Thursday, November 06, 2008

2 builders drop prices by 20%

20% down, another 30% to go. Anmol used to be 4100 per sq/ft 3 years ago. Its time for it to return to mean

DNAIndia reports

Low demand, global crisis finally take toll

MUMBAI: Builders did everything to keep the realty prices high — from shrinking flats to laying off employees and offering freebies to prospective buyers. But the slowdown has finally made them wilt. Two major builders in Mumbai — Orbit Corporation and Wadhwa group — have cut their property rates by up to 20% amid a severe credit crunch triggered by the meltdown, low demand and high interest rates.

The Orbit Corporation, a real estate development company specialising in redevelopment schemes, has slashed its rates by up to 20% for its 10 projects under construction across the city. It brought down the rates from Rs70,000 per square foot (psf) to Rs60,000 psf for apartments at Orbit Haven, a project under construction on Napean Sea Road. The company has already reduced the area of the apartments to 2,500-2,700 sq ft instead of the planned 4,500-5,000 sq ft in the wake of the realty slump.

The company has brought down the rates for its projects in central Mumbai - Rs12,000-18,000 psf instead of the earlier band of Rs15,000-22,500 for 600-1,600 sq ft flats at Orbit Grande (Lalbaug) and Orbit Grand (Lower Parel).

“One has to accept that there is a slowdown and accordingly adjust your prices. There’s no harm in creating a demand by lowering the prices,” said Pujit Agarwal, Orbit Corporation managing director.

The Wadhwa group, which paid a whopping Rs831 crore for a plot of less than two acres at the Bandra-Kurla Complex, has also slashed its rates by Rs1,500 psf, bringing it to Rs10,000 psf for flats at Anmol Pride and Prestige, the company’s residential projects in Goregaon (West).

Group promoter Vijay Wadhwa said: “We had to reduce the prices as the demand is low because the rates are too high. When the demand is low, I can afford to reduce the rates.”

The group had also not given bonuses and increment to its staff this year. “The slowdown is definitely affecting and my staff understands the ups and downs of business. I could have dismissed 10 employees but I didn’t,” said Wadhwa.


Anonymous said...

It does not make any sense on why for an apartment one should pay 15000 psf.... It can correct 60-70 % from 15000 psf...

Anonymous said...

Central Bank of India is offering Home loans floating at 9%. I think these builders have given enough money to Politician to bring down the interest rates. Corrupt politician will stoop to any level especially election round the corner.

Anonymous said...

heard that oberoi - goregaon east is offering flats at 6,000/- psf - from the original 16,000/- psf...this has been communicated to select brokers as the co is keen that the price doesnt get too public...they are also hard pressed for cash. is this true? can anyone find out?

Anonymous said...

I pray it is true, I would like to buy, will find out revert back, thanks

Abdulla said...

Do not believe in rumors. Find out for yourself. Due to the slow down in market, some builders with cash flow problems may may offer incentives to buyer, but nothing in the scale mentioned in the report. Comparing high end properties which are just 1% of the whole real estate for sale, to the other 99% is foolishness
High end properties don't go buy sq. ft etc. Buyer inspects the property, offers a price and there goes the transaction if it is accepted by the builder. I have dealt with property transaction where the offered price was 30% more than the market value. This is due to several people eyeing the same property. The highest bidder gets it.

As I mentioned in my earlier blogs, builders may offer to good incentives to genuine buyers but dont expect it to be substantial. Currently demand is more than supply and there is still money around in spite of market crash

Now is the opportune moment to buy

Shailesh said...

don't feed the troll abdulla. Ignore him.

Shailesh said...

“[Indian] Bankers said the trend has intensified in recent months and the portfolio may have shrunk by about 10% this fiscal year so far. This is significant as the industry has seen growth at an average 30% in each of the past four years.

“The percentage of non-performing assets, or NPAs, in banks’ credit card portfolios has almost tripled, going up from 5-8% in fiscal 2008 to 15-20% in the current fiscal. NPAs are the portion of the credit card portfolio where a customer has not paid dues for at least 90 days.”

It’s getting pretty bad in India and leading Indian banks like ICICI (NYSE:ICB) are going to have a lot of problems to deal with.

Observer said...

I find it comical that brokers like Abdulla are holding out hopes for interest rate cuts to stimulate the market. The demand slowdown is caused primarily by the high property prices. The prevailing interest rate, while a factor, is a secondary issue. People know that interest rates fluctuate. If it is going to be reduced now, why would it not go up again in the future?

If people are stupid enough to buy properties just because interest rates went down, they are going to get burned when interest rates go back up, and they will not be able to make the EMI payments.

It is all about prices and the perceived value for money.

Anonymous said...

checked with oberoi builders goregaon. They told me that everything is sold out and directed to me a broker. The broker is quoting 9500/sq.ft. and not prepared to give any information on phone

Anonymous said...

Guys report activities in your local areas:

Here in Gurgaon, prices are not down as much yet like 50%. Maybe 10-15% so far. Sellers are in denial mode as they have already made plans how to spend their fortune and buyers are not willing to bite the bullet.

Delhi is the same way. State of denial that this is just a correction and would bounce back up in coming months as soon as the world recession is over.

IT and Finance people who I met are shit scared as they can lose their job anytime or may be asked to take a good paycut.

Some IIM finance major I met was touting about the Delhi games and the prices will start booming again.

How about places like Bombay, Bangalore, Madras and other satellite cities. I'm sorry for using the old names of these places.

Anonymous said...

Guys, the biggest acceptance by DLF about distress sale. There are lot of distressed sales going on & will start. One should not offer more than 50% of the price. Definitely DLF know the right price for purchase (not for sale). So guys stay with bear strategy, let if fall down completely then only buy, 1% interest rate doesn’t make big difference in EMI. Now the market game has changed, not only the buyer is looking for distressed sale but big real estate companies are also looking for distressed sale.

Previously the builder never used to hesitate to provide the rate on phone or through mail. But currently they are requesting to meet in person so for genuine buyers they can close down the deal at whatever may be the price.

Warning: Don’t entertain the chutiya abdulla …

Anonymous said...

Yesterday for the first time there was an ad by a big builder of New Bombay (Haware) on the front page of the Property Times supplement to the Times of India that prominently showed a discount of 20% (for under construction) and 10% (ready possession). This has never happened before in the last five years that I have been tracking this market. No builder announces upfront discounts. At most there used to be freebies like car, appliances, stamp duty,etc but the basic rate was like a sacred cow. It was not touched at all...until now. So lets see how far and how fast the whole building of (cards) falls.

