Change of plans

I just came across this article on DNA India and I am really appalled by the justified two timing by the real estate developers and builders. Is this even legal?

"Residentials hot, commercial space not.

With developers forced to return to the drawing board to make projects financially viable, the landscape is, indeed, changing."

Many commercial property areas are supposed to be only commercial. Its a way to ensure that there is uniform distribution of activities and that there is equitable growth withing the city's numerous sub sections. Also these builders claim incentives like cheap electricity and water from the civic authorities for commercial projects.

India has none or non existent zoning rules, you can mix educational, shopping, recreation, residential, commercial and industrial units in any city block without any awareness of consequences. Does this mean that zoning only for demarcating and industrial land. Why should a builder that owns a piece of land intended for commercial use - that can generate thousands of jobs and provide nearby residents place to shop, be allowed to switch to residential plans. Such haphazard plans not only lead to uneven development, it gives rise to unnecessary skewing of prices.

The same article also quotes

"Inventory days in the two cities have fallen back to early 2008 levels or better. However, the overhang in Bangalore, Chennai, Gurgaon and Hyderabad remains significant with at least 15 months of inventory in the pipeline," Goldman analysts Vishnu Gopal and Aditya Soman wrote.

Well, if GSachs is right, then I don't see how the over supply is going to be filled at current rates. In cities like Pune, there have been lot of shady dealings where builders have given huge discounts but have prolonged delivery of the house. This very similar to the years 1997-2000 where rates were decreasing but not collapsing.

On a Lighter note with the swine flu scare, I am hoping the rush of people to the city will at least pause :) and open some window of opportunity. :) FYI I genuinely think Pune will bottom post Diwali - at least in suburbs.

Six reasons why real estate is a good investment

Times of India, Bangalore trumpetting the cause of the builders. The article is right next to an advertisement from Credai - Karnataka (The builders lobby) which is touting a property mela on the 15th and 16th of August at the Lalit Ashok Hotel. Can someone from Bangalore visit and give us a real report of the ground situation. I'm tired of these soft marketing articles from the Times of India. They are as one-sided as a the coin from Sholay.

This is a good time for investors to buy property as part of a portfolio, says Kavita Sriram
Leading a life of luxury on borrowed money may not always be the right thing to do. How prudent would it be to make an exception on home loans? Should you buy your dream house or invest in some piece of land? Is it time to invest in real estate?

Stability
Real estate is less volatile than stocks. While real estate may be less liquid, and you may have to wait indefinitely before a buyer agrees to purchase your property for the price you seek, the prices are not as volatile as the stock markets. The transition towards a correction or boom takes place gradually, giving ample time for investors to read the transition and safeguard their positions.

Price correction
The economic slowdown had an impact on this sector. The rates have come down over the past few months. Wouldn't it make a lot more sense to invest in real estate when a price correction is taking place rather than in a heated market?
People with a large disposable income can explore investing in real estate for diversification of their assets. Lowering home loan interest rates and lower property prices makes it an opportunity hard to resist.

Good in recession
Some investments are considered safe in times of recession like precious metals and foreign currencies. In this list of investments that are popular during times of financial uncertainty, real estate can be included. Focus on achieving positive monthly cash flows rather than immediate appreciation. Cash flow refers to the amount of cash coming in relative to the amount going out.

Hedge against inflation
Real estate and gold are considered a hedge against forces of inflation. Inflation has led to the rupee value depreciating and property prices travelling upwards. Property investments are typically held over a long term.

Tax benefits
Home loan borrowers are eligible for tax deductions on their interest and principal repayments subject to a certain limit. Further, you can use the rental income from the property to make a portion of the EMI repayments.

Good returns in long term
Investments in property has always proved to be stable and yielded good returns over the long term. With lesser risk and probability of higher returns, this is a much favoured investment option.
Stimulus packages announced by the government are expected to show good results and bolster the economy. Cement, a key construction material, has indicated a growth of 12 percent in May. This is enough indicator of vigorous economic activity.
Borrow as little as possible and consider investing in property.

