Tuesday, April 18, 2006

Pune Property Boom- Whats the truth?

Wonder whats going on with Pune Property Boom

Consider following examples

July 2005- Property Rate at Wakad 700-800 Rs psf
Nov 2005- Same property rate- Rs 1700 psf
March 2006- Rs 2200 psf.

Aundh-
Oct 2005 Flat in a scheme would cost Rs1900 psf
March-Apr 2006- same scheme hikes rate to Rs 3000+ psf.

Well everyone blames IT for same, but to be frank is this hike justified? Can the builders be transparent in the profits they are earning? May be that explains the Income Tax raids on some of builders. If rates go up in same fashion, they would rival those in Mumbai and which will be detrimental to Pune’s growth. Even Bangalore is not this costly for property.

2,920 comments:

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sudhanshu said...

You never met anybody from Gurgaon, did you...

Anonymous said...

i beleive people luv playing blame game .. its human being natural tendency .. somebody needs to become scape goat .. :) anyways


but the bottom line is people are buying houses whatever price the builder says ,, this means in few yrs in a mango in pune might also cost 10,000 .. but people will buy it ..

i dont believe people are stepping back and thinking where exactly this is going .. is this just a balloon which is going to burst tommrow ...

... some more later ...

Anonymous said...

The kind of lfe style Pune offers..it still comes cheap...

Medha Purandare said...

Once TV channel commented this property boom as "it will be a competitive market,so prices are likely to come down for some period. Investors are advised to invest in real estate,expecting further boom due to IT boom in Pune."

tantra108 said...

yeah pune is turning into a concrete jungle.No parks no trees only tall ugly buildings

Anonymous said...

I agree with you..
This is going to hamper the growth of Pune.And this will also affect adversely to the people like me who find owning a flat is being more and more difficult.

Anonymous said...

Its more than a month, I have been looking out for a flat in Pune. Surprisingly the prices are as good as B'lore and for no reason. I inquired one 3BHK in Kalayni Nagar and it was 1.75 crores.. awk.. not sure whether they are going to put gold instead of marble in flooring...The couple of new projects are using agriculture land...you can see farmers and cows around you and the builder proudly says pointing to farmer's land that our next project will kick off soon their....

harekrishnaji said...

I purchased flat in Pune in Dec2004. Today rate is exactly double.

Anonymous said...

How much of this propery boom is due to many NRIs investing in Pune? Is this investment by NRIs a good or bad thing for Pune? What do you think?

Anonymous said...

Hi Friens...First lemme tell you..I love pune and i am punekar..I work in Tokyo but my Dil n Dimag is alwys in Pune..

Btw, Anybody could suggest me where should i buy the residential property..
basically i love the old pune .Shaniwar peth etc.
But since i have not been to Pune for some years i have been worring that where should i buy it...any suggestions....Suhas patwa

Anonymous said...

But some one should take care of this...and this has to be controlled...where is the goverment? what about the middle class person? where he will go?
Its exactly 2 yrs my family purchased a flat, now its value is double. It was affordable to have loan on that rate...but rates increasing with this speed how would a middle class person will think of buying a dream of his own...
Some one should put a stop on it.

I think our goverment should wakeup and should think about the increasing extra pressure on the infrastructure in Pune. Rather than concentrating on building tall biuldings, they should consider first the facility provided by the contractor. The parking area, gardens and basic needs?
More to right but no time...but still i am searching for sweet home within my budjet...

Anonymous said...

Hey All,

Why to say like groth in rate is not good or so...just invest anywher you can at Pune and then just watch your money growing with double or even triple arte per 5 yrs.

This is good in a sense that it encourages people to throw their money into the market so that it can be used for economy growth.

Also, the real state sector is providing jobs to thousands of ppl, so its not incorrect to command the prices and property rates by builders.

Also, banks are giving you the money so why to worry. Enjoy and have fun with the fact of "growing Indian economy".

Anonymous said...

Not only the prices are sky rocketing. Builders are promising and booking flat without even approved plans. Very renowned builder Mont Vert who sells flats at a premium promising excellent quality and good exection have failed to deliver flats to over 100 flat owners in three different projects for over 3 years now. Not only he booked the flats he got the agreement of sell is registered with local authorities and most of the owners have paid full amount as Advance Disbursemetn Fund and paying EMI as well as house rent. Projects like Mont Vert Grand, Mont Vert Dieu and Mont Vert Tranquil all are being told as delayed indefinitely. There is so much irregularity and still there is no mechanism to stop this bilder from launching new projects. Be ware of MONT VERT builders.

MeNMydreams said...

Hello all,

Its true that prices are skyrocketting like anything. I bought a flat 7 months ago and the price is increasing by Rs. 1 Lakh per month. SO, its good to buy any flat in any area of Pune as soon as you can. Because it is beleived that demand of housing will grow manifold and supply will not be enough to provide houses for everybody. By 2010 the demand will be 20 times more than suppy at Pune itself.

So, people its better to buy soon and at the current rate. You will be happy after few years to see that you are owning a asset worth of millions.

So, keep searching for a house near you...!

Anonymous said...

In first place, i think it's very foolish to buy a 1/2 BHK flat at the price of gold, some 10-15 kms away from the main city, saying that it's a status symbol. Anyways, even if you need to plan to buy it, and go to any builder of any project, he'll tell you 2500 today. After a week's time, the same person will charge 3000 bucks saying that he has another customer ready to pay the same. Now you all know what we can call this... I see only one solution here... let us unite and just stop this business, say for one month.. it'll surely open the eyes of these Businessman... But as we know, everyone is in hurry to buy a flat in Pune, because now we have fat salaries which keep on increasing every year..

Anonymous said...

Dear All,

Since you have good salaries, please invest it in the market. The best form to invest is to put in properties. Buy flats and sell that in say 1-2 yrs. I can assure you, you'll be making nothin less than 70-150 % in this period.

A return that no other investment can guarantee you. Also, it is safe coz surely more n more ppl are buying houses so demand will grow only. Every year lacs of people are getting employed in Pune, they are also a potential customer so certainly demand will increase to an extent that supply will appear as too short.

So, plz keep investing and secure the money multiplyer magic work for you.

gaurav thakur said...

my brother bought flat 2bhk in hadapsar in 2001 8.5 lacs , now in same bldg builder is asking for 19 lacs even its 7 yrs old.

gaurav

Anonymous said...

Beware of Montvert builder in Pune!

Just want to warn the people who would like buy property in Pune. Do not book in Montvert projects, that builder is a big cheat. just see mails in Montvert_dieu yahoo group. Montvert_dieu@yahoogroups.com
Beware of this fraud builder who already been to Jail once in a TDR scam.

Montvert Dieu C victim

ms said...

Property rates in pune are getting over hyped, it starts with the real estate agent, then the builder. The unsuspecting buyer believes in anything they say. People from other cities are not aware of the exact rates and end up paying more because of their ignorance. What it does is increase the prices more.

IT & young people are buying apartments left right centre and now that the home loan interest rates are high they are regretting it. He makes 60K a month and he paid for 38lakhs for a apartment. His EMI has gone upto 36K a month now. He also has a car loan.

Being an IT prof does not make a person smarter in accounting. The bubble is gonna burst soon. Pune is a mini metro and it can grow through its seems it is not like bombay where land development is limited because of the sea.

Anonymous said...

Non-maharashtrians are to be blamed!!

Maharashtra needs Visa Regime.

Anonymous said...

MIRCHANDANI BUILDERS ARE CHEATS
Beware of mirchandani builders and do not invest in their properties. I invested in Mirchndani palms and now suffering. The agreement says wooden wardrobes, mosquito wire mesh to be provided in each flat by the builder. But now Mirchnadnai is refusing to provide these things in the flat. also he is charging Rs 12000 for putting an extra electrical point int he house, thsi is gundaism to the height man! On top if it they are threatening to stop any work in our flat because i am raising my voice!

Sandeep said...

I believe that the prices will only go up as the salaries are increasing & everybody from home owners(for rental) & builders will take advantage of this. Its upto individual to assess the risk of investing in market or real estate & do accordingly.

Buy real estate only if u need to ..dont buy it as a investment unless one really understands it

Anonymous said...

I guess the boom continues... I heard wakad rates have tripled in last three years? Well the infrastruture around has crippled in the same time, no electricity problem of water and roads, then why can prices still soar??

Anonymous said...

Hi All,

I dont know when this price will come down or stablize..
But the thing is how can a person who is not from IT can servivie in Pune.

The prices are getting high without any reason.

We can not compare it with Bobmay Delhi Hydrabad Banglore etc ..
They all are metro and Capitals of state with very nice infrastructure..
But in Pune ...it is almost hell to go on the road....
Sorry to say that road....

Cities are not made buy only building...We need infrstructure..
Roads parks electricity..and a lot more...

Any one from Greater NOIDA or Hydrabad should look at the Quality of Roads...

Any way hope for the best that things will improve and we can have nice Pune with good Residential Apartments... :) Hope so

Anonymous said...

Its very strange. Not all in the city is IT professional. Not all in the city earn 30000 rs. I am looking for 2BHK house but I am not able to find one for 15-20lakh. The prices in the city are comparitive to bombay and it appears if such trend continues there will be stagnation in pune market and prices will crash because at these price level very few can afford to buy a house. Renting the house for next 5 yrs is a cheaper option.
DONT BUY PROPERTY AT THESE RATES
DONT BUY PROPERTY AT THESE RATES
DONT BUY PROPERTY AT THESE RATES
DONT BUY PROPERTY AT THESE RATES
DONT BUY PROPERTY AT THESE RATES
PRICES ARE GOING TO CRASH
PRICES ARE GOING TO CRASH
PRICES ARE GOING TO CRASH
PRICES ARE GOING TO CRASH
PRICES ARE GOING TO CRASH

Radhakrishna Iyer said...

Pune property Boom ... going bust

Yes its is true.All the experts are advising not to buy property right now.The boom is over. All the builders are having surplus flats and there is no one to buy them.
The rates will go down as there are no investors. The same advise has been given to my overseas friends also.
Do not buy for another six months atleast - this is the advise.
With everyone talking about the prices going up, the rates have touched the peak. They will not increase any further. But because of drop in demand , the rates are coming down. So do not buy for atleast 6 months now. Buy only if you have a need to stay in it yourself.

Supriyo Sen said...

Agree with you MS and R.Iyer,
The realestate market is in for a major correction. Check with any buider in town. They have surplus. The big ones will hold the prices for some more time. So it is a wise thing to wait - even if you want to buy for yourself. Stay in a rented place for 11 months - the prices will come down as they have already started on a downward trend. Pune has plenty of Land and there is no shortage.The way it has grown over the past three years - it has gone overboard. Now is the right time to SELL & NOT BUY. If you do not sell now, then ......

Anonymous said...

Hi Friends,

After reading the blogs I've come to a conclusion that people are framing logic according to their own need and comfort.

Just have a look on the figures below,

1. Per year 25 - 40 thousand working people adding to the city.
2. 70% of these people having earning between 25 - 35 thousand PM.
3. also existing people who started their carrier 3-4 years back having accumulated good money, they are willing to buy propery now.

As per these facts the prices are bound to increase for ever..

so, whoever wants to buy the property, its the right time..

I've seen from my past experience that there is only one right timeto buy your home and that is " NOW".

Anonymous said...

Do you have any basis on the figures given, if yes SHOW, if not
then thats exactly what you have done
"people are framing logic according to their own need and comfort "

Anonymous said...

I would like to add logic that
1. Property rates Go high in proportion to common economics rules "Demand & Supply"
2. It is the marketer who increase & decrease the price according to their supply.
3. Recent Dollar devaluation will bring the cost down & correction is sure.
4. Never be prey of Marketing Professional from property who gives you option & we the customer get blinked by them.
Thanks
Praveen Pandey

Anonymous said...

1) Around 1998, 99 APt in Aundh was around 1800 to 1900 psft Then April 2001 (I was in US then and the market crashed so bad that my $2000 reduced to 118 in 2 to 3 days thats b'cos of silly investment) Then I got a very nice apartment right near convergys for 1260 psft in 2001 in Aundh.
It must be 3 times now I guess..But I know this going to blow up..
Why?
2) Right now I am in BT UK, the cost cutting is so bad our clothes will get cut off I guess and applicable to all finally to Infosys, TCS and all other desi IT companies..
3) Who says NON IT people cannot afford to buy now? The correct statement is NON IT and IT both are not able to buy as of now.
My sis cant buy despite her husband working in IT for 5+ years and my offshore PM cant buy with 10 years IT experience
Why?
2 Things - Dollar getting weaker and IT maturing now..(Its high time already)
bank rates..
If most people cant buy then who can buy? n what happens to prices?

Cement is issue though , however do u remember pune guy who had to throw away 50, 60 lakh through window? (related to the land scam) that scam is getting old now and its time for new scam for pune municipalty.. they will find out way to sell FSI etc..

Opinions are of 0 value.. all that helps is information and data..

Anonymous said...

Hi,

Next year commonwealth youth asian games is scheduled to be held at Pune. Mostly due to this the surrounding area of Balewadi, Katraj, Chandni chauk....will report a very high surge in property prices.as expected by all investors and builders..

So, all thinking to buy a property please accomplish your goal within this year only so as to save lacs of your valuable money..

Anonymous said...

Here is my comment for what it is worth...
The builders had got a goose that was laying golden eggs in the name of IT professionals. As the old story goes they got greedy and had cut it open.

Presently -
property is beyond the reach of a salaried person - how many can afford a 2 BHK house costing 30lacs plus - an EMI of 35K. To afford it he must be earning a salary of 1.00 lac & above.

The reason given for the increase was high demand. Now that there is no demand, wait and see if the pricess come down. Otherwise be content with a rented house or even move out of the city.

Buying a property at this point would only mean you will work for the builder for the next 15 years. Do you really want to do it?

It would only benefit brokers, builders and financial institutions. Stop buying.

Anonymous said...

Hi all

I purchased a flat in Vimannagar in Jan 05 and sold it in Feb 07 in approx 2 yrs i purchased that for 4.20 lacs and sold it for 17.5 lacs and people are mostly making conclusions on the basis of past trends. i.e. the property crash in 1997 but now the scenario has changed that time there was an artificial market where no one had money to but a flat still the prices kept increasing but now everyone has money a guy who is 21 yrs old even if he is working in a BPO has the capacity of buy 2 flats and a nice hatchback car. Now money market has changed drastically, this is the best time to purchase a flat. I have noticed a person buying a flat worth 20 lacs gets an appreciation value of Rs. 5000/- everyday and that is for sure, from past 2 yrs people say the market is going to fall but nothing happens so belive in yourself and keep investing
Thanks

Anonymous said...

