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....
Read more
Reply
12597 Replies
Sort by :Filter by :
  • Guys, you are again missing the facts. No body is scared, and people with more then 40L of Loan won't be reading these threads for fresh ideas.

    The point i am trying to make is, India has a strong growth story. Look at the recent IIP figures. I think you guys are the people who missed the bus earlier and now want to see India doomed so that you can make some buyouts. But guys look at the facts. In all kind of market scenarios you will find people who say it will further go down, if its already down and others will say it will go up, when its already up.

    Sometimes too much of analysis and facts will lead you nowhere. Sometimes shear commonsense, Gut feeling, some research will do the job for you. Otherwise you will find solace in Wisey views(which i think are applicable for short term only, in case some bad happens in worst case).

    Ok, tell me where you guys see India 20 yrs from now?. I am sure we will be far better, with good infra and good quality of life. Why you think all these top car companies are jumping to India suddenly with all kind of fast and luxury cars. Guys they have done some analysis, they know that India is the next growth Engine, because of huge middle class doing well.

    We are and will be hardcore consumer driven economy, and thats a fact which is going to increase day by day unless we stop producing ourselves. :).

    I am always OK with Wisey views(-ve) though because he makes us to think twice. But, the point is you should not start scaring people by sayin OH Iceland is doomed so wat will happen of bigger fishes n all.

    Thats not true.

    Think Big. Think Long and Sometimes long term positivity helps.
    CommentQuote
  • Or Wisey you are comforting people who cudn't buy earlier and want to see India doomed to buy now. :)

    I am not sure the so called scared people really come to this forum for anything. They dont have anything here, better focus on work. :)

    Look at the facts, IIP figures, long term indian story(which is very very strong), look at the Big car exhibitions suddenly hitting India(do you ever think why these MNCs suddenly started loving India). There you go, they do long term research and figure indicates them that India has come.

    Please check the Mumbai rates again?. If you have anythink in 50L(which was 1 Cr) last year, do let me know.

    Originally Posted by hitmady
    Wisey, you definitely scare a category of people who has bought 2BHK in kothrud/baner for 60Lacs with loan of 40L+.
    Let them live in fool's paradise.
    You know a famous quote "India is decoupled from western economies".

    Two years back in Mumbai I could hear people saying their RE is worth 1 crore. Now same people have come down to 50L.
    I seriously doubt if they can buy RE worth 50Lacs
    CommentQuote
  • The consumer confidence index has fallen in US according to figs released on Fri. The BPLR will now be fixed by RBI meaning no special benefits to big corporates who used to dicate the terms to the bank as banks will have to charge above this BPLR. This also means end to practises by banks like low interest rates for first 2-3 years & so on. Hence, no more gimmicks. Good for the market, bad for the banks. The food inflation has again touched all time high:(. China has has tightened it's liquidity yesterday as well, to cease artificial growth. Man, even if I want to, I am unable to see real growth happening in the country, now let the FM cut the stimulii due to rising fiscal deficit, we will see the real fun. Rented clothes will be taken away:D.
    Originally Posted by puser
    As far as Pune's RE prices are concerned; they are extremely unbearable, but people are buying by taking loans and NRIs are booking apartments in third class localities of BlueRidge or Park Street based on power point presentations, website's manipulative pictures of happy people and landscaped gardens...

    Third class? Man, you are too lenient, I would rate projects like BR as class-less:D. When people buy these type of projects based on their presentation, I remember the Hindi song:-

    "Humne tumko Dil Ye De Diya, Ye Bhi Na Pooncha Kaun Ho tum":D.

    Originally Posted by hitmady
    Wisey, you definitely scare a category of people who has bought 2BHK in kothrud/baner for 60Lacs with loan of 40L+.
    Let them live in fool's paradise.
    You know a famous quote "India is decoupled from western economies".