Underwater Mortgages Reach Epidemic Levels

Heard on the radio today. Caller bought a house in Merced, CA for 300k in 2005, now the house is worth 150k. Multiply this situation for all purchases made in 2005 in Merced. Isn't everyone who bought a house in merced in the last 4 years under water ? When the loan goes into foreclosure the caller loses all the equity he has paid up to the bank and the interest payments for sure. All housing loans are structured to pay of the interest first so the principal payment to the house is negligible.

Now assuming an area like Cupertino, CA which hasnt' seen such a drop, maybe 10%. By definition if the owner's equity portion on the house in the first few years is negligible so without doubt this buyer is under water too. By this metric all housing transactions made in the past 4 years should leave their owners under water. Houses prices have dropped to levels more then the outstanding loan amount because of negligible payments made towards the principal.

Lets random sample a house in Santa Clara, CA using Zillow in one of the sought of areas by Indians and Chinese first generation immigrants.

06/19/2009: $660,000

03/14/2001: $650,000

4% closing costs of $650k = $26,000

Total cost (2001) = $676,000

Downpayment ~10% = 76,000

Total Loan ~90% = 60,0000

Total interest paid at 5.4 % till date = 243,311.60

Total principal paid till date thru monthy payments = 80,000

Property taxes = 8,000 x 8 = ~64,000

Income Tax Interest deduction in taxes at 30% = -80,000

House maintainence cost 3,000 x 8 = 24,000

Total equity in the house = 76k + 80k = 156k

Total cost of ownership = 243k + 64k + 24k = 331k

Outstanding loan =520k

Total Loss = 660 -(520k + 331k)  + 80k(IT deduction) = -111k

Total Loss for owner over 8 years = ~$111,000

Lets assume owner had rented the place for 2k a month as an average over 8 years = 2 x 12 x 8 = $ 192k total

Assume the owner saved the difference between mortgage and the rent (3.3k -2k) = 1.3 x12 x 8 = $125k

Total savings in the bank of renter  = downpayment + difference = 76 + 124k = 200k

Assuming an average return of 3% over 8 years of 200k, yielding simple interest = 48k

Total savings with renter in the bank = ~248,000

http://www.zillow.com/homedetails/charts/19597851_zpid,1year_chartDuration/

24x7 Wallst reports

Underwater mortgages hurt home sales and increase delinquencies and foreclosures.

People who have to pay their mortgage holder to sell their homes are less likely to be sellers. A home sold for $200,000 when it has a $250,000 mortgage is a home that the owner may not be able to afford to sell.

People living in homes with monthly mortgage payment that stretch their abilities to cover their living costs may stay in homes that they believe have a lot of equity and where a sale will eventually bring them a profit. That hope for a bonanza may encourage them to go through the agony of making large payments. People who have no hope of making money on their homes are more likely to be willing to abandon them or be kicked out.

Both of these trends make it more likely that the housing sales pace will continue to be slow and property values will not recover.

Real estate research firm Zillow says that 23% of mortgages are now underwater. The company adds that the number could be 30% a year from now.

One of the major reasons for the trouble is that home values fell 12.1% year-over-year in Q2 to a Zillow Home Value Index of $186,500, resulting in a total 22.3% drop in value since the market peaked in mid-2006. Twenty-two percent of all transactions in June were foreclosures, a possible sign that people are not willing to fight until the end to save their houses.

Investors may have lost one-third investment in real estate

If Deepak Parekh is right investors have lost close to $8 billion dollars. There are numerous purchases made in the Bandra Kurla complex area which will end up as null and void with the buyer forfeiting on the token amount. Jet Airways is a good example where they don't have the cash to pay up 825 crores for the land which could now be worth 600 crores, a drop of 225 crores.  A huge bubble in QIP/HNI/AIM/Hedge fund real estate speculation has ended with a thud. Hirco.L is quoting down 70% from peak. How the mighty have fallen. 

