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Builders & Real Estate Bulls Theory Proved Wrong

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Builders & Real Estate Bulls Theory Proved Wrong

Last updated: November 1 2016
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  • Re : Builders & Real Estate Bulls Theory Proved Wrong

    Accenture Raises Full-Year Revenue Forecast After Strong First-Quarter

    "Revenue in the outsourcing business rose 11.2 per cent to $3.80 billion in US dollar terms, accounting for 48 per cent of the company's total net revenue."

    Accenture Raises Full-Year Revenue Forecast After Strong First-Quarter - NDTVProfit.com

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    • Re : Builders & Real Estate Bulls Theory Proved Wrong

      One may not agree with views of another poster,but civility in replies is essential.This forum is for learning and understanding RE.
      Good economic sense is being talked about.If an average man looses a job and has a big loan o/s it is crisis time - EMIs to be paid,family to be looked after.
      Loans are to be very thoughtfully taken and reserve of emergency fund built up.
      Near the place where I stay there is large number of unsold flats,but prices are still higher than earlier.The builders seem to have deep pockets and are resisting price reductions.
      Last edited by sayan; December 19 2014, 05:32 PM. Reason: part of post ( quoted/ personal attack) removed

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      • Re : Builders & Real Estate Bulls Theory Proved Wrong

        Maharashtra lifts ban on sand mining - The Times of India
        Construction pace will catch up.But strict control over illegal mining is necessary.
        ""Government officials said e-auctioning and thorough scrutiny of mines would control illegal mining.""
        Let us hope that things improve.Illegal sand mining can create havoc.

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        • Re : Builders & Real Estate Bulls Theory Proved Wrong

          Whatever theory we apply, it just seems incomplete.
          Look at the real case from my experience quoted below.
          One cousin had been scouting for a bungalow in western Banglore for the last two years.He found one two years ago and the price was 2.9 crore.He didn't buy as he felt prices would fall.Finally he bought it last week for 3.4 crore.Luckily I didn't advise him not to buy last year as he would have blamed me for wrong advice.
          Another one came across a good flat in North Banglore last year but backed out as the price was 1.5 crore.That area is in good demand.But he got the same flat for 1.34 crore last month !!!!!
          In my home town plots were quoted at 7 lakh last year.My nephew bought one this week for 14 lakhs !!! No reduction at all.
          So much for all our theories and news reports.


          Originally posted by vaibav123 View Post
          One may not agree with views of another poster,but civility in replies is essential.This forum is for learning and understanding RE.
          Good economic sense is being talked about.If an average man looses a job and has a big loan o/s it is crisis time - EMIs to be paid,family to be looked after.
          Loans are to be very thoughtfully taken and reserve of emergency fund built up.
          Near the place where I stay there is large number of unsold flats,but prices are still higher than earlier.The builders seem to have deep pockets and are resisting price reductions.

          Comment


          • Re : Builders & Real Estate Bulls Theory Proved Wrong

            rambler,
            The pace of increase in rates is pretty low as compared to heydays when 5 lakh flat in Pune becomes 18 lakhs in three/four years.
            This increase in rate may be due to normal inflationary price rise.
            Plots are a different category.

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            • Re : Builders & Real Estate Bulls Theory Proved Wrong

              Originally posted by investwest View Post
              so did builders and bulls put a theory that there'll be hiring in better pace than past or there'll be no layoffs?
              Furthermore - a layoff is layoff but each employer has its different reasons behind any layoff.

              Are we going off topic? All those who lose their current jobs will find something else otherwise govt will provide them yellow ration cards and will feed them. Don't worry about it - as some companies fire, some others hire and that's what we see in the news pasted and posted here time to time.

              I want to know about the theory which is proved wrong.
              1. Almost all working people in private sector will be laid off / underemployed at some or other time in their working lives . It's a fact and they'll find new work is also a fact .
              It does not mean that they will not buy new houses in their lives or should stop living their lives . People should see the positives rather than negatives .

              2. Prices in Pune are certainly not increasing at the rate they did during 2009-12 which many people seem to take as base percentage for future appreciation .
              Last edited by suryawork; December 20 2014, 11:44 PM.

