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Market to cool off in 2008?

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Market to cool off in 2008?

Last updated: October 13 2008
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  • #11

    #11

    Re : Market to cool off in 2008?

    The place like Bangalore/Chennai/Pune/Gurgoan.... Price are directly depends on the IT industry. And hope by now everyone knows the current situation of the IT Jobs. Recession !!! A big US recession may drive out all the real estate pricing. US is already hit by the recession, and you may need to think about your job. If you buy a house at this time may be willl land up in a mess.

    People who watch Stock market will be able to view this situation closely. Brigade IPO: which came on 450 -600 few days back now it is landed * 185.
    Most of the Mall/Office places are over rated.

    Please read this thread...

    https://www.indianrealestateforum.co...ce-fall?t=2409
    Either land or AIR and FOOD. Choice is yours.

    Comment

    • #12

      #12

      Re : Market to cool off in 2008?

      You're right, the indian property market has already reched the height where affordability issues matters. Also the economic factors looming around the world and impact of the same on the IT / ITES industry will drive the fall of prices. The prices of property in various cities like Gurgaon, Hyderabad are started falling as per the news. The driving factor for the real estate was the IT/IT ES and growth of the indian economy.

      All this growth rate are related to the FII and the currencies of other countries. The INR is getting apprecaited with almost every currency in the world and the income of NRIS having a drop when they convert to indian money. There is a severe threat to USD is looming around. If that happens god only knows where will the property rates are going to end up.

      Comment

      • #13

        #13

        Re : Market to cool off in 2008?

        Well i feel, now the focus of growth and appreciation in real estate market has shifted from large cities to smaller semi-urban area like for example, trichy with 200 km distance from Chennai is kind of developing as a satellite town for Chennai-citizens find it easier and comfortable to settle down in trichy rather than the tumultous life of a metro like Chennai, this is happening in all the metro cities around India-so it may also be wise investing in such places right now

        Comment

        • #14

          #14

          Re : Market to cool off in 2008?

          True, it depends on location and one farmula may not work everywhere(even within the country). The prices depends on a lot of local factor, which is opposite of global sentiments of sensex.

          regards,

          Comment

          • #15

            #15

            Re : Market to cool off in 2008?

            what correction ???

            The orignal post is over 3 months old now... I was in India in February?(Mumbai and Gujarat) wanted to buy some property(not as an Investment, just as a second home In India) and prices are just ridiculous... I was talking to all my friends and relatives and all were talking about affordibility(middle class could just not afford a property even in suburbs of Mumbai)... Some says that prices in suburb of Mumbai could come down as much as 40-50%...but one of the friend was telling me that the price of land which was going at 15,000 Rs/sq. yard during diwali time near Kharghar is going for 35,000 Rs/sq yard in february

            Comment

            • #16

              #16

              Re : Market to cool off in 2008?

              Forget real estate prices, ask your bank for a loan

              Demand for property comes from owner occupiers, developers, real estate investors, hedge funds, private equity... Apart from the first the rest are all looking for relatively quick profits. The balance between the short and long term investors is impossible to judge for Indian property, but the newspaper headlines suggest that the former are significant.

              These groups could finance higher prices because of cheap loans. Now banks all over the world, despite the efforts of central banks everywhere, have begun to look closely at the risk of such lending. Among the international property hotspots, the US market has seized up, in the UK lending is down almost 40% from a year ago, Ireland and Netherlands price growth is slowing down. If the banks in India get worried about their exposure to property risk then the same will happen.

              My advice - forget about what prices are being advertised just go and ask your bank for a loan. If you feel that they are keen to get your business then expect the price growth to continue. I personally believe the cold winds blowing in the US and Europe will arrive in Asia in 2008/9.

              Comment

              • #17

                #17

                Re : Market to cool off in 2008?

                I dont think that indian realty market will slow down in coming decade.

                Comment

                • #18

                  #18

                  Re : Market to cool off in 2008?