The Pune property market has declined by at least 30% between February 2007 and October 2007. I checked properties in Aundh, Baner and Kharadi. Most builders have either not increased prices or have increased only a hundred rupees. I looked at Gera's, Emerald city, Goel Ganga's, Constellation, Sancheti's Mount and Glory at Kharadi, GK builder's Roseland residency at Aundh, Mont vert at Pashan and many others including a project of Clover at Ganesh Chowk. I was approached by various brokers inFebruary and they are still looking for buyers in October. I met various investors who are willing to sell their property at Emerald City, Mont Vert etc. Here are the best prices I have been given.
1. Emerald City Kharadi, December 2008 possesion Rs.2300/-
2. Mount and Glory, December 2008 possesion Rs.2100/-
3. Ganga Constellation, March 2008 possesion Rs.2800/-
4. Roseland Residency, August 2008 possession Rs.2400/-
The biggest investor based discounts are at Mont Vert and Clover properties. Anywhere between 20% to 30%. Many investors are stuck and not able to pay the slab wise installments to builders. That is the reason for project delays across the country. The property market is going to be in a downturn for the next 18 months. With the stock market booming investors are willing to take lesser profits and put more money in the stock market. However the builders are forcing them to stay. Vascon has applied for an IPO which will bring in a lot of money, they are doing their best to hold the prices until the IPO after which they will have more money to hold out. Investors at Zenith are offering 10% discounts or free parking.

If you are looking for a property at a good discount, look at sites with direct investor numbers, not brokers or builders.

Real Estate Pune said...

If you want to find out the real value of property , and be aware of the best deals available you need to Visit Real Estate Pune

Anonymous said...

I agree the property prices have come down. I am not sure if it is 30% but they have come down. The time period between Feb 2007 to now directly corelates to the dollar falling. It is easy to see IT companies would be in cost cutting mode. Which has led to the decrease in property prices. In Mumbai you have many paid articles being published saying the prices will shoot up. But the truth is the prices have not gone up even in Mumbai in the past 5 months. Prices in Malad are falling 100 rupees every month and the fall will accelerate with more jobs being cut and companies moving out of Mumbai. I believe Pune will at least have a sentimental drop in prices.

Anonymous said...

I bought a flat at Baner for Rs.3500 in January this year. In August the builder told me the prices have gone up to Rs.5000 per sq.ft. He sells under construction apartments for Rs.4500/- per sq.ft. mainly to overseas investors. I put an add in the paper to sell my flat and havent got a single offer even at Rs.4200/- for my finished apartment. Builders are fooling Dubai investors and jacking up prices. The builder pompously claimed he would buy my house at Rs.5000/- per sq. ft. but he is not even buying my flat at Rs.3900/- I feel like a fool falling for the builders claims. There must be some sort of market regulatory authority that informs you about the real value of property. All this IT hype is a big bubble, with the dollar fallen 18% it is going to burst in peoples face, soon.

Anonymous said...

And now builders are resorting to chargin membership charges for club house gym and other ammennities which actually was sold as a package when you may have signed the deal! and was Never mentioned in agreement! on top of this they have already charged a maintenance @ 1/- a sqft thats the kind of rate prevailing in Pune. I am refering to Gera Builders here and their ville scheme in Kharadi!! Very MIS-MANAGED...things keep changing now and then! So anyone dealing with Gera's in PUNE PLS PLS KEEP EVERYTHING BLACK N WHITE!! YOU MAY HAVE TO ALSO RECORD THE CONVERSTATIONS THAT HAPPEN ;-)ITS THAT BAD!!

Anonymous said...

Hi

If you want to go for a short trm investment for a year or so go only for suburbs in Pune like Undri, Mohammadwadi, Wakad, Wagholi, Talegaon. Please do not invest in places like Kalyani nagar, Kharadi, Vimannagar, Camp, Koregaon Park, rates in these areas are stable right now. and it wont increase till the the suburbs starts demanding 4000/- per sq ft so try to invest in suburbs for a year and sell it off when the rates in suburbs as well as on Nagar road are the same this would be the smartest investment for the time being

Anonymous said...

ITS MY HUMBLE REQUEST TO ALL NONMAHARASHTRIANS TO GO BACK TO THEIR HOME TOWN

Anonymous said...

Hello & happy diwali to everyone.

i feel theres a lot of desperation for not able to buy a house at affordable prices.

dont be a desperate buyer, there are people who bought a house beyond their budget and from day one lost their sleep, the life style got effected drastically and eventually in less than a year they disposed the property in less than the market value. Here i talking about people(my friends & collegues) who make around 1.5 lakh per month and still landed up in trouble. The same friends are staying happy today in a premimum area with less than 15 thousand rent.

i am not scaring anyone out here but after discussing with them i understood that to have a house, one should have good savings and only 40 percent of your salary package should go on emi(including car, personal if any).

continue staying in retal apartment, earn more, have a ecent lifestyle, save more and there should not be a problem to buy a house down the line....if you are financially secure, it shoudl not be a problem to buy a house at 5000-6000 per square feet.

cheers and my apologies if i have any one sentiments.

Piyush said...

The above comment is the most considerate comment. We spend all the money we have earned and even compromise our lifestyle. We choose to be slaves for builders and banks for next 20 beautiful yrs of our life. Why all this? just for the sake of a feeling of owning a house which in fact is the morgage to a bank? Every night we have a nightmare of market crashing or bursting of IT bubble. I personally feel its really not worth it. I would prefer paying rent (non taxable) for next few yrs untill I could pay atleast 40% of the amt. By 2010 few of friends might have earned few lakhs on their flats but I have spent those 3 yrs as a millionair with lavish lifestyle. Now its ur call to choose ....

Piyush

Anonymous said...

Causes of this unreasonable boom:
- Peer pressure. People are buying at unworthy prices mostly because others have done it already. This is foolish if EMI is more than 30% of monthly salary.
- Double income. Both husband and wife are earning currently from IT. This earning rate will not be constant in next 20 years as there will have to be more attention towards growing family. IT will also slowdown as its difficult to sustain this pace of growth.
- Investments from ppl returning from US. They have bulk money and hence they buy high priced property at unworthy prices. This is one of the most prominant reason.
- Nexus of builders, promoters, agents, politicians, media owners. This nexus will keep market rates 300% higher than what it is really worth. Building 2BHK will cost only about 10 lakhs (you can build a banglow in that cost in smaller town) in real but selling is at 40 lakhs. Addition to this nexus are now all existig owners who have bought homes at high prices. They will always tell prices can not fall since it will be their loss


Solutions:

- Allow growth industries like IT to spread to Tier2 and Tier3 cities. Govt has to make this happen. This will cause less demand on housing and infrastructure in metros like Pune. Improving domestic polocieis to help other industries and agriculture will help in long term.
- Do not EVER buy home at prices you feel unreasonable. Prices close to 1000~1500 p.s.f. are reasonable. If this gets established by collective resoponce by all new buyers in market, prices have to fall.
- Aware of economy trend. IT is heading for a downhill in next 10 years. New recrutiments in IT is happenign in China and other contries. Contract jobs getting cancelled in major IT companies in Pune as well which is a signal of what to come. Rise in rupee will continue and will keep hitting IT. See, did one expect US subprime crisis? no, but IT DID HAPPEN. Beware ..
- Promote awareness among all new buyers NOT TO SUCCUMB for high prices. If no one buys flat at high prices, they will fall. THATS THE ONLY SOLUTIONS.

Anonymous said...

Builders also use the tactic of 'false shortage'. when 10 flats are available they will tell buyer that only 1 or 2 are available. I tested this with one builder in baner area. 4 people from my family called this builder over a period of 2 weeks. Each time he told different rates, and also different flat nos. that were available.

Similar thing happened in Parajape's Blue Ridge project. They started taking pre booking (of which very few people were aware), so in that prebooking time of around 3 weeks itself 8 towers got sold out. Now when they opened official booking on 27th, a person comes in and is told 8 towers already full, he has no idea about pre booking, so he just books whatever is available.

Anonymous said...

Well, pune and the neighbouring area got approved for an additional of approx twenty two thousand acres for building! 22,000 Acres! This means a lot more room freed up in different parts of the city... property prices could crash, or may be the demand is so high that it shall not be an issue. But the permit for 22,000 Acres is enough for building a lot of flats and schemes... On top of all this, the city has been approved to build 38 stories... so again prices could drop. (but Mukundnagar has rates of 10,000 per square feet going right now... and these Marwadis are buying as a status symbol.) It's crazy... buy if you can pay your EMI and still save 25% of your salary after all the other expenses. Some firms are laying off people, as jobs are going to South American countries as there is no time difference and they speak America's second language - Spanish. Also the dollar is going to crash and salaries will go down as cost of doing business with India will go up by 20%

Anonymous said...

I am planning to buy a 2 BHK house in Pashan, Baner area and during this search i was amazed to see the amount of money these builders have spent on advertsiements, plush offices and brochures.

Where is all this money coming from??
Undoubtedly they are making huge profits and from nowhere else, but from our own hard earned money.

Its sad to see that a typical uneducated broker earns on an avg 15k per deal in a minute..and we spend days to earn that money inspite of so much if education.

I believe, this is the result of all those who are blindly buying properties and keep on predicting that they will go high.

Certainly IT salaries will become stagnant, both due to dollar depreciation and saturation.So think carefully and dont just assume that you salaries will grow at the same pace.

So,i would say dont let these builders and brokers take undue advantage of yours and chill out your hard earned money!!!

Anonymous said...

True.

Bubble has started to burst now. People are realizing that buying a house for more than its worth is a follish decision. People will not have the kind of money forever they have now. Salaries are not going to rise too much and you have a complete lifetime span to take care of rising needs. Guys who bought homes for high prices have done exactly the wrong thing, by commiting their lifetime finance earnings to put down to builders throat, who overpriced things by at least 400%. Poor chaps ..

I suggest DO NOT BUY property for more than 1200~1800 p.s.f. anywhere in Pune areas. Its not worth more than that. Wait n watch how the bubble bursts and you will be proud that you did not succumb to unreasonable rates.

Anonymous said...

I am a Pune resident and there are talks that rates in areas like Baner are coming down to early 2000, and are expected to fall much more. This trend will continue to spread across all Pune areas soon.

Anonymous said...

I completely believe that the real state market in Pune is a completely hyped market.

I understand that a flat's cost does hikes over a perion of time but not the way these buildes and realtors are increasing.

If one person calls up the builder he will mention the rate as 3000/psf.

After two months he will qoute it as 3600/psf. I really dnt understand on what basis and what grounds they are increasing it???

dont just let these builders drive your future and force you to buy it at their specualted rates...a loan of 20 years is a big thing...much can change in the country till that time...

Think wisely and fight with these builders for the right rate...dnt just fall prey to them.

Anonymous said...

After ULC act was cancelled, the prices should have gone down. But, we can see that the builders are lobbying in and no body is ready to reduce the rates. They did similar lobbying with the people who booked flat at lower rates and either extracted extra money from them or have still not given the flats to them. All new schemes coming in take around 1 - 1 & 1/2 yrs to complete. And with these huge investments, this is going to impact our bottom line. There is only one solution. Let's bring all the buyers together and STOP BUYING till we see the rates reduced to normal.Builders have to reduce the rates. The reason is the way they work. Generally, these companies invest money received from one project into new project. Today, becuase of the boom they do have money, but at the same time they are also firing in all cylinders and are working on multiple projects. Hence if they do not get customers and in turn the money, there projects are gonna go om hold. Builders lobby is not going to sustain this for a longer time and they are going to succumb. The only issue is can we collect all the buyers and make a lobby.

Anonymous said...

I fully agree with this. We all know now how real estate market is manipulated by builders. We all should say NO to high prices and make a clear comment that we will buy only when pricess fall to reasonalble rates. For comparision, just before 2~3 years, many of my friends got the falts for Rs.1000~1500/psf in prime locations and thats the best price we should offer, no matter what the claims are from builders. D'you know one thing ? People who bought those flats even with such a low price are still finding diificult to keep pace with EMIs as their other resonsibilities are starting to grow up. So if you try to buy flat for more than the rate above, be ready for indian version of subprime crisis. And remember, debt is alwys a debt and its HORRIBLE once you find it difficult to repay the money for next 25 years.

Anonymous said...

Agreed, however when r the prices going to come down, 2 yrs back people were saying prices will come down however all wht i have seen is increase

Murli said...

Dears See the bigger picture!.
1) Next 20 years IT industry will saturate and with fall of doller , Jobs will starts moving to low paid countries than India. So you dont know if you will be making same or more money over coming 20years.
2) Lots of young Indians from every part of the country are enrolled in IT degrees and they will start competeing in next 5 years. Companies will recruit them to keep cost low.
3) Indian economy can not be self sustained as development disparities are too much in the country. So every chinese learning english can be direct threat to indian economy. And our job in doldrum.
4) What is the point in sticking to the one location or flat if gone are the days to spend life in single company. Better change companies as frequent to get better salary rise and rent a good flat at closest location to your work place to avoid travel hassels.
5) Once your company know that you have to pay for debt . they will think that you are dependent on them and they will never increase your salary to the expected grade.
6) Pune at the heart of city is hell to live in with chaos of traffic and pollution. Wait till the price stabilise ( remember with the current inflation rate they will never fall ) and then buy a good flat in well planned suburb.

7) From where the job will come ?. Remember there are many flats coming in pune , than jobs coming in. This is all hype!!!.

Buy a flat or not ! Take your own decision. But as said in earlier comments never pay EMI more than 40% of your salary.

Good luck and enjoy your life tension free!!!!

Anonymous said...

Yes, I think the awareness is apreading well these days. I am also a Pune resident working in IT and I know that buying a flat with EMI more than 40% of you CURRENT salary is very gangerous option.
Because IT sector is volatile and there is no guarrenty of same or more salary for next 20 odd years.

Plus, I know some of my friends who fell for peer pressure blindly and bought 2 BHK worth 25~30 lakhs are now finding very touch to manage their lives. Their family is growing and so are other expenses. Their personal life is slowly downgrading and they are can't to enjoy quiality time with family and friends. Instead, round the clock they have to think of money, money and more money to repay the loan amounts.

To manage this situation, they made their spouses to work hard by saying bye bye to those precious family moments. It also affecting how their kids are being brought up without those good 'sanskar' becasue both of their parents are busy chasing bucks.

It all started because they made to get in to debt which was overstretched than acceptable limits.

Choice is yours, whether to give up to overpriced housing or make FIRM DEMAND to lower the rate to reasonalble limits. This is the only solution remaining now.

Anonymous said...

Dear friends,

Looking at current scenario, I also have decided not to buy flat in Pune now. I'll wait till proce falls to affordable limits as taking a large loan will cause me to loose sleep as well as peace of mind.

I have also managed to convince my friends about the possible risks of getting into unmanagable debt and they agreed to this logic. EMIs should never cross 30% of you salary since there is no guarrenty what lies in IT sector after say 5 years.

Lets spread awareness. HOUSING IN PUNE IS ABOUT TO WITNESS A CRASH. BUYERS NEED TO RAISE VOICE AND DEMAND AFORDABLE HOUSING.

Anonymous said...

I agree...no buying at current prices in so called know city locations.. ..only suburbs seems a right place to invest...stay close to work place by renting and invest in suburbs where prices are reasonable...both targets achieved - peaceful life & investments.

Anonymous said...

Good news. Here are some indications of changing times as prices are stabilizing and started to have come down.

- At the start of this year, I enquired rates in Kothrud and they quoted from 3700~5500/sqft. Even today after a year, there are vacant flats and booking is open. That means there are no takers for higher prices.