Observer said...

In Chennai, my father told me that a broker who used to be an acquaintance called up suddenly and was begging him to refer any clients that he knew of. He said business is slow. He is asking Rs. 4100/sqft for a place in Vadapalani, which is not really a posh location in Chennai. If it were up to me, I would not pay more than Rs. 2500/sqft for a flat in that location. In 2001, prices were around Rs 1150/sqft for that location.

The fact that transactions are not happening, and brokers are desperately calling up people they barely know other than saying hello on the street is indicative of the slowdown. Prices will come down once the brokers realize that people are waiting for a correction.

Anonymous said...

This is no correction ..Its a crash .prices haev to drop by atleast 50% to make any sense for buyers..Keep away ..these buliders have hoarded profit now let them face the heat..we know they are hand in glowve with the politicians..But people like us who have hard earned money should just not budge and stay away from buying..After all they wil lhave to come to terms to reality and sharply reduce prices to more affordable levels..For everyones information..Ashok Towers or Gardens, one of them started in Parel at 4500 psf in 2004 -05..and it went right upto 20000 looking at a correction it has to go below 8000 psf in Parel-lalbaug area before we can see some value ...KEEP AWAY MY FRIENDS..LET THE BUILDERS AND POLITICIANS GREASE EACH OTHER..IF THERE ARE NO BUYERS ONLY WHAT WILL THEY DO..

Anonymous said...

15000 psf ? Nation goes crazy.

Anonymous said...


Please buy property near your hometown now itself... Else the property price there also will increase due to rural bpo :-)

Jokes apart its heartening to see the rural bpo piloting... Hope with their commitment and work ethic these bpo's will be hugely successful... This is a final nail in the coffin to the buider community who increased prices in the cities to sky high level.. When good amount of educated people go to villages may be rural IT piloting is not far off... That change will be very heartening and hopefully we all will see in our life time...

Abudlla - Tell your broker community not to increase the prices in villages to 5000 - 70000 psf :-)

Anonymous said...

The financial crisis has spilled over to other sectors. The great troika of Prime minister, Finance minister and the unscrupulous builders (front men of politicians) has taken us for a ride.

But the reality is hitting hard in the face

Indian economy is decoupled from the world happenings -- > Fundamentals of the economy are strong --> Index of Industrial Production (1.3% growth rate down from 10 plus %)on the downhill --> Lay offs in aviation, reality sectors--> aggressive REPO,CRR rate cut--> Auto companies keeping the plants shut for 3-5 days--> automotive component manufacturers in trouble ……and the chain goes on

No more THEY can fool as. As suggested by other members please have respect for the hard earned money and wait until the real estate prices come down by 40-50%.

Vidyanshu said...

I think all Markets are cyclical. Indian real estate market has clearly gone through a bubble phase and this bubble has now ballooned to unheard of levels. Beyond this there is only one way it can go - Down. The builders/brokers are now looking at the last of the big fools. They also know the gig is up.
In the US around 2006, people were adamant that there is only one way real estate prices go and that is of my best friend tragically after sitting on the fence for 3 years, finally decided to buy a house in 2006. The house he brought for 1.2 million dollars is now barely 700 K. That too there are no buyers and his EMI's are killing him at the same time..Similarly any fool buying a house at these prices is blowing away his retirement fund with dynamite!
Waiting for a year will give you the dream house plus surplus funds. Let us wait it out.

Prashant said...

I would wait for two years. It's going to be a mayhem. Remember don't buy until there is fear in the market. Until then save up your capital so that you can buy real estate when everyone has thrown in the towel.

Abdulla, unfortunately, I think you are completely insane. If you are in real estate, I think you should either change your profession of become a home repossesion/foreclosre expert. That's where the money is going to be.

Barucha said...

The reason why the prices are slow in coming down is due to the sellers have high holding capability.Now, the question is how long they can do so. I agree with Prashant that this could take some time, say 2 years before the selling frenzy could start. I would rather wait than waste my hard earned money on overvalued asset.

Brokers spread rumors, for selling is their livelihood.

There bis going to be recession and do not believe if anyone says that our economy is strong. Hold on to your hard earned money, for it will come to use than a posh flat

Anonymous said...

to anonymous (9.56am) re oberoi goregaon -

send a sms or call broker quoting ur price, and dont be embarassed abt a low price like 6-7,000 against his 9,500, and it is highly likely that he will arrange for a meeting to negotiate and arrive at a intermediate price.

the person i heard fm was very sure that the rates were 6,000


Anonymous said...

A local tamil channel recently interviewed a guy who were looking for apartment in some posh area of Chennai, when he inquired an apartment’s price 4 month’s back, it was around 1.2Cr & the guy refused the deal due to exorbitant price. Now the builder is chasing this potential buyer with a price tag of 75 lakh but due to liquidity crunch the buyer is not getting loan from bank.

Just 1/2% interest rate cut is not going to make any change in market. The global market is facing a credit crisis, credit crisis means no loan in any form Or loan to the tune of 50-60% of property value max for credit worthy applicants. As majority of home buyers heavily depends on home loan route, even after price cut people can’t afford the house. This is going to have a long term impact on housing prices. So it’s not over with just 20% price reduction, this is just the start of correction & it will take around 2years to settle down the dust.
The steps taken by RBI to ease the liquidity by reducing the CRR ratio is a clear indication of credit crunch in India.

Shailesh said...

Builders won’t budge, but realty investors are wilting

Brokers told to sell flats at 20-25% less, but even that is too high for the buyers

In a clear sign of the softening real estate market, property investors are inundating brokers to sell their flats at 20-25% discounted rate than the builder rates. Though the number of such flats in the market may not be more than 100, brokers say this scenario is different from the one that existed eight months ago, wherein sellers refused to negotiate the rates.

Prakash Ahuja of Prakash Estate Agency, Andheri, said that he has the mandate to sell four to five investor-held flats, “Investors want to get out as builders are taking time to complete their projects. They do not want their liquidity to get stuck. However, the prospective buyers aren’t keen to buy at the discounted rate because the price is still high.’’

Despite the flat owner dropping the rate from Rs1.35 crore to Rs1.10 crore, Ahuja has been unable to find a buyer for a 1,000 sq ft apartment at Dharti building in Versova.
Similarly, a spacious garden facing apartment of 1,500-sq ft plus terrace at Versova is also up for grabs. The owner is now willing to accept a bid of about Rs1.75 crore from Rs2.25 crore, his earlier asking price.

