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Dear ck.kislay,
You are subscribed to the thread "Real Estate Bubble Set to Burst Again in India" by MANOJa, there have been 10 post(s) to this thread, the last poster was flatowner2.
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
These following posts were made to the thread:
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: helium
On: April 4 2018 11:55 AM
[QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: humblefool
On: April 4 2018 12:48 PM
[QUOTE=helium;n2591839][QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.[/QUOTE]Yep, if you have 25 lacs for downpayment. Then you will have 25 lacs to invest in FD. Based on the arguments in above comments that will take 9 years to become 50L and the, 18 years to become 1 crore. There fore your calculations should start at 25 Lacs. Given say you start this at the age 30. You will be almost 50 by the time this happens. Also people who talk this way should ask themselves what were the prices of homes 18 years back, and what they are now. That plus the net amount of rent over 18 years for that flat should be added to the price of the apartment. If you think 18 years from now that 25 lac you invested in FD, worth 1 crore now will be enough to buy a good luxury flat, then I rest my arguments, you are roaming in disney dream land and I hate waking people up from their dreams. P.S: Also in my experience keeping that kind of money away for 18 years never really works, some responsibilities sooner or later catch up with you and most people generally have nothing.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: TruthSeeker1
On: April 4 2018 02:51 PM
[QUOTE=humblefool;n2591866][QUOTE=helium;n2591839][QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.[/QUOTE]Yep, if you have 25 lacs for downpayment. Then you will have 25 lacs to invest in FD. Based on the arguments in above comments that will take 9 years to become 50L and the, 18 years to become 1 crore. There fore your calculations should start at 25 Lacs. Given say you start this at the age 30. You will be almost 50 by the time this happens. Also people who talk this way should ask themselves what were the prices of homes 18 years back, and what they are now. That plus the net amount of rent over 18 years for that flat should be added to the price of the apartment. If you think 18 years from now that 25 lac you invested in FD, worth 1 crore now will be enough to buy a good luxury flat, then I rest my arguments, you are roaming in disney dream land and I hate waking people up from their dreams. P.S: Also in my experience keeping that kind of money away for 18 years never really works, some responsibilities sooner or later catch up with you and most people generally have nothing. [/QUOTE]waht were FD rates 18 years ago and waht were home loan interest rates 18 years ago... ?you have your answer... lower the rates higher the prices.. higher the rates lower the home prices... so it would be a huge mistake to assume FD rates will stay at 6-7% for next 18 years.... India a developing high inflation ecnonomy cant sustain sub zero real rates for 2 decades from here... we have hit the bottom of interest rate cycle... prepare for rate hikes in home loans.... many of the 3-5 years fixed rates will reset to higher rates wrecking havok on indian borrowers... peoople will soo wish that they had stayed in FD rather than piling on moutains of debt... [b]"Existing home loans from the State Bank of India (SBI), the country's largest lender, will get marginally expensive with the bank increasing its base rate to 8.70%, up 5 basis points (bps), from 8.65%, in what analysts see as a first sign of gradually hardening interest rates."[/b] https://www.hindustantimes.com/business-news/sbi-home-loans-to-get-expensive-as-bank-hikes-base-rate-by-5-bps/story-szvAbbxLD6aej4hZjt0ECO.html
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: humblefool
On: April 4 2018 03:06 PM
[QUOTE=TruthSeeker1;n2591900][QUOTE=humblefool;n2591866][QUOTE=helium;n2591839][QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.[/QUOTE]Yep, if you have 25 lacs for downpayment. Then you will have 25 lacs to invest in FD. Based on the arguments in above comments that will take 9 years to become 50L and the, 18 years to become 1 crore. There fore your calculations should start at 25 Lacs. Given say you start this at the age 30. You will be almost 50 by the time this happens. Also people who talk this way should ask themselves what were the prices of homes 18 years back, and what they are now. That plus the net amount of rent over 18 years for that flat should be added to the price of the apartment. If you think 18 years from now that 25 lac you invested in FD, worth 1 crore now will be enough to buy a good luxury flat, then I rest my arguments, you are roaming in disney dream land and I hate waking people up from their dreams. P.S: Also in my experience keeping that kind of money away for 18 years never really works, some responsibilities sooner or later catch up with you and most people generally have nothing. [/QUOTE]waht were FD rates 18 years ago and waht were home loan interest rates 18 years ago... ?you have your answer... lower the rates higher the prices.. higher the rates lower the home prices... so it would be a huge mistake to assume FD rates will stay at 6-7% for next 18 years.... India a developing high inflation ecnonomy cant sustain sub zero real rates for 2 decades from here... we have hit the bottom of interest rate cycle... prepare for rate hikes in home loans.... many of the 3-5 years fixed rates will reset to higher rates wrecking havok on indian borrowers... peoople will soo wish that they had stayed in FD rather than piling on moutains of debt... [b]"Existing home loans from the State Bank of India (SBI), the country's largest lender, will get marginally expensive with the bank increasing its base rate to 8.70%, up 5 basis points (bps), from 8.65%, in what analysts see as a first sign of gradually hardening interest rates."