Thursday, May 15, 2008

CNN-IBN touting the builders line

Mumbai house prices soar but no shortage of takers

Looks like the property marketing folks are at it again. With prices beyond the reach of the common man who will buy. Cushman and Wakefield are pimping the builders by coming out with useless data. If no-one can afford prices have to drop. 11000 per sq/ft in the outskirts of Mumbai is more then most places in the world. The builders will put up a brave face until they will relent. The property prices have not risen due to high demand since as we can see the demand is almost non-existent. Builders with surplus cash have caused inordinate high prices by bidding against each other. Now they are attributing the price rise to the rise of steel, cement and labor costs. The common man could be fooled but right now his wallet cannot support 11000 rs/sq ft. Maybe it can support 4000-6000. 11000 seriously doubt anyone not born with a golden spoon or inheriting is capable of paying so much

IBNlive reports
Mumbai: A two BHK apartment in Nariman Point at Rs 3 crore or even a Rs 11,000 per sq ft apartment in the far-off suburb of Mulund might sound atrociously expensive, but that definitely does not mean there are no takers.

According to the Planning Commission's latest report, urban housing shortage in India in March 2007 was around 24.71 million and is all set to touch 26.5 million by 2012.

Little wonder then that the real estate developers are unwilling to give in to the latest slump and reduce prices.

“The market is not growing at the rate we had expected but we are still not feeling the pinch,” says Manager, Akruti City, Tarang Patel.

“We might even witness a further rise in the already increasing land and steel prices,” says Director, Goel Ganga Developers, Atul Goel.

While the developers are refusing to budge, it is the common man with a limited budget who's feeling the heat.

For the average Mumbai citizen, who is battling inflation and rising interest rates, buying a house is just next to impossible. All that one can do is hope for prices to stabilise to own your dream house.


Prices won't land; buy that Bangalore house now

Faye D'Souza / CNN-IBN

Bangalore: While property markets in various Indian metros brace themselves for an oncoming correction, Bangalore's residential property rates are not about to drop.

According to a report released by property consultants Cushman & Wakefield, the city has witnessed a stabilisation in prices of homes with the residential rates across the city have recorded a growth of less than 10 per cent in the last year.

But experts say even though the rate increments have slowed down, the prices are not about to fall.

“There are indications that housing loan rates will not go up in the near future, which means that there is no fundamental reason for primary residential market rates to come down. It going to remain the same for the next six months and then it will rise again. So now is a good time to make a purchase,” explains Director, Cushman & Wakefield, Anurag Mathur.

The low market sentiment may have affected small developers but sources say big developers have not witnessed a slow down in sales yet.

While this might be the best time for you to buy a house in Bangalore, experts advise those buying property in the city purely as an investment, to wait a couple of months until after the new airport in Devanahalli is unveiled, as it will change the dynamics and the valuations of Bangalore's property market completely.

“The new airport is now reality. At the end of the month when it will open, the entire dynamics will shift. Access is going to change and that will throw up more opportunities,” Mathur adds.

The Cushman & Wakefield report also states that Bangalore has the highest demand for commercial space in the country, which gives experts reason to believe that the increase in jobs being created will result in more demand for housing.

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