“Although in Thane, the investors may be selling their flats at prices 10-15% lesser than the builder rate, the discounted rate actually comes to over 20% if one adds the transfer charge the investor would have to pay the builder and the estate agent’s brokerage.

Though the number of such flats in the market may not be more than 100??? Yeah right!!! That number will be soon in thousands. Buyers don't jump the Gun. The ponzi scheme is coming down.

Anonymous said...

I just checked with Oberoi's they are refusing to sell below 10,000 for under construction and ready property @ 11500. It seems thay have sold more then 80 flats in three weeks by just reducing the rates, now they are comfortable and will not budge. I think there are assholes who are buying and I think these guys will mess up the market slowly.

I was very happy to hear the rates have come down and now I am really tired paying rent. I started two years back with 25000 rent per month, now my greedy landlord has got a client for 45,000. I really dont know what to do?

Kalyana Malla said...

to anonymous at 10.36pm

oberoi has a few limited flats it keeps for nri / vip clients, media barters etc. the rest of the flats are sold to investors and it is these that are coming to the market. to get to these flats, you have to call up local brokers - the co also will share some broker names with u - then u call up these brokers to get the investor flats and the rates. typically investor flats are quoting 10-15% less and in some cases even 20% less. see today (10nov) dna story.


Anonymous said...

Actually i doubt whether it is investors falt . The builders do not want to show that they are reducing the prices and hence they claim that this is investors flat. I have come across couple of builders in Mumbai telling me the same. The fact remains none of the so called Investor wants to sell below 10,000 as of today atleast.

It seems a couple of weeks back it was avaiable @ 7500.

I would appreciate if any one can guide me. I have checked with couple of brokers and their main broker Mr. Ambekar. Thanks

Anonymous said...

Good you deserve this, Greedy guys who wait to time the market will only get this. Not only you there are lot of people around will get this.

I would suggest to close the deal as soon as you get a deal. Pls. dont wait for the market to fall otherwise you will miss opportunity.

I have seen a lot of suckers wants free everything be it shares, house or anything else, these guys will never take any risk in their life and perpetually wait through out their life to time the market. Finally these suckers end up paying more. You really deserve this!! HA HA HA HA HA HA!!!!

Anonymous said...

@checked through real estate agent(oberoi glats, goregaon) The higher floor flat owner(investor) is quoting 12000. Believe me, i met the owner and he is living in a slum and i'm sure he daily sits at the railway track early morning doing his morning job.

I am so frustrated that i am considering giving up house hunting and wait for the price to drop. I think, it will eventually

Shailesh said...

China unveils stimulus package as growth slows

Funds from the stimulus package will be spent in ten major areas that include low-income housing, rural infrastructure, water, electricity, transportation and improvements in the environment.

I think India will have to follow suit. If Infrastructure surrounding to Urban areas improve, large supply of land will become available. The prices will crash like rock. For government, it is important that economy is growing with lot of jobs not that RE is staying unreal high level. This is just beginning to unravel. Long decade for no housing price growth. I know the frustration of some here, but hang in there.

Observer said...

Looks like brokers (Abdulla) are posting as anonymous trying to get the hype going again (BUY NOW OR BE PRICED OUT FOREVER!). Same old story. These tricks will not work. Folks it is not a question of timing the market. It is a question of affordability and sustainability. Buy only when one's financial situation is comfortable and reasonably secure, and do not spend more than 30% of your income on a home loan.

Ignore the tricks of the brokers and builders. Just continue to stay on rent until flats stay unaffordable. Do not financially stretch yourself to buy a flat, it is just a place to live, not some heaven that everyone should aspire to.

Shailesh said...

Maha Govt to build 10 lakh houses in 2 years

Vidyanshu said...

I have had the opportunity to see the US real estate market unravel and melt. This is despite the trillions of dollars pumped into the market and the capacity of the US govt. to literally print money (As Ben Bernanke stated we have the technology to fight this crises, its called the printing press!). I.e. infinite staying power...

Compared to that staying power, the staying power of the singh's and raheja's is atomic.

Yet, what happened? Why could they not prop the market? Because that is the nature of things..Markets have cycles and go up and greed takes over and people try to grow like crazy ultimately collapsing the deck of cards..
The way the realty markets in India have gone up(unrealistic prices and refusing to climb down) reminds me of the Nursery Rhyme on Humpty Dumpty -

Humpty Dumpty Sat on a wall
Humpty Dumpty had a great fall
And all the Kings horses and all the Kings men
Could not put together Humpty Dumpty together again!!

Such wisdom in Kindergarten Nursery Rhymes about Markets... So if the prices climb up a wall and refuse to come down..the fall would be so severe that the Fed, Treasury and all the central banks of the world will not be able to put together the system together again...

Wait it out and reap the rewards.

Gopal said...

Abe anonymous at 12:51am, kisko ullu bana raha hai? It must be chutiya abdulla or Boss or ashish. Rates actually went up from 7500 to 10,000? Can you give a link or some proof of this fantastic story you pulled out of your arse? Omaxe/Parsvnath profit results are out now, they have dropped by almost 80%! Sales have dropped by more than 50%, and I think most of these sales are to other leasing arms of the same company. Visit the following link, and don't try to fool people.

Vik said...

Its important to follow the trend and see the reversal whenever it happens. As of now the trend is down. We have to wait for the bottom to fall out. The builders will not reduce the rack rate. Instead they will rely on brokers to sell of flats which are held by investors who are their cronies. This is important since the media will create a ruckus if they officially drop rates. So the best deals will come thru a third party. IF the broker has said they have sold 30 flats a week/month it means he has transferred the holding to his cronies, so that he can count the booking in his accounting books. Remember the investor just has to pay 10%. the rest is for the sucker end user to pay

Shailesh said...

Indian real estate price can fall 60 to 70% from current levels in the next five years

The real estate sector in India may have seen its best time for the next several decades. The real estate markets now heads downward, as people cannot make their mortgage payments.

OP Bhatt, chairman of State Bank of India (SBI), the country’s largest bank, expects 50% correction in the housing sector prices in the country. “In India we may witness up to 50% correction in pricing in the mortgage markets. If that happens, it’s good news for the Indian banking system as NPAs would reduce and new business would fall-in,’’ he said at the concluding session of Ficci-IBA Conference on Global Banking: Paradigm Shift, in Mumbai on Saturday.

The glut of unsold apartments is skyrocketing. The residential mortgage market is collapsing faster than the subprime mortgage market in America.

Who do you want to trust, chairmen of SBI or some Abdulla on internet?

Anonymous said...

