MARKET ANALYSIS - Make use of this dip in Real Estate Market
By djain128, Section Gurgaon Real Estate Property Posted on Tue May 23, 2006 at 01:37:26 AM EST
Dear Friends,
There have been a lot of talk about crash in Real estate prices. Presently there seems to be some inactivity in the realty market in NCR. some of the reasons are:
- No new projects in the offerring in NCR: Last week all news papers carried Advertisemwents on Jaipur projects there was no upcoming residential projects in NCR.
- Restriction on prelaunches in Haryana: Haryana Govt has banned prelaunches prior to issueance of licence by the Govt this has pulled back investors
- Advent of summers: Due to summers the buyers keep away and wait for more pleasent weather.
- NRI effect; The NRI's will return to India in Winters Holiday i.e the time for the highest activity in realty market.
- Increase in Home Loan Rates
- The prices have stagnated for some projects and have not actually come down in Gurgaon
Well these are some of the factors (list not exhaustive.) But i see a opportunity in this dull market as property never goes below a certain point.
The reasons for booming Indian Economy are
- India has a population of more than 55% people who are below the age of 25%. This is the working age of population and so the demand will grow and so will the economy.
- All top companies of the world are lining up for India as there is demand exceeding supply in India, comparitively Cheap labour, Democracy, etc etc.
- US & Europe is growing @ 1.5 - 2% p.a. where as as per data of Indian Govt Survey our economy is growing at 8-10% so investing in India, a business house gets 4 times better results.
- The Investment inflow from GULF: Due to distrust on Bush administration post Iraq war & Now Iran, Oil money is coming to India for Investment earlier it was going to US. The better returns as well as growing economy is attracting investments.
- The Sorbans Oxlay Act has made listing at NYSE a hard proposition. With Computerised Trading on Sock Exchanges now any share can be traded worldwide over internet. So MNC listed on NYSE are soon going to be listed on BSE/NSE.
Again List is not exhaustive
Here are comments by some unregistered user on Realty prices
It is not company which trades in stock market, it will never goes for bankcurrpcy. Appriciation will be less, I say if you get 8-10 percent avarage a year, that is very normal (conservative) in any where e.g. in delhi, gurgaon, noida, greater noida, faridabad, or any satellite township of any mega city etc. Then I still see it is the best investment option. Don't get loan and buy property for appriciation. If you have money, just invest, you will never regret.
People should make use of this panic selling. Stock market correction (20%) is good for stocks, good for investment, good for long run. It is the opprotunity for fund managers and stock investors to enter in the marker at right time, and intelligent managers have invested yesterday (monday) when it was down 10%. They will get benifit of this dip.
Regarding property who are posting message or selling at 20% low are making mistake, it will rebound around diwali and again big jump in next Feb March 2007, indian economy is doing good and well set to cross 9% or 10% (as China) in coming years. It will be doing good for next 2 to 4 year with out any break. Mark my word sensex will cross 12000 in next 60 days. This is called correction not crash. Government gave new opportunity to FIIs to enter in the market by throughing couple of bad news in the same week, mark my word on 25th May short term tax increment will not be 41% as statement given by officials. Wait for final news out on 25th, it will not be more than 20%.
Wait and watch. Wait for some time if you are not comfortable to invest now.
Comments are welcome.
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