- Few months back, I enquired rates in other suburbs and site managers used toget excited to tell me that rates are going to be increase and better hurry up. Now, in this month i am seeing that faces of site office managers are increasingly pale and that enthusiasm of quoting price increase scenario is lost now. If I tell them that process are actually decresing everywhere in Pune, now there is not much argumentation on this. This means they are starting to agree the fact that prices are stable now and are expected to decrease.

- Check out articles in December 2007 on http://indiahousingbubble.blogspot.com/.
These articles are showing up that real estate market has started to crash in Bangalore, Chennai, Navi Mumbai and hydrabad. Pune is next in queue folks !!

- Check out bank results for last three quarters. Home loan disbursements have reduced by 60% which means there arevery fewer transactions happening.

- Banks are now reluctant a bit. Go to SBI and enquire for home loan, now they will be very very strict in sanctioning the home loan only to those who have good repayemnt capacity.

- Visit all suburbs in Pune. There are thousands of flats being constructed with expected possetion around March 2008. This number is is too much and excess supply will hit market leading into crash.

- Look at software companies sharesover last complete year. All IT biggies are LOSERs. So expect
IT slowdown and salary cuts.

- US has published december data on (un)employment and job losses. US is entering into recession. IT folks are not in good times in years to come so beware of huge investments.

All these factors show that real estate high prices are unsustainable will crash in next three months.

Anonymous said...

http://economictimes.indiatimes.com/Banks_face_defaults_from_retail_borrowers/articleshow/2684634.cms

Subprime crisis started in INDIA. HOUSING CRASH IS NEAR.

Anonymous said...

Its very true, Builders are creating artificial hype and just sucking out Lakhs of money from IT people who are getting into this trap and buying flat worth 40L.

I think we all should act wisely and work towards this common problem as there is no reason for them to charge so high in Pune city.

Pune is growing only due to IT sector, and as many people rightly said that IT sector is going to become stagnant if not come down.

If all of us stand together and do not agree to these builders, auotwallahs and many others for paying the extra buck, im sure they will drop their prices.

If they get one buyer who pays 40L, they wont sell it a penny less to others.

Anonymous said...

Hi,

I have born in Pune and have seen Pune grow since 1983. Yes Pune has indeed grown in leaps and bound primaly because of manufacturing hub and now the IT boom. This resulted in the increase in the land rates and the flat rates. going by the current situation it is adviced not to invest in property in Pune. following are the reasons.

1. US recession has hit most of the companes accross the globe. This recession is here to stay for next 24 months because elections and news leaders will need time to design policy to come out of the recession in US

2. Rupee appreciation dues to strong India Economy and huge inflow of foereign revene has resulted in making Ruppe stronger

3. IT companies are hit by slow business in US. remeber 70% of software business still comes form US and Rupee appreciation is erroding profits for India IT companies.

4. IT companies are firing- TCS 500, Yahoo 40, IBM 1200, Wipro planning to fire so remember IT companies are here to fire if rupee apreciates further

5. any 2 bedroom flat in Pune is between 45 to 55 lacs. Guys is it worth it. Does Cement, Steel , Land really gosts so much to make a flat price 50 lacs?

6. Are you ready to pay 45 to 50 K as EMI per month? Remeber your wife even if she works now will have to quit because you want to grow your family.

7. Remeber Education, Medical and Insurance are very coslty and you need to pay for it per month.

So looking at the top 7 important points it is adviced to wait and not buy the property.

Remeber Emaar MGF the big construction company from Dubai had to withdraw its IPO, so there is tremendous pressure on other construction companies to raise money...!

So guys choke them, wait wait wait wait wait for another 12 months and you will find that buildrs will give you at 30% discount. yes thats the right price of your flat.....


Last but not the least remeber you are going to give 20 to 25 years of your precious life to repay your debt and remember just by cutting on clother and hotle bills really do not affect the repayment, because the amount is very huge and you need to grow your salary by 25% year on year to repay it considering the inflation..


So WAIT AND WATCH

Anonymous said...

no one knows for sure when the prices are going to come down, the arguments are valid however is there any surety that prices will come down, who knows wht you are getting maybe after a yr or two might not get even that.......

only option will be shell out more & go to even far off places to stay

Punam said...

i am thinking of booking a flat with naiknvara at chakan talegoan dwarka any feed back is it safe?

Anonymous said...

Hi,

No,, dont go to Talegaon, no water, no electricity, no road..

dont get carried away by the adds of advertisement agencies.

Anonymous said...

Does anyone know what are the rates for places beyond Pashan, like the Sus Gaon area? I last heard someone mention Rs.1600 per foot. Is that correct?

Thanks for your feedback.

Punam said...

thanks for your feedback can anyone advise on mira road in mumbai

Anonymous said...

The posts on imminent property price decline in Pune make interesting reading. Have prices actually stabilized or its just that the rate of increase has become less. When will the decline actually start and how much will it be?

Does anyone have any idea about land prices at Khese Park near Pune Airport?

Anonymous said...

The rate of increase has definitely decreased specially in west pune, areas like baner,wakad,balewadi. For eg. rate in from feb07 to feb08 has increased only by 50-200 in most projects. Some projects are at same prices. there are so many projects in pashan at ready posession having availiability. As months go by, the builder will have to get rid of these at little lower prices. I dont forsee any decline in prices, maybe they will stabalise now for a few years. For projects of smaller builders with slow sales there could be hidden decline as they offer stamp duty waivers.

Please post your comments as well.

What do you think about blue ridge project. their 2nd phase launch is still awaited.

How about wakad for living vs baner for living for people working in hinjewadi?

Mr. PATIL said...

Hello Everyone..
I have been looking for a 2BHK apartment for the last 6 months.

This is what I figured out in the last 6 months:

There are very few people who are ready to buy flats at these rates.

THAT IS THE REASON WE SEE THE SAME ADVERTISEMENTS AGAIN N AGAIN.
JUST CHECK THE TIMES PROPERTY FROM THE TIMES OF INDIA FOR THE LAST 6 MONTHS.

I am really fed up of these same ads.

And I am sure we will see the same advertisemnts for teh next 6 months as well..

They still have so many flats available however they are not ready to decresae the rates.(I dont know what makes them believe that people will keep buying flats at this rate )

We should wait for some more months and hopefully the rates will go down.

I agree with all of you..

I request all of you to wait for few more days...This baloon is gonna burst very soon...

So rent a nice place for the next one year ..things are gonna change very soon...

And I really think that Government should do something in order to control the rates.

Till then lets HOLD ON....

Sachin said...

I agree to the post above me. I too am fed up of same ads. I am looking for areas like Baner,Pashan, balewadi.
I am seeing so many ready posession ads, each day, not only on saturday property times, but also on every day classifieds.

Typical rate is 3200-3500, but seeing the quality of construction I do not feel like buying that house after taking so much loan . So better I am putting downpayment in FD and renting a nice place with peace of mind. If things continue like this, prices are bound to come down atleast 10%.

Also IT is in downturn, major cost cutting in all companies. Hikes are not what they used to be.

So lets all hold on and not agree to pay these high prices.

Anonymous said...

This isgood news. from the thread it is clear that buyers are feeling the pinch of rates and are delaying their buying decision. good. just a small calculation. if there are 2000 people who are reading this blog and are convinced that rates are high and delay the decision then imagine the impact. 2000 people not buying the flat for next 6 to 12 months. this will choke the builders in the repsective cities. they will reduce the price.

We should replicate this model. more and more people shoudl be told to delay the decision of buying the house. and we shuld have a count of about 20,000 people delaying the decision.

TRUST ME RATES WILL COME DOWN. THEY ARE STARTED AND WILL FURTHER GO DOWN.

PATIENCE IS THE NAME OF GAME.

Anonymous said...

If you are planning to purchase your dream home then just wait for 6 to 12 months as property rates started coming down.

Closely watch constructions going near by your home then you will find now they have stopped construction or the speed of constructions is very slow.

Reason behind is they don’t have bookings so it is very difficult to complete their project. If they become defaulter then you will loose your valuable money.

For confirmation you can visit Aditya builders bawdhan pune, Aditya Builders Baner, Sun Orbit Singhgad Road Pune, Huzur Developer Singhgad Road Pune, DSK Vishva Dahiri, Roseland Aundh there are so many who don’t have customers. Rates will surely come down which is good sign for buyers.

You can check it very easily visit their sites and enquire from some construction supervisor or site engineer about bookings. Then visit in their sales office they will try to present 80% – 90% has been sold out. Actually it is just 10% – 20%.

So total 10% – 20% poor guys has been nicely looted by these smart property developers. Please don’t disclose them how you get real information about their project that way other interested property buyer will not get correct information about project and they might loose their valuable money.

You can also enquire this from small kirana and pan shops which are near to that site. Or you can visit site 2 – 3 time in 10 – 15 days. So you will also get idea about work progress.

Before investing watch regularly CNBC and other business channel’s real state programs. According to them real state developers are in big trouble. Some of them have invested their money in stock market when it was 20000+.

Most important thing is be aware about your job security also. Now a days job market is also little bit shaking. In case if you are job less and can pay their heavy EMI at least for 1.5 year then go ahead and purchase property if you feel it is worth.

Then after if you are interested in buying a property then just bargain with property developers if they ask for 3300/- per sq. ft. then just tell now it is buyer’s time I can’t pay more then 2200/- and give your contact number they might contact you.

Believe or not last month someone purchased a 2 year old 2BHK flat somewhere near to Kothrud bus stand (It is prime location of Kothrud) in just Rs. 1900/- per sq. ft. because seller and purchaser were aware with current market scenario.

Property developers are having a syndicate which is not allowing small developers to sale their property openly in reduced rate.
It already happened in USA. Property market, It has been came down 30% - 50% depends on location. You can enquire from your friends who are living there.

This is awareness message for all highly paid people. Don’t get looted by smart property developers.

Rajesh said...

http://economictimes.indiatimes.com/News/News_By_Industry/Auto/Automobiles/Fiat_India_to_invest_Rs_2341_cr_in_Pune_facility/articleshow/2896055.cms

Pune's growth is growing and i dont hink rate will decrease.

Rajesh said...

http://economictimes.indiatimes.com/News/News_By_Industry/Auto/Automobiles/Fiat_India_to_invest_Rs_2341_cr_in_Pune_facility/articleshow/2896055.cms

Pune's growth is growing and i dont hink rate will decrease.

fed up said...

I am so thankful that I stumbled upon this blog.I am tracking the Pune RE market for couple of years now.
I wanted a flat of my own , but the prices were so high , that I was kept pushing to the outskirts with each passing month.It is really ridiculous.I am from IT and like many other friends , I am finding it very difficult to even imagine buying a loan for 20 years ( for a flat with inferior construction quality , no water etc )..
The property rates have been pushed to the limit by speculative buying.If people having paycheck of 30K cannot buy a house 20 km from the city , then we can imagine what is happening to the common man..
It is fear of rates getting higher which makes every salaried man to buy an inferior flat outside of city and he gets stuck up for the next 20 years..No vacations , no celebrations..coz everything comes under thigh control..( after all theres 40K EMI to be paid every month..) This is ridiculous..We should not be working for the banks / builders / brokers..
I am pretty sure that Pune real estate bubble is going to burst in the next 6 months..Even if it doesnt , I will stay in a rented flat for my whole life instead of worrying about paying 40K every month in EMI..
I suggest that everyone who is a victim of this builder lobby get united and spred the word that pricess are about to fall..Watch the cascading effect on the prices..
I am of a strong view of coming out with something which can make these prices fall..
It can be done , with everyones help..
you can write on this blog , or if you want to keep it confedential write to me at
bubble.must.burst@gmail.com
united , we all can bring them down.

Mr. Patil said...

I completely agree with the blog above. I also think that we should work together against this and the we should be able to burst this bubble.

So lets work together..n damnn this builder lobby will realize the effect soon...

Cheers

sachin lets burst the bubble said...

I agree with above comments, 'fedup' I am also thinking to go on living in rented appartment, they are so many and relatively cheap. Can easliy get 2bhk for 9k on rental. I also agree with below par quality of construction. I am from mumbai, and since I cant afford to buy in mumbai and also i am being transferred to pune, i came to pune to seek out a flat. In 2 day survey I was sorely disappointed. Most buildings (even the famoues ones ) the landmark ones look like chawls, they look like in 15 years they will be in shambles. Rather I will prefer to buy 1bhk in mumbai, atleast I know it will stand well for 50+ years.. even small builder makes better quality buildings here than best in pune..

So i decided, I will go on saving my 40 K instead of paying it in EMI , and keep putting it in FD. In 5 years time, it will will be enough to not only generate my rental but also some extra saving, thus I will be laon free and live free life.

If at that time, job scene is fine, and also rates are ok, then I will by that time have 60-70% down payment for a 2bhk, so I will buy with 30% loan rather than buy now with 70% loan.

Because already in my and all friends IT companies major cost cutting is going on. 1 year before, people were sitting on bench for ages getting their salary, now many major companies are giving major pay cuts to bench sitters. Also people above certain level of exp. eg. 8+ years, if they do not have work they are send to any location, imagine even if they are from pune they have to go work in calcutta, job jumping is no more easy, there are not too many job opps in IT now unless you are specialised in high demand field. Also with US recession, I think IT is sure to come down. Already pay rise has gone from average of 15% to meager 5% this year for many IT people.

So, people just hold on. dont blink first. let the builders blink.

cooltiger said...

Hey Guys,

My suggesation is like this :

1 Those who are interested in buying the flat register their names in a common place on internet or lets start a google or yahoo group.
2. Provide there are sizable people interested , lets use the old idea of cooperative housing and we will all spends some equal amount and buy a land in near by pune with majority votes and with everyones consent.
3. Lets develope the basic building structure of the building cooperatively.
4. Let then owner develope his own interiors as per his own wish.

This will cut the unncessary costs and profits of the builder.


I know every one will say who has a time. My solution will be let everyone interested in this work in rotation by taking a leave for 2-3 days in 6 months.

let me know your comments if you find this idea interesting.

Anonymous said...

Guys, I am shocked, today i went to Samrajya scheme by Pethkar bulders and shocked to see that they are quoting Rs 93 lacs for 3 bedroom flat.

Guys this is a ripp off. I told them, i canot afford this rate and got up. Then suddenly they said what is your expectations. This is ridiculous,,, i mean rates are decide on perception.

Yes,,,, WE SHOULD ALL WAIT AND CHOKE THIS BUILDERS. DONT BUY ANYTHING FOR NEXT 6 MONTHS AND WE WILL GET TO HEAR CORRECT PRICES.

fed up said...

Cooltiger , I totally agree with you. This is the only way of getting ones dream home in at an affordable price.
I am working in IT and for the last two years trying to buy a decent flat at a decent price. And I cant get either.
The construction quality is very bad , yet the builders are asking for 40lakhs. Isnt it ridiculous , that one ends up coughing out around 70 laks ( including interest on loan ) for such a pigeon hole.
And after 20 years the value of the flat is not 70 laks and one has invested all f his youth paying huge EMI amount.
Its a daylight robbery from the builders/brokers/politicians on the common mans hard earned money..
what I fail to understand is how can one earn for all these people leaving aside his own personal comfort?
There is a huge correction expected in the real estate market.
I am from Pune and can see the signs.The same advertisements from the last 4 months.. Rent at an all time low.. Ready possession flats in abundance..
It all points to one thing.. Rates will fall.. If they dont , I prefer staying in a rented flat my whole life than paying 35,000 per month for the next 20 years. If I pay that EMI , I would not get a chance to say 'cheers'.. which I can say happily to everyone here , right now..
Cheers ..and pls unite against these selfish buliders..

sachin said...

