Hereby I will prove how the realty boomers arguments are false.

What are the boomers arguments?

1.) Buy today, houses always increase in value in the long run.
WRONG. House prices cannot increase more than incomes in the long run. This is obvious if you think about it. If house prices go up more than people can afford to pay, buying stops, like it has stopped now.
Even Warren Buffett have pointed out that houses don't increase in intrinsic value. Unless there's a bubble or a crash, house prices simply reflect current salaries and interest rates. If a house is 100 years old, it's value in sheltering you is exactly the same as it was 100 years ago. Then came the maintenance as the house didn't renovate itself. It also has taxes, and insurance - costs that always increase and never go away. The price of the house went up about as much as salaries went up.
To put this is simple perspective, vegetable were costing Rs.5-6/kg when 5 digit salary was a rarity.
Today, the prices have gone up by about 4 times but so have the salaries. So, sounds very much like the reasoning people use now when they talk about how much their father's house appreciated "in the long run" without considering that salaries rose a proportional amount.

2.) Renting is just wastage of money.
WRONG. As said before renting is now much cheaper per month than owning. If you don't rent, you either:

* Have a mortgage, in which case you are throwing away money on interest, tax, insurance, maintenance, costs that increase forever.
* Own outright, in which case you are throwing away the extra income you could get by converting your house to cash, investing in bonds, and renting a similar place to live for much less money. This extra income is sufficient for emergency expenses,retirement etc.

Either way, owners lose much more money every month than renters and that's assuming prices don't correct to very high level & everything is smooth in the economy.

3.) As a renter, you won't have any money left as you will spend them on vacations,cars & hence won't have equity/savings etc.
WRONG. Equity is just money. Renters are actually in a better position to build equity/savings through investing in anything but housing. Renters can get rich much faster than owners, just by investing in conservative stocks & bonds.

* Owners are losing every month by paying much more for interest than they would pay for rent. The tax deduction does not come close to making owing competitive with renting.
* Owners must pay taxes simply to own a house. That is not true of stocks, bonds, or any other asset that can build equity/savings. Only houses are such a guaranteed drain on cash.
* Owners must insure a house, but not most other investments.
* Owners must pay to repair a house, but not a stock or a bond.
* Owners lose their money as house prices reduce. The EMI's remain constant in spite of reduction in rates. At the end of loan tenure, they would have paid almost twice than that of current renters who will buy at logical rates. Keep interest rates in mind. Most of the EMI is not principal amount but interest.

4.) There are great tax advantages to owning a house.
WRONG. Many people believe you can just reduce your income tax by the amount you pay in interest, but they are wrong. Buyers may not deduct interest from income tax; they deduct interest from taxable income. And even then, the tax advantage is not significant compared to the large monthly loss from owning.

If you don't own a house but want to live in one, your choice is to rent a house or rent money to buy a house. To rent money is to take out a loan. A mortgage is a money-rental agreement. House renters take no risk at all, but money-renting owners take on the huge risk of falling house prices, as well as all the costs of repairs, insurance, property taxes, etc.

5.) RE is based on local factors, it's not a national phenomenon. RE of Delhi-NCR,Bangalore & rest of the cities has nothing to do with Pune RE.
WRONG. Lending rates remain the same throughout the country. ALL loans are harder to get. This will drive prices down everywhere.

6.) A rental house provides good income. So, you can rent if you have purchased as investment.
WRONG. Rental houses provide very poor income in hyped areas and certainly cannot cover mortgage payments. Remember there is almost 300% difference between EMIs & rent for the same house.

It's pointless to do the work of being a landlord if you can make more money with no risk, no work, and no state income tax by investing in assured good returns bond.

7.) If owning is a loss in monthly cash flow, but appreciation will make up for it.
WRONG. Appreciation is negative. Prices are going down. It only adds to the injury of already high EMI's.

