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Some RE Broker Inputs on Pune RE Situation

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Some RE Broker Inputs on Pune RE Situation

Last updated: September 8 2015
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  • Some RE Broker Inputs on Pune RE Situation

    Today while having breakfast at a dhaba, I met my RE broker with whom I had spent over 1 year looking for flat to buy. He gave some insights in to the current state of Pune RE:

    - Number of Sales he managed in last few months is 20% down over similar periods in past. Other brokers are in similar situation

    - Rental transactions are still strong, but pricing power has decreased

    - Bachelors can negotiate to their advantage during rent renewals. They will be able to avoid any rent increases (I think he meant any class of people who don’t mind changing houses, not just bachelors)

    - It is fashionable nowadays to discuss "Unsold inventory". But the bigger problem is Investor/Speculator flats. They were bought to be sold at a higher price. Pune has a very large number of such flats that will come on sale if prices appear to start dropping. He estimates 80% of the Pune market is speculative. People buying for own use are 20% or less.


    - In 2007-2008 many investors got great deals on RE and they were able to minimize their overall costs by paying a large part in cash. However few people buying 2-3 BHKs nowadays can afford to pay much cash. They can barely manage the usual expenses. These investors expect cash payments to minimize their capital tax expenses but are not finding suitable buyers. 4-5 BHK buyers are still prepared to pay cash.

    - The RE Situation has started to become worrisome but there is no panic yet. Current investors holding flats should not make panic sales, but at the same time they should keep a watch and get out if there are signs of the dam breaking.

    - Resale property buyers needs to be careful to check legal status of properties. When prices were rising rapidly, people bought with their eyes closed ... confident of selling at higher prices. Many did not bother to check legal status. Now it is up to people buying these in resale to do the needful.

    - Some lawyers are in cahoots with builders/developers. You should be careful of the lawyer you hire. Many sales of "proposed NA" plots in and around Hinjewadi area were possible only because lawyers did not warn their customers adequately.

    [Disclaimer: This is a record of discussion with a broker and should not be treated as advise. Everyone should do their own investigation and form their own opinions before deciding to buy/sell RE]
  • #2

    #2

    Re : Some RE Broker Inputs on Pune RE Situation

    @sudhanshbahu

    i too had similar experience wehn i was searching for resales .... flats with high cash componenet remained in the market fr longeer ... also there seemed to be variation in sells based on society ... in good society flats were selling faster and many times purely through internl society referrals or relatives ...often 2-3l lesser than market rate owing to the fact that seller knew the buyer hence the trust factor was high ... (many times it can be a pain selling through broker and both buyer and seller at loss since brokers get 1-2l in between)...

    i would disagree on the % of speculative buying by investors though.. it seems to be lesser than 80% (removing speculative retail buyers buying 1-2flats like us ) ... my experience is investor flats are very high in upcoming areas than in developed areas


    good info

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    • #3

      #3

      Re : Some RE Broker Inputs on Pune RE Situation

      Originally posted by Tangent View Post

      i would disagree on the % of speculative buying by investors though.. it seems to be lesser than 80% (removing speculative retail buyers buying 1-2flats like us ) ... my experience is investor flats are very high in upcoming areas than in developed areas


      ...
      The broker operates in the West areas of Pune like Hinjewadi, Wakad, PS, Baner, Balewadi etc.

      I guess what he says applies in this region and would not cover older areas like Aundh or the city proper

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      • #4

        #4

        Re : Some RE Broker Inputs on Pune RE Situation

        I met the agent friend again today. He was in a very good mood as he had finally concluded a deal on a Row house in gated community at Talegaon.

        Deal had been going back and forth in negotiations for over 4 months. Owner asking price was 1.25Cr as per his idea of current price in that community. Finally after 4 months he agreed to lower price and sell at 1.075 Cr.

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        • #5

          #5

          Re : Some RE Broker Inputs on Pune RE Situation

          Originally posted by sudhashbahu View Post
          I met the agent friend again today. He was in a very good mood as he had finally concluded a deal on a Row house in gated community at Talegaon.

          Deal had been going back and forth in negotiations for over 4 months. Owner asking price was 1.25Cr as per his idea of current price in that community. Finally after 4 months he agreed to lower price and sell at 1.075 Cr.
          Row house? How many beds? Must be 6-7..
          3bhk row houses in wakad-balewadi-baner-mahalunge quote 1.25 - 1.8 CR and deals happened in past few months show the actual deal price 20-30L lower than quoted.

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          • #6

            #6

            Re : Some RE Broker Inputs on Pune RE Situation

            Originally posted by investwest View Post
            Row house? How many beds? Must be 6-7..
            3bhk row houses in wakad-balewadi-baner-mahalunge quote 1.25 - 1.8 CR and deals happened in past few months show the actual deal price 20-30L lower than quoted.
            Checked with him, this is not really "row" house. It was land sold in a plot scheme years ago. People constructed their own houses. The community itself is walled and gated.

            The house in question was 4 Bed. Ground + 2 with two covered car parks and two large balconies and two dry balconies.

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            • #7

              #7

              Re : Some RE Broker Inputs on Pune RE Situation

              ohh and if it's talegaon then I must say that the prices are skyrocketed already..

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              • #8

                #8

                Re : Some RE Broker Inputs on Pune RE Situation

                Its already sky-rocketed like satellite launch ! Few months ago, I inquired to one local builder (Named Maane Builder, who has done several projects in Talegaon) for a 2BHK near Talegaon Dabhade road. He was quoting 5000 INR / sqft !! So minimum 50L for 2-BHK.

                I had a brain-fart at that time. Project was in planning phase. He mentioned that prices will go high once project starts. Only 12 flats in a 3 floor building.

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                • #9

                  #9

                  Re : Some RE Broker Inputs on Pune RE Situation

                  Originally posted by innerpeace View Post
                  Its already sky-rocketed like satellite launch ! Few months ago, I inquired to one local builder (Named Maane Builder, who has done several projects in Talegaon) for a 2BHK near Talegaon Dabhade road. He was quoting 5000 INR / sqft !! So minimum 50L for 2-BHK.

                  I had a brain-fart at that time. Project was in planning phase. He mentioned that prices will go high once project starts. Only 12 flats in a 3 floor building.
                  5000 psf is same as Sarjapur Road/Outer Ring Road....
                  How many IT (or non-IT) companies are there in Talegaon?

                  Comment

                  • #10

                    #10

                    Re : Some RE Broker Inputs on Pune RE Situation

                    Originally posted by investwest View Post
                    Row house? How many beds? Must be 6-7..
                    3bhk row houses in wakad-balewadi-baner-mahalunge quote 1.25 - 1.8 CR and deals happened in past few months show the actual deal price 20-30L lower than quoted.
                    Could you please elaborate more on 20-30L lower price? I don't see any rowhouse in Wakad,Baner,Balewadi below 1.2-1.4 CR...Even these are old row houses...

                    If you have any confirmed prices per society please share with us...So some people will get benefitted by not overpaying....

                    Thanks

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