    Two years back in Mumbai I could hear people saying their RE is worth 1 crore. Now same people have come down to 50L.
    I seriously doubt if they can buy RE worth 50Lacs

    What struck me first after reading this post is pocket money!! Why? Coz in India, the youngsters only learnt how to go to pub with GF/BF & enjoy there like the American's, but forgetting that the American chaps earn & learn....be it at Pizza Shop, Flourist or whatever & then make merry, & not on parents money. This is indeed a very good quality to learn from American's. Same goes for RE as well, buy as they do in west without knowing that west has bankruptcy laws as well social security unlike India & hence they take such stupid decisions. There are people who have canceled their holidays this year as well coz their salaries goes in paying home loan EMIs & they overstretched themselves thinking that 20-30% increment YoY will be there & now are in a jam.
    CommentQuote
  • OK, got the message! Time to get optimistic!

    Jai Ho!
    My name is Caan! And so I Can!

    All of you on this forum MUST get yourselves a financial education (if you do nothing else in life, this will see that you do not end up penniless). And this should take you around 1 year part-time. Here's how you do it ...

    Cut your pub time by 50%. And add movie time cut another 50%. This should give you at least 4-5 hours a week which is around 20 hours a month (this is around 12.5% of your productive time at office as computed normally).

    In addition to freeing time, you also cut your expenses by 50% which could be sizeable!!! Use this to get some important books and subsidize your internet time. Here is a list of books you must have ...

    - A fundamentals book on Finance which explains the nitty gritty financial terms like principal, interest, simple, compound interest, IRR, NPV and maybe the basics of how to read financial statements (from how transactions are recorded - cash, bank, sales, purchase, etc - to the bookkeeping basics to books of accounts to trial balance and the P&L and Balance Sheet). It is very important to get a common-sense knowledge of how companies (and later countries) do their finances - in fact it is not much different from how you do your home accounting and financing!

    - A fundamentals book on investing in various asset classes - stocks, fixed income, tax-saving investments, RE, Bullion, etc, etc. And most importantly, the pros and cons of each asset class. Very important is the chapter on risk and how the Risk Profile of an investor changes from the age in 20s to 30s to eventually 70s.

    - A great investment book (please get your hands on "The Intelligent Investor" by Ben Graham - buy it second hand and its available in plenty in second hand stores). I have found that the most important books in life are always available at deep discounts - shows how little people really know about what is important and the rest of the fluff!.

    And now about Asset classes.

    I believe most people drift towards buying a home for a few reasons like ...
    - Environmental pressure (not yet bought a home on gigantic loan?)
    - Genetic memory (for centuries your ancestors did one thing first. Bought land/home
    - Govt partiality towards high leverage at low interest for property (give me 90% loan at 10% interest to buy stocks and see what I can deliver!)

    But, I have, in the last 25 years done better at stocks than in RE (though RE investment too has done exceedingly well). Therefore its obvious that I have a partiality towards stocks. So, here is what I suggest to the youngsters ...

    First get into stocks after educating yourselves on financial and tax matters. For this, you must always buy when everyone is selling (Mar 2009) and sell when everyone is buying (Dec 2007 and Oct 2009-Jan 2010).

    Here comes the optimism. Land and RE will only rise in sync with salaries and wages. Stocks will rise with profitability and surpluses - which could rise much higher than wages. Since India is likely to see a manufacturing boom in the mext decade, investing into sound stocks will probably see you do very well in the next decade as compared to any other investment. A side-effect of this corporate bonanza will also be a sound price rise in RE.

    When you have spent around 4-5 years investing in stocks you will have a sizeable corpus of funds to deploy as down payment into RE. You might want to invest this into RE when prices are at reasonable prices (use long term rental yield as benchmark for "reasonable) and buy after taking all else into consideration (proximity to work area, markets, schools, transport hubs, etc).

    Do not put every penny of your savings/investments into RE. You will suffer.

    You will also note that, when you read financial news, you get a lot of gyan when you are financially educated. This has many beneficial side-effects, one of which is people will seek you out and listen when you talk about economic matters.

    Whatever else your education, you have no excuse not to educate yourself on financial matters.

    cheers
    CommentQuote
  • More thought on Iceland Story

    Wiseman,

    As u have mentioned that iceland (entire country) has gone bankrupt, now what next???

    I mean what Iceland will do,what the ppls of iceland will do, whether they all will die by starving like ppls die in African countries??? or there is any Hope???