'fedup', i agree.. after paying 70 lacs(after intrest) it sont worth. EMI wil be over in maybe 20 yrs, by that time value of flat wil be maybe 30 lacs.

better to stay on rent now, and after 10 years if want to buy, buy resale flat that is 10-15 yrs old, one can get those at much better rates..

quality is another concern in pune.. just visit mumbai.. any small building by any small builder... construction is 100 times better than in pune..
inpune some buildings i feel if i go it might fall

lolh

Anonymous said...

After reading lots of comments of my friends on this site..I am getting that people are anger and a bit frustrated..not due to higher prices but due to the fact that its not worth investing your hard earned money into a house which gives you tension and burden, instead of peace and happiness..

Its perfectly fine..some are saying that they will prefer to stay in a rented house for ever..etc..

But there may be a different view on this..think from this point of view..may be you can think broader..Buying a house will..
a. save you lots of tax
b. save your rent
c. your money will be valued equally after 10 yrs. also even after depreciation of actual money value
d. your salary must be increasing at a rate of 10-20-% at least on yearly basis..but your EMI will be constant. so more value of your money.
e. Today 15-20k is a big amount to pay in EMI but tomorrow after 5-7 yrs. it will be carrying very less "value".
f. your property prices will keep increasing at a rate of 20-30 % annually.

After considering all these facts..it might be understood that "a house comes for almost free".

If we buy carefully, which means,
a. It shouldn't be of more than 20-25 lacs.
b. Try to maximize the down payment.
c. Try to have a house closer to your office, to save commuting time and priced petrol.
d. Repay in between whatever small
amount you can.
e. Buy only if you want to stay in it for a long time span.

We need to consider this, builders are not forcing us to buy..its our own decision..whether to buy or not.

So, make clever buying decisions.

I hope I've not hurted anyone. Comments are welcome.

Anonymous said...

above comment,

what do you mean by 'a. It shouldn't be of more than 20-25 lacs.'.. is it the cost of the appartment or the loan ?

fed up said...

Hi ,
The first section everyone here agrees with that buying a house saves tax , rent , property appreciates etc.
The second section , some points are relevant , that downpayment should be large..But some of the statements for which concerns are that a)you no longer get a 2BHK in Pune for 20-25 lakhs..If you get it , its not pune but some 30 kms far away place.
I am a supporter for people getting good returns on the property they have invested in.. but the current scenario is :
1)Every new construction prices automatically become 3000 due to speculative buying(even though they are far away)
2)The resale flats also start quoting the same rate
3)The quality of new constructions is not so good
4)The builders start increasing the rates by 200 every month and the rates in the vicinity start shooting up.
5)The rates 1 km away from this place now touch 3000.
So now , all the flats in the first area are bough by people who actually dont stay there or by people who somehow take a loan of 30lakhs and start paying an EMI of 30K per month for the next 20 years.
And thats where my question starts:
Are these the correct rates for these areas?I will not contest Koregaon or FC road rates. They are in herat of Pune.
But what about Far-away Aundh , Baner , Kharadi?
I see many flats bought on speculation and lying empty..And new constructions are seen everywhere..
This is how I support my demand and supply equation.
The demand is huge..But the price is sooo high that no-one is ready to buy these flats.. As such the only solution is to correct the prices and then balance the equation.
comments are welcome.

Anonymous said...

Well,

Busying a flat is a good choice only when valuation of the asset has been done correctly.

In present scenario where rates have shooted up by 300% than its actual worth, buying a flat means shooting in our own foot. This is because loss in terms of yearly EMI is much more than gain earned by saving on tax, rent. Plus, appreciation will not be flat 10-20% yearly. If you see the history, every boom has followed by burst and there will be DEPRECIATION of the house, than the other way.

Add to it, other variable like unstable IT sector, See, you have to make a financial commitment for next 20 years at least, so you have to be damn sure that you will have good job all the time and EMIs are not more than 40% of earnings.

So I think in current scenario, buying a flat is foolish option, mostly recommended by either builder lobby or existing owners who do not want to have prices reduced as it hampers their own interest.

Start bargaining right for 1/3rd of current rates and then you'll end up in fair deals.

Anonymous said...

I agree.

There are distress sale ads started to come up in times classified in Pune. Looks like indian version of subprime has started to show effects.

Anonymous said...

aundh/baner/wakad rates are only driven high by IT boom, and only with IT slowdown it will come down. People need to realise that rates of more than 2500 are not fair for place like pune outskirts, where there is no scarcity of land also.

Anyway IT is slowing down and will continue so for next 1-2 years.

Please read rediff article on 'death of indian outsourcing'.
in 10 years, the cost advantage to outsource to india will be over, thus IT will face a major setback. then think if you get a paycut will you be able to sustain a loan of 30k per month?

Anonymous said...

I think even rate of 2500 is too much in Pune for these areas.

See people who made booking 3 years before have booked flats for 1000~1200 psf only. Still they are under stress for managing their expenses.

Then why should we pay more than double of that now just after 3 years. There is no way we have guarrenty to have salary good enough for 20 years to pay EMIs more than 20k.

So the right rate one should look here in Pune should be 1500~2000 only. Remember, in Tier2/3 cities, rates are not even more than 1000.

Punyala kay sona lagalay ka evdhe rates dyayala ....

Anonymous said...

well the rates arent going to goto 1000-1500 levels as the cost of contruction increased a lot recently. so reasonable rates as per cost of const. and land cost in pune suburbs would be around 1800-2200. that is a significant amount lower than prevailing rates of anywhere from 3000-4000 even in suburban pune areas like baner.

Anonymous said...

I also agree that Mirchandani builders are chaeting with the customers,they promised many things to customers and mentioned in the agreement also but now not providing. worst thing is that they have promised the possesion date as Dec'07 and still they have not completed the construction work,builder is taken full disbursement of loan amount and just earning the interest or profit from the investement instead of completing the Mirchandani Palms project on time ..really frustating..dont believe what they are promsing you that is only for booking the flats and to lure the buyers..really cheaters..

Jatinderbir said...

Buying a flat in pune is a constant agony. You will spoil next 20 years of your live for no reason and pune didnt deserve that much property rates either roads are horrible here and no planning in the city. Please dont buy flats for investment you will end up nowhere.

Anonymous said...

investment times are gone inpune. all investors are selling now. only genuine buyers left who are not ready to pay high prices for no reason. thus there is low demand now and prices will be stable or fall down

Anonymous said...

Read this article

http://economictimes.indiatimes.com/News_by_Industry/Two-bedroom_home_within_Rs_5-10_lakh_most_in_demand/articleshow/2932242.cms

This shows the real buying capacity of most of end users

Anonymous said...

Please think again before buying a flat from Gera builder. I have been suffering a lot from them. Their Emerald City Kharadi project is chaos. Every now a then, builder finds a excuse to delay the project.

He was supposed to give the flat in Dec - 2007. Now is it April 2008, still no commitment on the possession date. Now, he is warning me that he may increase the rate of flat if I keep on pressuring for the possession. He says there is clause in the agreement that flat rates can be increased after registration. Please think twice before buying any property from them.

Anonymous said...

My thanks to above commentor for posting your troubles online. Like this many other prospective buyers can be forewarned.

I ask for all people who have bought an appartment, to please share the experiences about their builder eg. construction quality, on time posession, any other harrasments.

cooltiger said...

Guys

Please check this link. This is going happen with in 5 to 7 year anyways. You don't need to live in the town where you work.
http://www.saamana.com/2008/April/09/Link/Mumbai03.htm

Then do you think at that time your property prices will appreciate ha ha ha !

fed up said...

Cooltiger ,
Thats an interesting article..
It will take time to come into reality , but if it does happen then forget todays scenario.
by the way what is the latest update on Pune prices?

Has everyone of you stopped even enquiring about the latest real estate prices? :-)

I can see lots of repeatative advertisements in Times of India..
I guess people have stopped visiting the new constructions ..is it a welcome sign?
I guess that May will provide a better picture of things to come..

Anonymous said...

New property buyers in Pune, beware of this rogue builder called M & T Constructions, primarily Mittal Builders which is into construction of new projects in Hinjewadi & on Bypass road to Expressway. He has left people in a lurch in his previous projects in Ambanagari Vishrantwadi. People in those projects have been facing serious problems of water, parking & security. The builder made tons of promises but failed to keep even one of them. He left the society in a lurch without handing over documents in a proper way. Before leaving he has collected all outstanding Maintainance fees from property owners. He has sold of all available parking slots arbitrarily & has not even provided mandatory parking spaces that is required by building bye laws for every building. No Maintainance was being carried out to lifts & generators during his regime. So property owners been carefull when you are dealing with this rogue & fraudulent Builder called Mittal Builders (M & T Constructions.).

Anonymous said...

now hear this, PBAP is increasing rates in Pune , Rs 50 - Rs 400 per sq ft. I think these builders in pune have gone nuts.

Anonymous said...

already sales are low.. who will buy if they increase by 50-400. its ridiculous. people should unite and not buy at all.

fed up said...

PBAP has increased rates by rs 400..This is a last attempt by Pune builders lobby to sell vacant flats.and instead of being rational , they have taken a ridiculous decision. Its time that a common investor in Pune awakens and stops buying flats from these selfish builders. The current rates are out of scope for the genuine buyer and with this new move , its going to be out of wven the dreams of anyone..as Atul said , let the prices increase at a fast pace , so that the bubble burst is steep and soon..what do these builders think , that everyone ( including the IT people ) are super-rich? if I pay 40,000 as EMI , there is nothing left to spend for daily survival. I see a lot of empty flats around Pune , and so the builder lobby is desperate to sell them off, so that it can finance their existing constructions.. but if no-one buys these flats , they will be choked.. pass on the message to everyone you know , to not buy flats in Pune..let the builders choke for a while..lets burst the bubble.

Anonymous said...

If you are looking out for new/resale apartments , please apply extreme caution, try and not to purchase apartments which have a loan.

Before signing on the agreement find out from the pune corporation that the property belongs to the person who you are buying it from.
Also find out whether the property is not on a controversial site.

Last but not the least do not I repeat do not care about jacuzzi,swimming pool,club house etc. Make sure that the building gets drinking water from pune corporation. I have been looking out for resale apartments in posh areas like sopan bagh etc and believe me they have all the luxuries but they do not have regular drinking water supply .

As these resale apartments are primarily owned by investors who never bothered to find out whether there was proper provision for drinking water.THey just wanted to make a quick buck.

Last but not the least the recent price hike (effective from 20-Apr-08) by builders is just a sham. I have been to a few projects and they are ready to give a discount of the same amount if they find you are a serious buyer. In effect they want to keep the prices at the inflated rate. (pehle thoda badake phir ghatake).Really cunning these builders are.

umesh said...
This comment has been removed by the author.
Anonymous said...

It is stated coming down since it is not realistic to buy 5000 rps per sq ft.
what is happening in USA in housing market may happen in India as well - because people are buying costly property on 30 years loan when there income is not assured for next 30 years..........

R. Gandhi said...

Every must read this.
I was looking for commercial property in Pune, so talked to very famous builder in Pune and he showd me property and his marketing guys stated 4500 rps sq ft rate in November 2007, The deal could not worked out becuase of my finance problems, then after having enough money when I checked again with Builder he stated 6500 rps sq ft, I again could not buy the property...
But then on Feb 15th, Friday, I got a call from marketing office of builder and he sold me same office space for 3300 rps per sq ft.

So my suggestion to everyone is, please do not buy in hurry, residential property should not buy above 3000 rps per sq ft and commercial not definatly above 4000 rps per sq ft.

Other wise if you buy property for 5000 rps above then you will be in big trouble becuase you would buy property of 2000 rps to 5000 rps and after 2009 no one will pay you 3500 rps............ remember this is truth...

please read what is happening in America in housing market....Indian IT is depending on North America...
in North America, no one saves above 4000 USD per month, it is not possible, in short NRI can not buy property above 10000000 rps.

Market is towards negative and lots of layoffs on the way from big companies.. this is negative but truth.....

if you have loan of 40 lacks in India and if you dont have job, you are in big trouble.....Bank wont wait to grab you house if you don pay, thats contract.... no family in India has 2 lacks in bank as a reserve so you can not hold you house if you don earn....

so think 100 times before buying property above 5000 rps, wait till 2009, save till next year, and buy same property for halp price.........

Anonymous said...

PUNE PROPERTIES DOWNTURN

I guess it is already started 6 months back, and people have started realizing. those who baught flats for 4000 rps sq ft made biggest mistake in life if the are salaried or employee with private companies....a big mistake they cant afford.
Because global economy slow down, US doller going down, other east european countries grabing IT jobs, call center going to far east asian countries because of less cost.....
FACT IS FACT, unfortunatly Indian growth was 8 % last 3 years but analyst wont tell now how much they see in coming years.

so if someone has job of 7 lacks per annual and having loan of 40 lacks then God only can save you.

Anonymous said...

Pune builders have increased rates by 400 rps....its all drama everyone knows now.

IT people know that there jobs are not secured now because of Global slowdown.

In America millions of people have given up their houses to banks or lenders and so many Billion doller banks are in big trouble since there are no new buyers.

God must help India and such subprime drama wont happen in India

sachin said...

Hi R Gandhi,

can you tell how prices will become half of current in 2009 ? its not possible. the construction cost is rising. maybe prices will be stable due to low demand, maybe even come down by 100-200 but going half ? i dont think so.

Anonymous said...

I don't think cost of construction has really increased to justify 400% price rise. Such comments are posted either by un-informed people or existing buyers who don't want to have price down due to conflict of interest.

Visit any project outside Pune in Tier2 and 3 cities and you will find 2 BHK with all bells and whistles just under 10 lakhs.

sachin said...

Well at least my comment was not posted as someone who does not want prices to come down. On the contrary I am someone looking for an affordable flat in western part of pune.. but prices have been constant or risen only 50-100 rs. for last 1 year around the range of 3000-3500 psf. I did not see any drop. I would be more than happy even with a 20% correction. Ofcourse places where prices are already 5k+ would need a larger correction to come into afordable middle class range.

I do agree about your point of other 2,3 tier cities. but pune has lot of IT, and they are well earning atleast as of now, and buying, so prices are holding. lets see how it goes. I am also going to wait more 1 year, then take the plunge.

Anonymous said...

hi all
to go through your comments, i just confused now...so is anybody help me in this regards pls... just tell me is this correct time to buy proerty or shall i wait

Anonymous said...

Hi All,
After reading about the reality in real estate market, i have suspended my plans of buying the property. I will wait for atleast 1 year.

PATIL P R said...

