Prices doubled from 2009...enough said....
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  • HPC = House Price Crash

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  • Sharing a link posted by a fellow member in some other thread.

    Increase in Interest Rates May Result in 10-15% Hike in Property Prices

    Key extract:

    “Property prices are bound to go up in next 3-6 months by 5-10 per cent across the country,” Confederation of Real Estate Developers’ Associations of India (CREDAI) Chairman Pradeep Jain told PTI
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  • RE has been operating as cost plus industry. So whatever may be the case they cover their cost and decent margin so the prices will keep rising in an overall inflationary environment.

    Only if there is major recession prices may fall moderately and even then people have learned that modern governments will not allow that to happen by taking stimulus measures and increasing money supply so it is wise to hold real assets than distress selling.
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  • waiting to hear your side of the story

    Originally Posted by stoxxx
    Good post as usual....will get back time permitting have been traveling extensively hence first post was cryptic....

    waiting to hear your side of the story
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  • Many "impossible" things will become possible

    Originally Posted by stoxxx
    RE has been operating as cost plus industry. So whatever may be the case they cover their cost and decent margin so the prices will keep rising in an overall inflationary environment.

    Only if there is major recession prices may fall moderately and even then people have learned that modern governments will not allow that to happen by taking stimulus measures and increasing money supply so it is wise to hold real assets than distress selling.



    Assumption #1
    --------------
    RE "has been" operating so far as cost plus. There it "will continue to be" operating as cost plus indefinitely into the future!

    Not in India, but in the US and elsewhere, this argument has been completely demolished. In distress, prices have come as far down as 95% in some cases and over 50% median countrywide. Prices today are FAR BELOW Cost price!

    Assumption #2
    --------------
    Whenever there is a threat of recession, Stimulus has been introduced and has worked to eliminate recession. Whenever there will be a threat in future, Stimulus will be introduced and will eliminate the threat.

    Stmulus programs have a increasingly lower marginal impact over time. QE2 is largely believed to have failed completely as its twin aims show measures worse than when stimulus started. After a while Stimulus does not work and its like "pushing on a string".

    When Stimulus finally fails, the economy is flooded with money and there will first be hyperinflation resulting in a collapse in the confidence on a currency, following which a very deep recession / depression follows to flush out the excesses and re-start the economy.

    If you look at the short term, it looks like the situation has been corrected and brought back to equilibrium. Look a little deeper and you will notice that the ship has taken on more water and is sitting deeper in the water and also listing badly. Eventually all these measures guarantee a much worse recession / depression.

    You only need to be patient and have a longer perspective if you want to ultimately ensure safety of your assets.

    cheers
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  • Originally Posted by Venkytalks

    My father bought a motor vehicle in 1975 which he sold in 2000 for a HIGHER price (in Rupee terms) than what he paid for it in 1975. There are not many countries in the world where even normally depreciating assets become more "valuable" over time.


    That must be a lambretta scooter! :D
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  • Originally Posted by ThePunjabi
    That must be a lambretta scooter! :D


    I was not the one who posted the motor vehicle post.

    Still, my Dad had bought a lambretta in 1974. He used it for many years. When I turned 18 and got my licence, I used this lamby for a while - only for puttering around the colony though - because it had no rear brakes to speak of, front brake was very powerful but the lever was broken and applying pressure on the remaining 2 inches of the lever was really tough. As for the gears, numbers were invisible and there was continuous smooth motion - you had to guess the gear and release the clutch. Sometimes you would release into 1st gear with comical consequences.

    After a bad scrape, my Dad got me a Kinetic Honda. We finally sold it for 1000 bucks to a junk dealer - I have no idea what my Dad paid in 1974, but must have been less than 1000 bucks.

    Our neighbor booked a Maruti in 1984, sold the booking on allotment and bought a second hand fiat with the proceeds.

    Another neighbor bought a Maruti for about 50,000 bucks, used it for 6 years and sold it for 60,000 bucks in 1992 when he shifted to a Zen.

    I believe in using a car till it falls apart though. So I drove a premier padmini for 15 years before changing it, I got 10000 bucks for it.

    When we got the Kinetic Honda, its price was 11000 bucks only. I recently sold the Kinetic Honda for 5000 bucks - still running, but I hadnt used it for 5 years, so sold it. Chap who bought it regularly using it - Hondas really last well.
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  • Guys,
    I feel sorry the ppl who waited from last one year to buy their flat.
    Looking at the past data itself, I am seeing the appreciation of price by atleast 700-800 psqft. In wakad, last April, ready possession was available for 2700 psqft and now it is 3800 psqft. Even if price correct and go to 3200 psqft, it would be still a loss for the one who waited.
    In PS, the price hike is more due to monoploy of few builders.
    Take any area, any project, the prices went up and even if it comes down, they won't fall below the 2010 rates.
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  • Originally Posted by kirunOnly
    Guys,
    I feel sorry the ppl who waited from last one year to buy their flat.
    Looking at the past data itself, I am seeing the appreciation of price by atleast 700-800 psqft. In wakad, last April, ready possession was available for 2700 psqft and now it is 3800 psqft. Even if price correct and go to 3200 psqft, it would be still a loss for the one who waited.
    In PS, the price hike is more due to monoploy of few builders.
    Take any area, any project, the prices went up and even if it comes down, they won't fall below the 2010 rates.