Whoever buys now will be foolish since he is going to buy at the highest point in a bear trend thats going to last for quite sometime[2-3] years.

A couple of things need to happen,

1) Enduser slowdown has to continuer for another 4-6 months

2) Panic selling by investors who had purchased plots/flats at near peak rates expecting huge profits. I can speak for bangalore where employed ppl have purchased 2-3 flats on loans hoping to make money when the project is completed. Also reduction in rentals due to oversupply, this is very true in bangalore/chennai.

3)Slowdown in land aquisition by builder lobby, this is driving their input costs high which inturn is getting passed back to endconsumers.

4) Also govt. policy of giving higher interest rates for FD's while at the same time reducing lending by increasing interest rate and amount of scrutiny is going to reduce the amount of cash entering the realestate market which is driving the prices to the sky.

Once real estate prices come back to 2003 levels + 10% Y-O-Y gains
which is more realistic then is a good time to buy. This is approximately 2003 levels X 1.6/7 times.

Vidyanshu said...

Shailesh, we might know each other in a professional context. I read your comment about ponzi scheme. Also check out Minsky cycles. Hyman Minsky got a Nobel prize for economics and is known for the minsky moment.

Cycles are typically bear to bull to euphoria/bubble/boom to doom/bust to gloom/bear leading on to another cycle. This is just of the peak of euphoria and the market is priming for a bust.

Dilip said...

Real Estate Companies Badly Hit by Global Crisis

The blood bath in the real estate sector is now clearly getting reflected in the balance sheet of leading developers. The recent results of major real estate companies have revealed that bottomlines have indeed been hit badly. While DLF’s earnings in Q2 Financial Year 2009 came down by 4% as compared to the same quarter last year, Unitech’s earnings came down by 12% as compared to last time. Ditto is the case with other real estate companies such as Parsvnath, Ansals and Omaxe.

This has clearly made things worse for the sector which was already facing a major cash crunch and is an indication of the current slump haunting the real estate market. So are realty players ready for a change of strategy? Says Vipin Aggarwal, executive director, Omaxe Group: “We will be concentrating more on affordable housing for people. There has been less demand for high and even middle-end products. Gradually, land costs will also decrease. Affordability, undoubtedly, is the need of the hour.”

Many real players are changing their focus and business strategies. Even real estate major Unitech has changed its product portfolio and included more mid-income housing projects to push up sales. In fact investment in the real estate sector remained subdued in the second quarter amid global economic slowdown, which has cast its shadow on the property markets across the world, as per global real estate consultant C B Richard Ellis’ (CBRE) Asia Pacific Investment Market Report for the second quarter of 2008. The property markets around the world, particularly Asian markets have been affected by slowing economic growth and unsettled capital markets.

Rajeev Talwar, group executive director, DLF feels that a breather is necessary for the sector. “There have been a whole lot of changes in the global economy across various sectors. As far as real estate is concerned, the home loan rates need to be reduced. Also this sector should be treated as urban infrastructure on par with other sectors. Financing real estate liberally is also needed.”

Agrees Pradeep Jain, Chairman Parsvnath Developers Ltd: “In the last one year, the inflationary trend has increased the input costs, thereby putting pressure on margins. Global slowdown and financial crisis in US and European countries has put pressure on liquidity in India as well. This has resulted in increase in interest cost further affecting all the industries including real estate sector.”

However, Shobhit Agarwal, Jt. MD - Capital Markets of global real estate consultancy Jones Lang LaSalle Meghraj says that the mixed results of different real estate companies indicate that there is a slowdown in absorption in the market rather than a slump. “Demand for real estate asset classes like residential is still strong but the consumer is no more willing to accept irrational pricing. Hence, a correction of prices along with reduction in home loan rates, is most likely to boost up absorption.”

Shobhit adds that developers now seem to be focussing more on mid-income housing, enhancing self-liquidity by offering incentives and are lobbying with the Government and banks to catalyze debt funding to the sector at lower interest rates.

Anonymous said...

In 2006 lot of central bankers observed the housing bubble in globally.
Greespan(ex US central banker) also told in his testimony that he observed the housing bubble in 2006 in more than 2dozen countries.

The RBI research report also observed the similar bubble in 2006. So there is no doubt that the housing prices are inflated. Now up to what extends correction will happen? Based on various research & survey it will be at 50%.
So guys don’t even bother to call builder for next 6 month, you will guaranteed to get a 50% or more price cut after 6 month.

Act like a vulture; first let the market fall then pick up whatever you want.

Anonymous said...

To Sabbelseshu & Abdulla,

Where will you go from now

Economy slowdown may up extortion rackets
By: J.Dey
Date: 2008-11-10


It's not just the common man that is affected by the economic slowdown, even Mumbai's Crime Branch is a worried lot these days. Crime Branch sleuths are apprehensive that the harsh fall in the stock markets may trigger the resurgence of underworld activities (extortion) in Mumbai.

Crime branch chief Rakesh Maria said, "The foot soldiers in the underworld will be on their own after gangs feel the monetary pinch due to the slowdown." The cops expect a sharp rise in economic offences.

According to Maria, with the cash flow dwindling rapidly, there will be little money left to pay foot soldiers and middle-level organisers. This will prompt the lower rung to branch out and operate as splinter groups. They will resort to large-scale extortion to compensate the loss of regular hafta from businessmen stung by the austerity mantra, informed officials.

"I have already instructed my officials and informer network to be alert and keep tabs on new trends in mafia activities," added Maria.

Senior crime branch officials pointed out that the crime graph could shoot up by at least 30 per cent as the economy worsens in the coming months. Mumbai will be a natural target due to its sheer size and volume of commercial activities.

The falling real estate prices have already hit the underworld hard. A large chunk of their income came from protection money offered by builders and businessmen. The police also fear that there could be a significant rise in consumer defaults.

Mumbai's gangsters
Police records indicates while members of the Dawood Ibrahim gang protected and shared business interests in south Mumbai and western suburbs, rival Chhota Rajan dominated the north eastern suburbs in the city. Gangster-turned-politician Arun Gawli held sway over the central suburbs.

Anonymous said...
"Indian enterprises in the several key sectors are seen cutting spending on information technology by up to 30% this year as they try to cope with lower demand for their
products and services in a slowing economy."

The same is not happening in the west albeit with a twist. The entire enterprise is going bust before holiday season.

Circuit City files for bankruptcy protection
"The tally of failed banks in 2008 rose to 19 as the government announced that a Texas and a California bank had been shuttered Friday night."