8.) As soon as prices drop a little, the number of buyers on the sidelines willing to jump back in increases.
WRONG. There are very few buyers left, and those who do want to buy will be limited by increasing difficulty of borrowing now that many house owners are near bankrupt as they don't save anything at the end of the month due to high EMI's.
No one has to buy, but there will be more and more people who have no choice but to sell as their payments rise. That will keep driving prices downward for a long time.

9.) House prices never fall atleast in Pune.
WRONG. If you see the RE scenario of 1996, prices crashed by 50% & took a whole 7+ years to recover.
Exact 1996 scenario may not be there today but strong correction is inevitable across the city.

10.) House prices don't fall to zero like stock prices, so it's safer to invest in real estate.
WRONG. House prices won't be zero, but the equity or the principal amount you paid can be zero or even negative. What you will pay as EMIs later in actual terms is not for the principal amount but only the interest as house prices dip. So, you will be only serving the bank.

11.) Prices will soften gradually, won't crash immediately.
WRONG. Prices are falling off a cliff. No one knows exactly what will happen, but it looks like prices will continue to fall for long time. These are just more manipulation of buyer emotions, to get them to buy even while prices are falling.

12.) The bubble prices were driven by supply and demand alone.
WRONG. Prices were driven by low interest rates and risky loans & good returns for investors in initial phases of boom in 2004-05.
Prices went up, interest rates went up & buyers savings went down. So prices are violating the most basic assumptions about supply and demand.

13.) There is lack of land.
WRONG. Ample of land is available & continue to be even in future in Pune. Sales volume are down. Even in Japan (small country with less land), prices went down. Current prices here are the same as that of 23 years ago. If we really had a housing shortage, there would not be so many vacant rentals.

14.) If you don't own, you'll live in a cheap neighborhood later.
WRONG. For the any given monthly payment, you can rent a much better house than you can buy. Renters live better, not worse. There are downsides to renting, such as being told to move at the end of your lease, or having your rent raised, but since there are thousands of vacant rentals, you can take your pick and be quite happy renting during the crash. There are similar but worse problems for owners anyway, such as being fired and losing your house, or having your interest rate and property taxes adjust upward. Remember, property taxes are forever.

15.) There's always someone predicting a real estate crash.
TRUE, yet irrelevant. There are very real crashes every decade or so. Even a broken clock is right twice a day.

16.) Local incomes justify the high prices.
WRONG. The mortgage should be more than your 3 years earning. It is much higher today. Most are already in danger/red zone.

17.) You have to live somewhere.
CORRECT. But that doesn't mean you should waste your life savings on a bad investment. You can live in a better house for much less money by renting during the down slide in RE.

18.) It's not a house, it's a home.
WRONG. Wherever one lives in it is home, be it apartment, condo, bungalow , mansion or house. Calling a house a "home" is a manipulation of your emotions for profit.

19.) If you don't buy now, you'll never get another chance.
WRONG. History proves otherwise.
Here's a beautiful quote from a analyst:-
"The real issue isn't whether you will be stuck being a renter all your life, she says. Its whether you'll get so scared about being shut out that you'll buy at the market's peak and be stuck in a property you can't afford or sell."

20.) It would take major economic recession or a major earthquake that wipes out this area in order for the price to fall by over 50%.
WRONG. Even today, if the prices fall by 50%, there will still be very few people who can buy at this levels due to uncertainty in jobs & most importantly high EMIs. Also, look at the rental rates for equivalent houses. Which loss per month is larger? EMI or rent?

contd....
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  • Originally Posted by Munish Malhautra
    it all depends on who is going to buy. i am quite sure the discount will not hold good for more than 3 months. it basically is to attract a few people and increase awareness against a bigger project(i am assuming that sun planet is bigger than sai virat).
    i too was able to negotiate around 1000 for a commercial property but the prices increased the very next week as builder was able to attract. the builder did that to ensure better / faster sales against a large project coming adjacent.
    "herd mentality"

    Agree, but the fact remains that prices are being reduced & this is what matters to the buyer (alongwith delivery of course). I am least bothered whether it is done to as a competitive strategy or out of compulsion. As long as people are aware, keep scouting, they will find a good deal.
    * Sai Virat is smaller than Planet but the infra is better than Planet.