Hi

I totally agree with comment that price woudl come down to 50 %. its because 2bhk flat should not cost more than 15 lacks with good construction. what is causing high price is land price.
IT employee thinks that they are rich when they get 5-8 lacks salary per annum... but it is a lack of experience. no company gurantee job for 30 years but employee gurantee bank for 40000 EMI for 30 years, its a immature thinking by most employees.. it is unfortunate that educated people makes mistake.
I would advice everyone to read what is happening in America in housing market. and think why this wont happen in India (Indian IT is depending on US market becuase there is no such big market in world).
I would even advice to forward this blogs to all friends and request them from doing mistake of buying 5 times costly 2bhks

Anonymous said...

I agree with Patil, holds bold talks in his message, it is fact that employees promise banks that they would pay 40000 per month to bank for next 30 years.

I also agree the fact that every years there are 500000 new IT faces in India, but there are not that many jobs.

I work in ERP (SAP) where I had more than 4 offers from all good companies last year with 40-60% rise, but this year because of slow down no one is calling me.
this year I was thinking of changing job but now I am struglling to hold my present job because if I loose this job then it is not sure that I will get another job with same salary.

One of friend who is ABAP programmer has already joined another company with same salary and he thinks that he is lucky because he is on 9 months project and he thinks that he will get 9 month salary.

I would like to thank everyone who posted all message because after reading I have decided to wait for next 1 year and see if prices really comes down. I hope prices will come down. even though builders wont sale falts and rents it. because no one can affort to buy 2bhk of 60 lacks.

Anonymous said...

Its really unfortunate that slow down started showing bad effects,, last 3 years India was making progress with 8% rise, but now this year expected is 5% only (that is because of last 3 years momentum).

I HAVE A BANK LOAN OF 27 LACKS AND I AM PAYING 22000 EMI PER MONTH, I THOUGHT THAT I WILL GO TO ABROAD AND EARN MONEY AND RETURN IT BANK. BUT THERE ARE NO JOBS IN NORTH AMERICA SO I DONT KNOW HOW WILL I PAY BANKS....HOPE THIS SHOULD NOT BE STORY OF OTHER SINCE I CAN FEEL PAIN OF NOT HAVING GOOD FUTURE.

Anonymous said...

pune builder association going mad and they think others are also mad to pay 7 times more money to property.

desai said...

Hello

My name is Rakesh Desai and I am staying at Karve Road. Last year I was planning to buy house and agent told me if I dont buy house now then rates will go up by 500-1000 rps in a year, Agent quoated 6500 rps per sq ft.
I called same agent to check if he has any other house to sell, the same Agent asked if I can buy the same house that he showd last year, I asked what would be the rate, and it was shocking when Agent told me that that rate is 3500 rps per sq ft. I was shocked, but then agent said owner wants to sell this for his son education, and owener had baught this same house for 700 rps per sq ft in 2000.

This is real story.....I am not wasting my time just for time pass, but I thaught I can share my story too on this blogs where Pune gone mad in real estate.......

Anonymous said...

Hello

My name is Rakesh Desai and I am staying at Karve Road. Last year I was planning to buy house and agent told me if I dont buy house now then rates will go up by 500-1000 rps in a year, Agent quoated 6500 rps per sq ft.
I called same agent to check if he has any other house to sell, the same Agent asked if I can buy the same house that he showd last year, I asked what would be the rate, and it was shocking when Agent told me that that rate is 3500 rps per sq ft. I was shocked, but then agent said owner wants to sell this for his son education, and owener had baught this same house for 700 rps per sq ft in 2000.

This is real story.....I am not wasting my time just for time pass, but I thaught I can share my story too on this blogs where Pune gone mad in real estate.......

Anonymous said...

Punekar and also people our side of Pune,,, I am so happy that all of you have finally agreed that ABAP and Pune builders are charging huge prices for their flats.. This is so important because one you understand that the problem is then as a human being its very simple to identify the solution...and the solution is dont buy the flats...... simple because
1. Inflation is more that 7%... remeber your daily chapati and sabaji is costing you high.
2. National elections are going to happen by end of 2008.
3. US is in deep recetion
4. Many naitonal banks in India like SBI (800Cr), ICICI Bank ( 1200Cr) Axis Banks(500Cr) have lost due to subprime issue in US.
5. Banks are lending more that 20 lacs.
6. YOU ARE NOT GUARENTEED BY YOUR FELLO EMPLOYER THAT YOU WILL RETAIN YOUR JOB FOR NEXT 20 YEARS TO PAY YOUR HOUSING LOAN...

So guys Chill out relax.. take a rental accomodation wait till correction hapens in real estate and then take a plunge of buying a house..
hope this helps

cooltiger said...

Check this link

http://www.equitymaster.com/ht/detail.asp?date=4/24/2008&story=3

an eye opener :)

Anonymous said...

Cool Tiger,,, amazing article.... yes it is verly clear now...
Guys the article says " Dont buy the propery now" It too high"

Wait till you get the right price for your hard earned money.. Dont get fooled down by these Builders in Pune

Anonymous said...

Hi All,

First of all I would agree with some of you and disagree with rest all. Housing prices will fall or stabilize, it depends upon lots of factors which nobody can control. in 2004 my friend has bought a flat in a project at Pune for 1000/sqft in a very good area. I thought that lets wait for 6 months and then I'll buy, you know what happened, I had to pay 1500/sqft in the same area, only after 6 months.

It cost me some 5-6 lacs more than what my friend have paid for same type of house.
So, waiting is ok but I suggest you to buy a reasonable flat of approx. 2500/sqft and start paying your loan as fast as you can. May be by proper planning you can repay some 50K-75K yearly apart from your EMI so as to reduce the principle amount.

Because waiting is ok but too much wait can spoil all the paln. As it must have happened to most of us in our teenage time, that we wanted to propose some girl but we thought of waiting till perfect time comes.....just due to that wait..those girls are married today to somebody else..

So, please think and buy..a reasonable house..after all a house on your family's head is worth spending few ruppees.

ashvin said...

Anonymous you idiot, a house is not like a girl friend. Nowadays you will get any gf but not a house within your budget. Also stop comparing home prices of 2004 and 2008. Talk about today , bottomline is prices are out of their proportions, period.

http://pract-ical.blogspot.com/

Anonymous said...

Hi Ashwin, it seems you are a frustrated soul, both on love front and now on affording a housing front..don't be so desperate dear..

To enlighten you, examples are not comparison, it shows you a similar path not the exact way to move upon.

yes, 4-5 years back prices were very low, but at that time those prices were also too much if you could campare prices at that time.

Who knows prices may touch 10000 or may be 15000/sqft. in next 4-5 years..any single change in the policy/economy/technology would change the whole idea of life/earning/needs/affordability.

So, its only good to be aware and proactive rather than sitting and throwing muds at people who are earning by using their brains.

Anyway its up to individuals..after all marzi apni apni..

ashvin said...

Anonymous , u smell i mean u literally smell like a roadside real estate agent trying extremelt hard to make a house sale.

About my love life, let me just put it this way, u don't need to teach ur pop how to f***. You are just a result of a stray sperm

ashvin said...

This just in, Maharashtra govt has made it mandatory for builders to put the Carpet Area(actual usable area in the house) in black and white before selling the house. If you are aware nowadays builders use a nice jargon called built up area . So when a builders says it is a 1000 sq ft apartment then then it would include sq ft from common areas like the passage, balcony etc and the actual usable area could be just 700 sq ft. This is also applicable for RESALE flats.

If you feel you have not got what you have paid for then you can file a suit against the builder.

Be alert, you are spending your hard earned money. Remember the magic words "CARPET AREA".

Anonymous said...

I checked PMC's website related to property registrations and taxes. I did random search on some of the reputed new big projects in kothrud. Here is what I found:

1. Bhujbal township - One 1 flat registerered and has got property card details.
2. Ved Vihar: Only 17 registrations so far.

See the diference. Buildes claim most of the project ( say 100+ flats) are sold out but why only few registrations. Means builders are LYING.

I know some flats are newly sold out and property card is not arrived yet for the owners. But looking at the time laped from project launch, I expected a good number of flats to be registered and has got property card available.

Plus, builders and agents claim they are selling flats to IT folks for 40-50 lakhs. Frankly I have not found a single IT person who has got the flat at such a high price.

Anonymous said...

Hi Ashwin, by the language you use on a platform used by common people, anyone can easily make out that who is a roadside person.

Anyways, let 5-6 years pass and see where you stand..inflation would hit very high level and resources will become costlier than today.

Just open the windows of the brain and see the world.

Anonymous said...

Hi

I am trying to sell my flat in Wanawadi so I put 5500 rps per sq ft, I got 20-25 enquiries in a month, but no one actually gave me hard offer, then I reduced it to first 5000 and now to 4000 rps per sq ft, but same again, only people are asking and checking property, but no hard offer yet.

I told agent who has got a good office in shivaji nagar but he also did the same, only good words but no actual offer.
I baught this flat for 2800 rps per sq ft 18 months back....
so I thought of making some money but it is not working for me , I am not ready to sell this flat below 4000 rps but no one ready to by above 4000 rps....

umesh said...

what happen in America same is coming to India.

in US, banks gave loan (4%)to people to buy house then people baught houses and monthly emi was 1000$.
then change in economy interest rate goes up buy 6% and so bank told people to pay EMI 1400-1600 US$.
now people cant pay this high EMI and so they first tried to sell house and make some money.
No one baught the house and so people goes to Bank and say take this house back, we dont need.
Bank offer this house to others but no one is ready to buy......
so ultimatly what happened, owner ran away from property and returned it to bank,
bank can not sell it now but money stuck.
so BANK ARE POSTING HUGE LOSSES IN US HISTORY and economy is down.

same is happening in India.
Real estaet is very high and people have promised banks that they woudl pay 30000 rps as EMI.
once people loose current job, they may not get another one. so they would return the house to bank and so now no one is buying property Bank will go bankrupt.....

if you check on internet how much lose ICICI posted becaseu of US housing slowdown, they you will understand the seriousness.....

Umesh

ashvin said...

Hi Wanawadi(anonymous). The current ready reckoner rates in wanawadi are between (3200-3600) for a new apartment (low and high depending on the area). If your apartment has all the frills & whistles(swimming pool Etc) then it could go at a rate of around Rs 3800. I know you wanna sell it at 4k. I am just making you aware of the prices.

http://pract-ical.blogspot.com

Anonymous said...

Sub Prime has arrived in India. Check out economic times headlines on 2 May.

http://economictimes.indiatimes.com/News/News_By_Industry/Banking_Finance_/Finance/CitiFin_sacks_400_bank_plans_1b_loan_selloff/articleshow/3002880.cms

A slowdown and loan defaults in the local market coupled with capital concerns across the globe have forced Citigroup India to take some tough calls.

While CitiFinancial, its non-banking consumer finance company, has sacked 400 employees, the bank is looking at selling off close to $1 billion of its portfolio.

Guys, this is a clear indiicationthat people who are borrowing more than they can pay back, are now getting into trouble. Loan defaulters are on rise.

So do not buy high priced property or you could end up being a defaulter.

P T said...

made big money, just luck

I purchased flat in Aundh sicne I was looking a place to stay in Pune, I am from Aurangabad.
I purchased flat for 950 rps per feet, now same I sold it for 3500 rps.

I saved not more than 5 lacks in 5 years while workign with TCS, but I saved 30 lacks just by selling my flat.

I can bet that property in Pune (Aundh and main Pune) will never come down. Because these are main areas of Pune. IT will never be down becasue India is super power now.

Dont beleive on people who says real estate will go down.. it will go up.

by the way I baught another big property in Talegaon.

and waiting now for good price

THOSE WHO BELEIVES THAT REAL ESTATE WILL BE DOWN, ACTUALLY THEY SHOULD DO THIER HOME WORK AND STUDY MORE ABOTU REAL ESTATE BUSINESS.

IN INDIA STIL REAL ESTATE IS UNDERVALUED,

ACCORDING TO ESTIMATES, PUNE REAL ESTATE WOULD COST ATLEAST 15000 RPS PER SQ FT IN 2010.

SO YOU BUY NOW FOR 4000 RPS AND THEN SELL IT FOR 15000 IN NEXT 3 YEARS.

Neha said...

Hello PT

read this and stop writting shit comments,
in Kothrudh property is not costing more than 1900 rps

http://www.indiastudychannel.com/resources/13656-Property-Rates-Are-Coming-Down-In-Pune.aspx

Kaboom said...

OK, so anyone giving you the true picture is posting "shit comments"? If this a blog for silly hopefuls with dreams that someday they will buy flat for under 2000 psf in prime locations, then good luck to you. Those in correction camp are clutching to any news articles for their 'drastic correction' fantasy. If this is your first home and you are waiting forever for rates to come down, you are doomed. Even a worst correction will see no more than 15-20% drop in prices. On the other hand, rising inflation is more likely to push the prices up. And if your money parked in savings accounts, your buying power will definitely erode in coming years. Thanks to RBI and finance ministry, home loan rates are not going up.

Anonymous said...

Classic case of conflict of interests. Current investors are hell bent on justifying price rise scenarios by saying rate of 15000 psf. This is clear indication that they have gone mad as they have realized that they themselves are doomed by investing in property with undeserved high rates and are not liely to come out of it without some (huge?) loss.

Pity! Those guys are just listed themselves in the list of loan defaulters in few years to come.

Rates should be 1500~max 2200 in Pune. Anything more and you are falling in debt trap to waste your life.sz

Anonymous said...

I agree.

There were similar comments like from Kaboom above earlier. Look what happened:

- In US, they said housing prices will always increase. Look, they crashed to 20-30% of their boom time price.

- In Japan few years ago, they said housing prices will always increase. Look, they crashed.

- In India till Jan08, they said share prices will always increase. Look, they crashed.

- In India in mid 90s, they said housing prices will always increase. Look, they crashed in late 90s.

- On planet earth, they said dot com companies will keep up boom. Look, they crashed.

What goes up, beyond their real worth, will always come down, below their real worth.

Anonymous said...

There is one comment saying those who are looking for price decrease, should do homework.

So I did the homework and founf out following:

- In a recent data data published by RBI, there is 40 % drop in home loan disbursements in 2007-2008 compare to previous year.
If one refer to Home loan figures only. then sales in 2007 -2008 is down by 80 % compare to 2005-2006 levels.

It is very clearly written that some 53000 Crs. disbursement is done in 2005-2006.
Some 46000 is done 2006-2007
in 2007-2008 only 26000 Crs. are disbursed as housing loans. But prices have tripled.
What is means that only prices have increased but actual transactions dropped by at least 40 % is this year compare to previous year. Considering prices have remained same.

- CITIBANK India sacked 400 bank employess due to lesser credit growth and lesser profits and rising loan defaulters.

- even ICICI anounced last week that there wont be promotions and sal hikes this year

- GE MONEY Used to give Two wheeler loans But now they closed it. What happened with 2 Wheeler loans can happen with Home loans too.

No matter how much shouting from the roof happens to justify high prices, real factor is buying capacity which is not much for average buyers will bring the market to balence and rates will CRASH.

Anonymous said...

I know in 1995 real estate prices in Mumbai come down drastically. Anybody knows how much drop in percentage happended at Dadar, Andheri area. This figure will be guide for us to find out bottom of real estate in Pune during slow down

Anonymous said...