These tremors are being felt in Indian IT companies. The fear is lurking dark in the heart of IT guys who just spent money recklessly in buying expensive flats and helped balloon the real estate bubble. Believe or not for few guys who returned from the onsite the EMI is more than the monthly salary.

Yeh...but don’t worry ...our economy is still unaffected and let’s put a spin on it.
Minister for Commerce and Industry :"We must recognise that last four years, the companies have made 50-60 per cent profits. In the West and in the other parts of the
world they are struggling with five to 10 per cent profit so if there profits are coming to 30 per cent, Indian industry must live with this 30 per cent profits. They can’t have the
same 50 per cent profit always. "

Anonymous said...

Dear Anonymous,
@checked through real estate agent(oberoi glats, goregaon) The higher floor flat owner(investor) is quoting 12000. Believe me, i met the owner and he is living in a slum and i'm sure he daily sits at the railway track early morning doing his morning job.

This kind of statement reduces the credibility of this forum. Pls. refrain from doing this.

We all are actual user over here expect for some jerks. We have missed the bus once and we all are hoping to catch it again.

No doubt we have seen property market correct in last six months in fact in some area it has corrected more by almost 50%. There is no doubt about this. As some one rightly said it is the question of affordability.

I have seen the crash in 95 but it was different we were caught unaware; no one spoke about this well in advance as we are speaking now. It was more or less like stock market crash it happened all of a sudden.

I was told that the same happened in Tokyo and off course in US. No one predicted the crash as we are doing. At the same breath I would like to say that in India the property prices have corrected but we all know that the same is for different reason, none of us had predicted the melt down of US financial system.

Here I would still like to add that since 2006 a lot of people had predicted about the crash including Mr. Deepak Parekh from HDFC due respect to him, this did not happen since then we have seen 50 to 100% appreciation.

Now after this since Jan 07 a couple of pundits have also predicted about the crash but till date we have not seen the kind of crash we expected.

Now it is for any individual to asses and take their personal decision whether there is a crash coming ahead or is it a bull markets correction in real estate.

India has less then 17% population living in Cities, whereas in developed countries it is 90%. Infact in China it is more then 35%. The demand for housing will always be there in India and infact some reports suggest that by 2020, 50% of India population will live in Cities.

I am currently staying in a rented house at Mumbai paying Rs.25000 PM and by Dec end my contract will expire and the land lord is demanding Rs. 45,000 , this has put me in tight spot as my sons school is very good over here.

Personally I am waiting to pay max EMI Rs.60,000 the moment the interest rates reduces and I am able to buy a house with this budget I will go for it.

I have my brother working for a Bank and he is of the opinion that I should not wait more them 3 months from now as he feel elections are nearing Govt will need money for funding election and top it all Govt will be pushing for growth. He feels it is just matter of time we will again see interest rates @ 7%.

I don’t believe in timing the market but I strongly believe that the being election year the Govt will take money from the builders and do whatever they could to keep them afloat in the name of growth.

I am not suggesting everyone to do this but always there is other side to a story which we all should know.

I am not a broker or an investor but an ordinary guy working 10 to 12hrs a day trying to make both ends meet.

Kind Regards,


Observer said...

Layoff party has started in real earnest. Abdulla has volunteered to find jobs and take over EMIs for all of the fired employees.

Globalogic cuts staff:

NEW DELHI: In another hit to the IT sector, GlobalLogic, one of the largest outsourced product development
companies in India, has laid off
about 125 employees. While 108 employees were asked to leave ‘due to poor grading in the appraisals’ concluded in October, another 17 were told to leave because their ‘skill sets fell obsolete’.

The over $100-mn company, which has delivery centres in Noida, Nagpur and Pune, confirmed the layoffs but said the figure is 115. GlobalLogic CEO Peter Harrison, who flew in from the US this week, called an emergency townhall meeting to announce the drastic steps.

Anonymous said...

Gaand Phati Rajesh Ki, What happened, if you have guts pls. wait for a year.

I know for sure the kind of demand is there for house. People over here praying for other people to loose jobs so that they can buy house.(cant be more selfish) DREAMS DREAMS HA HA HA. Keep dreaming you all suckers. Despite the fact India is on a strong wicket some fools predict dooms day for there own benefit. Now it is between the pessimistic and the optimistic lets see who wins.

We know for sure that lot of people are holding on to buy there dream homes let us see what happens.

I think we must invite Astrologer Daruwala to see all this posts. Wake you all suckers you will never be able to time the market. As your friend rightly said wait for the interest rates to come down and then see the herd mentality.

People are not going to get influenced by this kind of prediction. Wait and watch you all suckers!!!! Let us see who will have the last laugh. Pls. laugh for a couple of more months then it will be my turn. All the best suckers!!!

Observer said...

FIS Limited in Chennai fires 10% of its employees in Chennai. Bangalore and Mumbai next in line.

Abdulla has graciously volunteered to take over EMIs of all laid-off employees till they find another job. If their next job carries a lower salary, then Abdulla has given in writing that he will make up the difference in the EMI.


: Fidelity National Information Services (FIS) has given pink slips to over 100 employees at its Chennai operations. This constitutes more
than 10% of its staff in the metro. Though the company, which has been in India for over a decade, termed the move as ‘rationalisation’, employees are on the edge.

A leading provider of core processing for financial institutions, card issuer and transaction processing, and related information products and outsourcing, FIS has a headcount of over 4,000 employees across India. The sacked staff were unceremoniously escorted out of the office once they handed over their laptops and other official gadgets, sources told ET.

“Employees are on the edge. Those who got fired did not have any clue about it. Nobody knows what criteria was applied...whether it was the CTC parameter or poor performance. A mail was sent to the employees asking them to leave,” sources added.

Chennai operations has more than 1,000 staff. Among those axed, included four in the directorial cadre. An official from the US came specifically for retrenching people. Bangalore and Gurgaon are the next downsizing targets.

Observer said...

Just like the Govt regulates Oil prices and food prices, it is time for the Govt to step in and regulate home prices. No real estate company should make more than 10% profit. Homes must be defined as an essential commodity like Food, Oil, Electricity etc.

The above steps will automatically bring house prices down by 70%. Until this step is taken, people must not buy houses, regardless of the frustrations of the brokers like Abdulla who are posting as anonymous here.

Observer said...

Abdulla, nobody on here wants to see other people lose jobs. What people are trying to do is to warn potential buyers that job losses are a real possibility, and it would be dangerous to buy in this climate. Information and awareness about the current situation has to be spread to prevent people from making a decision that will cost them their house.