    Coming to the commercial prices, I don't know 1000 bucks reduction was on which price & in which locality (For the residential project mentioned above, the discount comes to 24%). However, if the original prices for commercial RE you said were say 3500/sq ft & if it made sense to buy at 2700/sq ft, then if there was discount of 1000/sq ft, you should have closed the deal ASAP. Man, corresponding price target should be there in your mind when you see the property, infra etc. at first time, so that the moment you get a good deal, you need not waste time in thinking about these aspects:).
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  • Originally Posted by realacres
    Agree, but the fact remains that prices are being reduced & this is what matters to the buyer (alongwith delivery of course). I am least bothered whether it is done to as a competitive strategy or out of compulsion. As long as people are aware, keep scouting, they will find a good deal.
    * Sai Virat is smaller than Planet but the infra is better than Planet.

    Coming to the commercial prices, I don't know 1000 bucks reduction was on which price & in which locality (For the residential project mentioned above, the discount comes to 24%). However, if the original prices for commercial RE you said were say 3500/sq ft & if it made sense to buy at 2700/sq ft, then if there was discount of 1000/sq ft, you should have closed the deal ASAP. Man, corresponding price target should be there in your mind when you see the property, infra etc. at first time, so that the moment you get a good deal, you need not waste time in thinking about these aspects:).


    makes sense.
    The commercial property was in gr. noida with a price tag of 7000. i got it for 6000 after major nego. yes discount % is less if compared to residental of pune.
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  • Unsold Realty Stocks Pile Up On Rising Rates

    Guys, see what happens when builders hike the rates exhorbitantly. Man, don't these builders know the basic ABCD of biz that a product sells only at particular price??

    Wed Jul 07, 2010

    The demand for residential property has taken a big beating thanks to the sharp rise in prices across the country, resulting in a massive stock of unsold residential inventory in cities like Delhi and Mumbai.

    According to Pankaj Kapoor, managing director of real estate research firm Liases Foras, the reason for the drop in demand is the high rates at which residential properties are priced by developers. " All the new residential projects launched today are in the range of Rs 1.5- 2 crore and above, which is not affordable for most of the people living in the city. Even investors are wary of investing in such projects as they are unsure whether these flats would be sold at a later date," he said.
    Kapoor said cities like Mumbai have been the worst- hit due to the drop in demand. " In the last two quarters, there has been a 15 to 20 per cent drop every quarter as the rates have even surpassed the 2008 levels. It has come to a level where a correction of around 25 to 30 per cent could be expected," he said.
    Kapoor said the situation is similar in other cities as well, including Delhi- NCR. " The difference between big metros and other cities like Chennai and Hyderabad is that those cities have yet to recover from the last correction while cities like Mumbai and Delhi recovered much faster," he said. " In Delhi- NCR, the inventory has virtually doubled in the last quarter ( March- June). Sales in the region are mostly investordriven and not consumer- driven.

    There are huge advertisements by developers that nearly 50 to 80 per cent of the flats were sold in 30 to 40 days. This is all due to By Amit Shanbaug in Mumbai ` There are barely any flats in Mumbai priced below Rs 50 lakh' Drop in demand has mostly hit developers in Delhi & Mumbai investments done by investors.

    If you discount the inventory factor, the situation in both the metros is just the same," he said.
    According to Yashwant Dalal, president, Estate Agents Association of India ( EAAI), there are barely any flats in Mumbai which are priced below Rs 50 lakh.
    " According to a report, nearly 95 per cent flats in the city are above Rs 50 lakh and 50 per cent of the flats carry the price tag of Rs 1 crore and above. If a common man thinks of buying a flat he would get a flat below that rate only in very far off suburbs where commuting is a major problem," he said, adding that nearly 50 to 60 per cent of the flats are lying unsold due to a steep drop in demand in all the new projects.
    Of the 70 million square feet of residential inventory available in markets like Mumbai, hardly three to four lakh square feet would be priced below the Rs 50- lakh price bracket, he added.

