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What Are The Plot Rates in Sector 45, 46, and 47 in Gurgaon?

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Posted on Sat Apr 12, 2008 at 07:17:07 PM EST

Hi,

What are the actual rates in sector 45,46, 47 in gurgaon?

The dealers are saying it as between 30-32k/sqyd but it seems to be on higher side.

Is it worth buying plots at this time when the interest rates are again again going to be hiked. Can the prices correct from these levels?

Thanks.

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What Are The Plot Rates in Sector 45, 46, and 47 in Gurgaon? | 78 comments (78 topical, 0 hidden)

Property prices in India (none / 0) (#75)
by raul on Sun May 04, 2008 at 10:16:14 AM EST

This is what my friend from chennai tell me.
-----------------------------------
I had visited quite a few plots in madipakkam/Kilkattalai yesterday along with brokers and surprisingly most of them have shown the same plot which I happen to see 6 months back. The brokers quoted the price to be 45L to 50L. (Earlier it was 30L to 35L). Finally I liked one place and decided to talk to owner (offer price was 48 L) and I put up my price (without any hope) as 28L for 2250 sq.ft (Kept the broker away from the conversation). The owner started bargaining and came down up to 40L and I was adamant at my price. The owner called me up yesterday night and offered the final price as 33 L with 23 L as cash. I am still negotiating for 28 to 29 L.

This brokers are putting pressure to get this deal completed (according to them in recent months they could close max 1 or 2 deals per month). This may be useful info for guys who is looking for plots in madipakkam/kilkattalai area.
------------------------------------

greater noida development authority (none / 0) (#74)
by bitseee on Fri May 02, 2008 at 07:41:20 PM EST

hi
greater noida dev authroty recently came out with a scheme of 120 sq m plots in sec-3 for 30 lacs.

can anyone tell me the premium on those plots???

Good article on BS (none / 0) (#72)
by sush on Thu May 01, 2008 at 08:11:26 AM EST

Real estate developers are feeling the liquidity crunch -- the sources of funds are drying up even as they get squeezed from both sides: high interest rates and property prices have hurt offtake while rising steel, cement prices have pushed up input costs 20-25 per cent, which developers have to absorb for now.

''The crunch is getting severe. It's not apparent, but will become more apparent in the next six months. Land prices are likely to fall in the next 3-6 months,'' said Chanakya Chakravarti, MD (real estate business), Actis Advisers, a PE firm.

Land prices have been the key instigator and catalyst for real estate prices going through the roof. Real estate observers, analysts and agents say there's enough evidence to suggest that developers are feeling the crunch.

The evidence: Thanks to the demand slow down, actual transactions have dried up. In some cases, where developers have higher sales, the cash flows are not there as the receivables are high, points out the CEO of a real estate fund.

Developers are cutting price tags. DLF recently sold projects in Chennai and Manesar in Haryana at Rs 2250 per sq ft, which were sold in a space of 3-4 days. This underscores the point that there's a market if prices are affordable.

Developers are disguising price discounts with various incentives like free parking or free registration to reduce the overall cost of acquisition for buyers.

Construction cost has gone up by 20-25 per cent with the spike in prices of steel, cement and other material.

''The cost of steel today might be more than the land cost for a 1000-sq ft flat. While the market was able to absorb the increase in land prices, it may not be able to absorb the increase in the cost of inputs,'' said Arun Agarwal of Reliance [Get Quote] Estates, a Delhi-based real estate broker.

Developers, especially mid-tier and local players, are trying to rope in private equity players.

''The availability of bank finance is very limited. As a result, most developers are going for private equity as that's the only avenue left,'' said Vijay Kumar, CFO, Delhi-based Shipra Group, with presence in Ghaziabad and Noida.

To cope with the slack in demand and liquidity crunch, real estate brokers say developers are going slow on the construction of existing projects, with the hope that the pressure from high input prices could ease off in coming months.

Builders are borrowing in the inter-corporate deposit (ICD) market at interest rates of 19-20 per cent. This shows their desperation for cash flows. Companies typically borrow in the ICD market for 3-6 months; thus, they are borrowing with a view that the market will improve and its short-term measure to get some funds.

Developers are entering into bulk deals with large corporates to offload their inventory. Employees of a Noida-based technology firm recently bought 150 apartments in a large project at a 20 per cent discount to the quoted price.

''Prices in NCR have fallen by 25-30 per cent,'' said Sanjay Agarwal, a Delhi-based broker. ''Investors (who constitute 30-50 per cent in a project) have withdrawn as they have seen no appreciation in prices in the last 12 months. When investors withdraw, values are bound to plummet,'' said Sanjay Dutt, CEO, real estate consultancy firm Cushman & Wakefield.

''Barring Mumbai, prices have fallen 10-20 per cent, which is marginal compared to the increase in the last two years, when prices more than doubled in many cities. If you sit across the table with cash and negotiate hard, you can get an additional 15-20 per cent discount on the quoted price,'' said a realty expert.

''Discounts and freebies have been there for a while; it's only now they have come to the forefront after media started writing about it,'' said Chakravarti.

Last week, the grapevine in real estate circles was that another 100 flats have exchanged hands at 30 per cent discount although it could not be confirmed.

''It's not surprising. During the pre-launch phase, builders offer discounts of 14 per cent to investors and around nine per cent during the launch of a project,'' said Sanjay Agarwal, a Delhi-based broker.

''This could be corporate end-user demand using the opportunity to buy or some investor using the good offices of a builder to offload his inventory,'' said Dutt.

''It conveys the pressure to transact and create liquidity, discount values to seek capital,'' added Dutt. Developers are feeling the crunch as other sources have dried up. Debt is expensive and scarce while the meltdown in stock markets will make it difficult to push through public offerings.

''With no IPO, cautious private equity investors, stagnating sales, rising costs and high interest rates further hampering demand, you can't be in a worse situation. Both the supply side and the demand side has been impacted,'' said Dutt.

But developers need to raise capital and complete existing projects and flag-off new ones for which they have bought land. ''Developers realise clearly that in the next six months, the values will not go up. If they have lots of units to sale, it may make sense to do large deals at a discount,'' said Dutt.

For instance, a developer could sell 30 flats a month at the rate of Rs 4,000 per sq ft over five months. If he can sell 150 flats today and realise Rs 3600 per sq ft, the net present value of this deal would be the same as selling 30 flats over five months at Rs 4,000 per sq ft.

The developer gets the capital in the bank, which he can deploy effectively to lower his debt burden or fund another project. This kind of deals can also help the developer ease his working capital pressure or de-risk himself from future setback (further deterioration of capital values).

Observers say the bulk deals also signal that builders no longer have the ability to hold onto the inventory.

Experts say the crunch is more with smaller guys as they have limited resources. These are city-centric builders who are not financially savvy, have small profits and accruals, don't have easy access to the financial institutions as they largely deal in black. Companies that have raised money through IPOs are better off.

''Builders in tier-II cities may feel the crunch more as markets like Jaipur and Chandigarh were more investor-driven markets,'' said a Delhi-based consultant.

Developers try to downplay the liquidity crunch, saying it is not severe: ''It is not yet a panic situation. The free flow (of money) has been restricted,'' said Vijay Kumar of Shipra Group, which is building hotels and homes in the NCR region.

During the last two-three years, developers have made good money, which has helped them somewhat absorb the down turn. Encouraged by good profits, each builder (who were city-centric) wanted to be a pan-India player; every developer wanted to be in every city. So, they began buying land at whatever price, which resulted in prices real estate prices sky-rocketing across the country.

During last Diwali (festive season, when many people book new flats), a Mumbai- based builder had raised prices by Rs 1,000 per sq for his project in Ghatkopar.

Since then, he has not been able to raise prices by even a rupee; the builder has been privately cribbing to his friends. ''It's a question of who blinks first. Pressure is clearly more on the developer,'' said a real estate expert.

