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 wiseman
    Altogether a nice post rocknrolls!

    In one of my recent post I too had mentioned that, after considering everything (including appropriate level of loan), if it feels right, go ahead and buy it!

    This is similar to the last para of yours where you had mentioned "take advice, but do what your heart tells you to"! We only added the advice ... stay within your limits on debt! :D

    For those of you who wish to remain renting, let me also assure you that, despite all the problems that rocknrolls listed (which is faced by renters), if you look after the rented place like you would your own, there is no better friend than your landlord. I vouch for that from personal experience, since I too travel abroad and have faced minimal problems about police verification, change of address, etc, etc because I have stayed in same rented place (for more than a decade) and at times the owner even forgot that he had to check if I was paying the rent regularly. Used to repair, maintain, pay taxes and inform him about everything including deductions and owner was only too glad that he had such a tenant. Also helped keep the rent lower than market since he didn't want to let me go! :D:D

    Hear out others carefully but take your own decisions.

    cheers


    Getting some points from my old post and I am adding more points for rocknroll to think over.



    Comparing Builder and Owner nuisances.... Owner wins .!!..
    :D
    -Who is known to Be more Notorious ... Owner(Retired/Service class) or Builder ?

    -Who misleads you in Aggrement... Owner(Retired/Service class) or Builder ?

    -Who eats your money ... Owner(Retired/Service class) or Builder ?

    -Who makes you owner of few trucks concrete and Iron etc by paing 50+ Lakhs.. land is never in your name ..you are just owner of concrete... Owner(Retired/Service class) or Builder ?

    -Who delays your possession ... Owner(Retired/Service class) or Builder ?

    -Who has criminal cases on him... Owner(Retired/Service class) or Builder ?

    -If you don't pay he will send Goons... Owner(Retired/Service class) or Builder ?

    -If your job changes the house you can leave easily???Yes builder will arrange the Tenants for you ...

    Service sector of Metros will change job at least in 5 yrs ??

    -when your city changes will you Move and Pack your Flat too ?
    or before the new job you will take 1 month Break to buy a new flat in new city. (pay 6% SD+ Reg + 2% brokerage 8% )
    Just so the kids can paint the walls ?

    -Address change won't be required in that case when you buy new home in new city ???

    -Or home in Noida and job in Gurgaon .... ask those who travel and their family life.....


    As Wiseman has said earlier we(our Generation) instead of focusing in our career/Growth focusing more on Retirement needs.

    Is it Misplaced Priorities ....... Builders have created a fashion of RE.

    You don't go and buy Train Bogey if you frequently travel.
    Thats just the service you use in EASY way.
    Now if some one ask you to do that you will laugh.


    Now tell me what is simpler
    CommentQuote
  • Originally Posted by frugality
    Now tell me what is simpler

    Great post wiseman and frugality (still laughing).

    Seeing past-glory, every tom-dick-harry feels RE is great investment at current-level and their flats would be worth half/1 crore in near-future. I feel social-compulsion are just excuses to hide poor financial-skills.
    CommentQuote
  • Originally Posted by frugality
    You don't go and buy Train Bogey if you frequently travel.
    Thats just the service you use in EASY way.
    Now if some one ask you to do that you will laugh.

    Now tell me what is simpler


    Why work? Why earn money? Why save money for our future?
    Why not seat idle at home, if anyway we all are going to retire one day?

    Tell me what is simpler? :)

    Hum sab is rang manch ki kathputliyan hai jahapanah... So we have to play our part whether its simple or difficult.

    Ambani brothers could easily rent a Mediterranean island and live rest of the life on FD interest. That would be really simple. But thats not what they are here for. So they are playing their part.

    Don't want to get spiritual but try and google following, when and if you have time and interest.
    1) Brahmacharya Ashram
    2) Grihastha Ashram
    3) Vanaprastha Ashram
    4) Sanyasa Ashram
    CommentQuote
  • Originally Posted by hitmady
    1. You can't be just kicked out if have rent-agreement. Besides it depends on your relationship with landlord. Just like company notice-period, rent's notice-period can be increased. I waited for almost 2.5 months to move to better place. No problem what-so-ever.
    Remember, just like you want good landlords,
    Landlords want good people to rent their house.


    Didn't I say one month's notice in my previous post. I have seen this happen many times.