    Dalal said these prices are unrealistic and cannot sustain at these levels. " A correction is certainly imminent but it is just a matter of time. I believe that in another three to four months time property prices should start correcting in the big cities. Actual buyers could wait for some more time before looking to buy a property," he said.

    Source:- mailtoday.
    Attachments:
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  • Originally Posted by realacres
    Guys, see what happens when builders hike the rates exhorbitantly. Man, don't these builders know the basic ABCD of biz that a product sells only at particular price??

    Wed Jul 07, 2010

    The demand for residential property has taken a big beating thanks to the sharp rise in prices across the country, resulting in a massive stock of unsold residential inventory in cities like Delhi and Mumbai.

    According to Pankaj Kapoor, managing director of real estate research firm Liases Foras, the reason for the drop in demand is the high rates at which residential properties are priced by developers. " All the new residential projects launched today are in the range of Rs 1.5- 2 crore and above, which is not affordable for most of the people living in the city. Even investors are wary of investing in such projects as they are unsure whether these flats would be sold at a later date," he said.
    Kapoor said cities like Mumbai have been the worst- hit due to the drop in demand. " In the last two quarters, there has been a 15 to 20 per cent drop every quarter as the rates have even surpassed the 2008 levels. It has come to a level where a correction of around 25 to 30 per cent could be expected," he said.
    Kapoor said the situation is similar in other cities as well, including Delhi- NCR. " The difference between big metros and other cities like Chennai and Hyderabad is that those cities have yet to recover from the last correction while cities like Mumbai and Delhi recovered much faster," he said. " In Delhi- NCR, the inventory has virtually doubled in the last quarter ( March- June). Sales in the region are mostly investordriven and not consumer- driven.

    There are huge advertisements by developers that nearly 50 to 80 per cent of the flats were sold in 30 to 40 days. This is all due to By Amit Shanbaug in Mumbai ` There are barely any flats in Mumbai priced below Rs 50 lakh' Drop in demand has mostly hit developers in Delhi & Mumbai investments done by investors.

    If you discount the inventory factor, the situation in both the metros is just the same," he said.
    According to Yashwant Dalal, president, Estate Agents Association of India ( EAAI), there are barely any flats in Mumbai which are priced below Rs 50 lakh.
    " According to a report, nearly 95 per cent flats in the city are above Rs 50 lakh and 50 per cent of the flats carry the price tag of Rs 1 crore and above. If a common man thinks of buying a flat he would get a flat below that rate only in very far off suburbs where commuting is a major problem," he said, adding that nearly 50 to 60 per cent of the flats are lying unsold due to a steep drop in demand in all the new projects.
    Of the 70 million square feet of residential inventory available in markets like Mumbai, hardly three to four lakh square feet would be priced below the Rs 50- lakh price bracket, he added.

    Dalal said these prices are unrealistic and cannot sustain at these levels. " A correction is certainly imminent but it is just a matter of time. I believe that in another three to four months time property prices should start correcting in the big cities. Actual buyers could wait for some more time before looking to buy a property," he said.

    Source:- mailtoday.


    Thats the reason why budget homes starting from 400 sqft with price of 10 Lacs are getting popular in outer suburbs of mumbai. Even in noida a few builders have launched 1Bhk flats.
    But even though further correction happens or not prices have already gone thru the roof.
    I was in mumbai few days back and was speaking to some people who told me there are buyers readily avl for flats of ~2cr. but flats are not so readily avl. hence i am confused as to what will be the effect of correction. a 2 cr house will be avl for maybe 1.8 cr after further correction, thats still anyway unfordable for 90% janta. and once the market picks that same flat will become become 2.5 cr.:) hence negating the effect of correction or price drop.
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  • A big lie ...

    Consider this.

    Lets assume that the turnover of the top builders who account for 80% of sales is, say 50,000 Crores.

    Lets assume that (as per approx data given by the Govt when they were trying to beat down the RE sector) current debt outstanding by the RE sector to banks is around 70,000 crores.

