will the proerty keep on rising the way it is. today i went to a property broker to check out 1 bhk.. in 20 days owners are asking 55-60 lakhs as 48 lakhs before.
this is in andheri mumbai. broker was telling me that 1-2 yrs back nobdy was willing to pay even 20 lakh for 1 bhk
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Abhay T on Feb 06, 2008 06:44 PM Permalink
It depends on whether you need that property now and whether u can afford it. 1. If u don't need property now and considering only as investment, answer is NO. You can wait for correction. Get a general feel in sourrounding areas. Is there any "real" change in cicrumstances around Adnheri or is it just the current trend? Also consider, whether its affordable to u now or u can consider other nearby areas that offer cheaper houses. 2. If you need a 1BHK house now as a priority, buy that is affordable to you. You may have to consider nearby cheaper areas. Once you settle in that house, over a period of time (5-10 years) the value will definately be much higher! At that time, u can consider another bigger house with additional savings and cash earned from this house.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Manish Jain on Feb 06, 2008 08:11 PM Permalink
Anyone India is the only market in world where only real estate prices are rising not the rent this goes only for residential properties. In Gurgaon you can get a two BHK for rent on 16K, but if you want to buy it will be at least 80 lacs. From simple business sense the 8% Interest rate on 80 Lacs after tax works out to be approx 35K. Why would a user then buy that property? It's only the speculators who are driving this boom. All set to become a doom after commonwealth games at least in NCR.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Abhay T on Feb 06, 2008 08:42 PM Permalink
1. It depends on your needs. Once you have family and need your own place to live, you have to think about your own residence. There are times when house may not be your priority or you may already have one. In that case you are right! Don't invest in property. I used the same logic in mid 90s, when property prices were nearly flat and it wasn't my priority. 2. From time to time, properties will go through boom and correction. But, I don't see anyway for it to crash! Don't believe in speculated prices. But also don't believe in "all doomed" theory. With continuing growth in India and shortage of houses for people, house price crash is just not possible. Slowdown and corrections happen only after some sharp increase.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by naive boy on Feb 06, 2008 09:40 PM Permalink
everyone talking about time value of money..wht about time value of need??? thevery purpose of any investment should be the need and not the future value. if someonereally need a property sucha s house due to certain unavidbale circumstances then one shouldbuy it without caring baout price.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by ThirdInstance on Feb 06, 2008 10:32 PM Permalink
is the rent always going to stick at 16 K Manish ?? Will the person who is buying properties with ur calculated amt of 35K not charge atleast 36K for rent sooner than later ?
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Manish Jain on Feb 07, 2008 03:32 PM Permalink
Yes the rent would increase but I am not saying to follow this approach for life but you can stick to this approach at least for next five years and then my understanding is supply and other factor would bring the prices to more affordable level. If you compare the rent of residential properties in India they haven't grown like the cost of these properties.
I agree with the argument raised here that property prices can not correct over night but the problem is technical otherwise it wouldn't take time to fall. Property prices are not available on any exchange, ownership transfer is not that easy. Moreover it's the local brokers and builders who can change the dynamics of any property market. There are many transactions done where there is no ownership transfer (Registration) only a power of attorney is taken. The sole purpose of these transaction is to hike the prices and those parties are traders.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Naveen Bhutani on Feb 06, 2008 08:42 PM Permalink
Very well said...property prices the world over are declining...It's only in India that the property prices are going up, and that too because of speculation...end users simply cannot afford these unrealistic prices.
RE:property rates go!!!!!!!!!!!!!!!!!!!ng up!!!!!
by Abhay T on Feb 06, 2008 09:02 PM Permalink
You are forgetting few things. Indian economy is in its teenage where as American economy is in its 60s. Its only in US where properties are crashing, because of subprime mortgages! This is not the case with Indian economy! 2. Remember one thing! There are always people who can afford it. They invest only when they see some prospects. Otherwise, why would Amabnis put so much investment in real estate!