Prices could to fall in other segments, where significant supply is being added. ''In IT parks, there would be a correction of 15-40 per cent in rentals as there has been a significant build-out. In the western corridor around Pune, 35 million sq feet is being built. Developers are not finding occupiers,'' said Chakravarti.

Rising salaries and high real estate cost are also negating the cost arbitrage the IT and BPO firms enjoyed. ''Many BPOs (in voice and low-end data processing) can't afford these rentals, which is forcing them to look at Eastern Europe,'' said an expert. If rentals come down, it will encourage people to occupy the IT parks.

Faced with a liquidity crunch, developers are bracing up for more private equity investments. ''Real estate developers are more forthcoming, more flexible and realistic than they were three to 12 months ago,'' said Chakravarti

This is reflected in the financing proposals being structured. Earlier, developers wanted the entire premium for land in the beginning of the project. Developers are now accepting performance-based structures wherein they get deferred premium on land valuations based on achieving certain revenue targets.

Despite the downturn, investors remain bullish on the long term potential.

''The fundamentals of the story are very much in place. India is a long term growth story. Our funds are of seven to nine year tenures. We can take a bit of rough with the smooth,'' said S. Srinivasan, CEO, Kotak Realty Fund.

''There's demand at the budget end of the market, in residential and for budget hotels. Even if GDP growth slows down to 6-7 per cent, there will be demand for a lot of office space, hotel rooms,'' said another expert.

''It's not the end of the road for real estate. This is just the beginning.

In the last 12-14 months, people have got carried away. Correction is a good opportunity to bring in a more committed set of buyers, long term investors and occupiers. The boom in Indian real estate will continue for another decade,'' said Chakravarti.

: good article (none / 0) (#73)
by bitseee on Thu May 01, 2008 at 05:16:43 PM EST

good article but i cant see real esate prices moving up now .
people just dont have tte money and willigness.
its pessimism all around
be it in corporate sec where people have realised job is unsafe and increments r low.
stock markes asi crash likely..
who knows dlf may be 30k per yard in 2 yrs

[ Parent ]

US Housing Market (none / 0) (#51)
by sush on Tue Apr 29, 2008 at 07:20:15 AM EST

NEW YORK (AP) -- Housing prices dropped in February at the fastest rate ever, a widely watched index showed on Tuesday, reflecting that the housing slump is gaining momentum and showing no signs of letting up.

The Standard & Poor's/Case-Shiller home price index of 20 cities fell by 12.7 percent in February versus last year, the largest decline since its inception in 2001. Seventeen of the 20 metro areas reported record annual declines.

"There is no sign of a bottom in the numbers," David Blitzer, chairman of the index committee at S&P, noting that all 20 metro areas have declined for six straight months.

Half of the cities saw home values plunge by double digits led by Las Vegas at 22.8 percent and Miami at 21.7 percent. Those two areas experienced the sharpest appreciation in 2004 and 2005 with annual increases above 50 percent and 30 percent.

Only Charlotte, N.C., posted a positive return of 1.5 percent year-over-year.

The narrower 10-city index declined 13.6 percent in February, a record drop in its two-decade history.

Ohhhh...... (none / 0) (#55)
by malikboss on Tue Apr 29, 2008 at 09:52:41 AM EST

OH MY GOD !!! I can't see the same argument anymore. Come On - US market is 180 degree opposite to Indian Housing Market. Search on MBS - mortgage backed securities for more.

Some details, it might get technical, otherwise read Frank Fabozzi for more details on Fixed Income (or Debt in layman's terms) market dynamics.

Before jumping to MBS, here is the background - there are 3 major risks when a bank gives a loan

a. Interest Rate risk - Rates can swing, you must have mourned when your 7% APR housing loan slowly inched towards11.5% APR. Hey but hold on, how about your car loan, the one you started in 2003 (on 5 years repayment terms) for your new Honda City or Scorpio? Did you see any change in EMI or payment duration or any other change? I am sure you "DID'T". You must have boasted your acumen couple of times in beer bashes that you bought your car at 7% fixed loan and now you can get 8% in FD. That's what we call a loan. Indian Banks are making mockery of "Juntaa" and simply passing their burden to customers by benchmarking their loans against the base interest rates set by RBI. In US a fixed term loan is a pure fixed term loan, just like your car loan. Imagine how happy we would have been if we were paying 7% on our EMI's even in these days. Reverse is also true but a succulent take Away - Indian Banks have removed this risk from their housing loan portfolio.

b. Default Risk: When a Wall Street Journal correspondent asked a strawberry picker in California, "why did you take 1 million housing loan, whose loan's EMI is more than your family's yearly income", he gave the most honest reply -"I always wanted to stay in a mansion, and when bank gave me the money why should I refuse?". Do we see this behavior in India - again a big "NO". Indian Banks are responsible and they see your payment potential before handing you the money. Hey let's try to validate or invalidate this point: can anyone name honestly his or her 3-4 acquaintances who managed to get a loan who's EMI is more than his/her monthly income, or at 80% of total monthly income? Again to summarize, Indian Banks are much more responsible then US Banks.

c. Pre-payment Risk: Now you in loan jungle, paying EMI. What's the bank's biggest worry at that point? Well, if interest rates would move up, you might pre pay the loan. If you are earning, a bank would want to keep you in debt - always. You are more "yummy and juicy" when rates are higher - more profits for the bank, higher stock price. So during the loan agreement you would be asked to sign ambiguous terms stating that you would make up for bank's loss in different way. The most common is 2% pre payment charge. So what's the summary of this point - Indian Banks have also covered the last risk

Well, you may die in accident or due to cancer/heart attach, or an earthquake or fire might destroy the property, the bank might incur the loss in many random but very less probable event. You know the answer - the bank disbursed your first EMI with additional 1-2% insurance charges.

The last argument, what if someone looses his job or his/her salary is slashed? But is it really a risk? Banks have higher interest rates for such risky customers and they keep such loans to the minimum with loan capped at 50-60% of property value. It is also required by bank to take some risky bets - these bets pay more. And the bank has the first right to sell the property.

In a general case, if a loan is for 20 years and bank financed 85% of the original value, then bank already has a 15% spread on the original value ( not on the current ballooned value) to recover it's loss. US Banks sponsored more than 100% of the market value - a customer can buy his SUV and brand new furniture, and go to Florida along with the purchase of a new house :)

I would write the second part also - MBS. But let's see now where do you see a risk from the banks' perspective? The result - we have balanced prices since last one year. People are comfortable keeping their property even with 11.5% EMI, there are probabilities but on whole I would say Indian Banks have done a good job. They have screened their customers and provide loans to healthy customers only who can repay, to healthy speculators who can repay, and not to the junkies.

[ Parent ]

Dear Malik Bossji and Knightrider .... (none / 0) (#69)
by aka on Thu May 01, 2008 at 12:31:27 AM EST

I am happy to see your blossoming uncle - nephew relationship.

Unfortunately, I cannot even boast of a 2nd class B Com degree (which MB sir thinks KN has). So, I learn a lot from the very articulate comments that both of you and others make.

MB's thesis on how banks assess risk (e.g., using paying ability of the borrower based o his income etc.) was illuminating. He recommends Real Estate for end users, and calculating post tax returns, taking advantage of the tax deductibilty of interest etc. I have also learnt from KN and Happyinvestor, where the money should be invested - Gold, FDs, Gurgaon Real Estate etc. etc.