    At 10% Net Margin, the profits generated by the RE industry should be 5000 Crores. And at 12.5% interest on debt (is that conservative), the interest on debt is 8750 crores.

    These are rough approximations and anybody with better data, please correct. But the point is this ...

    RE is in a Catch22 situation. If prices remain as high as they do, sales volumes will be low enough for these companies to die a slow death as debt load crushes them. If they reduce prices significantly they will have to go below cost and face similar slow-death situation.

    The only reasons holding back slow-death for many players are:

    1. Enough suckers who don't mind going into great debt levels in the belief that prices are reasonable OR fearing that they may run away and become unaffordable forever

    2. Banks not calling in loans of non-performers fearing that it may undermine the banks themselves as their exposure is so huge.

    But, given that we should see many years of slow global growth, recession or even depression, slow-death is inevitable, one way or another. Simply waiting on the sidelnes with growing amounts of cash (while renting ever cheaper) should see one get phenomenal bargains when the RE sector blinks.

    But you need to go against conventional thinking and have some guts for that. How many do?

    And given that most people have never seen a recession/depression in their working lives, they simply cannt comprehend what it can be like and instead they are swayed by the fears of prices running away forever and so get into debt at the earliest opportunity!!! And most people are in the belief that 2008 was bad and will not repeat again, not taking enough time to consider ... What if 2008 was only a trailer and the main movie is starting only now! :)

    cheers
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  • Originally Posted by wiseman
    Consider this.

    But, given that we should see many years of slow global growth, recession or even depression, slow-death is inevitable, one way or another. Simply waiting on the sidelnes with growing amounts of cash (while renting ever cheaper) should see one get phenomenal bargains when the RE sector blinks.

    But you need to go against conventional thinking and have some guts for that. How many do?

    And given that most people have never seen a recession/depression in their working lives, they simply cannt comprehend what it can be like and instead they are swayed by the fears of prices running away forever and so get into debt at the earliest opportunity!!! And most people are in the belief that 2008 was bad and will not repeat again, not taking enough time to consider ... What if 2008 was only a trailer and the main movie is starting only now! :)

    cheers


    Hi Wiseman.

    Most RE companies have got adequate private equity also as a source of funds. RE companies are now flush with funds, thanks to Ben bernanke lowering interest rates in USA to ridiculous levels, so that better returns in India was attractive for US and other investors.

    Stimulus measures by Govt has also created huge corruption related black money which is finding its way into RE. More is on the way after the telecom windfall.

    Price correction will be time related (price stand still till 2013-2014) and is unlikely to see more than 10-15% downmove (that also only in Mumbai which has run up too much - absolutely no chance for downmove in NOIDA and Gurgaon).

    You are also forgetting one very important correlation - food price to farmland.

    Food price inflation causes the yield per bigha to rise. Currently in north india, it is rent of 15000 per bigha per annum and price of 1.5L per bigha = 7.5L per acre.

    This is based on a 10 Rupees per kilo of grain. If price becomes 20 Rupees per kilo, price of land doubles. Already, in UP, price of farmland has risen some 10% per annum for the last 10 years.

    If price of food grain, pulses and vegetables keeps on rising like this, the base rate for land (yes, very similar to base rate for bank lending, based on cost of deposits :D) the base rate for farmland will rise, probably double.

    This percolates down to the RE price also.

    So while I totally agree that the global economy will see serious problems and India will also face hiccups, I anticipate stagflation in India.

    As I have discussed with you many times before, food price inflation always causes rental inflation, which affects flat valuation adversely. You of course have argued against that.

    Inflation also has a habit of increasing the corruption levels (if govt purchases more expensive things like hospital equipment or plant machinery or weapons, commisions are correspondingly more), all of this increases the black money circulation. Black money is always shown uneven distribution, i.e. some people get a windfall which in lakhs and crores, which can only be deployed in RE.

    When multiple factors exist for price escalation in RE, talking of only salary level and demand supply mismatch is too simplistic. Also, builders might simply bypass salaried people totally and artificially manipulate supply (as they are currently doing).

