Tuesday, July 1, 2008

Premium housing in Pune is in the Rs 3-5 crore band

Launching a project with UK-based YOO, Panchshil Realty brings around 100 flats into the market annually, in the price range of Rs 3-5 crore and are spread over 3,000-5,000 sq ft. “The demand is not as strong as last year but we are selling all that we construct,” Panchshil Realty director Atul Chordia said.

read more | digg story

5 comments:

  1. I wish the UK company all the Best for selling these Palaces at Rs. 3 to Rs. 5/- crores.
    Glad to Note India still has its Maharajas to buy them. They themselves say demand is not as good as last year and they are selling all they construct.
    By next year...Hope these Maharajas are not Beggars without a Roof by buying this.

    And for the UK based company, I guess they have not learnt their lessons from their experiences at Home. This would be their last such project.

    Wishing all the best to the Buyers if the project gets completed.

    Also for Megapolis with 5800 Flats...Hope this project gets fully completed by 5800 days.

    And for the Nanded City Project, for which bookings are closed. I guess they would have to close the bookings once for all because the advance amount for the Rs. 3,500/- plus per sq ft would have been already spent in advertisement and no one with brains will pay anything more when flats will be available in the Rs. 2000/- to 2,500/- range.

    Hope Ravi Saab you are listening...things are looking southwards....please write about projects which were selling Rs. 3500/- two months ago which are now offered at Rs. 2500 to Rs. 2750/-.

    thank you

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  2. Dear Mr. Ravi, I must appreciate the courage of the real estate developers who launch these kind of projects and also your courage for writing it in your blog..
    Inflation at 12%, growth slowing and real estate bubble busting at 14% interest rates.. Wake up people.

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  3. courage....!.....?.....!!...you need a courage to live happily in... 350 sq ft carpet area!!...for.3 to 5 crores...you need money...this is reality....real estate bubble and interest rate is for you and me!

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  4. Courage is indeed.. !

    Courage of people (if any) who buy these and any real estate at these outrageous inflated prices..

    Courage of people taking home loans for 14% - 15%

    Courage of callous and money laundering builders who refuse to say that demand is down - Read TOI article:
    http://timesofindia.indiatimes.com/Cities/Rising_rates_shatter_sweet_home_dreams/articleshow/3186498.cms

    Anybody who has lived or is living in US , UK or Europe would testify when prices collapse how is the impact. India seems to be still sleeping and snoring for the last couple of years..

    Hope people wake up from dead sleep sometime.

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  5. Ravi Saab, Kahan hai aap..
    A good read -

    --------------------------------
    Link: http://www.valueresearchonline.com/story/h2_storyview.asp?str=11593

    The Real Story of the Real Estate Debacle

    By Dhirendra Kumar | Jul 7, 2008
    Valueresearchonline.com

    The consensus story—visible in the general as well as news media—is that real estate is in trouble because of the rise in interest rates. Real estate prices as well as the stocks of real estate companies are down in the dumps because the rise in interest rates is keeping people from buying houses and apartments and so on. The idea being that since property loans have become expensive, fewer apartments will be sold. It’s a convenient piece of reasoning, but it also happens to be only vaguely related to the truth.

    High interest rate may be the last straw that broke the camel’s back, but the business was already in deep trouble. This real estate story started out quite nicely about six to seven years ago. With rising salaries and low interest rates, the early part of this decade saw a large proportion of Indians suddenly becoming capable of buying a house quite early in their lives. Given the tax breaks on housing loans, people realised that they could easily buy an apartment with a few lakhs down payment and an EMI of roughly whatever they would have paid as rent anyway. Such a situation had never really occurred in India. A house was something that Indians bought after a lifetime of hard work and miserly savings. As a result, there was a huge overhang of unmet demand.

    Typically, someone earning Rs 40,000 a month could buy an apartment worth costing Rs 20 lakh taking a loan of perhaps Rs 15 lakh. Back when interest rates were around eight per cent, such a loan would mean a monthly repayment of around Rs 13,000. Add the tax breaks and it was a great deal. However, those days didn’t last all that long. Powered by the cheap and easy money that banks were pouring into real estate financing, a huge swathe of investors rushed in and pushed up prices beyond the reach of all but a handful of real users. The 20 lakh rupee apartment was now a hole-in-the-wall fifty kilometres outside the city that would not interest anyone who could pay for it. Anything that would interest a middle class buyer was now above a crore of rupees. The basic price-salary-EMI equation now implied that if a real salaried user bought an apartment that he or she actually wanted, then they would have to mortgage the rest of their lives to someone. Genuine business-owners who wanted a shop in a mall were also in the same situation.

    At this point, which I believe we reached during 2005 and 2006, the real real estate market had essentially disappeared. There was breed of investors ranging from rich individuals buying two or three apartments all the way up to big syndicates with hundreds of (leveraged) crores at their disposal. These people were now buying up property either from each other, or in competition to each other. In the process, they were bidding up prices to bizarre levels. Into this morass stepped in the investor in real estate stocks, who eagerly believed in these fairy tales of fabulously valuable ‘land banks’. Today, we are in a stage when the truth is sinking in. Real estate companies were being valued on the basis of fantasy land prices. In real (inflation-adjusted) terms, those land prices will not be paid by actual users for years, perhaps decades.

    The party is over, and it’s the investor who bought these stocks who has paid the bill.

    ReplyDelete