DNAIndia reports

Mumbai: "Investors have pumped in $25 billion into the Indian real estate market over the last three years but with land values having gone down they could have lost a third of the value of their investment,"said Deepak Parekh,chairman,HDFC, in a letter to shareholders.

Parekh said that the $25 billion are invested through IPOs, QIPs (qualified institutional placements), AIM listing (alternate investment market) and foreign direct investment. A large part of these funds were used for buying land at exorbitant prices.

"With land values having come down, my estimate is that investors could have lost a third of the value of their investment," he said. Advocating caution, Parekh said investors in real estate have to be more discerning. They should be more realistic on valuation expectations and not throw caution to the wind, he said. He also criticised the recent trend where housing loans are offered at attractive interest rates in initial years.

"We are seeing some variations of teaser type housing loans being offered. The lure of low interest rate at the start of taking a housing loan is enticing. But are customers being made aware of future implications," he asked.

Its Official: Property rates in Pune have started to fall

National Housing Bank is the Apex Institution for Housing Finance in India. It is wholly owned by the Reserve Bank of India.
It maintains an index of real estate prices from all over the country.

Look at the data and charts for Pune: property rates have started to fall!

http://nhb.org.in/Residex/PUNEres.php

You can check the trends in 15 cities across India.

This is as official as it can get!

This just confirms our observations and conclusions that the real estate bubble in India is going to burst.

On offer in Chennai: Get new flats for old

TOI reports

CHENNAI: It’s commonplace to exchange old utensils, gold jewellery or cars for new. But ever heard of a builder coming up with an exchange offer 

that translates into: ‘You take my new flat; instead, I will buy your old one’? 

In what could well turn out to be a trendsetter, Chennai-based L&T Arun Excello Realty — a joint venture between an L&T subsidiary and a local real estate group — has offered an apartment exchange scheme exclusively to senior citizens. For them, the builder has reserved the ground and first floors of Estancia, an integrated township being promoted 18 km from the Chennai airport on the Madurai route. 

They have also tied up with international realty consultant Jones Lang LaSalle Meghraj (JLLM) to guide elderly customers through the nitty-gritty of the transaction, including evaluating the worth of their old apartments. It is also the first time in Chennai that senior-citizen-friendly flats are being launched within an integrated township. Two other builders had recently launched such apartments in the city. 

Detailing the concept, P Suresh, MD, L&T Arun Excello Realty, said, “Senior citizens quite often feel out of place in the din of city life. They would have put up with hardships for decades, for the sake of their children’s education. In retired life, instead of living alone, feeling insecure and coping with daily challenges in managing the household, we invite them to our gated community that provides a secure environment. They will not be neglected or left alone, but will form part of a community, including children. We also offer to organise even the housekeeping.”

Stock market bubble blog

Maybe it is time for a blog on the stock market bubble. All Indian indexes are fluctuating like pendulums and noone seem to know the direction of the market. Just few months ago, every commentator on CNBC India was forecasting doom and gloom. Now everyone is cheering the market rise and predicting the moon. Its time for a bottom up analysis of the situation and try to gauge the market commentary from the trenches of our desks. We might not be on Dalal Street, however let them not insult our intelligence by propunding gibberish market analysis. The blog is at indiastockmarketbbubble.blogspot.com. Hope to see some of you folks there.

Bangalore periphery realty prices slip below guidance value

Economic Times reports.

If Whitefied with all the IT parks can drop 30% offically, what about Devanhalli which has nothing but Greenfields :). In fact I know of deals in Shantiniketan taking place at below 3000 so the drop of 40% is not unheard of. Maybe a drop by 70% in Devanhalli is not a bad idea to start with.

BANGALORE: Bangalore’s realty market has thrown up a queer problem with property prices in peripheral areas falling below the guidance value set
by the government.

While buyers pick up property at prevailing (lower) market rates, they are having to cough up higher stamp duty for registration. This is because stamp duty is calculated on the guidance value set for each area/property.