    Originally Posted by hitmady
    2. There should not be problems finding decent home in the vicinity of school. Besides most good school ply buses. Right?

    Not sure if you been through school admission prcedure recently...
    Why should I risk my kid's happiness/life? for saving money? I would rather travel for hours myself than make the kid go through this ordeal.

    Originally Posted by hitmady
    3. If kids draw on wall, it can be repainted and repaired. Right?

    Depends on the landlord. I had come across a landlord who wouldn't allow me to hit a nail in the wall.

    Originally Posted by hitmady
    4. Most of pune city-dwellers live in pigeon-holes. One will find many such holes in the same area.

    I didn't intend to live in a pigeon hole hence I bought a "house".

    Originally Posted by hitmady
    5. Most can be updated online. Besides rent agreement can be made to good use here.

    Can you update address of your Dmat a/c, Ration card, LIC policies, Driving license online? How about police clearances? Two witnesses staying in the same wing as yours for last 2 years to accompany you to the police station with their ID as well as address proof on a "weekday"? Do you think its a joke?

    Originally Posted by hitmady
    Don't want to see wife (especially my mother) suffer in financial difficulties coz I screwed up.

    If you don't cover your risks by buying sufficient insurance, you are to blame for the screw up.

    Originally Posted by hitmady
    Finally, you are not the only person living on rent (must be a billion) and there're good laws to safe-guard interests of rentee/tenant.

    I don't rent. Period.
    CommentQuote
  • Misplaced Priorities

    Originally Posted by rocknrolls
    Why work? Why earn money? Why save money for our future?
    Why not seat idle at home, if anyway we all are going to retire one day?

    Tell me what is simpler? :)

    Hum sab is rang manch ki kathputliyan hai jahapanah... So we have to play our part whether its simple or difficult.

    Ambani brothers could easily rent a Mediterranean island and live rest of the life on FD interest. That would be really simple. But thats not what they are here for. So they are playing their part.

    Don't want to get spiritual but try and google following, when and if you have time and interest.
    1) Brahmacharya Ashram
    2) Grihastha Ashram
    3) Vanaprastha Ashram
    4) Sanyasa Ashram


    Adding some colour for rocknroll to understand easily... read the whole post again .... and then interpret.
    what wrong with you .... where it appears from my post to not work and retire rather its the reverse....
    Forget buying rather work hard and leave home buying to the Retirees

    Originally Posted by rocknrolls
    Why work? Why earn money? Why save money for our future?
    Why not seat idle at home


    Getting some points from my old post and I am adding more points for rocknroll to think over.




    Comparing Builder and Owner nuisances.... Owner wins .!!..
    :D
    -Who is known to Be more Notorious ... Owner(Retired/Service class) or Builder ?

    -Who misleads you in Aggrement... Owner(Retired/Service class) or Builder ?

    -Who eats your money ... Owner(Retired/Service class) or Builder ?

    -Who makes you owner of few trucks concrete and Iron etc by paing 50+ Lakhs.. land is never in your name ..you are just owner of concrete... Owner(Retired/Service class) or Builder ?

    -Who delays your possession ... Owner(Retired/Service class) or Builder ?

    -Who has criminal cases on him... Owner(Retired/Service class) or Builder ?

    -If you don't pay he will send Goons... Owner(Retired/Service class) or Builder ?

    -If your job changes the house you can leave easily???Yes builder will arrange the Tenants for you ...

    Service sector of Metros will change job at least in 5 yrs ??

    -when your city changes will you Move and Pack your Flat too ?
    or before the new job you will take 1 month Break to buy a new flat in new city. (pay 6% SD+ Reg + 2% brokerage 8% )
    Just so the kids can paint the walls ?

    -Address change won't be required in that case when you buy new home in new city ???

    -Or home in Noida and job in Gurgaon .... ask those who travel and their family life.....


    As Wiseman has said earlier we(our Generation) instead of focusing in our career/Growth focusing more on Retirement needs.

    Is it Misplaced Priorities ....... Builders have created a fashion of RE.

    You don't go and buy Train Bogey if you frequently travel.
    You don't buy Courier company bcoz you have hundreds of Courier daily.

    Similar is staying in City for 'service sector'. As their jobs are Dynamic so are their place of stay.