[/b] https://www.hindustantimes.com/business-news/sbi-home-loans-to-get-expensive-as-bank-hikes-base-rate-by-5-bps/story-szvAbbxLD6aej4hZjt0ECO.html [/QUOTE]That still doesn't say anything about_: 1. Home prices(Which would have increased multiple folds due to increased land rates, constuction costs, labor costs etc). 2. Your ability afford at late age. 3. Your ability and income standards to pay rent. 4. Value of 1 crore and purchasing power of that 18 years down the lane. 5. Your ability to maintain that FD going without touching it, giving the demands of liquidity and responsibilities over the years.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: TruthSeeker1
On: April 4 2018 03:59 PM
[QUOTE=humblefool;n2591902][QUOTE=TruthSeeker1;n2591900][QUOTE=humblefool;n2591866][QUOTE=helium;n2591839][QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.[/QUOTE]Yep, if you have 25 lacs for downpayment. Then you will have 25 lacs to invest in FD. Based on the arguments in above comments that will take 9 years to become 50L and the, 18 years to become 1 crore. There fore your calculations should start at 25 Lacs. Given say you start this at the age 30. You will be almost 50 by the time this happens. Also people who talk this way should ask themselves what were the prices of homes 18 years back, and what they are now. That plus the net amount of rent over 18 years for that flat should be added to the price of the apartment. If you think 18 years from now that 25 lac you invested in FD, worth 1 crore now will be enough to buy a good luxury flat, then I rest my arguments, you are roaming in disney dream land and I hate waking people up from their dreams. P.S: Also in my experience keeping that kind of money away for 18 years never really works, some responsibilities sooner or later catch up with you and most people generally have nothing. [/QUOTE]waht were FD rates 18 years ago and waht were home loan interest rates 18 years ago... ?you have your answer... lower the rates higher the prices.. higher the rates lower the home prices... so it would be a huge mistake to assume FD rates will stay at 6-7% for next 18 years.... India a developing high inflation ecnonomy cant sustain sub zero real rates for 2 decades from here... we have hit the bottom of interest rate cycle... prepare for rate hikes in home loans.... many of the 3-5 years fixed rates will reset to higher rates wrecking havok on indian borrowers... peoople will soo wish that they had stayed in FD rather than piling on moutains of debt... [b]"Existing home loans from the State Bank of India (SBI), the country's largest lender, will get marginally expensive with the bank increasing its base rate to 8.70%, up 5 basis points (bps), from 8.65%, in what analysts see as a first sign of gradually hardening interest rates."[/b] https://www.hindustantimes.com/business-news/sbi-home-loans-to-get-expensive-as-bank-hikes-base-rate-by-5-bps/story-szvAbbxLD6aej4hZjt0ECO.html [/QUOTE]That still doesn't say anything about_: 1. Home prices(Which would have increased multiple folds due to increased land rates, constuction costs, labor costs etc). 2. Your ability afford at late age. 3. Your ability and income standards to pay rent. 4. Value of 1 crore and purchasing power of that 18 years down the lane. 5. Your ability to maintain that FD going without touching it, giving the demands of liquidity and responsibilities over the years. [/QUOTE]increased land, labour cost is all dependent on availability of credit or other words inflation... If you feel you wont be able to pay the rent in future that means auuming peopel wont be making enough in future to cover inflation, then how do you believe they can buy more houses with even high prices? at the end of the day they have to pay the EMI with thier salary right ? so that arugument lokks self contradictary.. and Now rent is lesser than EMi by several fold so that makes it a no brainer to rent... If you are so sure of inflation Gold is much better bet than RE.. atleast its liquid due to it being fungible and divisible and is not effected by local issues unlike RE and slos serves as crisis insurance... while i dont deny a inflationary trend (that is why i hold precious metals myself) it have hard time beleving that the parabolic increase in cedit is sustainable... we need a big crash in credit before another round of credit increase can resume... The risk/reward is absolutely scewed towards the renter away from the buyer by atleast 10/1 odds.... Renter has little to no risk... Rising trend in global rates and non existant wage growth will give you ample evidence of the non so bright future for borrowers and risk asset owners...