                  Discounted Property

                  Just 5 days to save Rs 3,65,700! At Mantri Park, Goregaon, 1 BHK & 2 BHK apartments. Consider savings in stamp duty as additional sweetener. Rush! This offer is valid only up to April 13, 2008 or first 51 customers
                  Rs 300 off per square foot only up to 20 April 2008. Lok Housing for Lok Raunak Phase II, Mumbai
                  Pay 20 per cent now and 80 per cent on possession. Nahar Amritshakti at Chandivali, Mumbai
                  Free modular kitchen, free parking, free interiors, stamp duty relief. New Delhi

                  If all this was not enough, consider another recently concluded promotional offer by Bangalore-based Orange Properties that promised a Maruti SX4 free for every 1500 sq ft flat at Bannerghatta in India's silicon city. The apartments were priced at Rs 42 lakh. Considering the SX4 retails for Rs 6-8 lakh, the discount was pretty good.

                  Earlier, the group had offered an Audi A4 worth Rs 30 lakh to buyers who booked a villa at its upcoming Magnolia Brooksville project in Bangalore. The villa was on offer at a down payment of Rs 10 lakh.
                  The national capital region, where prices have cooled 5 to 10 per cent, is seeing developers quietly offer modular kitchens, free parking, free interiors and even stamp duty relief to attract buyers.

                  Goodies and early bird discounts are not a new feature of India's real estate story, but the timing is significant. Real estate prices have climbed off their historic highs in the last six months on account of tighter liquidity and an overall decline in sentiment.

                  According to recent reports, home sales have dropped 20 to 30 per cent over since last December in Mumbai, Delhi and Bangalore, the same cities in which residential prices had doubled or tripled since 2004.
                  Real estate analysts believe higher discounts and more sweeteners are the first phase of a correction looming over the property sector.

                  Said Ambar Maheshwari, director, investment advisory DTZ: "These measures are an admission by developers that their product is not moving. It is a first step before a more visible price correction".
                  Successive interest rate rises have also meant that housing loan disbursals have fallen, with leading financiers like SBI and ICICI Bank witnessing a 10 to 14 per cent dip in home loan growth for calendar 2007 over the previous year.

                  Ashutosh Limaye of property consultant Jones Lang LaSalle Meghraj (JLLM) said when the going is good, no one offers discounts. "Developers are giving these offers to boost sales. The goodies are aligned with the lifestyles of buyers," he adds.

                  The harder hit among the rash of real estate developers in India (the industry is fragmented and highly local in nature) are the mid-sized companies which are, expectedly, pushing the discount strategy more than the big developers.

                  Claiming there is no slowdown in demand, DLF and Unitech, India's largest real estate developers, said they are not resorting to any offers and discounts to beat the slump. "We have seen record sales in the just concluded quarter. We are not giving discounts and offers," a DLF spokesperson told Business Standard.

                  But property consultants believe that even bigger developers will feel the pinch in the coming days. "Till now big developers could hold prices due to their financial strength. But they will have to resort to some kind of price cut," a prominent Mumbai-based property broker said.

                  Raminder Grover, chief executive, JLLM, adds that while he has not seen too many advertisements of offers, he is aware of developers becoming more willing to offer discounts.

                  "Some of them are also paying home loan instalments for a year or two," he said.
                  Last edited April 16 2008, 11:16 PM. Reason: Formatting error
                  Either land or AIR and FOOD. Choice is yours.

                  Comment

                  • #19

                    #19

                    Re : Market to cool off in 2008?

                    Read this article !!!

                    http://business.timesonline.co.uk/to...cle3810486.ece
                    Either land or AIR and FOOD. Choice is yours.

                    Comment

                    • #20

                      #20

                      Re : Market to cool off in 2008?

                      Still not good enough! Wait for REAL BIG DROP!

                      Arin,

                      What you see now is what was happening on 2006 in US - to make a comparison. Still early days in our decline.

                      With last weeks crash in Stocks worldwide and an general understanding that the world is VERY CLOSE to a global financial meltdown, it is very clear that the emergency measures taken to fight that one will severely tear down the credit markets, tightening an already tight (36% interest!) credit market in India.

