No matter what's the current price and future appreciation/depriciation potential, until and unless one sell his property, then only he would make any profit/loss. So first time buyers (for property) can wait for some time and then jump.
This is totally wrong, I've property around Bangalore and yes prices are becoming quite stagnant. Buying flats would be most would be like getting yourself robbed in the daylight. There are 3 lac flats ready for sale and the demand is 50,000, I dont have to tell more. Hence I would suggest buyers to keep a watch on the realty for sometime in the background of some infrastructure projects that would be coming up in the near future, by 2011. For long term gains go out to the suburbs and invest on land and not flats /apartments, your ROI is assured. Use the data from surveys conducted by some authorized institutes, also put in your effort to 'investigate and then invest'. All the best.
Such type of misleading articles from pure real estate brokers should be avoided as far as possible. They merely want to spruce up speculation in market.
Please dont publish such fool articles anymmore and confuse people. Prices in Bangalore already have cooled off.. Fall upto 30% in the hottest area Whitefield.
My calculation is: buying a flat at 30Lakh now is a loss as compared to investing the money in Mutual Fund, even it is not a loss if you invest the money in PPF.
Now calcualte yourself: 1. You are paying a rent of 10k per month, calculate how much will you pay till 20 yrs. 2. Now calcualte EMI for 20yrs for a 30Lakh flat. 3. Now get the differece of EMI minus Rent per month. (eg. Rent=10k, EMI=20k diff= 20-10 = 10K) 4. Invest this diff amt. ie. 10K in PPF and check what you get after 20 yrs !! Still you are not at loss. 5. Another case, now invest this 10K in MF for 20 yrs. You see.. you will become a CROREPATI.!!!!
Even you, consider tax rebates and inflation, then also investing MF is profitable than buying a house. Again, the value of your flat will start decresing after 5yrs.
WHY MAKE THESE CHAT BUILDERS CROREPATIS ?? BE A CROREPATI YOURSELF!!!!! Better buy a plot in 2nd or 3rd grade cities. You will get a better return.
RE:IT professional's use your brains - DONT BUY FLATS
by Sridhar on Dec 10, 2006 04:36 PM Permalink
Hi Ritesh,
I am also against this author who wants to rub the idea of "Buy a house now OR you have to buy for more later".
But I would like to point out a glitch in your package of becoming a crorepati by staying in a rented house.
Going by your calculations, over the period of 20 years, EMI Rs. 20000 for a 30 L house will remain constant for the 20 year tenure whereas the rent definitely would not remain Rs. 10000 for 20 years.
It can be constant if one wants to keep moving to suburbs to maintain the rent scale of Rs. 10000 for the same area (1BHK, 2BHK etc.) or compromise on the rented area they get as time goes by (I bet it would be impossible to compromise with growing family needs).
My advise to you and others is not to think in these terms (of not considering inflation when calculating future rental expenses) if you donot own a flat/house yet.
Ofcourse like others in this reply list, I believe the prices are going to comedown atleast for the flats. In Bangalore I've already noticed 20 % reduction in flat rates compared to 6 months back (Sarjapur road). But still there are no takers.
The Author seems to be keen on selling the idea of buying home as an investment based on advice provided by Realtors themselves.Now that's credibility for you! Going by the US experience, the following myths have fallen flat on their face - 1) Property prices never go down. 2) Property as an investment always yields higher return fixed income instruments. 3) Buying property is always better than renting. 4) You can use the property for renting and have additional income (provided you have no loan obligation against the rented property). and many more....
People must be very careful against buying into these views and should make property decisions based on their income and investment (risk/return) profiling.