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: humblefool
On: April 4 2018 04:06 PM
[QUOTE=TruthSeeker1;n2591912][QUOTE=humblefool;n2591902][QUOTE=TruthSeeker1;n2591900][QUOTE=humblefool;n2591866][QUOTE=helium;n2591839][QUOTE=humblefool;n2591761]You can put all that money in Fixed deposits ONLY if you have it :) Welcome to the world speculative calculations. Where people who take loans of 70L on a 1 crore flat, sit down and calculate how much that 1 crore will be in 10 years. Conviniently forgetting that they don't have 1 crore to start with. They only have 30L, which they made for a down payment. You can't invest the money you don't have. In reality non-existent 1 crore, can't become 2 crores even in infinite years. [/QUOTE] It was not speculation. If someone had down payment for a flat he could have used that in FD. The greed got the better of his senses.[/QUOTE]Yep, if you have 25 lacs for downpayment. Then you will have 25 lacs to invest in FD. Based on the arguments in above comments that will take 9 years to become 50L and the, 18 years to become 1 crore. There fore your calculations should start at 25 Lacs. Given say you start this at the age 30. You will be almost 50 by the time this happens. Also people who talk this way should ask themselves what were the prices of homes 18 years back, and what they are now. That plus the net amount of rent over 18 years for that flat should be added to the price of the apartment. If you think 18 years from now that 25 lac you invested in FD, worth 1 crore now will be enough to buy a good luxury flat, then I rest my arguments, you are roaming in disney dream land and I hate waking people up from their dreams. P.S: Also in my experience keeping that kind of money away for 18 years never really works, some responsibilities sooner or later catch up with you and most people generally have nothing. [/QUOTE]waht were FD rates 18 years ago and waht were home loan interest rates 18 years ago... ?you have your answer... lower the rates higher the prices.. higher the rates lower the home prices... so it would be a huge mistake to assume FD rates will stay at 6-7% for next 18 years.... India a developing high inflation ecnonomy cant sustain sub zero real rates for 2 decades from here... we have hit the bottom of interest rate cycle... prepare for rate hikes in home loans.... many of the 3-5 years fixed rates will reset to higher rates wrecking havok on indian borrowers... peoople will soo wish that they had stayed in FD rather than piling on moutains of debt... [b]"Existing home loans from the State Bank of India (SBI), the country's largest lender, will get marginally expensive with the bank increasing its base rate to 8.70%, up 5 basis points (bps), from 8.65%, in what analysts see as a first sign of gradually hardening interest rates."[/b] https://www.hindustantimes.com/business-news/sbi-home-loans-to-get-expensive-as-bank-hikes-base-rate-by-5-bps/story-szvAbbxLD6aej4hZjt0ECO.html [/QUOTE]That still doesn't say anything about_: 1. Home prices(Which would have increased multiple folds due to increased land rates, constuction costs, labor costs etc). 2. Your ability afford at late age. 3. Your ability and income standards to pay rent. 4. Value of 1 crore and purchasing power of that 18 years down the lane. 5. Your ability to maintain that FD going without touching it, giving the demands of liquidity and responsibilities over the years. [/QUOTE]increased land, labour cost is all dependent on availability of credit or other words inflation... If you feel you wont be able to pay the rent in future that means auuming peopel wont be making enough in future to cover inflation, then how do you believe they can buy more houses with even high prices? at the end of the day they have to pay the EMI with thier salary right ? so that arugument lokks self contradictary.. and Now rent is lesser than EMi by several fold so that makes it a no brainer to rent... If you are so sure of inflation Gold is much better bet than RE.. atleast its liquid due to it being fungible and divisible and is not effected by local issues unlike RE and slos serves as crisis insurance... while i dont deny a inflationary trend (that is why i hold precious metals myself) it have hard time beleving that the parabolic increase in cedit is sustainable... we need a big crash in credit before another round of credit increase can resume... The risk/reward is absolutely scewed towards the renter away from the buyer by atleast 10/1 odds.... Renter has little to no risk... Rising trend in global rates and non existant wage growth will give you ample evidence of the non so bright future for borrowers and risk asset owners... [/QUOTE]I am talking about a person indivdually. With age ability to make big purchases goes down. Also risk is higher in case you don't have home, if you lose your job and dont have a home. Then there is a lot at stake. You have to understand not everyone will have a portfolio worth crores like you. In fact almost anybody who invests won't have anything more than a few lacs. In close to retirement age, not having a home and a steady income itself could give you sleepless nights.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: tempos2018
On: April 4 2018 06:11 PM