“There could be strong case for downward revision of guidance value in peripheral areas,” says K R Niranjan, inspector general of registration and commissioner of stamps in Karnataka. Typically, the government conducts a valuation exercise around October every year and issues fresh guidance values based on property price trends.

If prices continue to be south-bound, the state will have to look at aligning the value to prevailing rates and this could well be the first downward revision in Bangalore. Instead of an annual revision, B S Shankaranarayanan, a legal expert in the realty sector, suggests timely and periodic revision of guidance values based on property price movements.

“This will help the public in cases where there is a price decline and enable the government to mop up more when prices go up,” he adds. And, like a builder in the Yelahanka suburb says, this is as good a time as any to bring about a correction in guidance value.

In a particular instance relating to Devanahalli, which witnessed a steep spurt in prices, given its proximity to the new airport, the value was revised during the year, a state government official says.

Requests seeking downward revision have started trickling in with buyers of the Prestige Shantiniketan project in Whitefield and builder ETA (for The Gardens project on Magadi Road) approaching the department.

The guidance value of Prestige Shantiniketan project is 3,200 per sq feet while it is Rs 4,200 per sq feet for ETA and hence, stamp duty would be calculated on these rates. But, realty sources quote the prevailing basic market rate for ETA at Rs 3,400 per sq feet while prices in Whitefield, where Shantiniketan is located, have suffered a very sharp decline of even up to 30%.

Typically, the guidance value is pegged approximately 20% to 40% below market prices to allow for escalation during the year. In the last three revisions, there has only been an upward revision of the guidance value. In fact, in April 2007, the revision was in the range of 100% to 300%, mirroring the realty boom. But, a builder says, the government hiked the rates when the market had already peaked out, marking the beginning of the downward curve.

Global warming, high tides and Mumbai sea-facing property prices

Yesterday I was one of the curious onlookers witnessing the ferocious waves as they lashed upon the sea-walls. My parents have lived their whole life in Mumbai and they havn't seen this phenomenon ever. Flooding in Bacchan's Juhu house due to rains has become a norm, now the sea water has started entering his house due to tides. All areas within the vicinity of the beach are flooded. This set me thinking that maybe this is a game changer for all these sea facing mumbai properties. Global warming is real, the tides are higher then ever, the rains are more then ever and this combination is lethal. I love the sea, except when it enters my house and destroys my car and all my possessions. I think its time to rethink prices on Mumbai's sea-front. We are witnessing a game changer here. What do you guys think ?

Price rise is realtor strategy, not indication of market lift: report

A July 2009 report by HDFC Securities notes that over the last three months, there has been an average price rise of 3 to 8 per cent in Mumbai. “We believe this increase, by a few hundred rupees per sq ft, is being used as a tool to sway potential buyers to close deals,” it states. It notes that banks providing home loans have reported a significant increase in home purchases and approvals in disbursements have been peaked in the central suburbs.

Between May and July, Kalpataru has increased rates for its projects in Thane, Ghatkopar and Kandivli in the range of 5 to 8 per cent, Nahar for its Chandivli project by 7 per cent, RNA Corp for its Kandivli project by 10 per cent. A few like HDIL and Lodha, which had launched projects at relatively low rates, have hiked prices now, HDIL by 23 per cent at its Kurla and Versova projects and Lodha by 20 per cent at Dombivli.

Registration of Power of Attorney to become compulsory

Hindu reports.

The government of Tamil Nadu has proposed amendments to the Registration Act to prevent fraudulent transactions, evasion of taxes and stamp duty , writes R.L.Narayanan

Photo: M. Srinath

Changes underway: Rules relating to registration of Power of Attorney will be changed.

Recently, the Government of Tamil Nadu has proposed that the rules relating to registration of Power of Attorney will be changed and the registration of instruments of power of attorney will be made compulsory.