Another major culprit in jacking the prices are the brokers. They create a fake inflation and hype around the seller so the buyer gets the feel that seller is doing a favor.

The brokers treat buyers like shit before they make them meet the seller , so the buyer is already on a back foot and does not do hard negotiation.

This is from my experience that if you like the property and the price is high . You should quote a price which is atleast 30%-40% lower and leave. And trust me there are lot of desparate sellers who will come back running.

Anonymous said...

Please beware in case of resale of properties a lot of Society Secratories are also involved and they keep manipulating the deals

Anonymous said...

Read today's ET (8 May 08) , CITIBANK given several assets for Notice which were not giving back loans
For some loans it can be percepted that loan is taken and immediately it has turend into NPA.
It means not a single EMI was paid back.

Means investors who bought flats just a couple of months ago have realized they have made a big mistake and immediately they have opten not to go ahaed with payments,.

Sub prime has arrived in india as now banks will face the pressure to liquidate those foreclosed assets below their lending value.

I agree with one comment above that pune rate should not be more than 1500-2000.

Let builders, agents, investors quoting fancy prices get sunk to bottom.

Anonymous said...

Mont vert was quoting 36 lakhs for their new project just few weeks before.

Now they have reduced prive tag. Lots of ads are now quoting booking price of 29 lakhs from 17 May.

This is a proof that prices have started to come down.

fed up said...

Ohh!! You cannot imagine the happiness I get when I still see the advertisements of projects I used to visit some 6-7 months back..

These builders have tortured common people like me for very long.. and now I can see that they are desparate to sell off the vacant flats..

Me and my friends still enquire to many builders on a regular basis and its a common knowledge that no-one is willing to buy a pigeon hole which will leak in rainy season and which is 20 kms from heart of the city..

I always wondered , how these builders could shamelessly ask for 35-40 lakhs for flats which looked like chawls and not even worth 10 lakhs..
well , its pay back time..

3 weeks back , PBAP increased rates in Pune by 5- - 400 rs PSF..
Thatwas the last attempt to tell the world that Pune property is still rising..

What a fiasco..

Some people might have been lured to buy flats , because of this new rate increase..
PEOPLE , dont fall trap to this new game from builders lobby.. there is no hurry to buy flats which are being sold at twice their actual price..

The current market sentiment has confirmed that a correction was long due in real estate as well as stock.
I know for sure that real estate is 20-30 % low in Delhi and bangalore.

I am waiting for a correction in Pune real estate for last 1 year.. ( 2BHK in Wakad at 40 lakhs , 2 BHK in Kharadi at 38 Lakhs.. are you kidding me ?? what do these builders think .. if this is california outskirts ?? )

I also got confirmed news , that in a recent meeting of PBAP , they decided to boycott any builder who reduces rates..

but then , well there was Mont Vert who does not belong to that league.. after reducing the rates for their upcoming projects last week end, Mont Vert has started the downfall of these greedy builders at last..

this could well be the start of the buyers market.. and I think the downfall in real estates will happen over next 1 year..

But then , my question is "How do you know when is the right time to buy? "

Do I wait another few months?

I know for sure that second hand flats in good areas are being sold at a bargain..

So what should be the best time for all of us to book a good flat in coming months / years :-)
Suggestions and comments are welcome..

Anonymous said...

The boom continues and builders continue cheating people like us. Ome exmaple is Mirchandani Builder who is making Mirchandani palms in Aundh Annexe. The builde promised possession in oct 07. The delayed it to Dec 07 then to March 08, then to July 08 anf now maybe Diwali 2008... Ther are maybe just 10-15 people working on the plot where theyre are 7 building. he has not done any work for last 6 months and refuses to meet people, answer them, or give any explanation of any kind. He (Sanjay Mirchandani) is cheating people by not giving in time and laso not providiny many tings that are mentioned in the agreement (wooden wardrobes, mosquito mesh, extetnded kitchen, false ceilng...Now he has just refused to provide any of these things...Where and what do people do woth such goons. Such goondas are growing by swallowing our money and not doing anyhting. People beware of this goon - SANJAY MIRCHANDANI - Mirchandani plams

Archana said...

Friend of mine bought flat in Aundh for 65 lacks in last year and was very happy.
This year his company is planning to reduce strength by 20 %. My friend has become so much negative that he is unable to handle pressure.
He does not have saving and he has to give 38 thousand rupees per month to bank.

Finally he discussed with his father (who is a class one officer in Pune) and decided to sell flat. In last 4 months he didn’t get single offer for flat above 60 lacks.

So he discussed with agent and offer agent 3 % if he sells above 55 lacks. Same story again. No offer above 50 lacks.

So right now I guess no one is buying flat because flats are very costly and future is not secured.

Prasoon said...

Guys,

I do not understand who is able to afford the flats in pune with the current property rates?

Less than 15% of IT professionals in pune get more than 12 lacs gross salary. 1 lakh per month actually means 65K per month in hand considering all taxes. Atleast 10 % of salary is variable component that varies each quarter and is anyway going down these days. So that leave 55K fixed per month in hand. Typically people have a car loan with 7000 or 8000 EMI. So left with 47K per month. If one buys a flat worth 40lakhs, take loan of 35 lakhs; EMI would be 40K!!! Where is the money for monthly expenses?

Maximum that they can afford is 25 lakhs house with 20 lakhs loan that makes 25K EMI. Where is the flat at this rate in Pune?

If people think logically instead of going with the peer pressure, we should see property prices going back to the range that is affordable.

Anonymous said...

I don't even think 25 lakhs is affordable, even to IT guys.

When you are young, EMI of 25K may be managable but as family starts growing, with growing inflation, things will become tough. Add to it, volatility of IT sector.

I think max value for 2 BHK anywhere in Pune should not exceed 20 lakhs. This includes a handsome profit to builder as construction cost is much much lesser.

See, in all other cities except Pune and Mumbai, you go anywhere like Nashik, Aurangabad, Kolhapur, Nagpur, 2 BHK are availabe just around 10 lakhs.

You open your eyes, don't fall pray to gimmics like "oh, input costs have increased", "land prices have incerased". These things are floated by builders, agents, brokers and current investors who want to sell their flats.

20 Lakhs !! Thats maximum you can afford and you should afford.

Prasoon said...

These rates looks good :)
What say?

http://www.abodesindia.com/articles/mar2001/propertyrates_pune.htm

Anonymous said...

http://economictimes.indiatimes.com
/Markets/Real_Estate/News_/Landslid
e_Realty_is_facing_a_major_cash_cru
nch/articleshow/3044732.cms

This confirns slowdown has started in real estate and prices have been corrected by 25% as of now. Wait and watch realty crumble in next year or so.

Lets bring back the prices to where they were before 3 years.

Anonymous said...

Someone mentioned about a 2 BHK flat in Kothrud at 1900 /sq feet.

I too have seen a flat at similar rate near Kothrud Stand....but the condition of building and flat is such that I have decided not to purchase it and finally settled for 1 BHK at same price near Kothrud Depo......so don't believe on such rumours....and findout reason behind rate fall

Kaboom said...

Looks like everyone in this blog is running on hope of a serious correction. Too bad the ground reality is something else. The only results of the mild slowdown is the cooling down of the brisk pace of sales. Granted things aren't moving as fast as they were in 2005, but so what? Most of the buiders recover their investments when half the units are sold, rest is pure profit. If it is realised a little late, no big deal for them so don't hope for the builders to panic and announce fire sales. Sometimes they offer flimsy incetives like trip to Europe etc to sell some more units. Even a free modular kitchen means little (less than 1 L), but it brings in more buyers. All this while, procrastinators sit on their hands doing nothing but get desperate; their outward appearance full of bravado notwithstanding.
I have been through this phase before. I was advised by my dad in end of 2004 to invest in Ved Vihar, Kothrud for around 1800 psf. Too bad I listened to some people infected by correction syndrome. They assured that this type of price is not sustainable, wait for rates to fall below 1500. Alas, I missed a golden opportunity because the resale flat in the same complex are quoted 5000+ now. Then I wisened up and invested in a small scheme off Paud road in 2005 paying 3200+. Now that it's been 3 years since resistration, I am selling it for almost 5000. With that money, I am buying another flat in Baner, this time for 2900. I am betting even the worst correction would take it down to no less than 2400. On the other hand, commonwealth youth games might push the prices up in this area. Anyway, since I am looking at this as a home to live in rather than investment I don't really care what happens to price. But if there is a real correction and decent apartments in Baner/Balewadi/Wakad area are finally selling under 2000, let me know because I'll buy one more :-)

And yes, don't go gaga over Mont Vert selling 2 BHKs for 29 L. It is a clever ploy to bring in people who think 40L is too much. The apts are 950 sq ft, about 15-25% smaller than standard 2 BHKs in this area.

Anonymous said...

How 2010 commonwealth games going to affect Baner/ Balewadi? What after games are over? Unless there are big business houses come up its usless for salaried class people unless for retirement use (agreed it's proximity to Mumbai)!

When 50% apartment sold off & cost is covered, naturally builders have made killings over past 5yrs and won't bother to lower prices. For own use, I guess one has to look for a buy from an investor & not builder. I scanned some prices online, for same property high moderate and lower price quoted by same agent/ builder. It means not many are buying these days. Every one is talking about Rs.1,500-1,600 land purchase price & Rs. 850-1,000 construction cost. This takes to Rs.2,500 for a bunglow not for apartment where Rs.1,600 land price gets shared over multiple floors. For couple of properties I noticed individual seller's expactions as well reached out of roof e.g. Rs.70L for 2500sq.ft twin & Rs.80L for 2800sq.ft within compound. Obviously, people are looking for buy within compound rather than stand-alone housing (result fo raising aspirations & nothing bad in it).

Obviously new property price is going to be high due to high inflationary costs as well profits already made by builders who won't give up easily.

Genuine moderate price property will sell-off easily but not those over priced.Happy house hunting for wanting to be own use.

Kaboom said...

I was referring to Commonwealth Youth games of Oct 2008 to be held at Balewadi sports complex. Although a small event in the sporting world, it is a perfect showcase for Pune. The roads in Baner/Balewadi area are being widened at a brisk pace. Quite a few 5 star and 3 star hotel projects alongwith luxury service apts are coming up. Proximity of stadium to Hinjewadi phase 1 means the area has ample potential.

bhosale said...

one must study what happened in America for housing market before buying flat in Pune.

in USA people had purchased properties when they could, but now they lost jobs and cannot pay EMI so returning property to banks, Banks selling for less price and finally home owners are loosing home and their home liquidity they built.

Same could happen in India, and there are very very high chances.

Because people are buying very very costly flats because they can afford now, but now IT is slowing down and peak of IT has already gone, with world recession heading towards, there could be very high chances that IT guys may loose jobs or it would be difficult to get another good job in IT.

so if some one has purchased a flat for 39 lacks and paying 30,000 monthly EMI then it woudl be the biggest mistake because in his or her life.

NRIs also thinks 10 times before buying 40 lacks flat or paying 30-40 k or 1000 usd emi.

if someone has promised to pay bank 30-40k EMI then good luck.

it doesnt matter to builder to sell houses for less price if they can rent it for better price.

Builders have made their money because of hype of IT and foolishness of some IT guys who purchased flats for 5 times the cost of it.

prices will not come down immediately in next 6 months but houses will also not get sold in next 6 months.

There is certainly not concept of correction in housing market. but there could be sudden collapse in Indian housing market.

Because not where in world house pries have been doubled in 2 years. everywhere in the world there is control and statistical data is available for buyers.

so what happened in India was actually a hipe and mistake of buyer to buy flat.

if buyer wants to see if they have made mistake or not then try to sell your flat and see if you can.

You wont because no one will buy now for the 4-5 times costly flats

good luck new buyers

ashvin said...

After searching for months for a 2bhk at a affordable price, and checking out old useless resale flats,I have finally purchased a Chevrolet Spark last week.

And by god I think I am enjoying it. To hell with with the house now, I am planning to stay on rent for atleast the next 2-3 years. I am paying 8k rent and my car emi is 9.5k. I am so happy to see that I have to spend only 17k a month. I am loving it.

Anonymous said...

investing in a flat in pune at this time is rediculous. most of the builders are cheating the public. how can a rate increase in a day by Rs 200. builders who were saying that only 1 flat available are now following-up with more options, which indicate that there are surplus. PL. DO NOT BUY FLATS IN PUNE PRESENTLY, BECAUSE THE RATES HAVE TOUCHED TEH TOP BOTTOM. As a business cycle it will come down like bangalore.

Anonymous said...

Good luck to current investor. They still think that prices can increase despite they are at their peaks.

Do you think there wil be takers for 8000 rate in Pune when supply is exceeding demand (see there are so many ads) ?

Idiots in the game are over. They are either lucky guys who cashed out thier assets in 2004-2007 boom, OR loosers if they stil have thier assets unliquified.

Nobody in Pune is now willing to give rate more than 1500-2200.

So, quoting the rate as 8000 or 8 lakh per sq ft is not going to bother anymore to genuine buyers.

Kaboom said...

anonymous said
"Nobody in Pune is now willing to give rate more than 1500-2200"

Wow, are you even sure what you are talking about? Please let me know when prices for reasonably new flats in any of the good areas (Aundh, Kalyani Nagar, Kothrud etc) come down to these levels. I will buy a handful, really. !

People in Nashik are paying 1500-1800 in decent locations. In Aurangabad, it is 1200-1500.These are not bubble prices, but relatively stable valuations. And these towns don't even have many high income new economy jobs. Because you come up with a silly number like this, think about it: if a property was selling for Rs 2000 psf in year 2004 and if you consider 8% annual inflation, its price in 2009 should be 3000. And we're not even considering economic growth, new jobs and high demand. Your 1500-2200 target is laughable. Maybe an old, blackened, creaking building on Sinhagad Road is the only middle class area where this rate would work.

Don't blindly think about USA subprime example. In IT heavy bay area, there was hardly any correction! Even in worst case, the correction was upto 25-30%. If you are an investor, definiely stay away. But for first time home buyer, it would be silly to let your money rot in fixed deposits and then pay monthly rent on top of that.

Good luck!

Anonymous said...

Two things:

For one, I think target of 1500-2200 is certainly right one. Because ultimate factor which is now going to decide the market rate is CAPACITY of MOST end users. There are some greedy investors who can pay more what property deserves but then they don't fall under MOST end user catagory. Their numbers are less and because of their sins, there is a bubble in the first place.

Second, even if you have capacity to pay more, it is utter nonsense to pay the UNDESERVED rate. Because cost of construction certainly ver less including all bells and whistles. Otherwise, rates wouldn't have been low outside Pune and Mumbai. Hell, this greed by people who pay more are sickening out entire economy because too much EMI reduces buyers spending on other items and this leads to low consumption, putting the economy in geopardy.

Well, I don't care what current investors shout from rooftop. I know giving more money to something not worthwhile is plain fullishness and such things get timed out in market in long run.

most buyers have less capacity and hence once holdig capacity of investors and builders die down, market will correct itslef.

Not to mention, I don't know whether rates of 1500-2200 are right or wrong, but one thing is certain that THAT is the rate most end users can afford.

Anonymous said...