However, there is one small detail which I do not understand. Can some of you experts please enlighten me about the following:

According to our Finance Minister's statement in the parliament last week (I have copied below the news in case you did not read it), there are less than 2 lakh people in whole of India with (declared) annual income of Rs. 10 Lakhs or more. Looking at the size of Gurgaon, and limiting our discussions mainly to end users, I assume that most of these millionaires already have a house or flat in Gurgaon.

http://timesofindia.indiatimes.com/articleshow/msid-2984112

Therefore, any market and price growth in the future should be driven by the others (below incomes of 10 Lakh). To my simple (non B Com) mind there is no way these people can get huge bank loans to buy real estate, or invets in gold, or FDs.

Therefore, if we put aside theories, and yield curves, and discounted cash flows etc, and look at the affordability factor, we can conclude that property prices can go only one way - DOWN.

What gives?

Aka

-------------------------

India's millionaires up from 97k to 1.7L
26 Apr 2008, 0409 hrs IST,TNN

NEW DELHI: The tactics of the government to bring in more people under the tax ambit have worked with the number of "millionaires" -- those who have declared their annual income to be more than Rs 10 lakh -- going up by over 80% to 1,77,500 in 2006-07, up from 97,412 just five years ago.

Finance minister P Chidambaram, in response to a question in the Lok Sabha on Friday, said the number of people who have declared their annual income above Rs 10 lakh will further go up this year as the economy has registered a good average growth of more than 8% of GDP.

"We expect this figure to be much higher in the financial year 2007-08," the FM informed the House. He quipped that it was the result of Rup Chand Pal (CPM) who had time and again raised this question in the House.

The tax collection scenario in the country had never been so rosy. The direct tax collection is all set to exceed its revised target of Rs 3.05 lakh crore for 2007-08.

The final figures would be available at the end of April when the banks collate the tax collection data.

While Chidambaram had revised the direct tax target from an estimated Rs 2,67,490 crore to Rs 3,05,000 crore, in the indirect tax segment he had kept it at the Budget estimate of Rs 2,78,000 crore. According

[ Parent ]

: Well ... (none / 0) (#71)
by malikboss on Thu May 01, 2008 at 07:43:38 AM EST

two quick points,
First, let's call it off and close this discussion. We might go round and round without any conclusion. I think it wasn't my business to comment when I was sort of dragged in all this. Looking back at the whole chain, clearly it wasn't the time well invested, that too on the cost of improving golf score or tasting Chardonnay or Pinot Noir.
Second, just to conclude at-least from my side, we can't see inside the companies how they behaved in last 3-4 boom years. But from outside we can see they played with buying capacity of consumers. DLF introduced Icon at sub 3,000 level, it sold even at higher rates, so launched summit at the price it sold last icon, and chain continued till now when they are not able to sell park view etc...
But question is should they decrease price, my bet is they won't. Instead DLF would move to other higher profitable area such as Hotels and Exclusive Office/Mall space where lease money can provide perpetual cash flow. They have call option to again build apartments in after say 3-4 years when market might be attractive. In financial terms, when it is more profitable to leave the land unused instead of building apartment then use the first option.
Now the main question - where are the end users? I don't think it was all manuplation since market boom in 2002/2003. They were just unable to find the tipping point and used trial and error ( or may be some other analysis) to extract maximum from the market. well 7,000 psf park palce is quite expensive than 2,800 psf icon, though both might offer same value to the end user, at this point they might just shut their operations in the mature market and play same game in emerging markets.

[ Parent ]
: u r rt (none / 0) (#70)
by bitseee on Thu May 01, 2008 at 03:02:30 AM EST

u r rt
prices will fall 50% in ncr/banglore
all these corporate job walla will be burnt

[ Parent ]

unsold land (none / 0) (#50)
by bitseee on Tue Apr 29, 2008 at 01:50:55 AM EST

hardly any transactions happening and still rates stable.

but when pvt banks starft selling on their client behalf who couldnt pay up prices will crash

indian real estate at peak like japan (none / 0) (#48)
by bitseee on Mon Apr 28, 2008 at 09:57:32 PM EST

I feel indian real estate prices r at its peak and wont rise any higher for next 7-8 yrs

reasons

no liquidity
salaried people left with no money since due to inflation very less savings
medical costs rising
petrol prices will be 100rs per litre after leection

forget buying a house a salaried guy will find tuf to drive a car

5) huge job cuts expected and wage increments will be just 10% , inflation will be higher ,so no savings.....

onlyt bizmen can buy property from now on in india.
blackmoney

infact salaried people may hav to sell housed to marry theeri daughter, pay for petrol ,light etc etc..

indian economy going to the dogs..

its time govt goes after black money and gets tax or indian gdp will crash to 5%

: real estate and marriages (none / 0) (#49)
by gyanguru on Mon Apr 28, 2008 at 11:19:14 PM EST

i think the topic was prices in sector 45,46,47..
if we start discussing daugter marriages and establishing sons , we are loosing focus.. and no one can predict future(please take this in right spririt)

[ Parent ]

prices in delhi? (none / 0) (#38)
by bitseee on Sun Apr 27, 2008 at 06:01:29 AM EST

will prices in delhi ever come down?
or will ever inc supply of black money ensure prices just keep moving up up nd away in delhi

happy investor - knight rider : (none / 0) (#31)
by sh23na on Sat Apr 26, 2008 at 10:55:46 PM EST

looks like there is a chemistry going on between you two - did you considering exchanging messages on yahoo,msn chats instead of this forum. I appreciate all the good previous posts and healthy debats but lets just leave this forum for relevant discussions instead of getting mushy!!

cheers

derision and sarcasm isnt mush (none / 0) (#33)
by knightrider on Sun Apr 27, 2008 at 12:39:03 AM EST

and my wife did not take kindly to your comments!

[ Parent ]

: clarification (none / 0) (#36)
by sh23na on Sun Apr 27, 2008 at 03:28:18 AM EST

Knightrider - I didn't mean to offend you or your wife, so my apologies.
cheers

[ Parent ]

most expensive resedential sector in gurgaon? (none / 0) (#32)
by bitseee on Sun Apr 27, 2008 at 12:29:54 AM EST

hey
can anyone tell me which is the most expensive resedential sector in gurgaon and what is the rate per sqm/yard?

[ Parent ]

DLF II (none / 0) (#34)
by knightrider on Sun Apr 27, 2008 at 12:42:44 AM EST

main road: asking rates 70-80k psquare yard.
DLF I main road also has similar asking rates.

Last year people were talking about 100k+ for same plots.

Inside there are single floor houses where people are willing to give them at 45-55k psyard on "plot rate" basis.

A few bad plots have asking rates below 35k also.

No deals happening as such is the grapevine as investors have a severe liquidity crunch.

[ Parent ]

: ohh (none / 0) (#35)
by bitseee on Sun Apr 27, 2008 at 12:56:46 AM EST

then delhi is far more expensive
even in rohini rates r shot up at 2 lac per sq yard.
infact dda sold a plot of 110 sqm in rohini sec-11 at 2.8 crores

[ Parent ]

home loan defualts (none / 0) (#23)
by bitseee on Fri Apr 25, 2008 at 01:34:52 AM EST

one of my cousin is branch mnager at icici bank.
he says 80% of the people in IT sector who have taken home loan in bangy/ncr will default this year.

so u can easily see prices crashing by 50% in next 2 yrs
infact i think this is the highest property prices we will see fot the next 5 years.

indian real esate bubble is gonna burst like JAPAN

hype created by builders/brokers (none / 0) (#17)
by gyanguru on Thu Apr 24, 2008 at 03:17:40 AM EST

i agree 90% with knightrider.. u just cross check last three deals in any area and the average of that is actual price...and about real estate market dlf has launched two commercial projects..
one its dream project at shivaji marg(it was most expensive land deal in india before bptp bought recently some land at noida)
metro connectivity already there/monorail,golfcourse proposed/110 acreprime land only 6 km from c.p..price stagnant from last six months
second one 1700psf at okhla launched last month selling below 17000(some people got slightly cheaper employee/big dealers)

but prices of bptp have slightly gone up as citibank took some stake in the company and secondly they outbid dlf in the most expensive land deal recently in noida ,earlier banks were not giving them loan . this is temporary market sentiment which would die very soon (earlier their credibility was very low..which had improved slightly)

but overall market might go in correction mode

Faridabad/Noida/Kundli - prices are rising (none / 0) (#15)
by sush on Wed Apr 23, 2008 at 06:20:45 AM EST