    Have you considered another scenario - all flats are bought by investors who decide to give on rent. Price goes beyond the ability of salaried to buy. Everybody on salary goes on rent.

    Then the rents start escalating. Rents consume half the salary.

    Have you heard of this happening before? I have. Happened in the late 80s. Cost of flat was 10L in Delhi, rent was maybe 5000 per month. Combined salary of both husband wife was maybe 10,000 per month.

    Half or more of the salary went for rent in any decent flat. People opted to live in pathetic flats - could not afford better.

    80s was recession time in US and Gulf, times were dificult in India also.

    Such times can return

    Now people have got used to better living. Renting might force your hand in future to curtail living standards.

    Because you might not be able to afford the rent
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  • Originally Posted by Venkytalks

    Have you considered another scenario - all flats are bought by investors who decide to give on rent. Price goes beyond the ability of salaried to buy. Everybody on salary goes on rent.

    Then the rents start escalating. Rents consume half the salary.

    Have you heard of this happening before? I have. Happened in the late 80s. Cost of flat was 10L in Delhi, rent was maybe 5000 per month. Combined salary of both husband wife was maybe 10,000 per month.

    Half or more of the salary went for rent in any decent flat. People opted to live in pathetic flats - could not afford better.



    So who came to the rescue of people in Delhi after late 80's? How come people salary got raised and rents did not? All Delhi landlords in charity mode after late 80's?
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  • Originally Posted by RAJESHP
    So who came to the rescue of people in Delhi after late 80's? How come people salary got raised and rents did not? All Delhi landlords in charity mode after late 80's?


    Govt came to the rescue. 4th and 5th pay commisions gave a lot of money to the people.

    Life was tough through 90s also, only thing was that rents were stagnant around 6-7,000 while salaries in pvt sector went up.

    The reason was large scale illegal colonies.

    High rents and flat prices resulted in many urban villages building illegal builder flats. That increased supply (through no help from govt - which continued its curbs on building - accepting bribes to break the law). Quality of these flats was pathetic, basically tenement slums.

    In mid 90s, this supply got exhausted and there was another big upmove in prices for 2 years, followed by a slump till 2003-2004.

    Rest of the bubble in NCR followed the same pattern as rest of India and the world.

    Rents never ever went down.

    Point is, when demand exeeds supply, landlords crack the whip and extract a big pound of flesh
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  • I think we are missing few important factors -

    1. Do real buyers/salaried people drive the demand & the rates?
    2. Do the rates go down because people cannot afford?

    NO.

    Do you know where all the black money of Politicians, Bollywood Actors, Underworld goes?
    Do you know where NRIs and Foreign investors having crores of rupees will invest in? Share Market? Yes. But only partially.

    Where has most of the money gone and where will most of the money go?

    The answer is simple. Only in RE. Unfortunately, this is the fact of the matter. The property prices go down marginally because that is the time big money is not getting pumped into the system. However, once it goes down, these people pump in money to buy more. History says it all and hardly there will ever be a time wherein you can get properties for a steal like shares. You may get cheaper deals but that's about it. Small time investors can keep fishing for the bottom at their own peril.

    Agreed, the prices may correct in the near or mid-term BUT prices would have increased till then and then correct. Again, in a short period they increase beyond the previous rates. That has always been the case and will always be the case.

    Where does all the money go in recession? Does it disappear? Do you think everyone loses money? Think about it. There lies the answer.
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  • Originally Posted by real_pro
    I think we are missing few important factors -

    1. Do real buyers/salaried people drive the demand & the rates?
    2. Do the rates go down because people cannot afford?

    NO.

    Do you know where all the black money of Politicians, Bollywood Actors, Underworld goes?
    Do you know where NRIs and Foreign investors having crores of rupees will invest in? Share Market? Yes. But only partially.

    Where has most of the money gone and where will most of the money go?