    Why I am asking this, coz if somebody (IMF or UR or maybe some other country) will help them to come out from this situation then I think they are in better position than many African countries & if not...still what next???

    I am expecting a well elaborated post on this;);)
    CommentQuote
  • India is no more the protected economy of the 20th century. This extra boom in economy is mainly due to the semi open concept of Indian economy. Many of the western middle class lost to India China due to
    electronic age and the open concept trade. This in turn brought in the recession in these countries and a drop in consumption which in large part is got from trade from India China.
    I guess wisey is connecting the dots India as a global family and since India lags the western world by 6 months to a year the prognoses is India has not bottomed out yet if its looking for trade to give it the extra boost in economy and bring it back to the 2007 era. So lets wait and watch the US
    and western economies haven't picked up yet.
    CAN
    Originally Posted by findingnemo
    Or Wisey you are comforting people who cudn't buy earlier and want to see India doomed to buy now. :)

    I am not sure the so called scared people really come to this forum for anything. They dont have anything here, better focus on work. :)

    Look at the facts, IIP figures, long term indian story(which is very very strong), look at the Big car exhibitions suddenly hitting India(do you ever think why these MNCs suddenly started loving India). There you go, they do long term research and figure indicates them that India has come.

    Please check the Mumbai rates again?. If you have anythink in 50L(which was 1 Cr) last year, do let me know.
    CommentQuote
  • Wisey bhi optimistic ho gaya?

    Then crash is inevitable soon! :D

    By the way, why does Nemo have "banned" status? Surely he doesn't deserve this?
    CommentQuote
  • Originally Posted by findingnemo

    Think Big. Think Long and Sometimes long term positivity helps.


    Think Big & positive for whom, builders, black-marketers/speculators? So they make huge profits/money in short-term and we (middle-income RE buyers) shoulder the burden of huge EMI & loan in long-term :)

    Even with encouraging IIP numbers and Indian growth-story intact, BSE index is still 20% below it's peak.
    Pls let us know what is the logic behind builders' increasing RE rate and delaying projects at the same time?
    May be it's pure greed of making 200-300% profit in single project, so builders need not work again :)
    CommentQuote
  • Putting the cart before the horse ...

    Originally Posted by findingnemo
    Or Wisey you are comforting people who cudn't buy earlier and want to see India doomed to buy now. :)

    I am not sure the so called scared people really come to this forum for anything. They dont have anything here, better focus on work. :)

    Look at the facts, IIP figures, long term indian story(which is very very strong), look at the Big car exhibitions suddenly hitting India(do you ever think why these MNCs suddenly started loving India). There you go, they do long term research and figure indicates them that India has come.

    Please check the Mumbai rates again?. If you have anythink in 50L(which was 1 Cr) last year, do let me know.



    Nemo,

    You must be careful trusting the analysis of people who, in the first place, never saw this bust coming (remember, most of our corporate world was pumping their maximum investments into their businesses at the very top) and, after taking a solid hit in the last 2 years, still do not see the second (and bigger) bust coming. A prime example is Tata Motors and Tata Steel.

    Add to this the average Janta which wholeheartedly swallows the propaganda of Govt and big business. Much of this huge buying of cars (one of the highest depreciating asset classes and therefore the one that is most likely to take its buyers to the cleaners when things go down) is because the general population with purchasing power has been convinced that the worst is over and we will now recover soon and grow at 9% for ever! Man!!!

    Coming to IIP, first of all it is a measure of production, not sales! Big difference. In the first case, all you have done is pumped more money into producing and stocked it (risk increases) and in the second you have realised your money thru a sale. You might want to see the net differences in Inventory (period to period) to see how sales really progressed and be prepared for some surprises. Besides, Dec 2008 was one of the weakest Industrial Production periods and we are also seeing low base effect. Just asking you to check these before hoisting the National Flag!:D

    In response to what happens in cases like Iceland - and please note that many serious eonomists around the world are looking at at least one medium-sized country to go bust the same way in 2010 itself - Greece?; no one is even contemplating a possibility of one of the big countries going that way since its too horrifying to contemplate since everytime in modern history some bigcountry has gone bust it has resulted in War of global dimensions! - many British people invested in Icelandic Bonds and got taken to the cleaners (one of my cousins in UK was among them and he did it despite my warning him about it well in advance). So, the British Govt first bailed them all out and then did a neat trick.

