I have got confirmed news from one of family friend who works with one of the reputed builders (from Pune), that property market in Pune is getting worse day by day. Many people who has signed but not made agreements are cancelling the deals (due to job conditions). Plenty of new projects are at High Risk. Many wise builders stopped the launch of new projects (including Paranjpe, DSK, Kumar).
People don't have money to pay EMI. Investors are not getting good rents. They want to sell off.
All in all, by Diwali rates will be down, if not the same.

You still can buy a flat if you have secured job and enough of money in hand. Those who want to take loan (more than 10L), please don't take risk.

Sansona
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  • Crash seems unlikely, although a slow downturn (10% a year for 3-4 years)is expected. If crash was going to happen, it would have happened already. From this forum and other forums it is clear that there is still intense interest in Pune RE. Even after demand is down by 70-80% (based on registration numbers), builders are not reducing price. The investors are not ready to reduce price on resales as they are not in a hurry. For a crash here onwards there needs to be some major negative development on the international and/or domestic markets. Again, pune is relatively small RE market controlled by a cartel.
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  • I agree with space here. People are buying. Dont know why I feel an upward (or atleast stable) trend in the market now.
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  • Rude jolt: no salary for three months and then pink slips for 44 IT engineers

    More pain in IT continues. Biggest of this would be? RE ofcourse.

    http://www.expressindia.com/latest-news/rude-jolt-no-salary-for-three-months-and-then-pink-slips-for-44-it-engineers/497689/
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  • Space is right. people are buying homes.
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  • From the blog of Andy Xie, the guy who is genius in predicting bubbles,

    "...The most basic approach in studying bubbles is to look at valuation. For property the most important measures are price to income ratio and rental yield. China’s average price per square meter nationwide is quite close to the average in the US. The US’s per capita income is seven times China’s urban per capita income. The nationwide average price is about three months of salary per square meter, probably the highest in the world. As far as I can tell, a lot of properties can’t be rented out at all. Those that can bring in 3% yield, barely compensating for depreciation. The average rental yield, if one including those that can’t be rented out, is probably negligible. China’s property price doesn’t make sense from affordability or yield perspective. Some argue that China’s property is always like this: appreciation is the return. This is not true. The property market dropped dramatically from 1995-2001 during a strong dollar period. "

    Read it full, http://xieguozhong.blog.sohu.com/128798351.html
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  • Bank of India cuts deposit rates by up to 50 bps

    http://www.indianexpress.com/news/bank-of-india-cuts-deposit-rates-by-up-to-50-bps/497835/

    This would mean that more people will now withdraw money from banks resulting in lower deposits which in turn would reduce banks' lending ability. Access to credit will be further dampened.
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  • Point

    Hi Aditi,

    India's also in the same bracket. If u look at property prices, an apartment worth 40+ Lk will yield any where 8k -14k rentals giving returns of 2.5 to 3.5 % annually.

    So an economist will say its best to invest monies and buy property later with the higher returns collected incrementally. But the buying is not that simple and general population is not economist.;)
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  • Originally Posted by Sansei
    Hi Aditi,

    India's also in the same bracket. If u look at property prices, an apartment worth 40+ Lk will yield any where 8k -14k rentals giving returns of 2.5 to 3.5 % annually.

    Yep, to purchase the avg annual return on rental have to be 6%+. I pay INR 10k/month as rent for 2BR (I reduced the rent by increasing the deposit) while the owner pays around INR 30k/month as EMIs+the maintenance etc. & I get to enjoy all the amenities inclusive of this rent. The funniest part being that the owner has 4 flats which have been given out on rent in different localities. I don't understand why people don't buy a lavish house for themselves first & enjoy it than keep investing without much savings. He has got 2 of his properties recently mortgaged to send his son to US for MS. Loan pe loan, loan pe loan. What is this mike?? Personally, I feel that there has to be a balance between savings & spending. I would better go on a Caribbean cruise than pay 3 months EMIs for property I am not going to use at all.
    So an economist will say its best to invest monies and buy property later with the higher returns collected incrementally. But the buying is not that simple and general population is not economist.
    Gosh. It would have been so good had this been the case. Even US buyers did the same thing & ended up with sub-prime crisis.:p
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  • Same story

    Met a tele executive . Guy had 4 flats. Just hoped

    He was satying in his best/most convenient house.

    He does not get stuck in his EMI's like a punter gets stuck in his margins on Stock market.

    At present RE investment is strict NO-NO.

    Even stocks have out run themselves.

    Guys dont price ur buys at levels of future worth.
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  • Another story

    Guys the humble Dal has touched 100 rs.

    Now i would ask any one - Is there a SHORTAGE of dal

    NO

    The price have runaway due to perceived shortage in future, so

    traders / buyers r hoarding.

    Does any one think Govt will allow Dal to stay at this level. So when

    actual shortage will strike, Govt would have already taken measures

    (Imported/Tax benefit etc). The prices will have come down to realistic

    levels at those crucial time.

    So people dont hoard Dal for consumption or trading, just buy ur

    requirement.

    The stocks and flats also r being bought on the same hoarding

    (investment) premise. Don't expect the last RE good run (2003-2008) to continue in future.
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  • last heard:

    the analysts are going to publish a Dal/Oil ratio similar to the Gold/Oil one which can help indicate the big bubble inside the tiny dal.
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  • The gold might touch 17k-18k in the next 4-5 months. but take my word, as soon as the market stablises and the recession is eclipsed by the rising salaries and more offshore jobs, RE prices will start to appreciate and gold might come to 9k-10k.

    This good RE run is not going to stretch past jan-feb 2010 :)
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  • Prices will fall somewhere between Oct to Jan ... but for that the truth is Pune people need to stop buying homes .... if demand continues, this situation will continue till Oct 10.

    I learned that few of the well known pune builders are already in trouble, mostly those who have high end flats to sell.... and invested a bit more to make these flats for upper class.

    It is curious to see how things turn up. In Diwali, do not buy homes just because there are some discounts .. make sure you are getting a 'real' deal. .. Thats my take on it.
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