Simple advice for people thinking about investing in Real Estate or buying houses in the NCR - Stay away for the next five years atleast 1) Huge inventory in the system - most of the brokers are busy clearing their own, underwritten, properties and not allowing the real prices to reflect. Beware of such brokers. 2) Huge litigation pressure – most of the projects are under litigation on one or more counts. To pay these litigants eventually, the builders will either squeeze under-construction property buyer at the time of possession in the name of "Super Area increases" or those who reside in partially occupied societies in the name of "Higher Maintenance". 3) There are many super distress deals available in the market. Many deals are available at up 50-60% discounts from the market prices. Most of the brokers don't let these deals reach the end consumer who may want to buy, not for investing, but for living purposes. 4) Structural defects in many buildings – remember Delhi is a seismic zone 4 and is highly prone to earthquake related disasters. Most of the projects in NCR are delayed by atleast 4 years and these structures have weakened over time. A high-end project in sector 110 on Dwarka expressway has permanent seepage issues and despite many attempts the builder has not been able to resolve it. 5) RERA is ineffective – RERA is extremely ineffective and builders are using loopholes to delay the registration. RERA authority is not effective at all. In fact, Gurgaon RERA website is not even up. 6) Property will remain stagnant over a long time – first existing projects need to complete, then end users may purchase there. Investors will then take their money out and will stay away from under-construction projects. That would mean very low demand for new property for a long time. Prices may not go down but if an FD doubles your money in eight years, real estate will give you no returns in the similar period. Better off putting your money in mutual funds or if nothing else, Gold is a better option.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: NG2012
On: April 4 2018 06:30 PM
[QUOTE=sapvin82;n2589826]ooohhh..we are getting there for last 15 years. How stupid you have to be to understand the every asset goes through corrections...this is normal. there will be no crash... [/QUOTE] In Pune, I booked a flat for 83 lakhs in 2013. Sold in Jan 2018 for 83.5 lakhs. If this is not a crash then what is? If I had put all this money in a brain dead FD, XIRR of 7% would have made it 1.15 cr...enough to pay off my loan and have some left over to buy a new car and a Europe tour. Oh well, at leasti could pay off the loan. Good part is that being in a sought after society, I could at least sell it off. Some of the good properties in not so great areas are being sold at discount to purchase price. The crash is definitely here. If one is looking to buy, its a good time.
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: humblefool
On: April 4 2018 09:08 PM
[QUOTE=NG2012;n2591965][QUOTE=sapvin82;n2589826]ooohhh..we are getting there for last 15 years. How stupid you have to be to understand the every asset goes through corrections...this is normal. there will be no crash... [/QUOTE] In Pune, I booked a flat for 83 lakhs in 2013. Sold in Jan 2018 for 83.5 lakhs. If this is not a crash then what is? If I had put all this money in a brain dead FD, XIRR of 7% would have made it 1.15 cr...enough to pay off my loan and have some left over to buy a new car and a Europe tour. Oh well, at leasti could pay off the loan. Good part is that being in a sought after society, I could at least sell it off. Some of the good properties in not so great areas are being sold at discount to purchase price. The crash is definitely here. If one is looking to buy, its a good time. [/QUOTE]People like you are really great! Just one question, how do you guys manage to arrange big money like 83L as full payment?
With warm regards,
Team IREF
https://www.indianrealestateforum.com/forum/city-forums/ncr-real-estate/gurgaon-real-estate/13876-real-estate-bubble-set-to-burst-again-in-india
Posted by: flatowner2
On: April 4 2018 11:33 PM
[QUOTE=tempos2018;n2591959]Simple advice for people thinking about investing in Real Estate or buying houses in the NCR - Stay away for the next five years atleast 1[B] most of the brokers are busy clearing their own, underwritten, properties and not allowing the real prices to reflect. Beware of such brokers[/B]. 3) [B]There are many super distress deals available in the market. Many deals are available at up 50-60% discounts from the market prices. [COLOR=#0000CD]Most of the brokers don't let these deals reach the end consumer who may want to buy, not for investing, but for living purposes.[/COLOR][/B] 4) [B]Structural defects in many buildings – remember Delhi is a seismic zone 4 and is highly prone to earthquake related disasters. Most of the projects in NCR are delayed by atleast 4 years and these structures have weakened over time. A high-end project in sector 110 on Dwarka expressway has permanent seepage issues and despite many attempts the builder has not been able to resolve it.[/B] [/QUOTE] +1 Fully agreed. NCR is the worst place for RE, here broker is trying to sell even junk properties at premium price.
With warm regards,
Team IREF
With warm regards,
Team IREF
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