    They arm-twisted the Icelanders via the IMF saying, we will bail out Iceland if that country also bail out the bond investors (who took their own private risks investing there). Luckily for the Icelanders, their President had more spine than their parliament and refused to sign. This has gone into a national referendum with 60% of the population against it (in polls).

    Life for Icelanders is going to be tough for a long time to come. But they are tough and will pull thru. But these are some of the things you can expect. Of course, a side effect related to all assets in the country that goes bust (like RE) is that it literally collapses with liquidity going down to near-zero and prices re-tracing 100% of the gains of the recent boom that caused all this mayhem.

    Do not let all this affect you. India is not Iceland.

    cheers
    CommentQuote
  • Hi Wisey, nice to see you gave up optimism quickly.

    You should re-christen yourself to Pessiman.

    Originally Posted by wiseman
    Nemo,


    Do not let all this affect you. India is not Iceland.

    cheers


    No it is Greece (as you have said before). Check out

    ]http://www.businessinsider.com/between-dire-and-disastrous-2010-2-1

    to see what Greece means to India. We are in the same boat - the one going over the waterfall (cool picture)

    to see what Greece means to India. We are in the same boat - the one going over the waterfall (cool picture)
    CommentQuote
  • Originally Posted by wiseman

    In response to what happens in cases like Iceland - and please note that many serious eonomists around the world are looking at at least one medium-sized country to go bust the same way in 2010 itself - Greece?; no one is even contemplating a possibility of one of the big countries going that way since its too horrifying to contemplate since everytime in modern history some bigcountry has gone bust it has resulted in War of global dimensions! - many British people invested in Icelandic Bonds and got taken to the cleaners (one of my cousins in UK was among them and he did it despite my warning him about it well in advance). So, the British Govt first bailed them all out and then did a neat trick.

    They arm-twisted the Icelanders via the IMF saying, we will bail out Iceland if that country also bail out the bond investors (who took their own private risks investing there). Luckily for the Icelanders, their President had more spine than their parliament and refused to sign. This has gone into a national referendum with 60% of the population against it (in polls).

    Life for Icelanders is going to be tough for a long time to come. But they are tough and will pull thru. But these are some of the things you can expect. Of course, a side effect related to all assets in the country that goes bust (like RE) is that it literally collapses with liquidity going down to near-zero and prices re-tracing 100% of the gains of the recent boom that caused all this mayhem.

    Do not let all this affect you. India is not Iceland.

    cheers


    Wise,

    that means somebody or other gonna bail out iceland...

    So, could you please comment on this, that what is the better thing to do...

    Take debt,invest in the production, do great rise & if something goes wrong then wait for Bail out (that someway or other will defiantly bail you out )...This is what done by many countries in world so far including US....

    Or else Dont take any Debt & dont have any money for Growth & live poor always (like we have many African countries, they have good natural resources, still they are poor, coz they dont have money to feed their ppls then exploring these natural resources )

    So, in my understanding almost all the countries in world has made very good progress on borrowed money then not borrowing the Money...
    CommentQuote
  • Originally Posted by ash7979
    Wise,
    So, could you please comment on this what is the better thing to do...

    Take debt Or else Dont take any Debt


    I think something in between i.e reasonable debt.
    What is reasonable? Wisey can elaborate
    CommentQuote
  • This must be putting off Nats and others ...

    Originally Posted by ash7979
    Wise,

    that means somebody or other gonna bail out iceland...

    So, could you please comment on this, that what is the better thing to do...

    Take debt,invest in the production, do great rise & if something goes wrong then wait for Bail out (that someway or other will defiantly bail you out )...This is what done by many countries in world so far including US....

    Or else Dont take any Debt & dont have any money for Growth & live poor always (like we have many African countries, they have good natural resources, still they are poor, coz they dont have money to feed their ppls then exploring these natural resources )

    So, in my understanding almost all the countries in world has made very good progress on borrowed money then not borrowing the Money...