    In Company terms stick to Core Business ...

    Thats just the service you use in EASY way.
    Now if some one ask you to do that you will laugh.

    For service sector its Job, IT its Value growth/Innovation/ New Products

    While this RE buying is making half of IT/Service workforce spending 2 Hours on Road bcoz instead of renting closer to Workplace they are choosing to Buy and Be Inflexible.

    IT/Service sector is all about Flexibility ?? is it not ....?
    Buying RE is making them Inflexible.




    Buying has lot many these hassles ......


    Why Marriage age is 18+
    Why don't teenagers get married....

    Why Driving age is 18+
    why 13 yrs can't drive .....

    they can on simpler roads but when the situation becomes tough they will do accidents.....

    apply same to youngsters buying flats ....
    first of all they are not Financially literate....
    They don't understand vices of land deals etc
    They are not comfortable Court/Lawyers etc....

    So 25 - 30 is not the right age to fall in buying home....
    No where it is said/written so but certain things are like that..... see around in rest of the cities......
    For ease some use CCards why don't carry cash ?

    So 'Teenager' is Over leveraged buyer and 'Car' is Flat bought at inflated prices and 'tough situation' is World economic uncertainty.


    So our young generation is diverted from Core issue.
    Even when the times are tougher ahead :bab (6):
    Economy, jobs expected to remain weak through 2014


    http://finance.yahoo.com/news/Economy-jobs-expected-to-cnnm-1006831710.html;_ylt=AuMeGhJMi8bd9OuM48fWY467YWsA;_ylu=X3oDMTE1Njl1Z2E4BHBvcwM1BHNlYwN0b3BTdG9yaWVzBHNsawNlY29ub215am9ic2U-?x=0&.v=3.html?x=0&sec=topStories&pos=3&asset=&ccode=


    Now tell me what is simpler
    CommentQuote
  • I think people who don't live in India cannot appreciate the need of owning an apartment in this country. Most people don't mind living in cramped conditions as long as it is owned. Personally India is not for the fainthearted. People who have lived abroad have become soft. Don't question the need to own a house on the basis of logic. 25-30 year old ppl in my building end up buying in Mira road/Virar and other places. It is not the India of your fathers time. As long as one appreciates this fact it becomes easier to see why the situation is what it is. No amount of logical thinking will be able to justify the real reason to own a house either at obscene prices or at god forsaken location. However If you don't assimilate you run the risk of being run over by a road roller.

    A broker told me once about the people who work in Dubai and keep visiting India. He is like every 3 years they come and ask me "What is rate going ?" and then say "Oh It has increased so much" and then they come back after 3 years.

    Even though I own some flats I am praying frevently to all the 108 crore gods for a nasty correction. It will help me buy in the area I want too. However I don't know when those prayers will be answered.
    CommentQuote
  • Originally Posted by rocknrolls
    I tend to agree with asdf2357 here although I do appreciate the guidance seniors provide to fellow members.

    I think this renting argument goes overboard many times. Its advised to rent as if renting/stock investment is the best medicine for every house buyer's woes. I beg to differ here though.

    1. If I rent a house (a big plush house in posh area for peanuts), I can still be kicked out by my landlord on a month's notice. I don't want to see myself running around for a new house to be rented in the same locality.

    2. I have school going kids. Although renting gives me the flexibility to rent anywhere in the city, it does not guarantee admission to a good school in the new area.

    3. When I rent a house I can not make any changes inside that house. Small things like sticking Alphabet charts/ cartoon characters on the walls, hanging my kids photo frames on the walls etc. What if my kids write something on the walls?? I don't want to restrict my kids from enjoying their childhood.

    4. My relatives & good friends live in a particular area and given a choice I would like to live in the same area. I do value their emotional and social support at times. Also I don't know if I'll be able to find good places to rent, good land lords in the same area forever. My kids have developed their own circle too. I consider it an important part of their upbringing.

    5. I do not want to keep on updating the address for my bank a/c, dmat a/c, Ration card, life/vehicle insurance policies, employer records, electoral rolls, outstation relatives etc. I have better things to do in life. I also travel abroad frequently and in case of some police clearance I do not want to visit multiple police stations for clearances. As I said I have better things to take care of in my life.