Well - The whole argument is going about real estate prices are tumbling in Gurgaon - on the other hand - prices are going up in other places -

Faridabad - since aug 2007 - In some places prices have gone up by 100% - Greenfield was 16k per sqyard - now it' 32k - BPTP was struggling around 10k - now it's 15k.
Noida - Metro effect seems to be taking place ( 10-12 months before it will actually arrive) - In the past 6 months prices of plots/A grade apartments and kothi's have gone up by more than 25% - minimum rates quoted for a built up kothi is anywhere between Rs. 80k - 1 Lac per sqmtr. apartments in sector 50 (ATS/mahagun etc)..Prices are above Rs.6500 + per sqft. plots are anywhere between 55k to 65k per sqmtr.
Kundli - It was hovering around 8000-9000 per sqyard in Nov 2007 - now it's over Rs.14000 per sqyard

Comments welcome from all (especially Knight Riders)

manipulation in micro markets (none / 0) (#16)
by knightrider on Wed Apr 23, 2008 at 07:13:30 AM EST

Hey my TRPs are rising! Thanks Sush!

Real estate in India is just about as opaque as markets get. How it works is that there is a club of muscled/moneyed dealers and investors who very deliberately and effectively control the market.

Dealers will not entertain a person trying to sell or buy cheaper than a rate they decide. Deals just dont happen if they dont approve. This has been going on for years and probably will happen again. BPTP has flared up from "no buyers at 11k also" to "asking rates of 15k" all within the span of a few weeks. How manipulation is done is quite simple..first the manipulators tell real buyers prices have gone up..they also tell the sellers that prices have gone up..they advise sellers not to sell cos prices are going up. Some even give minor advances"bayana" to each others lackeys to "prove" deals are taking place at higher prices.

This charade, if continued long enough reiforces the notion that prices are indeed high. The key piece of information that is hidden all over India is the number of actual real transactions resulting in arms length transfer of assets in exchange of hard cash.

I'll go out on a limb and say that if 2 years ago, in a month 50 acutal transactions took place in a month in greenfield or bptp for that matter, today even 3-4 a month would be surprising. A whole lot of red-herrings are thrown around with no real deals happening. This can be proved from numerous newspaper articles showing that actual registries at the registrars office are miniscule these days.

If you were going to buy something to actually stay...would you not get the agreement registered? Only sham deals and investor exchanges happen without actual registration.

Now the million euro question is...if this strategy worked so well in the last 3-4 years and took gurgaon from 1800 psf for aralias to 10000 psf..why wouldnt it work now?

The answer lies in the reality of indian economic conditions. A whole lot of hype is created to attract buyers again..a whole lot of bait is dropped in the ocean.. but the manipulators forget that there are no hungry fish left in the ocean anymore.

Rising inflation,high interest rates, low consumer confidence,lower increments, IT industry recession, exporter woes, auto industry declines and liquidity crunches are real reasons why this attempt at pushing up prices will fail. Prices can be manipulated...volumes are rooted in reality.

cheers

[ Parent ]

yes (none / 0) (#22)
by bitseee on Fri Apr 25, 2008 at 01:28:25 AM EST

It is estimated that 80% of the people in IT industry who have defualt takehn home loan will
defualt this yr.

prices will crash 50% in ncr/banglore

[ Parent ]

Don't agree on some points (none / 0) (#18)
by sush on Thu Apr 24, 2008 at 04:07:22 AM EST

Knight rider - Your comments make absolute sense but what I see is a different picture -

If you think manipulation is going on in micro market than why record breaking land deals are happening in macro markets ? (NOIDA included which i am sure is not a micro market)

coming week - NOIDA authority is auctioning hotel plots where reserve price is 77k per sqmtr - mark my words it will fetch much more than that - my guess is above 1.25 lac per sqmtr. This will again raise the profile of NOIDA.

For kundli - I would say KMP work has started again and going at a break neck pace - this might be the factor for this sort price rise.

For faridabad - How can you justify this --- I know a family who make and sell builder floors in faridabad ( G+2 kinds) - where even registry is not allowed -- no bank loan - only POA is done ---still they manage to sell 6-7 floors every year in all cash deal ......and make a neat profit as well. Prices in Greenfield has gone from 16k to 32k in six months --- still if it comes down by 5k --- i don't consider this a crash.

Infact I see a good opportunity in micro markets -where you can invest less amount/wait 5 years and reap good rewards.

Comments Welcome.

Thanks

[ Parent ]

land banks and ipos (none / 0) (#20)
by knightrider on Thu Apr 24, 2008 at 05:51:22 AM EST

Sush..I will try to explain my POV on why things you mentioned happen..ofcourse I dont mean to pull down and split hair on everything you say but some of the points actually have a selfish reason.

1. Fantastically priced land deals. Unitech has done it before, DLF has done it before..now its BPTPs turn. What is wrong with these people? Why do they try to outbid each other? Unitech is having so much trouble selling Unitech Grande..on the GN expressway land they bought at fantastic prices..what does BPTP know that DLF and Unitech dont?

The answer is that BPTP has an impending IPO. They have been waiting for months for markets to settle down to go for IPO. They dont even have enough money to pay the first 2-3 installments for the land but yet they have bid so high. With this deal they have tried to buy status at par with DLF/Unitech hoping to get valuations like DLF/Unitech when they come out with the IPO. Like a neo rich 'socialite' buying the costliest house on Aurangzeb road..the idea is to say that you have arrived.

Why has Citibank put money? They get equity very very cheap..and on the back of these deals..when IPO is launched..citibank hopes to double its money. My POV is that both BPTP and Citibank will lose money on the deal and within a couple of years BPTP will go air-deccans way and sell out to some mallya equivalent.

There are other reasons..like all of BPTPs noida land gets revalued at these prices in their pre-ipo calculations. (eg..I have 99 acres valued at 1 crore each. If I buy 1 acre in that area at a loss, say at 3 crore rupees, my 100 acres get valued at 300 crores!) Sounds shockingly naive? This is how DLF IPO got its valuations :)

Noida hotel plots: Do you know DDA had to cancel many auctions because nobody turned up as recently as early as a few months ago? Ditto for Bandra Kurla in Mumbai? It will be surprising if people bid but 77k is really not that high if residential is at 30-40k.
Kundli and KMP: KMP work is actually stuck..and people are desperately trying to make model town/pitampura seths to move to Kundli...I doubt if it will succeed..but you never know.Siller things have happened.
Faridabad: You said it yourself..floors cant be registered in haryana..yet people have a craze to buy at any price...All I can say is that people dont have that kind of profits in business anymore..and I know many industry owners in faridabad to back it up. Small guys..big guys..everyone is short of work and certainly short of margins. In any case..why would you buy today if appreciation is unlikely?

cheers
KN

[ Parent ]

Advice from Knightrider (none / 0) (#76)
by babu bhai on Thu May 08, 2008 at 04:02:24 AM EST

In the present situation in Gurgaon this is the reality of the real estate! You can neither sell nor buy. This is a jolt for the property owner than the potential buyer! Because of the liquidity crisis which is going to catch up soon in the form of Indian version of Sub-Prime!!!! Normal human beings in this country(like me who earn less 3lacs/annum) simply can not afford a loan of beyond 10-15 Lakhs. Anything about 20-30 Lakhs is very risky specially when the job is not very secure. The economy will not always on the growth path for the next 20 years time frame.
how to plan for a small decent house(enduse)in Gurgaon region.
Prelaunch projects are not for people like us.i saw many people lost their hardearned money in those prelaunch.how much price(after all correction) we can expect for a small 700-800Sqft ready to move apartment in gurgaon area