    Ash,

    You must have heard that economists themselves have their own ram and caste system. In that scheme of things there is

    Keynesian philosophy of economics which says that, in times of recession/depression print and throw even more liquidity (money) and create jobs (the now famous Rozgar Yojana of digging ditches 6 months and filling them 6 months) and this should bring back economic "growth" and kill recession.

    Then there is the Austrian philosophy championed by the Mises school (refer the site Mises.org) which says that any boom created by too much debt must collapse and it is only a matter of time and whether it will be a gradual bust (Japan) or a violent one.

    Right now there is a battle going on between these 2 main schools and it is quite interesting to follow.

    I basically tend to side with the Austrians and believe that every credit-fueled boom must erase all that debt (thereby necessarily breaking down) before the next boom occurs. Of course, if the growth is slow and steady, then recessions will also be mild and you will not see this kind of volatility. But these are situations of the 60s to early 80s in India and we are unlikely to go back to slow-and-steady!

    Coming to Iceland, every bailout only tends to push the inevitable collapse down the road to another date. And it emboldens the risky elements to take even bigger risks, leading to the future collapse to be an even bigger one.

    Therefore bailouts are probably the worst way of handling today's problems!

    Probably the best way to handle these greedy bankers, politicians and corporates which create extremely risky situations while trying to make more than they can is how dictators do it.

    Invoke Emergency, pull out 1 in 10 randomly and take them into the deep dark woods. The rest of the criminals (whitecollared, but criminals unquestionably) will automatically fall in line and refrain when they realise that the punishment of taking the world back 2 decades in progress is far morer than the rewards.

    And, the way we are progressing, I do think that that point may not be too far off! This is the way the world works ...

    cheers
    CommentQuote
  • Hot news from Dubai ...

    Consider this ...

    You lent money to the "safest" borrower in the world - Dubai World! (or so you thought).

    They went on recklessly building castles in the sand.

    Today, they tell you that they will only be able to return 60 cents for every dollar you lent them, and that to spread over the next 7 years!!!

    http://in.biz.yahoo.com/100214/137/bav2w4.html

    There is no way they can ever make back the money to repay as well as make money on top of it given the non-existent demand for Dubai property of the amount available, the price all of it was built up on and the inability of the Arabs to come down in living standards.

    Probably why Emaar is so desperate to go with their IPO in India (to further loot our public in our land)

    The Arabs never made their own money. They always lived off the land (oil) and a sense of entitlement!

    Now, think of this disease coming up in many parts of the world simultaneously!!!

    Of course, the usual disclaimer ...:D

    All of this will never happen in India!!! So, don't worry ...

    cheers
    CommentQuote
  • Smothering The Green Shoots

    Originally Posted by veeemkay
    While watching Zee News yesterday there was this report on RE.

    The report said that since Builders have increased the prices again without thinking the inventory levels are rising again. I know Real has been saying that Pune has the highest inventory in India… but in that report they said Bangalore has the highest followed by Mumbai, Delhi and the Pune. (Maybe some other cities were menti0oned as well).

    They also mentioned that people once again are finding the rates too high and are shying off from buying RE. Although they did mention that affordable housing are finding buyers.

    I am not sure what to make out of it.. cause even in Media we get so many contradictory reports. Some say “What a recovery!!! India is absolutely shinning like a sun”.. some say “Recovery still not complete please don’t remove stimulus”.. some say “Demand huge so prices up.. people buying like flats like crazy”.. while some say.. “Inventory levels are going high because rates have been increased by Builders”

    In all this confusion.. sometimes I feel like ARJUN and want to ask LORD KRISHNA.. “Who am I? what will I achieve buying a flat? What am I wanting money/Flat etc. if I am going to die taking nothing? Mera Marg Darshan kijiye Keshav.. mera Marg Darshan Kijiye?”..

    Unfortunately I am no Arjun and I have no Lord Krishna to help me.

    VK


    Business world report ..... see yourself and know the truth

    Smothering The Green Shoots

    http://www.businessworld.in/bw/2010_02_06_Smothering_The_Green_Shoots.html
    CommentQuote