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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

    Dip in house sales in Q4

    High prices and low demand continue to pull down the sales of residential units in big cities. The volume of residential units sold in Gurgaon and Mumbai has come down by 77 per cent and 45 per cent, respectively, during the fourth quarter of 2013 when compared with the corresponding period last year, said a report by Goldman Sachs.

    Quoting data from PropEquity, Goldman Sachs said by value, sales in Bangalore went up six per cent year-on-year, while those in Gurgaon and Mumbai went down 73 per cent and 36 per cent, respectively.

    “Overall sentiments are down due to high prices and delay in competition of projects. People are also expecting rates to come down and policies from the new government to reduce their burden,” said Santhosh Kumar, chief executive (operations), JLL, a global property consultant.

    Gurgaon, Mumbai see biggest dip in house sales in Q4 | Business Standard
    If you are happy, you are successful.

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    • Re : Builders & Real Estate Bulls Theory Proved Wrong

      Car sales down for second year running, job loss pegged at 1.5 lakh

      Car sales in India fell for second consecutive fiscal in 2013-14 with a drop of 4.65%

      Car sales in India fell for the second consecutive fiscal in 2013-14 with a drop of 4.65 per cent as the auto industry continued to struggle with demand slump due to a sluggish economy that has led to an estimated job loss of around 1.5 lakh across the entire value chain.

      According to data released by the Society of Indian Automobile Manufacturers (SIAM), domestic car sales in FY14 stood at 17,86,899 units as compared to 18,74,055 units in the previous fiscal.

      In the 2012-13, car sales in India fell by 6.69 per cent, which was the first decline in a decade.

      Car sales down for second year running, job loss pegged at 1.5 lakh | The Indian Express

      ^^ When people aren't buying cars, why do builders think buyers will think of buying hyped up flats ??
      If you are happy, you are successful.

      Comment


      • Re : Builders & Real Estate Bulls Theory Proved Wrong

        Originally posted by realacres View Post
        On Monday evening, the finance minister, as ever, claimed all's well on the economic front. But the fact remains India will have to grow by 8.1% in January to March 2014, for it to hit a target of 5.5% during 2013-2014. It's unlikely to happen, Vivek Kaul explains.

        An important part of finance minister P Chidambaram's job for a while has been to keep telling us that "all is well" on the economic front.

        He continued this on the last day of the financial year when he said "the Indian economy is now stable and the fundamentals have strengthened." The statement was in response to 18 questions posed by former finance minister and BJP leader Yashwant Sinha on the economy.

        So, how strong is the Indian economy? "We have contained inflation. Our biggest success is containing fiscal deficit," said Chidambaram.

        But how do the numbers stack out? In February 2014, inflation, as measured by the consumer price index, was at 8.1%. It has come down from levels greater than 10%. The primary reason has been a rapid fall in food prices.

        Food products make up for around half of the consumer price index. The question is: how much credit for the fall in food prices goes to the government? Not much. Also, don't forget the damage to crops from the unseasonal rains and hailstorms in parts of the country. This is likely to push up prices again.

        If we look at non-fuel, non-food inflation, or what economists refer to as core inflation, it stood at 7.9% in February 2014. This number has barely budged for a while now. Non-fuel, non-food inflation takes into account housing, medical care, education, transportation, recreation etc.

        What about fiscal deficit? "We will end FY14 (period between April 2013 and March 2014) with a fiscal deficit of 4.6%, as planned," Chidambaram said. Fiscal deficit is the difference between what a government earns and what it spends.

        But how has this target been met? A lot of expenditure has simply not been recognised. Oil subsidies of Rs 35,000 crore have not been accounted for. Estimates suggest that close to Rs 1,23,000 crore of subsidies (oil, fertiliser and food) have been postponed to next year. A March 4 report in this newspaper pointed out that the central government owes the states Rs 50,000 crore on account of compensation for the central sales tax.

        On the income side, public sector banks have been forced to give huge dividends to the government, despite not being in the best of shape. Coal India has paid the government a dividend and a dividend distribution tax of close to Rs 19,600 crore. India has the third-largest coal reserves in the world, but still imports coal. Shouldn't this money be going to set up new coal mines?


        Neelkanth Mishra and Ravi Shankar of Credit Suisse point out in a report titled Elections: Much Ado about Nothing, on March 19, 2014: "True utilisation in thermal power generation is below 60%, near 20-year lows (reported plant load factor is 65%)." This is because we don't produce enough coal that can feed the power plants.