Knightrider your advice

[ Parent ]

: no easy answer (none / 0) (#78)
by knightrider on Sat May 10, 2008 at 11:24:44 AM EST

babubhai,
the real issue is raising your income by maybe starting a side business or activity. If you can, then save some money and invest it in blue chip shares like reliance/infosys when the market crashes and hold them for atleast 10 years. Please do not buy anything when the news is that the sensex has gone up by so many points etc.
Small plots/flats are available in 10-15 lakhs range in dharuhera,bhiwadi,jaipur even some areas in delhi like bindapur/khanpur etc. Unfortunately it might be tough to get loans for these properties. People are trying to change the scenario by building Special residential zones but all this is in the future. Until then, build wealth, increase income, be positive..
Also consider new areas for employment..for example salaries are skyrocketing in new areas like rudrapur while flats are going quite cheap in that area. Similary in dahej/anjar areas of gujrat..fantastic salaries, low living costs, low housing costs..
save first for your home rather than taking a loan for it. I know its easier said than done..so best of luck in whatever you decide!

[ Parent ]
: rent (none / 0) (#77)
by bitseee on Fri May 09, 2008 at 09:40:06 PM EST

stay on rent dude

[ Parent ]

Noida (none / 0) (#21)
by sush on Thu Apr 24, 2008 at 06:32:50 AM EST

Good analysis. You may be right in terms of justifying over priced NOIDA land deal of BPTP bcoz of impending IPO.

But my money is still on NOIDA - I have seen this place closely from the last 10 years and i can safely say - It is still under priced (If i compare it with South Delhi/Dwarka/Gurgaon).

The kind of infrastructure improvement i have seen and still see makes this place very attractive. After metro/Hotels/infra improvements etc - Price shoot up might take time but whatever you say - I see huge potential in NOIDA - mid term.

DDA Auction failure --- well 5/7 star deluxe hotel in shastri park/pitampura/dwarka .........n that too at such high price ummmnnnnnnnnnnnn...

Regarding KMP - Last time i read - work was re-started few months back.

Faridabad - still remains a mystery to me. If by any chance metro/badarpur flyover work started - then knight rider - all your calculation will fall big time :-) (2 bed DDA Flat in sarita vihar cost more than 1 cr - and in faridabad around 20-25 lakhs) - anyone can see the potential.

Though i am left with no money whatsoever for investment purpose but if i have - instead of buying i will build something and hopefully try to sell in a year time.

:-))

Thanks

[ Parent ]

hotel auction (none / 0) (#24)
by knightrider on Fri Apr 25, 2008 at 02:19:42 AM EST

Thanks Sush for letting me illustrate a point!

http://www.thehindubusinessline.com/2008/04/19/stories/2008041951610100.htm

shows the dreams of overpriced real estate.

http://in.news.yahoo.com/hindustantimes/20080425/r_t_ht_nl_general/tnl-few-takers-for-noida-hotel-sc heme-7244580.html

shows the reality of what happened. Even at 77k per square yard most plots did not attract any bids. Mind you people want to sell residential plots at these rates in DLF!. Businesses dont find it profitable to bid for 5 star hotels with land rates @77k psquare yard!

Even I am shocked at the extent of the liquidity crunch!

[ Parent ]

knightrider (none / 0) (#29)
by happyinvestor on Sat Apr 26, 2008 at 06:52:18 PM EST

mr dude knight - TASHAN~!!!

[ Parent ]

the gorilla is smiling.. (none / 0) (#30)
by knightrider on Sat Apr 26, 2008 at 07:58:14 PM EST

happyinvestor..this was your best post till date :D

[ Parent ]

yea (none / 0) (#37)
by happyinvestor on Sun Apr 27, 2008 at 05:50:07 AM EST

went easy on ur ass - this one did na, right?

[ Parent ]

: pathetic (none / 0) (#39)
by knightrider on Sun Apr 27, 2008 at 11:06:47 AM EST

it was, I thought.

[ Parent ]

Time to Re-think ...I guess :-) (none / 0) (#25)
by sush on Fri Apr 25, 2008 at 03:05:55 AM EST

Hotel plots auction -- ummmnnn .... I guess i was slightly hyper in my judgement but it is really shocking considering the shortage of Hotel rooms in Delhi/NCR and upcoming demand bcoz of common wealth games.

Still - clear picture will emerge in couple of weeks.

I have a plot in sector 51 and bloddy nobody bid in that sector ......Damnnnn .....:-)))

I guess I have to revisit my property investment portfolio :-)

Thanks

[ Parent ]

BPTP fails to pay first installment (5.00 / 1) (#26)
by knightrider on Fri Apr 25, 2008 at 08:17:21 AM EST

Now is this a "I told you so" moment or what :)
Its common sense..and Warren buffet said it in crisp words. "Price is what you pay. Value is what you get". You haggle with a vegetable vendor but pay crazy money for land...this is bharatvarsh after all.

[ Parent ]

Right Dude.... now what ? (none / 0) (#40)
by sush on Mon Apr 28, 2008 at 01:57:51 AM EST

Well this is definately "I told you so " moment and i am not denying that :-)))

abb kya kareennnn ? Things are so messed up and confusing that i am not able to think straight.

I have few investments in NCR and i know various people who have invested heavily in faridabad/Kundli and Noida and they are still laughing all the way to the bank. They are still able to buy/sell land at a decent pace and profit and if i just echo there comments about coming time ( Please remember these are sesoned players and in real estate development from the last 25 years ) - They say -

-- Still there is lot of scope left in NCR.
-- price correction which has happened or happening is good for the overall market
-- Don't be greedy - play this game slowly
-- should have holding power for minimum 18 months - (They deal in plots/land and build kothi's and builder floor only).
-- They are only worried about rising cost of material.

and they are damn bullish about NOIDA/faridabad and kundli ( for Kundli keeping 5-8 years time frame).

Knight riders - what do you think ?

Noida - Do you think after metro starts - Noida rates will shoot up big time ? Considering rates in Rohini were 25-30k per sqyard before metro starts and now it's around 1.5 - 2 lacs per sqyard?
Comments on Faridabad and Kundli also welcome. Does it make sense to buy a plot in a good sector of faridabad and hold it for 5-7 years ?
Kundli - Is it wise to hold on to it for another 3-5 years ?

PS - Holding for another 3-5 years is not the problem.

Thanks

[ Parent ]

go back in time and listen to me (none / 0) (#45)
by knightrider on Mon Apr 28, 2008 at 07:21:49 AM EST

Sush, you are pointing out good local factors which would give appreciation in normal times.

These are not normal times unfortunately. My POV has been that the galloping of worldwide real estate prices has been so swift due to incredible liquidity (everyone and their NRI uncle has loans for property/car/shares) that a worldwide depression is inevitable.

World economic conditions are drifting towards a mess that hasnt been seen since 1930s. The situation is getting worse every week and US is dipping into recession. Europe, Japan,Australia, UK are heading for severe slowdowns. Chinas growth is moderating. Everywhere in the world there is income stagnation, food inflation and loss of jobs.

Credit is what oils the capitalist machine. Every investment today bases itself on a large debt component. The wall street crises is deleveraging everyone and the only spare money is going into commodities. Interest rates and CRR will rise over the next 6 months dealing a death blow the property demand. US real estate collapsed first. UK collapsed next. Spain went next. Now Australia and China are going. India started going down a few months ago.