Further, it is proposed that the registration of these instruments shall be made only in the office of the Registrar of Assurances concerned having jurisdiction in respect of the property dealt with under the Power of Attorney is situated. Necessary a mendments to the Registration Act, 1908, are likely to be made shortly and date of notification for implementation announced.

The immediate concern for the proposed amendment is the large-scale prevalence of a system known as “Power of Attorney Sales”.

The Supreme Court has considered this terminology and the practice covered by the term in a case pending before it.
Gained acceptance

Broadly speaking, Power of Attorney Sales is the practice of registering Sale Agreement, Power of Attorney with or without Will instead of one Sale Deed or other deed of conveyance on payment of full sale consideration.

The practice has also been to register only one of the three documents mentioned above. This practice has gained acceptance in the market and also before various authorities.

It was noticed that where restrictions such as compulsory permission from the Authority concerned and where such permission was granted on the basis of payments to be made were imposed on transfer of flats, a hybrid system with a Power of Attorney Sale was effected by the allottee / holder of the Flat to avoid the procedures and fees to be paid.

Full article here

Group buying using Twitter

I'm not sure but am wondering if we have use Twitter to post information on group purchases.

For e.g a post can be

Buy : Pune : 3 Bed : Kalyani Nagar : 50L

or

Sell : Bangalore : 2 Bed : Jayanagar : 60L

I guess we can gain some traction if there are people and maybe go for group purchases.

I've created a twitter page IndiaBubbleApt

Dharna by Maytas Hill County residents

Maytas hill county residents of Hyderbad staged a dharna in front of the house of their scamster promoter Mr Ramalinga Raju. The Satyam fiasco has caused Maytas to collapse under its own weight. The project work has stopped and investors and house owners are losing their hard earned money to bank loans. This is a very stark reminder to the state of financing in the real estate construction business. Maytas Hill county was supposed to have been completed by mid 2009. Now with the stopped construction, there seems to be no light at the end of the tunnel. These residents have to push their battle to the media like the Jet employees. Just a weekend protest is not going to help.

A friend of mine helped me translate the 2nd video.
The NRI mom is lamenting the lack of security for investments for NRIs. Her son is in London and got lured by the promises of Maytas. He has been paying EMI for 3 years now with no sign of completion in sight. She believed the builders promises but now nothing is happening. The bank is not reducing the interest rate and the government is not doing anything and not taking action against Maytas.

Beware of taking a home loan from ICICI Bank: Consumer court levies 1 Lakh penalty

From an article in Times of India:

Excerpt:
"After completing all formalities needed to avail a loan, Goyal entered into an agreement with a home finance company and the bank. A loan of Rs 37 lakh, which was to be paid in 180 instalments in a period of 15 years, was sanctioned and he started paying the instalments from March 2005 onwards on a regular basis. However, a letter took him by surprise in August 2008. The letter allegedly stated that the repayment schedule through EMIs was being revised to increase the repayment time from 180 to 502 months. He immediately approached the bank's local branch and requested cancellation of the payment rescheduling but to no avail. "

Read the full article here:
http://timesofindia.indiatimes.com/Chandigarh/Bank-to-pay-Rs-1-lakh-for-overhauling-loan-account/articleshow/4750737.cms

This means that first ICICI bank agreed to give a loan for 15 years (180 / 12). Then using some obscure terms and conditions (who reads those anyway?), they hiked the tenure to 42 years (502 / 12).
42 years means your children (and maybe your grandchildren) will still be paying EMIs!!!

It is not humanely possible to read terms of conditions for each financial product, and clearly it is the banks fiduciary duty to adhere to the spirit of the agreement. I think any bank which shows such tendencies to violate fiduciary duty will exploit its customers.

Another issue is that of charging higher interest rates to existing home loan customers, and lower interest rates to attract new customers, but that merits a blog post of its own!

Can we share our experiences of taking home loans with different banks.?I have two home loans, one from HDFC and one from LIC housing finance, and the experience has been good so far (for the past 2 years).