    Wakad 2009 first half prices were about 2300 while a year later they were at least 3000-3100 . There were hardly any ready possession schemes during 2009-10 .
    2011 , they're 3700-3800 .
    You are half right . Quite a few people who I know and are waiting have money in hand and well invested...at least such people can buy ready possession which has the advantage of actually seeing your apartment/building before buying .
    For the others who were over leveraging it was always tough , be it 2009 or 2011 .
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  • This only applies to good quality stuff ..

    Originally Posted by Venkytalks
    I was not the one who posted the motor vehicle post.

    Still, my Dad had bought a lambretta in 1974. He used it for many years. When we got the Kinetic Honda, its price was 11000 bucks only. I recently sold the Kinetic Honda for 5000 bucks - still running, but I hadnt used it for 5 years, so sold it. Chap who bought it regularly using it - Hondas really last well.



    This thing about cars and bikes being sold for higher works only when the stuff lasts long periods and ages well.

    Example the Kinetic Honda and Fiats go for junk value. On the otherhand I have an original RX100 imported fully assembled (the early batches in 1986 and 87 were those) bike which I still ride. Did it up back to its pristine condition with same color, decals, seat, indicators (took 6 weeks to trace some of those stuff) and before doing it up I got offers for 30k. After, I keep getting offers for 50k. Original prices was 14k back in early 87. Its done 1.65L kms (all of that with my backside on top :)).

    One thing I must mention. The Escorts shocks in the back are still original and given the kind of roads we had in outskirts Bangalore back in the 80s and 90s, its a phenomenal thing for it to last that long and still run good - one Indian product thats stood the pressures of time (pun intended).

    But that is nothing compared to the feeling when an semi-oldie comes up in a fancy car alongside you at a signal and gets all nostalgic about how his first bike was an RX and how he would anyday trade his car for that bike again! :D

    Then I know I did the right thing in keeping that bike!!!

    cheers
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  • Originally Posted by wiseman
    Assumption #1
    --------------
    RE "has been" operating so far as cost plus. There it "will continue to be" operating as cost plus indefinitely into the future!

    Not in India, but in the US and elsewhere, this argument has been completely demolished. In distress, prices have come as far down as 95% in some cases and over 50% median countrywide. Prices today are FAR BELOW Cost price!

    Assumption #2
    --------------
    Whenever there is a threat of recession, Stimulus has been introduced and has worked to eliminate recession. Whenever there will be a threat in future, Stimulus will be introduced and will eliminate the threat.

    Stmulus programs have a increasingly lower marginal impact over time. QE2 is largely believed to have failed completely as its twin aims show measures worse than when stimulus started. After a while Stimulus does not work and its like "pushing on a string".

    When Stimulus finally fails, the economy is flooded with money and there will first be hyperinflation resulting in a collapse in the confidence on a currency, following which a very deep recession / depression follows to flush out the excesses and re-start the economy.

    If you look at the short term, it looks like the situation has been corrected and brought back to equilibrium. Look a little deeper and you will notice that the ship has taken on more water and is sitting deeper in the water and also listing badly. Eventually all these measures guarantee a much worse recession / depression.

    You only need to be patient and have a longer perspective if you want to ultimately ensure safety of your assets.

    cheers


    Yes both are assumptions. All economic theories are based on assumptions.
    1 is valid because I am talking about India.
    2 Yet to see evidence of what you are saying. A lot of media has been promoting dooms day scenario for last 2-3 years but none has materialised so far. If it happens in another 3 years time then I dont find it any surprising and will give zero credit to doomsday sayers as such events occur once in a while and helps get excesses washed up.
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  • You may be right, but

    Originally Posted by stoxxx
    Yes both are assumptions. All economic theories are based on assumptions.
    1 is valid because I am talking about India.
    2 Yet to see evidence of what you are saying. A lot of media has been promoting dooms day scenario for last 2-3 years but none has materialised so far. If it happens in another 3 years time then I dont find it any surprising and will give zero credit to doomsday sayers as such events occur once in a while and helps get excesses washed up.



    If I get a 30% reduction on a 1C home, on a loan I might end up saving 60L not paying it to the builder & bank. More since this money is post tax.

    I would gladly wait 6 years to sav 60L or more. This cash credit is more important than the credit for calling it right!:)

    cheers
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  • Originally Posted by wiseman
    If I get a 30% reduction on a 1C home, on a loan I might end up saving 60L not paying it to the builder & bank. More since this money is post tax.

    I would gladly wait 6 years to sav 60L or more. This cash credit is more important than the credit for calling it right!:)

    cheers


    Sorry can you explain how 30% reduction on 1 cr is 60 lakhs?

    Also in reality what would happen is say the price in 2009 was 50 lakhs that went up to 1 cr in 2015. Now a 30% reduction even if it happens would mean the price is 70 lakhs. So you are still none the better and have been playing a dangerous game of waiting.
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  • Things have changed now for good or bad.
    Now 3 yrs into the job (age arnd 25) a person is planning to buy only a new car.
    Standard bikes (even pulsar) are seen middle class.

    1L + bikes are seen as decent.

    Attitude have changed :)



    Originally Posted by Venkytalks


    I believe in using a car till it falls apart though. So I drove a premier padmini for 15 years before changing it, I got 10000 bucks for it.

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  • Originally Posted by Manoos
    Things have changed now for good or bad.
    Now 3 yrs into the job (age arnd 25) a person is planning to buy only a new car.
    Standard bikes (even pulsar) are seen middle class.

    1L + bikes are seen as decent.

    Attitude have changed :)


    Perhaps they could learn a bit from Warren Buffet ;)
    Warren Buffet and the 5 BHK home


    Warren Buffet and the 5 BHK home - Yahoo! India Finance
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