    6. The next place I rent might not provide me a parking facility. I love my vehicles just as I love my family members.

    So basically its not easy to find a place to rent, in the same vicinity as my relatives, that is owned by a "good" landlord, has a parking lot etc etc. Even if I get a place, a sword (getting kicked out) will always be hanging over my head.

    So a big NO to renting for above reasons (I haven't even touched the prestige/ego boost ones own home has to offer. Lets leave it for some other day).



    Nice sensible post from familiy man.
    CommentQuote
  • Originally Posted by mahesh pune
    Nice sensible post from familiy man.


    +1 to this. Although senior members are not ready to buy any argument on this. they can even prove you that renting forever is the BEST option, which will save you lots of money. One has to go by his conscience & buy as per his need & affordability.

    I have seen senior members advising to stay on rent, save money & spend it on other better things in life (in their opinion) like buying expensive cars, going on expensive trips, gifting expensive things to your wife etc etc. Fine but can't people's priorities be different? Why blame a person who thinks that I would prefer to buy a home (which is affordable to me) rather than spending heavily on expensive cars. gifts & holidays?

    I am no where trying to say that it's a must buy situation but definitely it's not a 'Never Buy' situation.
    CommentQuote
  • :), So when did the senior member suggest - "Never Buy" ? Infact, all of us are on this forum bcos we want a property in Pune.

    The question is -- WHEN to BUY and at WHAT VALUE ?

    Senior members have only suggested time and again - rent for 2-3 years, get good enough cash under your belt and then take the plunge in 2013-2015.

    Todays hype,builder cheatings,rent:sale ratios, interest rates,infra in Pune,etc are all stacked up against a property purchase of Pune.

    Well, but for some, " own house" sickness or happiness is more important than financial stability or future risks - So Be IT.

    We are advising all to think PRACTICALLY not EMOTIONALLY.
    CommentQuote
  • Originally Posted by pcpune
    :), So when did the senior member suggest - "Never Buy" ? Infact, all of us are on this forum bcos we want a property in Pune.

    The question is -- WHEN to BUY and at WHAT VALUE ?

    Senior members have only suggested time and again - rent for 2-3 years, get good enough cash under your belt and then take the plunge in 2013-2015.

    Todays hype,builder cheatings,rent:sale ratios, interest rates,infra in Pune,etc are all stacked up against a property purchase of Pune.

    Well, but for some, " own house" sickness or happiness is more important than financial stability or future risks - So Be IT.

    We are advising all to think PRACTICALLY not EMOTIONALLY.


    For Indians, social compulsions are more obligatory than logical financial decisions. Basically it is the herd mentality. If others are buying home... I should not miss the bus?:bab (6):
    CommentQuote
  • I would urge people not to buy in Pune. Din't you read the thread "Once you buy in Pune, you are doomed". What else need to be done to scare daylights outta you. If you people decide not to buy then there will be some chance of correction and then I can go and buy some good place for me.

    Don't ppl see what is "really" being conveyed in this forum and still think of buying :D
    CommentQuote
  • Hasn't realacres always says not to buy irrationally, and same time supported those who really had a need to buy ? Ask harishkulks.
    The above post actually is rational buying if he has not over-leveraged. While not all cases are like this. Does a 25-30 year old has school going childrens ? Haven't you seen irrational buying spree amongst many youngsters ? Also those who complain about changing flats every 11 months, have they explored option to lease for 2-3 years ?
    And, can't you still make out the fact that, everyone on this forum wants to buy and that's why we are here. Its just the fact that some of us don't want to compromise heavily, on leveraging, infra, and giving up the good things of life just for having the satisfaction of your own home. I support realacres when he says no to buying on over-leveraging urself and compromise the quality of life of urs and urs family. But you can buy without that, can still afford a car, nice furniture for ur home and good schooling for ur children, then go ahead and buy. The fact is, majority people who are inclined to buy now, can't afford it without over-leveraging (me included). Hardly anyone has enough savings to do a decent down payment of 50% or more. If so, why not rent and live happily is the question.



    Originally Posted by rsatitkar
    +1 to this. Although senior members are not ready to buy any argument on this. they can even prove you that renting forever is the BEST option, which will save you lots of money. One has to go by his conscience & buy as per his need & affordability.