Will you pay the EMIs of people who lose their jobs? If not, just shut up instead of inciting people to buy more properties. You brokers are truly rogues, and would gladly cheat anyone for a few rupees more in your bank balance. Do not lecture us about morals, because people like you have none.

Anonymous said...

Give some pratical solution, we will see what Govt does. You guys are living in Utopian world. Let the people decide whether they want to buy house or not. Not you and me, I know for sure that people who are going to buy homes will know about their Jobs more then you and me.

Pal give a break, Our exports are less then 10% of GDP. We are really happy with this slowdown. Infact if the slowdown would have not come it would have been bad for us. With election comming in Govt will definetly push growth to stay afloat.

All the best to all the astrologers over here.

Observer said...

Dear Abdulla/Anil,

If you are so confident that people will decide on their own, then what are you doing here on this blog? Who are you trying to convince? Is your broker income affected?

Do you want to pay Rs 200/litre for petrol? If not, why not?

Anonymous said...

HA HA HA, why are u scared it was my point of view. I am entitled for my views. Hope u are not running to buy a house

Anonymous said...

I dont want to pay even 56 but I am still paying. I would like to pay only 32 which i was paying in 2003.

Observer said...

Another proof that one should not go to brokers for financial advice or advice on economics is the above statement:

"exports are less than 10% of GDP".

These are the latest facts:

GDP for India 2007-2008 : 1.1 Trillion US$

Exports for India for 2007-2008: 158 billion US $

Taken from the commerce ministry website.

Anil/Abdulla, I know brokers have poor grasp of mathematics, but can you please tell me how:

155 billion $ / 1100 billion $ is less than 10%? Is it the same bubble mathematics you use for valuing Indian real estate? Who is living in Utopia and who is providing facts with links and not some anecdotes and fake postings under different anonymous IDs?

Also, in the current year, exports are projected to be 200 billion $, while GDP is supposed to be less than 1.2 trillion $.

Please let us know from your real estate mathematics classes how
200/1200 is supposed to be less than 10%? Brokers lie, and are complete rogues and will say anything to get their commission. And these guys are preaching about Utopia and morals. Wake up dudes, people are not stupid here ok? Go peddle your idiocy somewhere else.

Observer said...

Broker says:

"I dont want to pay even 56 but I am still paying. I would like to pay only 32 which i was paying in 2003."

So, in 5 years time, you are paying approximately (56-32)/32 = 75% more for your petrol. Why are you expecting people to pay 300% more for houses for the same period? If housing was regulated just like petrol, then price rise would have been contained to similar levels. Now, if all oil companies in India became private without any Govt control, and formed a cartel like the builder/broker cartel and said everyone must pay 300% more for petrol would you like it? So how do you brokers expect consumers to happily pay that kind of outrageous price? Who is living in Utopia here?

Politicians are also involved in this real estate business, that is why they are all keeping quiet. Hope that house prices become part of the inflation calculation, instead of house rents. Then we will see inflation figures like 50% instead of 12%. That would force politicians to act and bring housing under regulation like food and oil companies.

Anonymous said...

I am not sure from where u got the GDP figures 1100 Bn dollars. I will come back with facts very soon. This is the current headline at BS pls. read and enjoy.

As qouted your unfriendly broker

Observer said...

Idiot Broker, are you also weak in reading comprehension in addition to basic arithmetic? Check the link to that I had mentioned, where India's GDP is listed for 2007 as 1.1 trillion dollars. If you want more links for India's GDP figure of 1.1 trillion $ here they are below.

Also, just google for the above fact. Don't be lazy like a broker. Do your own research and stop leeching off of others.

Observer said...

Also, there is this fallacious argument that interest rates will come down, and therefore people should buy apartments. Most people in India apply for a floating rate home loan. Even if interest rates come down next year, what is the guarantee that they will not go back up the year after? Will this broker provide a guarantee that they will not go back up, and if they do he will cover the EMI difference? This kind of short-term thinking is what caused this bubble in the first place.

Rogue brokers just want their commission, so they will try to trick people into spending their hard earned money without thinking long-term. People should really focus on the total price first, and the interest rate second. Why? Because price is the one thing they can control. They cannot control interest rates, which may go up and down. So they should at least focus on getting the lowest price possible, and allow some room for interest rate variations. If they financially stretch themselves when interest rates are low and jump in, they will be caught again with a risk of default if interest rates go up again over the 20 year EMI period.

Anonymous said...

To Rajesh,

Politicians are the biggest investors of the builders, Raj Thackeray, Sharad Pawar et al are good buddies with the builders and have their own projects i.e PAL Factory - kurla and Lavasa respectively.
This election will be a bloodbath for UPA to get re-elected. The anti-incumbency factor is very much relevant this time too and to get their hands back on cash the politicos will liquidate their holdings, these politicos do not care about economics or finance. If they want their money back, means it is NOW.

Talking about not being aware of the crisis approaching and Deepak Parekh of HDFC timing his prediction of the correction early in 2006.
I visit this website '''' here in U.K. daily for the last 3yrs. There is a chat forum there wherein certain posters have been mentioning the crash with credible evidence, the subsequent events leading upto now have vindicated their forecasts. And they claim the larger bang is expected in Jan once OBAMA takes over and BUSH n CRONIES exit to their havens. Some of the more mainstream commentators are also predicting this now. One good website to visit daily is and their alphaville section.
On DP and the crash prediction, Manmohan singh - PM was on record last week in his meeting with the industry leaders claiming that the correction was expected in 2006 but has taken place now.
One statement of DP of HDFC that i remember correctly was made in 2001/2002 he said then ''House prices are likely to stay the same for the next 10yrs in India'', it was post 9/11 that USA started printing dollars big time to flood the world with easy credit the fall out of which we are experiencing today.
I expect prices to come down by 50% in India within the next 1yrs and likely to stay put for a few years. Bear in mind in India development has spread quite well and most of the growth going fwd will be in brick and mortars mainly core industries like POWER, MINING AND MANF. Most of these industries are located in the not so RE-Attractive states of ORISSA, CHATTISGARH, BIHAR etc

MUMBAI, PUNE, BANGALORE, DELHI have a huge excess of RE and will see massive sofetening of prices due to dampened demand.


Observer said...

Rajesh, regarding your landlord raising rates, it seems somewhat suspicious. Landlords usually want tenants who are quiet and well-behaved to stay, and will keep rent increases to a minimum, maybe around the inflation rate, 10-15%. They are not likely to increase it by 100%.