I agree with above comments of target rate should be 1500-2200.

See this site
http://indiahousingbubble.blogspot.
com/

There are verious articles confirming that real estate is correcting and sense is returning to market.

Various Bank reports also confirm home loans distributions are alarmingly low and no. of notices by bank to defualters in increasing day by day in leading newspapers like ET.

I support all who read this blog and make an honest attempt to bring real estate prices down. I don't want to saye "Please spread this news" because this is already happening. Buyers all over are realizing they get fooled by paying high prices and consequences of defualt are very dire.

Anonymous said...

Folks did you notice one thing ?

Before three months, no seller had opinion that market can correct.

Just three months of slowdown and investors themselves quote OK, max correction would be 25-30%.

Isn't this eye opening?

Wait for few more months and realty will CRASH.

Kaboom said...

Hey, I said
"Even in worst case, the correction was upto 25-30%".
This doesn't mean I am expecting it, but I am mentally prepared for it because you never know. Recently, I called my builder's office to ask about what they do to protect the bldg from earthquake after hearing the China news. Does it mean that now I am looking for an earthquake? That would be a silly conclusion. We all know the prices have stagnated for last one year. In these infaltionary times, that is equivalent to 10% pullback (By the way, most of the private sector white collar jobs are seeing 15% salary growth). Now if prices stagnate for one more year like this, it will be a correction to the tune of 20% without you guys even realizing it. More people will find the prices attractive in light of their increased salaries. So don't get hung up on what you think is the right price.
And if you know for sure that there will be a big slowdown in future, then of course don't buy. Maybe even short sell a falt, if there is anything like that :-)

Again investors need to be very catious but genuine buyers should not procrastinate for too long.

Anonymous said...

I will not comment about the property rates as I don't have much understanding about the factors which effect these rate but this is my advice to my fellow IT people.

Most of us reading these kind of blog and comment are people who are looking for there first home (a dream). In whatever direction property rate goes whether its up or down don't bother, You will have to evaluate your financial position. Don't bother about your peer who might have bungalow in Kalyani Nagar.

First look at the IT trend as our employers will not hesitate to fire us once they start loosing there overseas contracts. They will fire employee as quickly as they hire. Our income depends on the economy of other countries and not on the economy of India (My opinion). So before you plan to buy a house think twice about all your liability and your future plan, plan about the risk which involves your family, job and health. Paying EMI which is more than 30% of your Net Income is not a good Idea.

Unless you don;t have a good amount to pay initially don't take home Loan. And study a lot about the property market and the whole process of transaction.

If you are coming from on-site don't be in hurry, remember you can landup in wrong hands and will repend later when you lose your money and time. Always opt for a good builder or brand name. Ignore big Ad of small builder, ultimately you are the one who pay for that Ad and the celebrity in that Ad.

Anonymous said...

Very well said, above comments. Certainly you need to keep volatility of IT sector in mind. Dot com bust is a fresh example.

Paying EMI more than 30% of your income is max that can be afforded. Anything more and you are inviting trouble and might be defaulter in years to come if steady income level is not acheievd. In that case, you will loose the house as well as hard earned money paid till then.

Do not go by comments from speculators, brokers. They need to sell flats at higher prices than they bought. Thats the only truth. Actual price is much lesser as one comment above sites examples of cities outside Pune and Mumbai.

The very reason there is a bubble in big cities is because of these investors. In smaller cities, prices are reasonable because takers are reasonable end users and they are not property dealers jacking up prices to earn easy money from speculation.

So take a firm stand and do not pay high and unworthy prices, no matter what current investors shout to justify high prices.

Anonymous said...

http://economictimes.indiatimes.com
/IT_companies_go_slow_on_the_hiring
_front/articleshow/3057331.cms

This shows that there is a definite slowdown in IT sector. So all in IT sector need to be very cautious about financial commitments above their payment capacity.

There were recent layoffs in IBM (700), TCS(500), Citibank India(400).

Several companies have announced internally not to expect significant salary raises this year.

These things should serve as eyeopeners. Certainly, real estate boom is now over and common sense is returning to market.

Didn't our ealier generation tell us to stay away from loans as much as possible ? In today's age, this may not be entirely possible but staying away from unaffordable loans is the next best thing to do.

Else ..you know what would happen ..

Anonymous said...

One thing for sure, when someone goes for a loan that is bigger that his real capacity, and when its time when your capacity does not allow you to payback, these people who jacked up prices will not come to help you and pay for you.

Just like prices are hiked, there are plenty of justifications given by investors and builders to tell you to buy overpriced asset.

but when housing prices dip and EMIs stack up making you a possible defualter, these investors will not pay you a buck. Instead they will say. "Mate, you know all markets are volatile. You just ran out of luck and running into losses. Don;t worry there are many others like you in unmanagable debt. You have to minimize losses now. You need to sell this house at lower price than you bought and repay the debt. At least you can minimize the losses now. Thats what everyone is doing. Don't think too mcuh and hurry up, sell the house"

A Bad dream, isn't it ? This can be reality and you will loose your life's earning in a flash.

So, don't pay high prices. Give it back to price jackers.

Anonymous said...

http://timesofindia.indiatimes.com/articleshow/664904.cms

http://cities.expressindia.com/fullstory.php?newsid=83949


PUNE: A 33-year-old software engineer lost his life after getting trapped in a malfunctioning elevator at the Riddhi Enclave housing society in Viman

Nagar on Wednesday night.

Vishwanathan Swamy (33), along with his wife, three-year old son, Advai, and father-in-law was going to his brother-in-law’s residence in the same colony for

dinner when the incident occurred.

As soon as Vishy, as he was fondly known, entered the lift, it suddenly jerked up, with doors open. The upper half of his body, till the rib cage, was

trapped inside for more than 30 minutes and his lungs were punctured.

Horrified residents finally broke into the control room and brought down the lift manually. A local doctor provided first aid to a bleeding Vishy, even as an

ambulance was frantically summoned from Jehangir Hospital.

His wife and another person, who entered the lift before Vishy, had a miraculous escape. His father-in-law was near the lift door at the time of the

incident. Hari Poonia, secretary of the society, who broke the lock at the control room, said he was shocked that the lift went up suddenly with both the

doors open.

Vishy, probably, would not have lost his life had repeated complaints about the lift been attended to. Ever since it was installed in December 2000, the

residents were not happy with the lift’s electronics, Vishy’s brother-in-law and chairman of the society, V. Venkatesh, said. When contacted by TNN, Shyam

Agarwal, builder of the Siddhivinayak Group, said he cannot be held not responsible as the property was already handed over to the co-operative society.

Angry residents are now planning to seek legal remedy.

Parimal said...

Dear Friends,
I would like to highlight some points which will be helpful to you.
1.) Builders say price rise because of input costs. Did the input costs rose by 250-300% in last 3 years? If this is the logic, any automobile price should have been at least increased by 50-70% as majority of body,chassis is of steel & aluminum. The prices in real estate market are dictated only by demand & supply.
2.) Inflation is inversely proportional to real estate prices because you spend more & save less, which makes it difficult to pay high EMI's.
3.) Prices were hyped in cities like Pune,Banglore,Gurgaon based upon IT/ITES industries. All the mentioned cities have seen price correction of 25-30% & still expecting further fall. Pune will see this by the end of 2008.
4.) In Pune majority of people are engaged in manufacturing sector where the average salary is 15k to 25k. These people are the main end users & can't buy the flats at current rates. Investors are pulling out & IT people are insecure about there jobs.
5.) Home loans interest rates have increased from 7.5% in 2004 to 13-14% today. Hence, EMI's too have increased a lot,which many today can't afford.
6.) Based upon purchasing power of the Pune citizens & the infrastructure which the city provides, the logical rates are between Rs.1500 - 2200max.
7.) 22000 acres of land has been released because of ULCRA repeal. This will further push the prices down within next one year.
8.) Today, it's better to stay rented, purchase vehicles, consumer durables & when real estate prices crash, move in your new house with these products. Hence, you have well furnished house that will cost you much less than todays price & won't come with the headache of high EMI'.
Please let me your comments.
Regards,
Parimal

Anonymous said...

Very well said.

Typically initial responce from the people who do not want price decrease was " There will not be any property correction".

Then, buyers did not succumb as they could not afford high rates. That brought stability to prices. Now, above typical responce changed to " There will be some correction in only selected areas, not to all areas".

Still, buyers did not succumb to unaffordable prices. That started decrease in prices. Now, above typical responce changed to "Yes, There is some correction in all areas now. But % decrease is just 10-15% which is very low in hot selling areas."

This is the current time. Buyers still need to follow common sense and do not buy till prices drop to affordable levels, say 1500-220max. These responces will change again. You can make it happen.

Do not give high prices. real estate is all manipulated prices.

Anonymous said...

Hello people of Pune.

One more angle here. Use of media, espcially news papers like Sakal and TimesOfIndia to promote stories of real estate boom.

Read this article and comments on it.

http://indiahousingbubble.blogspot.
com/2008/05/times-of-india-and-
builders-desparate.html

This shows that an evil nexus exists between media and builder lobby. But they don't know that people also know this and they no longer get fooled.

Anonymous said...

read ET today 29May08, some 9 properties are being auctioned by Bank OF Maharashtra.

Also, there is one mroe thing to note. For one asset two banks claimed same property. It means both banks were cheated.

Guys, a real tough period has started to real estate in Pune. This looks like india has started facing its own sub-prime situation.

Banks and investors are doomed now.

There are talks of raising CRR more by RBI, means increase is EMIs which are already getting out of capacity. Soon, owners start telling banks they no longer can pay back and banks can sieze and sell those assets.

Wait for one more year and prices will CRASH liie anything. And I do not mean that that will be "drop" in prices but one has to say that prices are now "Correct and reasonable" and not reduced ones.

Anonymous said...

If you are planning to purchase your dream home then just wait for 6 to 12 months as property rates started coming down.
• Closely watch constructions going near by your home then you will find now they have stopped construction or the speed of constructions is very slow.
• Reason behind is they don’t have bookings so it is very difficult to complete their project. If they become defaulter then you will loose your valuable money.
• For confirmation you can visit Aditya builders bawdhan pune, Aditya Builders Baner, Sun Orbit Singhgad Road Pune, Huzur Developer Singhgad Road Pune, DSK Vishva Dahiri, Roseland Aundh there are so many who don’t have customers. Rates will surely come down which is good sign for buyers.
• You can check it very easily visit their sites and enquire from some construction supervisor or site engineer about bookings. Then visit in their sales office they will try to present 80% – 90% has been sold out. Actually it is just 10% – 20%.
• So total 10% – 20% poor guys has been nicely looted by these smart property developers. Please don’t disclose them how you get real information about their project that way other interested property buyer will not get correct information about project and they might loose their valuable money. You can also enquire this from small kirana and pan shops which are near to that site. Or you can visit site 2 – 3 time in 10 – 15 days. So you will also get idea about work progress.
• Before investing watch regularly CNBC and other business channel’s real state programs. According to them real state developers are in big trouble. Some of them have invested their money in stock market when it was 20000+.
• Most important thing is be aware about your job security also. Now a days job market is also little bit shaking. In case if you are job less and can pay their heavy EMI at least for 1.5 year then go ahead and purchase property if you feel it is worth.
• Then after if you are interested in buying a property then just bargain with property developers if they ask for 3300/- per sq. ft. then just tell now it is buyer’s time I can’t pay more then 2200/- and give your contact number they might contact you.
• Believe or not last month someone purchased a 2 year old 2BHK flat somewhere near to Kothrud bus stand (It is prime location of Kothrud) in just Rs. 1900/- per sq. ft. because seller and purchaser were aware with current market scenario.
• Property developers are having a syndicate which is not allowing small developers to sale their property openly in reduced rate.
• It already happened in USA. Property market, It has been came down 30% - 50% depends on location. You can enquire from your friends who are living there.

Anonymous said...

It is said that price rise is related to demand and supply, but you know builders creates demand for their own benefit. Few weeks back when Mont Vert was launching new project highlighting 29 L onwards, I called them to know about area and price of apartment. they told they will disclose only on 17th May on launch date. When I visited their stall at Le meridian property expo they said the same thing. But when I visited their site on launch date they told Block A & B are totally sold by 16th May evening and only few flats are available. What does it mean? Hope a logical and mature person can understand this creation of depend.
Also if you can see Times of India which is having most advertisements from builders have organized property expo almost every month in Le merdian and still they are doing. This shows how builders are getting desperate to sell off their properties as no one is buying. Property prices are getting higher because our foolishness, NRI and local investors.
It is definite the real estate financial curvature will come down by diwali.

Anonymous said...

I again say, rates of 1500-2200 p.s.f. hold true for Pune properties and they are maximum affordable limits.

Anything more and debt related worries start, especially if you are in IT sector where current scenario will not be guarrented till next 25 years.

Read an article in TOI on 2June08 where some cases of smaller loan defaulters are discussed. The surveyers say they were disturbed by suisides of farmers in vidarbha, but mumbai is also on verge of debt related suisides volcano.

Loan defualt is very very bad. So borrow considering your lowest possible guarrened income for next 20 years, and not the peak income figures.

Parimal said...

If the builders say many almost 50-60% flats are sold on the very same day of the launch itself, why do they advertise later & have stalls in all real estate exhibitions? The cost of land + construction is recovered when 50% flats are sold. This trick of telling that almost all flats have been sold out are just mental games to create pressure so that a prospective client hurriedly buys a flat. So don't let builders fool you. Take your time, builders will wait. Anyways don't buy flat now as a minimum of 30% correction is expected within next 6 months. Price correction areas will be more on the outskirts.

Anonymous said...

TOI is licking dog of builder lobby. They will publish any false news to promote real estate hype as it gets them ads.

Look at express. They came out with clear article

http://www.indianexpress.com/story/
317406.html

with correct figures from registry office confirming slowdown in property market.

Economic times is also regularly publishing many Real estate burst news. See this
http://economictimes.indiatimes.com
/Markets/Real_Estate/Realty_deals_g
et_buried_in_pan-
India_landslide/articleshow/3094570
.cms

and

http://economictimes.indiatimes.com
/Markets/Real_Estate/Slowdown_falli
ng_market_demolish_real_estate_stoc
ks/articleshow/3094815.cms

It is only TimesOfIndia which is culprit and creates false hype. They are the ones who own magicbricks.com. They are the ones who arranges property expo in Pune almost every month.

Pay attention to bigger picture. Realty is a big shame. Rates people can pay lie just around 1500-1800 range and not a penny more.

Various buyers are now grouping together and making hard negotiations to bring the price in this zone and then only buy the house. And do not trust any hype created by media like TOI.

Anonymous said...

Friends... forget what Times is doing and what Economic times is doing, everone here is for money..

Latest news Petrol rates increased by Rs 5 and Diesel rates increased by Rs 3. Which means inflation increases by 0.51% ie by end of Quarter will increase it to 9%. Guys this will create havoc in market sentiments now. People will suddlenly reduce their expenses and large investments decisions will be kep on hold. As a result Builders will have no option but to reduce the cost. So just wait and watch.

Never make a mistake of buying a house now because you will land up in trouble. Companies are under pressure hence they will lay off people so its a very dangerous situation.