Thanks to Ravi Karandeekar for blogging about the article.

Ackruti City's Q4 results worst amongst listed realty companies

Ackruti City's Q4 results worst amongst listed realty companies

Mumbai-based real estate developer Ackruti City’s fourth quarter results were the worst amongst the pack of listed realty companies. Due to negative sales, its net profit for the quarter ended March ‘09 took a big hit. Despite a slight improvement in the sentiment for the sector, Ackruti could not register any sales. In fact, it had to write off close to Rs 105 crore worth of FSI sold in the previous year. The company reported a 300% drop in net sales in its fourth quarter and its net profit turned red. It fell to a negative Rs 123 crore from Rs 22 crore earned in the December ‘08 quarter.

Sea link hits Worli property prices

This is commonsense for everyone to see. If a calm area is invaded by 5000 cars an hour, think about the impact. Tough luck for the residents and lovers on Worli seaface. Maybe it is time to commercialize this area too.

DNA Reports

According to real-estate experts, increasing traffic and the consequent noise and air pollution are bound to have a negative impact on property prices along the promenade.

"Individuals who may have wanted to shift to Worli Sea Face will be put off," said Anuj Puri, managing director, Jones Lang LaSalle Meghraj, a real-estate consultancy firm. "There are many issues like pollution, easy access to buildings, and security of children due to the increase in vehicular traffic."

Residents are already complaining that noise levels and air pollution have gone up. Moreover, the exit of the sea link has created a bottleneck, ruining the peace of the locality. The press of the National School for the Blind is on this road which, interestingly, is designated a silence zone.

Budget impact on Indian housing loans

If SBI can lower car loans to 8%, how much lower can they go on property ? I remember in Jan 2003, StanChart was offering loans at 7.75% with the some other banks offering 7.25% variable. Now the rate schedules are announced in advance, so people will have visibility into the rates for the 2nd and 3rd year, instead of just floating/variable rate. As of the latest SBI announcements its 8% for the 1st year and 10% for the 2nd and 3rd year. Still not bad when compared to 12-14% rates a year ago. Add to this the increase in the income tax deduction for housing interest loans from 1.5L to 3L. It appears that just like the US, the Indian government bailout of the housing industry is on track to boost property prices. We are back to the races now. How much will the home buyer bite is everbody's guess ?

Understanding the long term trend with data

Hi All,

It would be great to have actual rates from various projects recorded over a period of time. This will help us to understand the trend of real estate prices.
The trend should be derived from data gathered from guys like us "on the street", not from some biased reports of property consultants.

The idea is that we can have a database-on-the-web to capture real estate rates.

With a few hours effort, I created a google spreadsheet to record the rates over time from a single project in Kothrud, Pune. The pricelists have been grabbed from the builder's website from March 2009 to June 2009.
The latest pricelist can be viewed here:
http://www.pethkarprojects.com/samrajya/availability.pdf

The spreadsheet can be viewed here:
http://spreadsheets.google.com/ccc?key=rmv0n4AJNHEfU_5RRg1I_bQ

Creating a chart, we can see that the rate is the same for the past 4 months!! Compare this with the boom period when rates used to increase every month. Definitely, real estate in Kothrud, Pune has flattened out.

The google spreadsheet is not appropriate for large amounts of data which can start pouring in from various cities, so I have also created a mysql database with multiple tables.

How to gather the data?
1. Quoted by builders - this can be done by gathering pricelists of the projects at exhibitions, or from the website of the builder.
From the pricelist, we need to calculate the carpet area (excluding terraces, balconies, and other non FSI related areas) and the total cost to the buyer (including stamp duty, registration, one time maintanenance etc i.e. everything).
The carpet area, total cost and date can be entered into the database.
Entering pricelists into the database will have to be done by moderators.