Usually when we have had tenants whom we want to kick out, we do exactly what your landlord is doing. We tell the tenant that we are raising the rent by some large number that we know the tenant cannot afford, and that we have other offers for the apartment.

So check with your neighbors and find out if all apartments in the area are doubling in rent. If not, you should try to find out the real reason why your landlord wants you out of the apartment.

Anonymous said...

Guys you can expect only this kind of comments from Abdulla & Anil , finally pimp are pimp. After looking at the lucrative real estate business the red light area brokers(dalla) started real estate dalali & all this mess happened.
Anil was a know dalla in budhwar peth(Pune) just few years ago, you can see his posting on magicbricks, 99acre web site.

Now it’s time for brokers(dalla) to return back to original profession.

Anonymous said...

I love this forum , Few cronies will never beleive the other side of story. One jerk is talking about politician liqudating his own asset without realising that politician will never sell their own asset. The other still beleving that there is no corelation between EMI and sales.

A survey in ET clearly mentioned that most of the people in India EMI clearly matters while buying a house.

I am hoping stock market to further fall so that the Govt will immediately look at reducing interest rates.(Even if it goes up still we win) I personally feel that once the inflation numbers are out this thursday and if it is down reasonablly then we can expect a another reduction very soon

Builders are seen at the corridors of Lok Sabha and immediately the next day there will be statement from senior ministers about growth and rate cut.

Pal dont expect major cut some builders will further cut but here the question is will there will be a fall in the area you want. If yes then you are lucky, all the best to all you astrologers!!!

unfriendly broker!!! (HA HA HA)

Anonymous said...

Real estate prices are coming down but no one is yet buying. The real estate industry is in a crisis. Luxury flats are lying unsold. These are headlines seen every day in the media, a far cry from even a year or so ago when real estate touched stratospheric levels all over the country and more so in Mumbai, the mecca of high realty values.

While consumers bemoaned houses becoming unaffordable, the industry made record profits and saw valuations of companies as well as share prices go to ever higher levels.
Which is why it is somewhat difficult for the ordinary middle-class citizen to shed tears over the reported plight of the industry.

The industry wants several concessions — cheaper interest rates to boost borrowings among them. As if this will make buyers rush back. But after years of being burnt by absurdly high rates, consumers are staying away.

It is not merely the fact that a small fall of even 20 per cent in real estate prices means little when the jump in the past two or three years was over 300 per cent. It is the sheer stubbornness of the real estate companies who still refuse to actually lower rates even though demand has slowed down that is particularly surprising. Either the entire industry is living in denial or has some hopes that the economy will soon turn, failing which the government will step in to help.

The Maharashtra government, always ready to cooperate, has announced that the five per cent VAT on all purchases will not be applicable to real estate. Who will that help? Buyers or sellers?
Every little sop counts, but the truth is that despite this so-called relief, real estate in Mumbai and several parts of the country still continues to be beyond the reach of most Indians.

One of the reasons for this state of affairs is that there is no transparency in this business. In Mumbai, archaic laws have ensured that land banks are kept controlled, which in turn leads to artificial shortages and therefore manipulation.

While the economy has been liberalised, the free market does not prevail where the real estate business is concerned. This leads to lopsided valuations of land as well as built-up real estate. Add to that opacity in the manner in which transactions are done, the rampant use of black money and cartelisation.

This has dampened the enthusiasm of the consumer. If the government is serious about helping the buyer, it should enforce reforms on the real estate business. This will help builders too and will be a win-win situation. For the moment, nobody is really benefiting from the slump

Anonymous said...

So, in 5 years time, you are paying approximately (56-32)/32 = 75% more for your petrol. Why are you expecting people to pay 300% more for houses for the same period? If housing was regulated just like petrol, then price rise would have been contained to similar levels.

Fool like you should know that our wish is never always fullfilled, that is the point i am driving. Not your maths you Idot

Observer said...

Broker: "Fool like you should know that our wish is never always fullfilled, that is the point i am driving. Not your maths you Idot"

Looks like our broker is getting frustrated. Maybe his wish of continuing profits from cheating more buyers this Diwali did not get fulfilled. More and more customers are becoming aware of the housing bubble. Too bad for the brokers, but such is life.

Also, we are still waiting for the "exports are less than 10% of GDP" proof. And no broker mathematics, just regular mathematics please.

Anonymous said...

Pundits like you are talking about propety crash since last two years. It is anyone guess who is frustrated.

Anonymous said...

The real estate market WILL crash as surely as night follows day...

When cannot be predicted exactly..but bust it will.

Observer said...

Broker: "Pundits like you are talking about propety crash since last two years. It is anyone guess who is frustrated."

I only came upon this blog in April. I am actually happily renting, and not at all frustrated. I have absolutely no plans to buy until it makes sense. Unlike brokers/builders who will have cash flow problems if flats do not sell and are becoming frustrated, I do not have to buy, I can continue to rent for as long as I like :-)

Also, we are still waiting for the "exports are less than 10% of GDP" proof. And no broker mathematics, just regular mathematics please.

Shailesh said...

India Reins In Ambitious Building Plans

While China is making a big bet that infrastructure spending will prop up its economy, India is finding it hard to follow suit: The global economic slowdown could sink its ambitious plans, and some current projects are struggling.

The credit crisis is delaying building by crimping the flow of cash for roads, ports and power plants. Billions of dollars in infrastructure projects could be in jeopardy, builders say, threatening one of the world's largest programs.

Much of the new infrastructure is supposed to be funded through so-called public-private partnerships, in which private-sector companies build and manage the projects, and then make a profit through tolls or other fees for a few years before handing them to the government. Now the private sector isn't as interested, and projects already under way are struggling to raise money.

Builders that last year had droves of interested investors say that today, they're struggling to find cash. Loans for infrastructure projects that last year carried an annual interest rate of less than 10% now cost more than 15%.

So, I guess Government is not going to help those rich builders. RE is poof.

Anonymous said...

Every one knows that the real estate prices has gone down & even though it has not gone down it will go down. In recent US sub prime crisis, Bank started foreclosures on default but then realized that even for foreclosed house there is no buyer, to resolve the problem they come up with new idea of mortgage restructuring by reducing the interest rate, increasing tenure & yes reducing the principal as well.

The crux of the story is if buyers are in denial mode crash is guaranteed, else matter what govt. ,builder & broker do.

Just to remind again, the current crisis is the global credit crisis, which is not going to get over in a year.

So guys act like a vulture in this bear market, let it fall then pick up whatever you want. Don’t be impatient by the broker’s asymmetric news.

Heee heee haha haha ……….Very very unfriendly speculator.


