, provided we invest in good one without too much burden on our finacnes. Hoping modest to good return on RE is no false but expecting it to rise 20-25% every year is madness .

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

          I had one Q. Do builders accept gold as payment ?

          Comment


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

            Originally posted by mymarji View Post
            I had one Q. Do builders accept gold as payment ?
            not sure why u asking this but u can get cash from jeweller and give to builder (something should be avoided as it generates black money for builder)

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

              How many gold bricks do you have

              Originally posted by mymarji View Post
              I had one Q. Do builders accept gold as payment ?

              Comment


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

                My DREAM house is built with these bricks.

                No, I was wondering, becoz people are buying Gold to offset inflation, so had this doubt, what inflation were they trying to bypass. The only thing, one can do with Gold is to exchange for ornaments or take loan on it. The loan will also be about 50-80% and not 100%, right ?

                Originally posted by mangopeople View Post
                How many gold bricks do you have

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

                  Originally posted by JumboHulk View Post
                  Good analysis, but One thing is that , for me, I am yet to buy my first property so these bear calls give me hopes and feels positive while hunting. But I am damn sure that once I get my first property , after some years, I will myself turn to become bull looking for appriciation to my property or buying another property.
                  Thank you for saying that. You are right, that happens to us. Staunch RE bear who is looking for a house and writing hundreds of words on this forum and in meetings and invoking builders greed at every second minute, undergoes a dramatic change overnight after he himself books a flat. Then he becomes an RE bull dreaming about daily price hikes. He also start considering himself a property pundit everytime there is a marked difference in prices. I have seen that happen several times.

                  Nothing wrong with that...IMO thats what makes us humans.

                  Originally posted by amit3011 View Post
                  Why are you wasting time on the forum? Please go and buy in those places,prices will appreciate 200%.
                  I hate such comments. These are rude and uncivil. SOmebody can easily say these things to you--- "Go and sulk in your room and buy after an year when you will get your property free".

                  However, does this mean anything??? Reasonable debates are important.
                  There are a billion people in India with as many opinions. Outright logicalness and rationality do not drive us humans, thats not in our genes. Our history is replete with stupidity of our ancestors who drove countries to wars for flimsiest of reasons....and here we are being rude each other trying to predict the future!!!

                  Predict, but also try looking at things from other's POV.

                  Comment


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

                    Originally posted by NG2012 View Post
                    I hate such comments. These are rude and uncivil. SOmebody can easily say these things to you--- "Go and sulk in your room and buy after an year when you will get your property free".

                    However, does this mean anything??? Reasonable debates are important.
                    There are a billion people in India with as many opinions. Outright logicalness and rationality do not drive us humans, thats not in our genes. Our history is replete with stupidity of our ancestors who drove countries to wars for flimsiest of reasons....and here we are being rude each other trying to predict the future!!!

                    Predict, but also try looking at things from other's POV.
                    That was not a comment but a question. If RE is appreciating by 20% Yearly, why waste time on forum, just go an buy and make money.
                    Why should anyone avoid asking questions just because you hate those questions?

                    Comment


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

                      Despite rising prices, homes most affordable in 30 years: HDFC - The Economic Times

                      HDFC says that house is most affordable in last 3 decades and till the ration remains below 5, the demand will exist.

                      The average house price calculated is 30 lacs. But even if you assume 60 lacs and Double Income of couples with 10 lacs each, the argument sustains. Also, guess the absolute no. of people with 15 lac + salary has increased dramatically in past 4 years and continue to do so.

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