2. Posted anonymously by real buyers:
Anyone who has purchased a property can anonymously post the carpet area, total cost and date. The anonymous user is not allowed to enter data directly into the database, he can post in this blog and a few moderators like us who have write permission to the database will enter his post.
What if someone posts a misleading rate? I believe 1o people can lie, but 1000 people will not lie. When we have hundreds and thousands of unique users posting rates, the misleading posts become statistically insignificant. This is the same principle on which www.carwale.com operates.
Also a restriction is that a user can post only the rate for a property he has actually bought, so we can restrict posts to 1 post each month per email id.
People can also post links to builder's websites which have published pricelists.

There can be a discussion on how to allow anonymous posts.

We can have admin / moderators for each city, like I and someone else can do for Pune.

I can help with the perl code, sql and database, domain name, hosting, but I aint no website designer. Maybe we can form a team to collaborate on the website?

India's residential sector likely to see oversupply - Crisil

Crisil reporting accurately on the state of the housing market in India.

>>> Real estate companies have been launching newer residential projects at lower prices that >>>are located in "far-flung" locations (exhurbs) from the central business districts of cities. The Reuters article is below.

This statement is 1000% true. We see launches in Kalyan, Virar, Boisar in Mumbai which are 3 hours away from business districts. It makes no sense to commute 1/4 of your life every day and still be under the duress of loans. Life is more then loans and commute. Builders have bought land at sky high prices in the Mumbai suburbs and the only way out for them is an increase in FSI. I think in the coming years the Maharashtra govt will do just that. Prices will drop to more sober levels once that happens. Anyone buying at 8k per sq/ft will be rueing the decision for the rest of the loan life.

India's residential sector likely to see oversupply - Crisil

MUMBAI (Reuters) - India's realty companies will struggle to find buyers for about a fourth of their residential space between 2009 and 2011, the research arm of rating agency Crisil said in a report on Wednesday.

During 2009-2011, Crisil Research said it expects absorption of 506 million sq. ft. over the three years based on its expectation of a GDP growth of 6-6.5 percent in 2009/10, according to its study of 10 cities across India.

Although planned supply has been estimated at 1,202 million sq. ft., this supply "is unlikely to materialise in full due to the credit crunch and relatively sluggish demand," and the actual supply will be around 700 million sq. ft., it said.

This indicates 28 percent will be in oversupply while much of the planned projects will be delayed by up to two years and others in the planning stage, shelved.

Indian real estate saw demand for housing collapse in the second half of 2008 amidst a global credit crunch and the local market became stressed with buyers fearing job losses, Sudhir Nair, head-Crisil Research said.

The market is expected to stabilise in 2010, he added, "the Indian economy will stabilise and start accelerating and there will be stability in the global economy and fund constraints will be eroded."

Builders had also reduced unit sizes and cut prices, which will help stabilise demand, he said.

Residential prices are expected to fall further by 8-10 percent in 2009 before stabilising the next year and Crisil Research expects investors to maintain a cautionary approach until values stabilise, it added in the report.

Real estate companies have been launching newer residential projects at lower prices that are located in "far-flung" locations from the central business districts of cities.

Rotten apples on the blog

Readers and folks who comment on the blog like Priti, Shyna, Vandana, Abeer , the good BB, Retired old man, Bharat, Shriniwas, Shubh Chintak  have  noticed some several off-topic, irrelevant and offensive comments on the blog. I can turn on the moderator mode, however the feedback loop of posting a comment and seeing it visible on the blog immediately is lost. At the end of the day I can clean up the posts and comments.  BB or whoever is masquerading as BB will eventually tire out by entering the CAPTCHA characters, but  if his only goal in life is to troll this blog 24x7 and keep slandering, I will be forced to turn the moderator mode on and then reject all his comments. 

What do you guys think ? I think we have a good discussion going on prices, areas, builders and the collective wisdom of people is helping everyone including myself. I had no idea about the price rise in the DDA cluster of Mayur Vihar, so keep up the good work and let us all keep posting. Even the casual reader has something to contribute so don't be shy. We all are looking for insights from the real world, not bogus planted articles by TOI , Jones Meghraj and others.