Local factors may protect your investment but even as we speak..try finding a buyer for your property and then you will repeat this dialog verbatim from your friendly neighbourhood property dealer

"Ji rate tou achche hai market mein..lekin buyer nai hai..mai try kar raha hoon. Investor tou hat gaya hai bilkul property se..end user dhoondna padega"

3-4 years from now property will be cheaper in face value than today or if you are very lucky, then the same in price as it is today. Stocks will languish mostly except a few sectors. Boring old FDs are the only boring investments that will be protected for the next 2-3 years.

PS: Wait for RBIs monetary policy tomorrow..loan rates should go up again.

PPS: Incase you are curious, I had heavy stock investments, got out well in time. I do practise what I preach, and have most of my money in FDs for the next 2 years. I can be as aggressive in investments as your next chap but I would feel stupid if I try to catch a falling knife.2-3 years from now..I hope to be a real estate bull instead of the big brown bear I am these days.

[ Parent ]

Hey ... How'z Gold doing? (none / 0) (#52)
by malikboss on Tue Apr 29, 2008 at 08:46:09 AM EST

I remember, for abnormal returns the economist and chief investor advised the mankind to invest in shining metal "gold", if we go back two months in time.

Let's see how'z his recommendation is doing? Well, past performance is the best indicator of the future, so let' see where we are after two months...

I am sure people would have made a lot of money following advice of "knightrider": a 22 years old Delhi University 2nd class Bcom pass out, who recently completed a course in economics for dummies :). I am not following Indian markets but i think as global rates in Gold are going down, despite for it's love for Gold, Indian price would have slided down. So had I followed the kid, I would have lost a very good amount of money despite staggering 7% inflation.

Anyone can keep on going just like : traffic in gurgaon would increase in at an unmanageable rate .. Ha Ha ... Or power situation would worsen, along with impending water shortage; global warming would create floods near seashores and on and on and on , just like Duracell.

Do you find any point in just repeating the newspaper... May be I can find some matter to laugh and enjoy later in writing how immature, unexperienced and uneducated you can be !!

[ Parent ]

whose advice is it anyway! (none / 0) (#54)
by knightrider on Tue Apr 29, 2008 at 09:48:14 AM EST

malik uncle..

http://www.gurgaonscoop.com/comments/2007/2/2/19840/60611/1#1

an NRI wanted to buy a house in april 2007.
I advised him to gift his USD funds to his parents to save taxes and convert them to rupees. I also advised him to put it in FDs. Your fellow realtors advised him to buy houses in BPTP et al..I think I did alright? Should I have advised him to buy in DLF-I? :)

what do you say?

cheers

knight

[ Parent ]

: Stairway to disaster? (none / 0) (#56)
by malikboss on Tue Apr 29, 2008 at 10:03:24 AM EST

What is the least efficient method of investing?
Wouldn't it be just following a curve, where you go long in winners and short the loser, without understating the real dynamics who made a winner - a winner ?
And need not to say in such short term actions, transaction costs are expensive which eats away the positive spread, you need re balancing very frequently and don;t know when the curve would change? What would you say if I put your endless writings in such bracket?

[ Parent ]

sniper fire from mallik uncle (none / 0) (#53)
by knightrider on Tue Apr 29, 2008 at 09:09:45 AM EST

hit me straight on my 22 year old 2nd class "unexperienced" bcom brain!

yes gold is down..fds are crashing as we speak..may the stars shine forever on real estate!

dude..no need to speculate on my educational qualifications..everyone has a brain here. let them decide whos ideas they like and whos they dont. You are welcome to pilao your buy real estate ghutti to everyone like you used to earlier. My ego is not so fragile that PMSee comments from you will bother me :)

cheers and stay happy!

[ Parent ]

malikboss ji (none / 0) (#63)
by happyinvestor on Tue Apr 29, 2008 at 03:37:13 PM EST

ha ha ha ha - well said, well said.

he was asking people to buy gold.

this knight fd rider guy keeps asking people to buy FDs and also talks abt rate hikes in the same para - doesnt even know fixed income basics of bond prices falling when rates rise, or inflation going up.
havent seen anyone with such muddled fundae as him.

hope the readers here know better than to listen to him.

[ Parent ]

it's value .. not the actions... (none / 0) (#57)
by malikboss on Tue Apr 29, 2008 at 10:25:06 AM EST

If I have to say what to do - "Don't buy at this point in Gurgaon for investing". Your time is up - no more abnormal profits. So should we close our Apple Safari running on 3.06 Ghz Mac?

market is maturing, we would see segmentation , not a free fall.

Winner segments would be more expensive slowly oscillating around its value and moving upwards, and looser segments would see price fall The question is who would be the winner? Can we use Free Cash Flows to find the possible future value? It's tricky , and this is the point where I won't comment.

Is this the end? Wait... If you feel you need a property for your own use, you like the brand and the surrounding ambiance, and you feel it is not over valued ( how to find this - simple - find future free cash flows and discount them at tax adjusted risk rate, the rate which reflects your contribution and amount you took from loan - because loan is good, it saves taxes)

Simply, if you are happy with your investment, you have ability to pay at-least 30% of the value - go for the purchase.

[ Parent ]

A Correction (none / 0) (#59)
by malikboss on Tue Apr 29, 2008 at 10:35:16 AM EST

Read last para as:

Simply, if you are happy with your investment, you have ability to pay at-least 30% of the "asking price" - go for the purchase.

Value is little bit more complex - based on customer price elasticity.

Oil has -0.26% price elasticity, means with 10% price increase the demand would decrease only by 2.6%. So what should OPEC do? Decrease production so that prices increases upward, and wait till price elasticity is -1.0% , means 10% price increase would decrease demand by 10%. This is necessary from OPEC perspective because by not matching price elasticity , they are extracting less from consumer. Who cares if oil price spike creates riots in Bangladesh, pakistan and africa ?

Here is the article from where I quoted the elasticity data:

http://news.yahoo.com/s/ap/20080417/ap_on_bi_ge/oil_prices

Actual Estimates:
Energy Journal. Espey examined 101 different studies and found that in the short-run (defined as 1 year or less), the average price-elasticity of demand for gasoline is -0.26. That is, a 10% hike in the price of gasoline lowers quantity demanded by 2.6%. In the long-run (defined as longer than 1 year), the price elasticity of demand is -0.58; a 10% hike in gasoline causes quantity demanded to decline by 5.8% in the long run.

Goodwin et. al. find that in the short-run the price elasticity of demand is -0.25, with a standard deviation of 0.15, while the long rise price elasticity of -0.64 has a standard deviation of -0.44.

[ Parent ]

bullshit (none / 0) (#60)
by bitseee on Tue Apr 29, 2008 at 10:42:38 AM EST

forget all this bullshit analysis

indian property is at peak like japan
it wont rise above current levels for next 5 yrs atleast..

anybody buying now will lose his shirt
atleast 30% fall expected sooooooon

[ Parent ]

That's what I fear (none / 0) (#61)
by malikboss on Tue Apr 29, 2008 at 11:13:15 AM EST

This is what I fear.... People using F** and AH** words. Hey I told you to buy when I felt you would make profits, thats it - full stop. What's the use using your enviable vocabulary?

Now I am saying don't buy for investing because expected returns are not worth the risk you would take.

But you can buy if it is for your own use, just stick with good brands and don't overpay. Negotiate - everyone knows that there is higher probability of price reduction so why not squeeze the prices down in present time instead of waiting?

Again we are in world of probabilities, anything is possible. Hedge fund Amaranth lost $9.2 billion by betting on oil moving up to $88 from approx. $84 in Sept. 2006 whereas oil prices dropped, now oil is at $118.
http://www.businessweek.com/magazine/content/06_41/b4004071.htm

No more words, GoodBye !!!