So Wait and watch...

kartik said...

some companies have already started lay offs. one of my friends got layed off, now only his wife is working he is searching job, he has EMI to pay.. its though times ahead..

Amitk said...

I think living in India and specially in metros is same as living in a financial jail .we waste half of our life in getting good education(gre,,gmat dmat,,cat,cet..toffel 12th(double for few people)...we pay good money for school .. College ...entrance exam. then college donations(ex symbi)...and finally get a job in a multinational company in India(started in India for cheap and hard working labor ).nobody knows how many years these companies are having operations in India ......and one fine day we BUY a Flat in a good locality and waste half of the life in paying the flats EMI…paying for cars EMI ….Paying for children’s school fees.. College fees….(ex simbi)….will write a nice story on living in India later it’s too late here in NY(usa) need to sleep… I don’t have a flat in pune and I am not planning to settle down in pune so no worries I can have a great sleep…I can live in any small village near pune So at least I can save something for beard and butter when I will retire.

Anonymous said...

DO u think leaving in NY id different than this....atlease in india they have servents for house work....leaving in us is like prison labour .....work like a coolie whole life and then they findout they cannot afford a home in Puna.....and start cursing....Guys don't wait....Property prices will definitely come down by 5-10 percent...but before that they will increase by 10 % J

Anonymous said...

Ha Ha.

Even though prices have peaked beyond any common user can buy, There are some people who still think prices will still go up more.

Who will buy then ? Aliens ?

Ppl who reccomend to buy now are actually the investors who are doomed and want bigger fool theory to bail them out of bad investments. Thats why they keep cooking up stories about booming real estate.

In reality, current inventory is much much larger than existing demand. Interest rates are going to be hiked with RBI decision to increase reverse repo rates. Economy is slowing down globally. Increments all over have falled to insignificant digits. Layoffs happening.

Only one thing is booming now, Thats the Inflation.

See notice by Canara bank in TimesOfindia paper on 5 June08. They have published about 15 defaulters names and given possetion notice to their properties. See, demand prices is
is equal to 1000 per sqaure feet.

This means those assets were not able to get sold even at 1000 p.s.f. and you talk about justifying rates of 3000+ in Pune, What rubbish.

Real estate bubble has started to burst now. Celebrate the fall of greed and may common sense return to market all over.

Anonymous said...

I agree.

Thats why buildes, investors, agents keep giving ads demanding 60 lakhs for 2 bhk, 90 lakhs for 3 bhk.

This is not intended to sell the asset at that prices but to mislead readers that prices have not fallen down. They want to make buyers afraid of further price hikes.

This have worked till some months ago but not now. Everyone knows this is not correct and no one will buy at such idiotic rates.

Anonymous said...

what about cost of flats in Mumbai....they r lot more than that of Pune...I have not heard any news that any aliens has purchased any flat in mumbai....

On Mumbai blogspot..U can see comments like..."Cost of flats in Mumbai is too high better purchase one in Pune..."

I am not a builder or invester .......just want your views on this to clarify my doubts....

Anonymous said...

Yes, some people HAVE purchased flats in Mumbai at austronomous prices. These people are:

- Investors who will loose out in short time as prices are falling.

- DINK families (double income no kids) from IT sector who think things will be in good shape for ever. First hint of slowdown and layoffs and these will face the heat of EMIs. Plus, as years will pass by, with family growing, it will be difficult to keep paying EMIs with ever incerasing interest rates.

- Idiots who still believe prices will be increasing forever. They ignore crash in india in 1996. They ignore crash in US, Japan.

BUT most important thing is number of such people are very less as compared to number of end user buyers waiting in the market. Also, even if there were such rich people, most of them have already invested and unlikely to buy more assets.

Lastly, end users have realized that having more liabilities than assets is not the right thing to do and they will buy only when property suits their budget. This is even more true when inflation is rising, IT/global slowdon on the cards.

This leaves only one prospective buyer communiyt in the market to succum to idiotic prices. Yes you are right, they are "Aliens".

Parimal said...

Totally agree with above comments. Last year there used to be rush at builders offices in Pune. Today you go & see, even the staff strength in offices are reduced. I visited couple of sites where sales offices were closed that too at 1500Hrs. You too can visit any nearby site & observe how many people are actually visiting the sales offices, forget purchases.

Anonymous said...

R the Pune Builders r going crazy....all people in this blog r commenting that there r no buyer in Pune....but these builders r coming with new schemes....I can understand if some local builder is cming with new schemes....but all big brands...
1)Kumar builder....Megapolis...and now infinia
2)Magarpatta builder....nanded city
3)DSK
4)City group...Amanora.

.....and the list continues

Can anyone send these blog and tell them that prices r going to reduce...
I agree all buyer r idiots...aliens...etc. etc..

but any clever person has any idea when that 2-4 months time will be over when prices will see downwards turn...

Dates r not mentioned in this blog...but as per I remember, peoples r shoting since last 8 to 10 months that pricese will be down in another 2 months...

I'll be happy if this thing happens,just want tot ell u that don't misguide anyone if u donot have correct info....

Anonymous said...

Hi Pune,

Above comment sound interesting. It says bloggers should tell actual dates on when prices will fall. It says don't misguide if they don't have concrete info..etc.

Let me tell that price up/down does not happen on date. It happens based on responce given by buyers which is driving factor of demand/supply scenario which determines the prices.

The very point of such blogs is to discuss and spread awareness about inappropriate and unjust prices by builders and help these buyers to give a collective responce.

If all buyers do not pay any higher price, prices will fall in few months. If buyers succumb to unjust rates and give up, prices will not fall. Thats the point.

Buiilders do exactly sthe opposite. They keep shouting that prices will increase in next few days and eventually people believe in it. There is nothing wrong if buyers communicate within themselves and express their opinions. This is just discussions and no promises.

These forums will help buyers to know market pulse and come to decision that suits their budget with reasonable prices.

Kaboom said...

As I have stated earlier, a lot of correction has already happened on inflation adjusted value of money. But many people in this forum are simply screaming that economy is slowing, IT jobs will disappear, too much supply, too little demand, who affords this and so on. And if you search internet hard enough, you always find tonnes of links to back your conclusion, no matter what it is!!! But the ground reality is very different. This blog started more than two years ago and it is dominated by property bears. In any long, uptrending market, bears always tend to sound smart, intellectual and bulls are always supposed to be idiots who think prices will always keep going up. Price rises are slow and steady and that's when bulls profit. Eventually, the bears get it right but that is meaningless because the correction generally happens from much higher levels and silly predictions like dreaming of paying 1500-2000 psf in Pune's prime areas never come true. And I am not really bullish, but I believe upside and downside risks are balanced. That simply means investors can get burnt if market corrects, but genuine buyers can also get hurt by waiting for that elusive crash to take place. If you think the EMI doesn't suit your budget, please sit out. But if you have money and you are waiting for crash, that's a dumb move. Because your money in FD will earn 6-7% (after tax) where very soon inflation could reach double digits effectively eating into your wealth. At the same time you are paying that rent. If some people think they can forego buying their first house to finance such luxuries as buying car, flat screen TV or exotic vacations, it is very bad economics.

Anonymous said...

Hello wake up guys.....

Do you think india {PUNE}or {MUMBAI} is immune from the world's credit crunch and teh house price falls??? Get real kaboom !
The credit crunch has affected all teh countries in teh world and just like teh current state of teh stock market in IndiaBSE, the property market is heading for a CRASH not correction.Dream on KABOOM.
ANY INTELLIGENT INDIVIDUAL CAN SEE IT HAPPENING ALREADY IN MUMBAI AS WELL AS DELHI.IN 2 months teh CRASH is going to be totally evident.
Behold buyers, teh real estatate correction is HERE NOW....
Watch it to believe.

Kaboom said...

Really? You seem to have a crystal ball to predict crash in 2 months. Give us your target price ranges for some of Pune's areas like Kalyani Nagar, Prabhat Rd, Aundh, Baner and Wakad. Instead of 2 months, let's wait for 1 year and see how much it crashes. I have decided that I will buy one more 3 BHK flat (for investment) in Baner if prices go below 2000 within next 6-12 months!

Anonymous said...

Kaboom,

I think you economics is weak or you are from builder lobby. Reason why your economics is weaks because you are failing to understand the following

1. Major Oil crisis worldwide is poshing economics of the world in bad shape
2. India Inflationa dues to Oil price increase will touch double figure i.e more that 10%.
3. Election are due in India next year hence current governemt is not in a position to take polcy decision as they do not want to risk the implicatios.
4. US is enterring deep recetion ( i just came back from Newyork and i know the scene there. Its bad
5. IT companies in India are in trouble becuase projects inflow are reduced from US. remeber still 70% or IT is contributed by US.
6. Realestate has reached all time high and its time it will godonw. already builders are reduced rates.
7. Lending rates by banks are going up due to inflation as cost of banking have gone up.
8. Currnet sentiments withing vast population is nor jublient hence recesion in realestate in India is bound to happen.

So looking at above if you feel buying property now is right then go ahead. its your money. I have a property in Kothrud and i am not getting rate of more than 3000 there. So if you think buying now and getting appreciation while selling it will be a distant dream. so best thing to do is rent a house. out your savings in Fixed deposit SBI is offering 8.75%. Save money for the bad times ahead. Wait for the right time, right price and then buy a house.

Remeber patience is the name of the game. So sucessfull people wait for the right oppty and invest and make worth their money.

Happy waiting................

Parimal said...

Hello there all my friends & Kaboom,
I totally agree with the above comments especially oil & inflation. There is a strong possibility of Barack Obama as next US President. He has offered tax concessions to the American companies who are heavily into outsourcing (read IT/BPO). Hence, if these companies get good deal with US Govt., & faced with a recession, the first to go will be outsiders (read Non-Americans). The countries like Vietnam too are posing a threat to India in terms of outsourcing. Also the tax sops given to IT companies by Central Govt. will no longer stand after March 2009 which will reduce net operating profit margins of IT companies anywhere between 20-30%. Remember, Pune real estate is largely driven by IT sector. You move Hinjewadi out of Pune and see prices crash in next 24Hrs.
To get correct picture of Pune real estate, see the number of property registrations taking place in registration offices. It has dropped over 50% in last 6 months while the lease/rent agreements have increased. This clearly indicates that people now prefer to rent than to buy in current market scenario. The home loan borrowers too have reduced by over 40% & the banks are now are careful in giving loans over 65-70% of total amount taking current situation into account. Wake up Kaboom & first support your thoughts with facts. Don't daydream!!

Parimal said...

Dear Friends,
Giving you a link about rising oil prices & it's effect on global economy. Hope this proves useful.

http://www.ndtvprofit.com/2008/06/08113904/Oil-shock-threaten-global-rece.html

Regards,
Parimal

Kaboom said...

Hi guys,
If you are so fond of global bearish news, I give you this site. It will make you all very happy!

www.prudentbear.com

This site is extremely bearish and is preidcting crash for almost all investment sectors for last 10 years. Occasionally, they have proven right. Afterall even a broken clock is right twice a day. I am saying don't buy house for investment purpose at current rates. Also, don't buy house if your EMI works out to be excessive. But if you have let's say 20L in bank and you don't own a house, I would still say it is silly to let you money shrink in a FD and pay rent at the same time.
BTW, let me know which property in Kothrud is going for 3000, I know people who will really buy it. I hope it is a modern complex with standard facilities (lift with getsets, pool, play area, good fixtures etc). I am not interested in old standalone complexes with no amenities, lifts etc. Maybe that's what you are being offered. I booked a unit in Balewadi in Jan for 3000 and the builder is quoting 3500 now. Customers can bargain down to 3200/3300. I tried for 3000 very hard for a friend of mine, but the builder refused to budge. The offtake is slow but steady. No evidence of crash yet. Let's wait and see, this blog will hopefully stay here and so do I!

Parimal said...

Well Kaboom,
As per your info, the builder was earlier quoting 3500/- & is now ready to give the same property at 3200/-. This means almost 9% discount. This is sufficient to prove that rates are reversing because of no buyers & this is what I am trying to say. No builder reduces prices even by a rupee if there is a boom period. This is just the tip of ice burg, more will follow. In my opinion, go to the builder after coming Diwali of 2008 & I am very much sure that you will get the same apartment for sub 3000/-. See you on the blog soon.

Kaboom said...

My dear Parimal,
Please read carefully. When I bought in Jan, I negotiated from 3200 to 3000. Of course I bought alongwith two of my friends, hence the good discount. In April/May, the builder jacked up prices to 3500 and people are bargaining it down to 3200/3300. That is a normal give and take which used to happen even when market was good. I don't think most builders are expecting anyone to buy at listed price without bargaining(some big builders like Paranjape are exceptions to this rule). But my effort to get the price I paid 5 months ago (3000) for my friend was flatly rejected by the builder.
If you want to say prices are stabilizing or slightly sofening, I am in agreement with you. In fact I have said that unchanged prices for more than a year amounts to 10% correction in real terms.
My issue is with exaggerating the downfall and wild predictions like 1500-2000. It ain't gonna happen. But we'll wait and watch right here, in this blog!

Parimal said...

Well Kaboom,
Nowhere did I see you mentioning above that you negotiated from 3200/- to 3000/-. It is only now that you are mentioning it.Moreover, the builders did not used to negotiate even a rupee early last year. It is now that they are on the negotiating table. And what about the registrations which I mentioned in my previous comments?Do reply for that too. My friend in Gurgaon was looking at a flat for which the builder was asking 4550/- last year. In Feb 2008, the same builder was willing to sell the flat at 3700/- after negotiations. Still he did not buy & is awaiting for further drop which will take place soon. As far as that flat is concerned it still remains unsold even today! This means no one is ready for even 3700/-. The same is in Bangalore where prices dipped from 4000/- to 3000/-. Latest might be even more. Do you under any circumstances feel that Pune will be isolated? If so, kindly let me know the reasons.

Parimal said...

Hey Kaboom,
One more point I will like to mention again & that is give some substantial evidence for your claims for each & every point you have mentioned. In my comments,I have given ample of examples & facts & figures which you can confirm from any source. Whatever you are saying is the same old dialogue I hear from the salesperson at a builders office. Say with solid facts & figures. Don't tell me what the builders say. They are the biggest liars, bigger than even our politicians. And hey where are the other bloggers. I would like to hear from you too!

Anonymous said...

Kaboom,

I am still fail to understand your justification. you said if you have money say 20L then you cna buy a flat. My friend any 2 bedroom flat in Pune will not cost less that 55 lacs. that means you will have to go for a lon for 35 lacs. ie pay an EMI of 37 K per month ( approximatley). This mean you need to have a minimu salary of 1.00 lacs to sustain it. Now tell me does every tom dick and harry in IT urns 1.00 lacs. answer is no. Average salary is 35 to 50 K. so where does the question on buynig a house comes.

Hence your justification is wrong. Probably u may have money,, but whtever the current situation is grim and its risk to buy a property now. appreciations is difficult to get.

anyways I have decided to hold on for next 12 months ans wait for correction. Who knows market might crash. I hear 200$ a barrel Oil will reach in next 6 months.. so its going to be bad.

So lets wait wait wait wait wait wait and wait... :)

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