    The answer is simple. Only in RE. Unfortunately, this is the fact of the matter. The property prices go down marginally because that is the time big money is not getting pumped into the system. However, once it goes down, these people pump in money to buy more. History says it all and hardly there will ever be a time wherein you can get properties for a steal like shares. You may get cheaper deals but that's about it. Small time investors can keep fishing for the bottom at their own peril.

    Agreed, the prices may correct in the near or mid-term BUT prices would have increased till then and then correct. Again, in a short period they increase beyond the previous rates. That has always been the case and will always be the case.

    Where does all the money go in recession? Does it disappear? Do you think everyone loses money? Think about it. There lies the answer.



    Since you are in thinking mode right now... One question for you.
    A Flat sold by builder and bought by Investor, do you know who is at the end of this chain?:bab (35):
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  • Originally Posted by RAJESHP
    Since you are in thinking mode right now... One question for you.
    A Flat sold by builder and bought by Investor, do you know who is at the end of this chain?:bab (35):

    The investor remains at the end of the chain...real buyers unfortunately get converted to real renters most of the times!! :)
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  • Originally Posted by RAJESHP
    This is conveniently ignored by bulls.:D:D.

    They look at prices during last so called slump some where in mid 2009. Prices might be 4800, and now 5200, they immediately say see prices are rising again.

    LOL...:D:D

    Haha...What was the price in this area in 2004 and what will be the price in 2012?? Anyone can conveniently choose any time-window as per their convenience!!!

    Poor guy who wouldn't have invested in 2004 now has to pay 5200 psf.

    Also, realacres...have you bought at 5200 psf?? I am sure you will wait for it to fall further!! Notional values are best not discussed.
    The fact of the matter is RE is for long-term and if you take a window of 8-10 years...you can't go wrong!
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  • Originally Posted by real_pro
    Haha...What was the price in this area in 2004 and what will be the price in 2012?? Anyone can conveniently choose any time-window as per their convenience!!!



    LOL and what was the price today's 4/5L car in 2004? probably "Hot Wheel" car's did cost more then than original car right?
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  • Originally Posted by RAJESHP
    LOL and what was the price today's 4/5L car in 2004? probably "Hot Wheel" car's did cost more then than original car right?

    Haha...this is getting funnier...

    Car is a depreciating asset and RE is always going to be an appreciating asset...can't compare RE to anything!

    Time window...increase your time window for RE and you will always be a winner...no matter what!!!
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  • Originally Posted by real_pro
    I think we are missing few important factors -

    1. Do real buyers/salaried people drive the demand & the rates?
    2. Do the rates go down because people cannot afford?

    NO.

    Do you know where all the black money of Politicians, Bollywood Actors, Underworld goes?
    Do you know where NRIs and Foreign investors having crores of rupees will invest in? Share Market? Yes. But only partially.

    Where has most of the money gone and where will most of the money go?

    The answer is simple. Only in RE.

    Now tell me this:-

    Despite all this, where will this RE stock be off-loaded? Investor selling to investor, investor selling to builder or underworld selling back to the builder??

    Fact remains that their money is 'USABLE' only if this RE is sold to END USERS. There is no point where 2 goalkeepers are playing passing pass in the stadium with no players around. This will only consume the time, but will never score a goal. Hope you got what I mean.

    Originally Posted by real_pro
    Haha...What was the price in this area in 2004 and what will be the price in 2012?? Anyone can conveniently choose any time-window as per their convenience!!!

    Comparison is wrong. Compare prices of 2004-2007 & 2007-2010 to get the real picture.

    Poor guy who wouldn't have invested in 2004 now has to pay 5200 psf.

    If all poor guys would have invested in 2004, there would not have been 5200 at first place coz everyone would have already owned a house:D.

    Also, realacres...have you bought at 5200 psf?? I am sure you will wait for it to fall further!! Notional values are best not discussed.
    The fact of the matter is RE is for long-term and if you take a window of 8-10 years...you can't go wrong!

    Why should I when I can get the same flat for INR 8-11/sq ft on rent? As far as long term is concerned, I really wonder if buyers are like me, there wouldn't be much takers for 10 yr old flat:bab (59):.
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