[ Parent ]

Verbal Abuse and the Buy for Self Use Myth (none / 0) (#64)
by knightrider on Tue Apr 29, 2008 at 09:07:32 PM EST

I dont approve of using the F* words or the BS on any forum. However let me point out that these days what you face is much more sophisticated verbal abuse. Cuss words are used by simple people. Verbal abuse is much more sinister, as it attempts to undermine a persons confidence in oneself by questioning his credentials/qualifications/social standing/physical traits. It continues to shock me how otherwise well educated people look down upon simple cuss words but (perhaps unknowingly) continue to verbally abuse others in a debate/discussion. I can take and give back verbal abuse in good measure but the quality of debate would be so much better if we choose to avoid it.

Now for the buy for self use myth. Realtors have a very convenient answer to any genuine buyer when he or she asks for honest advice.."should I buy a house when prices are so high, upside potential is low and downside risks are enormous". The answer the buyer always gets is..dont buy for investment, buy for self use.
This in my opinion is as dishonest as any piece of advice can get. What do you think of this buyer? Is he the pansy who is supposed to hold the bag once everyone and his uncle are done filling it in speculation? It is wrong advice to ask a self user to buy houses which are at the most overheated prices in a decade. Whether the buyer is a rich businessman or a first time buyer wanting to get out of rent, real estate investments always involve a good percentage of lifetime savings. If housing is expensive, DO NOT BUY NOW!. Only realtors want the market to keep moving and they will advise you to go ahead.
Anyone who buys in this market will be the idiot who people will talk about for decades. Everyone knows housing is on its way down and only absolute morons will buy in this market and bail out the speculators.
cheers
KN

[ Parent ]

Investement in Gurgaon (none / 0) (#65)
by babu bhai on Wed Apr 30, 2008 at 02:12:51 AM EST

Excellent Knightrider
very good comments and usefull atleast for a person like me who dont know anything about the market trends in real estate.some people are pridicting that the rate will go down equivalnet to year 2003,when 20lacs was the price for a 2BHK flat in South City-II.Any comments?

[ Parent ]

yesyes (none / 0) (#66)
by bitseee on Wed Apr 30, 2008 at 06:41:14 AM EST

yeah

professionals cany gaon buy property in gurgaon anymore

all black money is put in delhi

IT/ITES/KPO/BPO all want to shift from gurgaon soon

gurgaon reality is over forever.

this is highest prices for gurgaon for a lifetime

sell sell sell and run away

[ Parent ]

gurgaon (none / 0) (#67)
by arun1964 on Wed Apr 30, 2008 at 07:22:27 AM EST

First of all runaway to where delhi exhorbiant???

1.The very reason of shifting to Gurgaon was cheaper Prices & white component

2. Noida/rohini/kundli/bhiwadi - where are the Jobs???? most MNC here not going to shift in a hurry

3 Lifestyle especially the apartments ( you have to strugle hugely for admisions to schools/clubs/limited numbers over crowded)

4 Airport distance & so on

mal
[ Parent ]

: hmm (none / 0) (#68)
by bitseee on Wed Apr 30, 2008 at 07:50:58 AM EST

mnc may not run away but they r not pay enuff to salaried to buy a house.
at best they can rent
i mean why shd anyone buy in gurgaon at such rate..
reasonable rate for dlf shd be 30-35k per yard

[ Parent ]

UK in depression soon (none / 0) (#62)
by bitseee on Tue Apr 29, 2008 at 11:51:23 AM EST

now like US , UK expected to be in recession soon

http://economictimes.indiatimes.com/International_Business/UK_faces_recession_risk_Blanchflower/arti cleshow/2996499.cms

[ Parent ]

no electrcity (none / 0) (#58)
by bitseee on Tue Apr 29, 2008 at 10:35:02 AM EST

why people live in gurgaon?

no light
no safety
so much crime?

gurgaon sucks

[ Parent ]

u r rt (none / 0) (#46)
by bitseee on Mon Apr 28, 2008 at 09:48:21 AM EST

u r rt at current moment a family with less than savings of 40 lacs and annual household incoeme of less than 7-8 lacs will find hard to live a decent standard of living.

i guess now people will marry their daughter to people who may have less paying job , but well established family with good assets rather than
a person with gr8 job and a avg family.

coz now icici bank and IT firms r gonna cut jobs bigtime.

also dollar expected to be 38 in 3 months , so export and IT ind wiped out

[ Parent ]

incredible profit margins (none / 0) (#42)
by bitseee on Mon Apr 28, 2008 at 05:08:32 AM EST

man
dlf earns a profit of 2100 crore on a sales of 3600 crores.

man profit margin is 75%.
wtf is this

is the govt sleeping or wat how can margins me more than 20-25% in current emv.
this clearly shows there is collusion and cartel working in real esate who dont lower prices.

if govt steps in prices can easily fall by 50%..

[ Parent ]

papa sells car to mummy, mummy rents it out (none / 0) (#44)
by knightrider on Mon Apr 28, 2008 at 07:04:05 AM EST

Now papa is a car dealer, mummy is a transport tycoon!

Usually half of DLFs sales are to DLF assets ltd, which is really their own company, their own money. Its not a real sale as its not arms length, and actual cash flow does not always match to their sale figures.

the number of projects by DLF can be counted on fingertips if one wanted to figure out if they are really constructing new buildings. Besides DLF manesar (at the most 4000 apartments at 50 lakhs a piece = 2000 crores), know of any big projects?

[ Parent ]

: dlf big projects for ur refrence knightrider (none / 0) (#47)
by gyanguru on Mon Apr 28, 2008 at 09:47:21 PM EST

1 dlf is coming with 110 acre of project in prime
location on delhi (which earlier was dcm factory) at shivaji marg next to punjabi bagh with proposed monorail,golfcourse( 70 acre is green belt)only 5-6 km from c.p.. this was the second most expensive land deal in india after bptp
(land deal approx 1600 crore)
2 okhlaphase-1 (earlier campacola factory) 5 acres approx
3 banjara hills hydredabad(its like what nariman point in bombay)
some more at kochi /new project in phase 5 gurgaon (commercial) and many more.. u must under stand they have got biggest land bank in india and were quoted no 1 real estate company in the world by forbes magazine recently
i am not a dealer or dlf employee but generally
invest in dlf commercial properties even i also disaagree with some of ther company policieslike
they have allotted okhla commercial at 17000psf fot small units to most of the people but some have got at 16000psf and even 15000 psf to very few

[ Parent ]

22 year old chap ? (none / 0) (#43)
by sush on Mon Apr 28, 2008 at 06:11:28 AM EST

You seems like 22 year old chap who is seeing a real world for the first time.

DLF or take any other Top builder - There margins can never be less than 200%. 75% profit you are seeing does not include black money so just imagine there margins.

Real estate is a game of low turnover and high margins.

