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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

    Property prices begin to dip, shows index

    It's official now, property prices are dipping according to latest Residex released by the National Housing Bank.

    Here is the link:-

    Property prices begin to dip, shows index - The Times of India
    If you are happy, you are successful.

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    • Re : Builders & Real Estate Bulls Theory Proved Wrong

      Banks Hike Home Loan Interest Rates

      The banks have hiked home loan interest rates by 25 bp or 0.25%. The banks are ING Vysya, IOB, Dena Bank & latest one is ICICI. The new interest rates of ICICI will be applicable from 4th July 2011. Man, even HDFC is now cotemplating a hike in interest rates.

      It is said that interest rates may go up by another 0.75% by this year end.
      If you are happy, you are successful.

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      • Re : Builders & Real Estate Bulls Theory Proved Wrong

        Originally posted by realacres View Post
        It's official now, property prices are dipping according to latest Residex released by the National Housing Bank.

        Here is the link:-

        Property prices begin to dip, shows index - The Times of India

        Good article. It says

        It was only Mumbai, Delhi, Ahmedabad, Chennai, Lucknow and Pune that bucked the falling trend.

        btw has TOI now become a good newspaper ? earlier it was eqauted to something not so good on this forum.
        Last edited by compuwalah; July 2 2011, 02:59 PM.

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        • Re : Builders & Real Estate Bulls Theory Proved Wrong

          Originally posted by compuwalah View Post
          Good article. It says

          It was only Mumbai, Delhi, Ahmedabad, Chennai, Lucknow and Pune that bucked the falling trend.

          btw has TOI now become a good newspaper ? earlier it was eqauted to something not so good on this forum.
          Looks like a case of Sour Grapes?

          Comment


          • Re : Builders & Real Estate Bulls Theory Proved Wrong

            Originally posted by Venkytalks View Post
            I did what was easy.

            Do you have New York prices? Do you have historical Bombay prices? I dont. I cannot compare data I dont have.

            If you have the data, go ahead and compare over the years. I would be interested to see your results.

            I dont even have pre 1980s data for Delhi. Nor is it available on the net.

            Even historical USD Rupee exchange rates are difficult to find. I had to guess from my memory that it was 12 Ruppes to the dollar when I was a kid - which year I have no recollection.


            Stoxx, even I said US prices will rise to cover 30% of the imbalance. I put the time frame for this at 5 years in my post.

            As for RE continuing to hold value - I agree on the long term - any real asset will keep some value when currencies are debasing with the global epidemic of currency printing.

            That is why I made some RE investments after abhorring the sector (as being only fit for madmen and criminals) for 8 long years.
            Good mathematical analysis but less logical - no one cared about India 30 years back and now its rise to an almost superpower, world stature and it being the 2nd faster growing economy set to become the top 3-4 economies by size in next 10 years has to be accounted. The 30-30-30 logic will not hold good - there may be some correction in Indian RE and some rise in US RE may happen because of the current situation though...

            R

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            • Re : Builders & Real Estate Bulls Theory Proved Wrong

              Originally posted by rajatk View Post
              Looks like a case of Sour Grapes?
              The caption under the photogrpahs says it all. That means that the Pune prices have not yet reached full potential since they kept on rising whereas it fell at other places (obvious from different posts on this forum though few cases of price negotiations were claimed). This has been a major complain two years back where people were demanding that since price has fallen everywhere else why not in Pune. So seems the dynamics of property prices differs according to the city. Though a small correction may happen just to start new wave of price rise. Looking at trend seems it seems things will settle at a average rate to 4K (higher in prime locations, lower in outskirts).

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              • Re : Builders & Real Estate Bulls Theory Proved Wrong

                Originally posted by compuwalah View Post
                The caption under the photogrpahs says it all. That means that the Pune prices have not yet reached full potential since they kept on rising whereas it fell at other places (obvious from different posts on this forum though few cases of price negotiations were claimed). This has been a major complain two years back where people were demanding that since price has fallen everywhere else why not in Pune. So seems the dynamics of property prices differs according to the city. Though a small correction may happen just to start new wave of price rise. Looking at trend seems it seems things will settle at a average rate to 4K (higher in prime locations, lower in outskirts).
                I think becoz Mumbai and Pune, the buyers are mostly from business class. they don't mind paying hefty prices to get RE, as they know they can squeeze this money from their customers. It only pinches the hardworking and honest middle class.

                In most of other towns such as Bangalore, the majority of buyers are IT folks and middle class money-saving folks, who till now used to think the same, but now due to recession 2 years back, they have grown wiser and very carefully treading the RE investment path. That's why rates here have stagnated (very few have reduced by 5-10%) for last few months. Also just if I leave my number at any builder, he just asks his croonies to call me every alternate day. That's how desperate they have become.

                Even the investors are ready to negotiate the prices. 10% is easily done but waiting for more. After all it is my hard earned money and earned thru honest means.