    I have seen senior members advising to stay on rent, save money & spend it on other better things in life (in their opinion) like buying expensive cars, going on expensive trips, gifting expensive things to your wife etc etc. Fine but can't people's priorities be different? Why blame a person who thinks that I would prefer to buy a home (which is affordable to me) rather than spending heavily on expensive cars. gifts & holidays?

    I am no where trying to say that it's a must buy situation but definitely it's not a 'Never Buy' situation.
    CommentQuote
  • Originally Posted by rsatitkar

    I have seen senior members advising to stay on rent, save money & spend it on other better things in life (in their opinion) like buying expensive cars, going on expensive trips, gifting expensive things to your wife etc etc.


    If this is the message that comes out of what seniors are trying to say then I am afraid to say that the seniors are not doing a good job. (I don’t count myself as a RE knowledgeable person).

    However what I have understood from seniors on this forum is importance of affordability and non-excessive leverage. My understanding of what seniors are saying here is not that one should buy expensive gifts or expensive cars. They have been constantly saying that excessive leverage should be avoided. (So if one has to take excessive leverage to buy a expensive CAR even that is bad). At the same time I see their view point about buyers being sold pathetic property on outskirts with lack of basic infra, water, roads etc. Given a view of the above the seniors say that instead of buying by over leveraging or buying at pathetic locations with lack of basic amenities it is better to Rent. I might be incomplete in my explanation above but it is a brief of what they have been saying.

    Pls correct me if I am wrong in my understanding.

    Originally Posted by rsatitkar
    Fine but can't people's priorities be different? Why blame a person who thinks that I would prefer to buy a home (which is affordable to me) rather than spending heavily on expensive cars. gifts & holidays?


    If one has to sacrifice expensive holidays, gifts and expensive Cars for buying RE then I agree completely with you one should sacrifice them.

    But if one has to sacrifice modest Car, modest gift and modest holiday for 10-15 years then there is a problem. Pls note although subjective there is a difference between modest Car, modest gift, modest holiday and Poor Car, poor gift and poor holiday.

    If I am not mistaken this (the above 2 lines) is what some of the senior members have also been trying to tell.

    What I personally tend to ignore are posts like Crash to happen in 6 months etc. etc. AND the opposing posts like since crash did not happen means prices will double in the next 6-9 months.

    VK
    CommentQuote
  • Originally Posted by aditi sharma
    Hasn't realacres always says not to buy irrationally, and same time supported those who really had a need to buy ? Ask harishkulks.
    The above post actually is rational buying if he has not over-leveraged. While not all cases are like this. Does a 25-30 year old has school going childrens ? Haven't you seen irrational buying spree amongst many youngsters ? Also those who complain about changing flats every 11 months, have they explored option to lease for 2-3 years ?
    And, can't you still make out the fact that, everyone on this forum wants to buy and that's why we are here. Its just the fact that some of us don't want to compromise heavily, on leveraging, infra, and giving up the good things of life just for having the satisfaction of your own home. I support realacres when he says no to buying on over-leveraging urself and compromise the quality of life of urs and urs family. But you can buy without that, can still afford a car, nice furniture for ur home and good schooling for ur children, then go ahead and buy. The fact is, majority people who are inclined to buy now, can't afford it without over-leveraging (me included). Hardly anyone has enough savings to do a decent down payment of 50% or more. If so, why not rent and live happily is the question.


    Agreed.!!!!!
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  • Rent ~ EMIs

    Originally Posted by rsatitkar
    Agreed that in today's date supply is much more than demand & still prices are high, hence there are chances for a correction. But at the same time I think market has some support becasue of peoples current salary levels (not just IT, Banks, Cent Govt etc). Hence even though rates start falling down there will be some support it will not be a free fall (unless something like sub-prime happens in India. Touchwood.

    If salary levels are high, then rents too should be high right? What's the logic that person earning 50k puts 40k as EMI & same flat is on rent for 8.5k?? Shouldn't the landlord ask say 20-25k as rent?? Fact is the rates are hyped up. I am staying on rent from Oct 06 & in my current house from Nov 07 (this one is better one & brand new) & landlord has said to go for a 3 yrs lease agreement this time. Man, what you forget was BANKS. It were they who made the hyped prices affordable.......how many people who bought in 2005 can buy their own house at current rates today??:bab (34):
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