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              • Re : Builders & Real Estate Bulls Theory Proved Wrong

                rambler

                The micro markets pricing varies. It depends on the supply, holding capacity as well as the socio economic group occupying the area.

                Today, there are areas in Bombay which are not only holding up but showing increase in prices due to low supply/holding capacity of sellers and high demand. When the tide goes out, areas like this are the ones "with clothes on". These do not necessarily have to be hni areas with ultra high budgets.

                Incidentally your cousin in Bangalore has actually paid equivalent for the bungalow, if you account for the time value of money. 7% FD return on rs 2.9 crores is rs 42 lacs ..

                Even a fd would be rs 3.32 cr vs 3.4 cr paid.. Other mode of tax efficient investments like a mutual fund and he has actually saved money.
                Last edited by Que Sera; December 21 2014, 02:07 PM.
                Life is what happens when you are making other plans. Enjoy it

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                • Re : Builders & Real Estate Bulls Theory Proved Wrong

                  Originally posted by Que Sera View Post
                  rambler

                  The micro markets pricing varies. It depends on the supply, holding capacity as well as the socio economic group occupying the area.

                  Today, there are areas in Bombay which are not only holding up but showing increase in prices due to low supply/holding capacity of sellers and high demand. When the tide goes out, areas like this are the ones "with clothes on". These do not necessarily have to be hni areas with ultra high budgets.

                  Incidentally your cousin in Bangalore has actually paid equivalent for the bungalow, if you account for the time value of money. 7% FD return on rs 2.9 crores is rs 42 lacs ..

                  Even a fd would be rs 3.32 cr vs 3.4 cr paid.. Other mode of tax efficient investments like a mutual fund and he has actually saved money.
                  With own money he gained.

                  With leverage he has lost a lot. Usually people leverage for 3.4 crore purchase.
                  Venky (Please read watch a or before posting)

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                  • Re : Builders & Real Estate Bulls Theory Proved Wrong

                    venky

                    For investment.. Rent out purposes he may have just about be even. The appreciation has been in the range of 7% + odd.. Slightly below the tax adjusted cost of the home loan 10.4 odd.

                    For self occupancy , the tax benefits are limited and would have gained. Mind you the cost of the loan would be 10% + and tax savings limited to rs 50000 (30% of 1.5 lacs), now 60,000 (30% of 200,000) since a person in this tax bracket would have used up 80c anyways.

                    This ensures that the effective rate of the loan is nearer to 10%. This is the time correction folks are talking about, i guess.
                    Life is what happens when you are making other plans. Enjoy it

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                    • Re : Builders & Real Estate Bulls Theory Proved Wrong

                      Building homes for 1% population is bad business

                      Union minister for surface transport Nitin Gadkari on Friday asked Navi Mumbai developers that providing affordable homes to residents was a profitable option than paying high interest rate to banks on the unsold stock and that catering to 1% population was bad business.

                      "Everyone knows what is the true situation of the realty sector. You [real estate developers] may be claiming that you have recorded good sales, but I know for the fact what the ground reality is. Their are several homes which are lying unsold and developers are footing bank interest," said Gadkari during his speech after inauguration of the 15th Builders Association of Navi Mumbai property exhibition at Cidco exhibition centre in Vashi.

                      The union minister said, "There is a need to incorporate new technologies in construction sector, which will bring down the costs, and as a result, will also prove to be beneficial for developers."

                      He added, "Even today the developers think that one project should be able to earn them lifetime earnings. Those days are gone and you have to concentrate on increasing the turnover and maintaining the profit. How many people in the country can afford to buy homes worth Rs50 lakh and Rs1 crore? The number is hardly 1% and if you are constructing homes for that 1%, it is not going to be a profitable venture."

                      Gadkari said, "Instead focus should be on providing affordable homes to everyone so that sales increase and the profit is maintained," adding, "We are also in talks with the Reserve Bank to see how interest regime can be moderated and it will help the sector. But there is no point in sitting over unsold stock and paying interest to the banks."

                      Building homes for 1% population is bad business: Nitin Gadkari | Latest News & Updates at Daily News & Analysis

                      ^^ What do RE bulls want to say on this ??
                      If you are happy, you are successful.

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