Anonymous said...


Anonymous said...

Finance Minister : "Growth figures are encouraging".....still in denial mode

Tata asks group CEOs to brace for the storm

Rata Tata : ".... sent an internal email to Tata's 98 group CEOs and MDs, asking them to trim costs and go lean to tackle the slowdown better"

Anonymous said...

My dear Observer:
One advice for you: Please ignore all these abdulla and other anon comments who says hahaha etc.

You seem to be one of the knowledgeable person on this blog.
I don't know why Vik is not deleting unwanted noise from this blog.

My 2 cents: Major gaand lagne wali hai Indians ki. Bahut hawa mein ur rahe thhe.

Anonymous said...

You keep harping on exports figures, I am not making any personal remarks, what I am saying is there are lot of Pundits like you are are prediciting 2007. I must add that the things have drastically changed since the but at the same breath what I want to say is what Mr. Narayan Murthy said.
"I believe that India is better placed than any of the leading economies of the world to recover from the mess that the world economy has got into because of a very simple reason. We are primarily a domestic economy focused nation. Our fundamentals are good. Our productivity is improving."

Anonymous said...

BTW dont think of deleting any message unless written in a derogatory manner. I personally believe that any forum must voice both side of the story and not just what in Convenient.


Unfriendly broker

Anonymous said...

Inflation falls to 8.98% for week ended November 1

Dear Observer,

I dont know why i am writing to you but I feel that you are a nice guy. As mentioned there are good chances that Govt will now further reduce the interest rates.

We will have to see how people will react to this, it is still at a very fluid state, maybe home sales will pick up or maybe not but i would still feel that if you are getting a good deal for actual use go for it. (atleast 30 to 40% discount)

There are some people who are waiting to time the market, now you have to decide that if you want to buy or not.

Dont be in a hurry just start checking out buying is altogther a different thing.

Friendly broker

Anonymous said...

The broker (all brokers are unfriendly in manner or intent..they all result in you losing money and paying them commission for making you lose money) is demonstrating all the tools of his trade.

Sama, Dama, Danda, Veda -

Sama -Tries to explain (with whatever logic),
Dama -Tries to encourage you by telling you that you are making a good investment.
Danda -Talks about financial penalties you will have have to face and how much you will lose out by missing this opportunity..
Veda - talks philosophically..

I liked the last post it was hilarious - just because I think you are a nice guy, let me give you some advice...

Also practically imploring at least check out, meaning - give me an opportunity to do a hard sell..

Extremely Hilarious. Thanks for the laughs...Why do these jokers think they are the smartest sales people around? ROFLLMAO..

Guru said...

hi Observer and unfriendly broker and abdulla and others...
this is guru.. here i am seeing two groups, one is buyers ( waiting for prices to crash) and the other is sellers.. somehow trying to make everyone believe that prices will go up again.
I strongly agree with observer and co. yes, these builders and brokers are cruel.. cheaters... ruthless.. kindless... etc.. etc.. etc.... but remember one thing… its not builders who are behind the increase in real prices… it’s not even brokers..
Its customer who is behind this… its our greed which made the prices soaring… there many high profile job holders who purchased 2 or 3 units… keeping in mind that they can sell them off once the construction is finished for a hefty profit.. but cards have turned… its not builder/brokers fault… its the customers bad decision.. now he is suffering and trying to put the blame on these people.. guys remember one thing.. greed is the culprit…
these builders and brokers tried to make use of the situation… no point in blaming them… they just did what they r supposed to do… they did their job…

no one can cheat / put a trap for you without ur knowledge/Consent.

Observer said...

As I mentioned previously, one should focus first on the total price first, and the interest rate second. The total price is the only thing that the buyer has control over. Interest rates may come down, but they can also go up during the tenure of the loan. For a buyer to focus only on current interest rates and monthly EMI would be foolish. Even fixed rate home loans have a force-majeure clause which allows them to raise the EMI if the interest rates go up more than a certain amount.

Anonymous said...

Dear Observer,
I totally agree with you. You are absolutely right but I feel a majority of the actual users dont think that way. They immediately compare EMI vs Rent. Why is that our only 5% of Indian saving are in stock market despite the fact that banks interest rates are also cylical? Pls. dont ask me the proof because I have heard this in CNBC (Enam securities head mentioning about it)

Yesterday I met a builder who wants to sell at a prelaunch stage commercial propert @ Rs.5500 which was earlier quoted at 10,000 minimum. I feel he is doing the right thing because I am of the opinion that commercial property in Mumbai is here for major correction.

But that is not the case for residential property. This segment has huge demand, aspiration of people have increased, they want minimum 3 to 4 bhk, availability of easy loan, double income has changed the entire scenerio.

Last one year people waited for property prices to crash but yes it has corrected. I am no one to say that the prices will go up but yes it can reach the original level IF people start buying.

People expected the crash because during this period stock market fell and also the interest rates hardened. Every asset class is cylical but here I feel the upward cycle still hold steam in residential segment.

As long as there is demand, rates wont crash yes correction will come based on the locality/project and builder. Builders will hold on to property, go slow or for that matter change the configuration of flat i.e they will start making smaller flats but there wont be a crash. Crash will happen only if there is excess supply and govt intervention.

This morning i read in the news paper Mr. Chidambaram saying that Real estate is the back bone of economy and will request the banks to give loan to real estate company.

Now it is anyone guess that how many jobs people are loosing and will this effect the demand?


Anonymous said...

I enquired into pretigous residential complexes in Thane , suburb of Mumbai through builders and brokers as well. All amjor builders like Hiranandani and lodha are holding on to rates. Though no rates increase have happened after july, 08 no fall in prices as well. The builders who have dropped rates are mediocre builders but that to correction is < 10%. I think major builders have enough cash flow and are waiting for market to pick up. Smaller builders like cosmos had advertised about 1 room kitchen flat free over 3 BHK villa. But the location of the villas in thane is in tribal area about > 15 km from station without porperty amenities and free flat is not being given insame region but in slum areas of Bhiwandi where communal riots are very common and so not many people buy there and his flats in his building over there are vacant due to poor construction and lot of leakage problems. Just spoke to my friend, a loan approving officer, he said after the arte cut by RBI suddenly there is increase in number of loans demanded for residential apartments. But may be Thane may not be reflective of property prices in Mumbai. Thane is now increasingly becoming favoured destination over crowded mumbai suburbs due to lower cost factor, wider roads, better infra-structure, greneries about > 15 lakes, with also commute to Dadar, mumbai being< 30 mins by 12 lane express highways