Regards

[ Parent ]

lol (none / 0) (#41)
by bitseee on Mon Apr 28, 2008 at 04:31:47 AM EST

dont compare delhi with 3rd class placed like noida and ghazaibad and kundli

so much robbery, no light and water, cheap haryanwi anpad jat crowd.

invest in rohini, rates will be 4 lac per yard by 2012 and in by 2015 it will be one of the most exp placed in DELHI

[ Parent ]

kightrider u were right but i was more specific (none / 0) (#27)
by gyanguru on Fri Apr 25, 2008 at 10:24:04 PM EST

hi.
if u go thru my last thread i had mentioned
that "it would die very soon"regarding bptp market sentiment..anyway tell me how do u see commercial office space market in gurgaon/ okhla/shivaji marg delhi in near future

[ Parent ]

: lol (none / 0) (#28)
by bitseee on Sat Apr 26, 2008 at 09:31:06 AM EST

yaar
who will buy land at such high prices.
bptp just wanted to get out with a ipo.
i thinnk real estate co. stock prices shd fall 75% from these levels.
overall property prices in ncr/banglore will fall 30% in 1 yr. there r no buyers only sellers.
soon when people wont pay EMI. pvt banks will take possesion and sell these houses , then prices will crash.
it will take 6 months more before this happens

[ Parent ]

Prices (none / 0) (#19)
by arun1964 on Thu Apr 24, 2008 at 05:11:25 AM EST

The prices will be quite stgnant especially in the gurgaon area
Negative side

Supply side-- Huge amount of projects coming in or in Pipeline
Infrastructure Bottlenecks
Global Liquidity

Positive side

Inflation
Continious flow of corporates to Gurgaon because of huge A class Commercial Development
Huge demand for affordable housing especially

in 40-60 Lakhs bracket which the builders have consistently neglected due to concentration on High end market

4. Increasing Diffrentiation in the market depending on builder/project/amenities,connectivity,metro distance etc

mal
[ Parent ]

If price (none / 0) (#13)
by raul on Fri Apr 18, 2008 at 08:18:32 AM EST

If property rate have not changed for 1 and quarter year, thats 10% loss of interest on the money if it were in bank FD. If prices have gone down little bit by say 10% in that time (discounts freebies offer), it means prices are already down by 20% now. If rates don't change for another year it will translate to 30% down compared to 2006, if they go further down 10% in next year, it will translate to a 40% drop.

lol (none / 0) (#10)
by bitseee on Thu Apr 17, 2008 at 02:44:31 PM EST

i already live in a 1000 sqyard kothi in punjabi bagh in delhi.
i dont live in haryanwi areas full of anpad jats like u haha rofl.

sale bhikari ka bache the 2002 tak ab hero bante hai,

anpad gawad lol

lol (none / 0) (#11)
by happyinvestor on Thu Apr 17, 2008 at 03:01:08 PM EST

guess i was wrong abt the pedigree

[ Parent ]

: what is pedigree after all... (none / 0) (#12)
by knightrider on Thu Apr 17, 2008 at 09:57:19 PM EST

a brand of dog biscuits....

[ Parent ]

hahaha (none / 0) (#8)
by bitseee on Thu Apr 17, 2008 at 02:25:22 PM EST

hahaha u r so dumb man
pe firms r in deep losses
major co like lehman,citi r in deep looses and u say these firms r coming in hahaha rofl

u seem to be a real esate anpad property deaer waiting for some bakras to sell some inflated prices.

and anyhow these pe firms employ just 10-15 people unlike genpact bpo who have 2000-3000 staff.

check out chicago research partners in gurgaon a p/e firm which has a staff of just 6..

: hohohoho (none / 0) (#9)
by happyinvestor on Thu Apr 17, 2008 at 02:31:57 PM EST

citi/leh lost out in us, not india
3i infra raised 1.2 billion usd this week, fr an infra fund - 25% more than targeted.
any idea how many firms are moving shop to ggn?
also if bpo's are getting priced out, isnt it obvious / dont u think someone shd be filling in their place?
bpo's moving out is a sign of how strong and dictatorial the market is.
i think u're a man of great pedigree and taste. unfortunately u'll go the way of the bpo's firms - out of ggn - good riddance.

[ Parent ]

property prices 2 crash in gurgaon maybe by 50% (none / 0) (#6)
by bitseee on Thu Apr 17, 2008 at 02:15:00 PM EST

man'
now bpo compnaies may shift from gurgaon to smaller towns

http://economictimes.indiatimes.com/Infotech/BPOs_eye_tier_II_cities_to_cut_costs/articleshow/296047 1.cms

IT co+ BPO co and their employees have made gurgaon what it is but now these r flocking to smaller towns.
i see a 50% drop in prices in gurgain in 1-1.5 yrs.

its easily possible

in 2002 prices were 5000 rs per yard and now theyr r 1 lac rs per yard.

: bpo's moving out (1.00 / 1) (#7)
by happyinvestor on Thu Apr 17, 2008 at 02:18:41 PM EST

private equity firms and hedge funds moving in

[ Parent ]

Good one (none / 0) (#5)
by sush on Wed Apr 16, 2008 at 06:38:12 AM EST

I fully endorse this view of Knight Rider.

Especially i like the part --- "Ford bows to the market.DLF/Unitech still think the market bows to them." ------- This is bang on.

If i have to compare best place to Live/Invest in NCR ( Keeping 5 years time duration )- then NOIDA scores above gurgaon - any given day.

Thanks
Sush

Be your own Judge (none / 0) (#1)
by creative on Tue Apr 15, 2008 at 03:25:41 AM EST

Dear visitor,
Please be your own judge after doing a reasonable survey yourself. If you want to make an investment for this price, you have to be very careful as the loss in short term will make you disappointed/frustrated. But if you want to buy this property for your own use, use the feedback you receive from readers of Gurgaonscoop very carefully. The fact that you have sought advice from readers here makes it obvious that the opinions given here will help you take a decision, one way or the other. You will find yourself in a very confusing situation as to whom to trust - those who say "it is very cheap, buy it", or those who will say "don't buy it now as the prices are going to crash".
I will give you my own example. I had sought the similar advice as yours way back in April 2005, (on April 13, 2005 to be precise - exactly 3 years back) about a plot in Greenwoods City being quoted Rs. 20,000 per sq. yards at that time. I got 5 replies to my request. One, Malikboss, who has been a frequent reader/writer at this portal, suggested to grab it immediately as the price in the adjoining sector 45 was hovering around 18500 per sq. yard. The other three counseled me to wait as the prices were going to come down. One other visitors supported Malikboss. So, in my case 40% suggestion was for "Yes" and 60% was either "NO" or "Wait & Watch".
I bought the property as I really liked it and UNITECH's brand name with Greenwoods City was an added attraction. I wanted it for my personal use. It was not for speculation or reselling. I am happy with my decision. In the end, you must ask yourself: Do I like the property? Can I afford it? Will it give a good environment to my family members? If answer to all these important questions is yes, then go and buy it. I have no regrets buying that property as the prices of plots in Greenwoods City as per the rumours, about which I am not sure, are between Rs. 35000 - 40000 per sq. yard. For me, it is only a notional value as I am not going to sell it. But it gives me satisfaction that I took the right decision and bought it, as at the present price I could never afford to buy it today.
As they always say when you buy a property (land), it is cheap because in the time to come it is only going to get costlier. This (land) is the only commodity man can never produce. But as I have said before, if you have to buy it for your personal use, then this saying is true. Otherwise, seek professional opinion for investing your money in real estate.
I am trying to paste my query in April 2005 and the answers I got at that time. Hope it will help you make a decision. As you will see, my question then was similar to yours and you will find that I was also in the same dilemma as you are in now.
Is Rs 20,000 Per Sq.Yd A Fair Price For A Plot in Greenwoods City?
By creative, Section Ask Questions
Posted on Wed Apr 13, 2005 at 06:37:30 PM EST
I am looking for a 360 sq. yard plot in Greenwoods City.
The rate being asked is Rs. 20,000 per sq. yard.
Could anybody help me if this price is realistic? I find it a bit higher.
Thanks.
GREENWOOD CITY (none / 0) (#5)
by Unregistered Visitors on Tue Apr 19, 2005 at 12:40:16 AM EST
_____________
As malikboss has reccomended just go for it.
do immediate payment/registry as incase of advance seller still has option to back out-the quetion of double money back is only on paper and is never achieved.
adjoining 45/46 sectors are already 18.5 - 19 k/yard and Unitech is always premium property.
______________

[ Reply to This | 1 2 3 4 5 ]
Market Crash (none / 0) (#3)
by Unregistered Visitors on Thu Apr 14, 2005 at 10:10:21 PM EST
______________
Yes , there are talks of starting of crash in Gurgaon market as it has reached saturation point and there has been no hike in prices of plots/flats in last 2-3 months. There are more sellers then ever before in market at this time and in coming 2-3 months you may see the desper