        Getting back to Chidambaram, he said: "The CAD (Current Account Deficit) has contracted. We have added to reserves. The FY14 CAD is likely to be about $35 billion." CAD is the difference between the total value of imports and the sum of the total value of its exports and net foreign remittances.

        This has largely happened because of two things. The government has clamped down on legal gold imports. But anecdotal evidence suggests gold smuggling is back. This has a huge social cost. Also, over the last few months, non-gold, non-oil imports have fallen due to sheer lack of consumer demand. And that surely can't be a good thing.


        Chidambaram also expects "spirited growth, going forward". The finance minister has been spinning this yarn for a while now. In early February, he had said the economy will grow by 5.5% in this financial year.

        Growth during the first three quarters of the financial year has been less than 5% (4.4% in the first quarter, 4.8% in the second and 4.7% in the third).

        A back-of-the-envelope calculation shows the economy will have to grow by 8.1% in January to March 2014, for it to grow by 5.5% during 2013-2014. You don't need to be an economist to realise that this is not going to happen.

        Interestingly, in July 2013, Chidambaram had said: "People should remember India continues to be the second fastest-growing economy after China." By January 2014, this statement had changed to "India remains one of the fast- growing, large economies of the world."

        What happened in between? A whole host of countries in our neighbourhood have been growing faster than us. This includes Cambodia, Philippines, Indonesia, Sri Lanka and even Bangladesh. Given these reasons, it's fair to say that Chidambaram was cracking an April Fool's joke, a day early.

        P Chidambaram fades out, happy with himself | Latest News & Updates at Daily News & Analysis
        he is gloating about 10% to 8% !! Most well performing economies of the world will have an inflation rate of less than 4%.

        I just cannot believe how haughty this person is. It seems like he thinks he is the only economist left in the country. Despite his consistent poor performance, he thinks that the Indian economy cannot be handled by anyone else. And he has chickened out of the elections !!
        Last edited by Sat234; April 11 2014, 11:53 PM.

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        • Re : Builders & Real Estate Bulls Theory Proved Wrong

          Chidambaram has faded out but he has tried to perpetuate his legacy.
          His son is a candidate and if he wins Chidambaram junior will hold the fort.
          Our economy has slowed won.Our growth rate down.
          But asset increase of all our Honble MPs have shown vigour.
          Probably BJP will do a better job if they come to power.
          Gloom in the economic front can be dispelled by strong governance and not by tinkering with interest rates,repo rates etc.
          Any way economy will not miss Shri Chidambaram after his tenure,though he was /is eminently highly qualified along with the respectable PM.
          Combination of two economist has reduced our economy to poor state.
          Irony of highest order.

          Comment


          • Re : Builders & Real Estate Bulls Theory Proved Wrong

            Originally posted by vaibav123 View Post
            Chidambaram has faded out but he has tried to perpetuate his legacy.
            His son is a candidate and if he wins Chidambaram junior will hold the fort.

            His son will lose his deposit in Sivaganga




            Our economy has slowed won.Our growth rate down.
            But asset increase of all our Honble MPs have shown vigour.
            Probably BJP will do a better job if they come to power.

            Nobody can save this economy as BJP does not have a magic wand. As you said if Chidambaram and Manmohansingh struggle how come Modi do it?



            Gloom in the economic front can be dispelled by strong governance and not by tinkering with interest rates,repo rates etc.

            BJP will exactly try to tinker with rates. Mark my words...If they dont force RBI governor I will stop writing here...( it is another matter whether RAjan wilts or not)



            Any way economy will not miss Shri Chidambaram after his tenure,though he was /is eminently highly qualified along with the respectable PM.
            Combination of two economist has reduced our economy to poor state.
            Irony of highest order.
            red