                      These discounts are just games Builders and RE companies are playing, thinking this will end soon and they can get away with it.

                      This will take till 2010 - 2012 to bottom out; end is yet many years away .

                      Wait for the 50% - 80% drop in listed prices. Then you will have good long-term bargains. You might even expect these discounts soon as RE companies are close to going bust with their low capitalisation, high leverage and thin margins as well as holding large inventory at ridiculously high costs.

                      Truly, a recipe for quick disaster. With recession certain and possibly a global depression, job losses in India (especially IT/BPO) will mount. Salaries too will crash. Even existing loans will become difficult to sustain. And many, many loans will go underwater as loan amount will exceed home equity - JUST AS IN USA!

                      WAIT with CASH in hand. CASH is KING in recessions.

                      cheers


                      Originally posted by arin_12 View Post
                      Just 5 days to save Rs 3,65,700! At Mantri Park, Goregaon, 1 BHK & 2 BHK apartments. Consider savings in stamp duty as additional sweetener. Rush! This offer is valid only up to April 13, 2008 or first 51 customers
                      Rs 300 off per square foot only up to 20 April 2008. Lok Housing for Lok Raunak Phase II, Mumbai
                      Pay 20 per cent now and 80 per cent on possession. Nahar Amritshakti at Chandivali, Mumbai
                      Free modular kitchen, free parking, free interiors, stamp duty relief. New Delhi

                      If all this was not enough, consider another recently concluded promotional offer by Bangalore-based Orange Properties that promised a Maruti SX4 free for every 1500 sq ft flat at Bannerghatta in India's silicon city. The apartments were priced at Rs 42 lakh. Considering the SX4 retails for Rs 6-8 lakh, the discount was pretty good.

                      Earlier, the group had offered an Audi A4 worth Rs 30 lakh to buyers who booked a villa at its upcoming Magnolia Brooksville project in Bangalore. The villa was on offer at a down payment of Rs 10 lakh.
                      The national capital region, where prices have cooled 5 to 10 per cent, is seeing developers quietly offer modular kitchens, free parking, free interiors and even stamp duty relief to attract buyers.

                      Goodies and early bird discounts are not a new feature of India's real estate story, but the timing is significant. Real estate prices have climbed off their historic highs in the last six months on account of tighter liquidity and an overall decline in sentiment.

                      According to recent reports, home sales have dropped 20 to 30 per cent over since last December in Mumbai, Delhi and Bangalore, the same cities in which residential prices had doubled or tripled since 2004.
                      Real estate analysts believe higher discounts and more sweeteners are the first phase of a correction looming over the property sector.

                      Said Ambar Maheshwari, director, investment advisory DTZ: "These measures are an admission by developers that their product is not moving. It is a first step before a more visible price correction".
                      Successive interest rate rises have also meant that housing loan disbursals have fallen, with leading financiers like SBI and ICICI Bank witnessing a 10 to 14 per cent dip in home loan growth for calendar 2007 over the previous year.

                      Ashutosh Limaye of property consultant Jones Lang LaSalle Meghraj (JLLM) said when the going is good, no one offers discounts. "Developers are giving these offers to boost sales. The goodies are aligned with the lifestyles of buyers," he adds.

                      The harder hit among the rash of real estate developers in India (the industry is fragmented and highly local in nature) are the mid-sized companies which are, expectedly, pushing the discount strategy more than the big developers.

                      Claiming there is no slowdown in demand, DLF and Unitech, India's largest real estate developers, said they are not resorting to any offers and discounts to beat the slump. "We have seen record sales in the just concluded quarter. We are not giving discounts and offers," a DLF spokesperson told Business Standard.

                      But property consultants believe that even bigger developers will feel the pinch in the coming days. "Till now big developers could hold prices due to their financial strength. But they will have to resort to some kind of price cut," a prominent Mumbai-based property broker said.

                      Raminder Grover, chief executive, JLLM, adds that while he has not seen too many advertisements of offers, he is aware of developers becoming more willing to offer discounts.

                      "Some of them are also paying home loan instalments for a year or two," he said.

                      Comment

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