                Comment


                • Re : Builders & Real Estate Bulls Theory Proved Wrong

                  Demand for Home Loans Will Decline: Experts

                  June 29, 2011
                  IRN

                  At the peak of the global housing crisis in 2008, a group of executives at State Bank of India (SBI) were busy devising a new home loan scheme meant to boost the sluggish demand. The growth in housing loans had fallen from a high of 31.2 per cent in December 2006 to 4.1 per cent in March 2009. After State bank of India (SBI) launched its special home loan scheme, home loan portfolio of banks in India rose 30 per cent on a year on year basis till September 30 2010, against 20 per cent in 2009-10, according to data from the Reserve Bank of India (RBI). In 2011, as the housing market in the West slowly picks up, the Indian market may be in for slack. SBI withdrew its home loan scheme with effect from May, after RBI raised concerns on the borrowers’ ability to repay them over longer tenures. After a period of sustained growth, bankers expect a moderation in home loan growth in the coming months. Rising interest rates and property prices are once again set to hit demand for home loans, say bankers.

                  The impact of the slowdown is already visible in the priority sector lending portfolio of banks. According to RBI data, the growth in outstanding credit of banks, under priority sector housing loans, halved to 6.80 per cent in April, against 11.90 per cent in the year-ago period. SBI, the country’s largest public sector bank, expects a moderation in the growth in home loans. “We expect a slowdown, a moderation in the home loan market. It has been evident in the last two quarter. It is difficult to estimate the extent of the moderation,” said Diwakar Gupta, managing director and chief financial officer, State Bank of India.

                  Close to 30 per cent of the home loan market in India is currently accounted for by the teaser home loan market, according to Monish Shah, director, Deloitte, India. “The withdrawal of teaser loans would have a marginal negative impact on the demand. After 2009, in the two-to three year period, the home loan growth was mostly seen in the teaser home loan segment. It gained about 20-30 per cent market share, which is an absolutely phenomenal growth,” said Shah. SBI launched the special home loan scheme in 2008, under which it offered an interest rate of 8.5 per cent for a loan of Rs 5 lakh and 9.25 per cent for a loan of Rs 20 lakh, with a reset clause after every five years. The scheme was tweaked several times since then.

                  High interest rates are also expected to play a dampener. “Demand for home loans is likely to be impacted due to high interest rates. The impact would be more visible in the next two months. Both investors and home loan buyers are likely to wait for few months before buying property. In the last one year, the burden of easy monthly installments for borrowers has gone up by 15-20 per cent,” said S L Bansal, executive director, United Bank of India. The slowdown in home loan disbursements is already visible. The home loan growth recorded by United Bank of India till April was about 10-11 per cent on a year-on-year basis, against 12-13 per cent last year. R V Verma, chairman and managing director, National Housing Bank had said there was a slowdown in the growth in housing loans due to rising interest rates and property prices.

                  Smaller banks expect a level-playing field after the exit of teaser home loans from the market. Allured by lower interest rates, several home loan customers had shifted to teaser loans. “Now, we hope our customers will remain with us. Earlier, we saw some customers moving to teaser home loans. “During the first few months, the demand for housing loan is generally low, but for the whole year, we expect a reasonable growth in the home loan portfolio,” said M Narendra, chairman and managing director, Indian Overseas Bank. Rising property prices have also dented the prospects of robust home loan growth. According to realty consultant Cushman & Wakefield, residential property prices in Delhi-national capital region and Mumbai saw prices rise 36 per cent in 2010 on good demand. The trend was reflected in loan disbursements for banks as well. Housing Development Finance Corporation, one of the biggest players in the home loan market, saw fourth-quarter net profit rise 27 per cent rise last year.

                  In some markets, the outlook on property prices is expected to correct, while the interest rates are high. This could lead to a slowdown,” said Vibha Batra, co head, financial sector ratings, Icra. “A lot of factors would contribute to the slight slowdown in credit off-take. Affordability, interest rates and uncertainty in the real estate market are some of the reasons. So, going forward, there would be a slowdown in the home loan market for sure,” Deloitte’s Shah said.
                  If you are happy, you are successful.

                  Comment


                  • Re : Builders & Real Estate Bulls Theory Proved Wrong

                    Westerners becoming more competitive....

                    Cheap labour and low rent make the Lancs town better value than the Indian city, the firm claims


                    Chief Nigel Eastwood said: "India isn't that cheap any more. As call centres have grown, real estate prices have gone up massively, while salaries have also crept up."


                    India call centre axed for Burnley | The Sun |News

                    With current Salary people can't afford house & comapnies are closing down due to high salary.

                    Comment


                    • Re : Builders & Real Estate Bulls Theory Proved Wrong

                      Originally posted by khbarilal View Post
                      Cheap labour and low rent make the Lancs town better value than the Indian city, the firm claims


                      Chief Nigel Eastwood said: "India isn't that cheap any more. As call centres have grown, real estate prices have gone up massively, while salaries have also crept up."


                      India call centre axed for Burnley | The Sun |News

                      With current Salary people can't afford house & comapnies are closing down due to high salary.
                      It has been my prediction for quite a while that all BPO jobs will go back to USA and UK. It is the only work poor people of UK and USA can do.

                      Without currency depreciation, India will also not be able to compete with USA in IT sector. Massive college admissions in IT is USA currently will hit the job market in 2 years.

                      But I do expect our currency to depreciate to make up for this difference.

                      Net net IT sector will still perform.

                      BPO may not - we cant handle calls properly and will dwindle or go to phillipines
                      Venky (Please read watch a or before posting)

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