            Comment


            • Re : Builders & Real Estate Bulls Theory Proved Wrong

              mangoman2012,
              I am aware that BJP also does not have magic wand to turn the economy around.
              Will is needed.
              Hopefully BJP will try its level best to improve economy.They will certainly try and improve infra and that will have beneficial effects.
              Modi is a go getter.
              But certain plans like bullet trains from big city to big city are impractical and we can never reach level near Japan(due to various reasons)
              Certain industries will benefit when and if BJP comes to power.
              But it will be welcome change if BJP takes over.
              We badly need change.
              But again I wish AAP gets enough seats to be a bulwark against corruption and battle against corruption can headway only if politically the the issue of corruption is taken up.
              Corrupt decision making has been the main cause of our nation working and running in this skewed manner.
              We have a 27 storey residence and we have millions in shacks.
              We are in an historical election.Pray india benefits and its huge population gets relief from ever increasing prices and decreasing facilities-transport,roads,hospitals.
              Who will cut life support of leaking PSUs.I cannot keep paying Air India subsidy for allowing it fritter it away on pay and perks.(Air India is an example off course of leaking PSU)
              AI and many of the loss making variety should be told sink or swim.
              Tax payer cannot give you free meals any more.
              Ban on foreign medical care at Government expense.(But http://www.hindustantimes.com/india-...1-1207512.aspx)
              Downsizing of all ministries,private staff of political leaders.
              Cutting of perks of Government servants and political leaders.
              Who is going to take cost saving measures like this.No routine circular of government to cut 10% is really helpful.
              AAP as a phenomena is good for the nation.Let it be encouraged.
              I am not talking of Kejri as an individual here.
              Some one in political sphere should always question unaccounted privileges and unending rights(but nil responsibility) of our political decision makers.(They keep saying people have punished us by making us loose the election.After all is loss in election the ultimate punishment?)
              Only a maverick politician will do this. Think and vote accordingly.
              Unless we push in better politicians our nation cannot improve.
              Changing the ruling party is not sufficient.
              India should remember this while pressing the EVM button.There is no greater favour you the citizen will do-Vote and Vote right.
              Last edited by vaibav123; April 13 2014, 07:59 AM.

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              • Re : Builders & Real Estate Bulls Theory Proved Wrong

                Last week my cousin had come from Bangalore to Pune. He was thinking about looking for a flat in Pune. Seeing the rates in Pune, he decided against it and said Bangalore is much better than Pune. He was surprised at the rates builders are quoting. He got frustrated with the traffic problems and all sorts of things.

                Comment


                • Re : Builders & Real Estate Bulls Theory Proved Wrong

                  Originally posted by anupparekh View Post
                  Last week my cousin had come from Bangalore to Pune. He was thinking about looking for a flat in Pune. Seeing the rates in Pune, he decided against it and said Bangalore is much better than Pune. He was surprised at the rates builders are quoting. He got frustrated with the traffic problems and all sorts of things.
                  +1
                  Bangalore has the same traffic problems. But infra is somewhat better. Metro has started. There are multi level flyovers and 8 km long flyovers. Bus services are better. RE prices in Bangalore seem to be more in touch with reality, even though it has more IT presence and higher average salaries than Pune.

                  Comment


                  • Re : Builders & Real Estate Bulls Theory Proved Wrong

                    Sat234,
                    India needs to compare itself with advanced nations and see where we stand.
                    The road network is inadequate and number of vehicles keep on increasing.
                    Parking is a major problem in all cities.
                    We overcome it by wrong parking ,gravely inconveniencing the road users and giving tow vehicles their daily share of loot.
                    Go to Viman Nagar in the evening and parking is real horror.You keep wandering around looking for parking.
                    How can we enjoy our life?
                    Either we expand our road network or stop vehicle production.
                    Our public transportation is a joke,but still millions survive on this link.
                    Our priority should be flyovers,roads,public tpt and parking instead of statues and underground subways which dont get used in big cities.
                    Basic traffic discipline needs to be enforced.
                    Metro is mandatory for all big cities,Load on roads will reduce.
                    Town planning needs radical review and public spaces should not be encroached by vendors,shops etc.
                    What is lacking is the will to do things the right way.
                    Last edited by vaibav123; April 14 2014, 07:57 PM.

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                    • Re : Builders & Real Estate Bulls Theory Proved Wrong

                      Since past 5 months, I have been searching for a decent 3 / 2.5 BHK in close proximity of Hinjewadi, but am not getting anything less than 75lk. Seriously, does anyone buy a flat worth 80Lk or 1cr? Am I missing something here?
                      Now I am more inclining towards renting out a 3 BHK rather than buying one, given the IT industry uncertainty factor.

                      Googling on the same lines I came up with following site:
                      www. arthayantra. com/research-report/item/363-buy-vs-rent-report-8-cities-2014.html

                      Though a year old data used, it still gives some insight. As per the analysis it will take approximately 9-10 yrs to break-even for buy vs rent.

                      Am a newbee in these, any suggestion are welcome

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