The story of the boom and the crash in the real estate sector has been well documented.
Ever-increasing demand and inflated prices saw housing costs rising to unprecendented heights. But soon the global economic slowdown hit industry sectors hard; none was as badly affected as the real estate sector.
Stimuls packages coupled with dropping interest rates and housing prices have sought to breathe life into the realy sector so that builders can sell their apartments and people can buy them at affordable rates.
Experts differs on the staus of the real estate industry. While some feel that the realty sector is picking up, other see more corrections happening.
And if are confused about whether to buy a house now or wait for better times to come, here is an opportunity to clear you doubts.
A Shyamsunder (Shyam), chief executive officer of Disha Direct Marketing Services and an real estate expert, offered some valuable tips during a chat on rediff.com on Tuesday. Here is the transcript:
Sameer asked, is real estate value going to rise in 5-6 years from now
Shyamsunder answers, at 2010-04-13 15:56:05Real Estate given its nature is an asset which has assured appreciation over a period of time. Logically, there will be an increase in prices over the next 5-6 years as demand increases due to a general increase in standards of living
naeem asked, hi, I planning to buy flat in pune. but prices are not declined inrecession time in pune.
Shyamsunder answers, Hi Naeem, During the recession, some parts of Pune especially on the outskirts like Wankad, Baner, etc had seen a drop of more than 50%. Subsequently as demand increased and stabilised, there has been an increase in price
Badri asked, Is it the right time to invest and buy an apartment in Chennai?
Shyamsunder answers, Hi Badri, This is the right time to buy. The economy in general is looking up, salaries are moving up and so will demand for housing which will push up prices, so hurry up!
vamsee asked, How is the housing market in Hyderabad?. Is it a good time to enter?
Shyamsunder answers, Hi Vamsee, Hyderabad is stable at present and there are many projects coming up in the developing areas. Given the kind of infrastructure that has been developed in Hyderabad the future is bright. May be the right ime to enter.
Rajaji asked, Is it the right time to buy a Home? or shall i wait for some more time to buy? Plz. Advise me When should i buy a home and whether to buy an Apartment or Independent House or a plot for future Home! Suggest me the best option keeping in view of current scenario, situation and future trends!! Thanks, Rajaji
Shyamsunder answers, Hi Rajaji, Long Question That! The timing to buy a home is subjective, it depends on the need and the resources. In case you need a place to live, its always a good time. From the investment perspective, the demand trends suggest that there is an increase and as the year progresses it will increase, hence the sooner the better. As regards the kind of property, it will depend on your budget. If you have a substantial; budget you may vhose to have a portfolio of units i.e. apartment, plot etc. or focus on one.
Howzz asked, Sir I stay at Ahmedabad and have an offer to buy a plot measuring 1000sqyd @ 1300/sqyd. Its in a village off NH8 by 2kms. Its a residential plotted scheme. Howzz that?
Shyamsunder answers, Hi Howzz, You have not mentioned how far away its from Ahmedabad city and in which direction. Prima facie the rate seems reasonable, however other details will help give you a better perspective
meenu asked, meenu says,I am living in Jaipur and I am a Govt.employee,I wish to make a property for myself but I am quite confused whether I should buy builder flats or will it be better to invest in plot.
Shyamsunder answers, Hi Meenu, The answer to your question lies with you. How much time do you have on hand to dedicate to building your own house? If you have the time, its the best alternative as you can save on cost. If not, its better to go with a developer of repute.
tanuli asked, Hello Shyamji, Is the investmemt towards Kandivali good. With Kaplataru saying 9100 per Sq with Rs.50 Floor rise.
Shyamsunder answers, The rates in mUmbai vary with the reputation of the developer and some of them do command a premium as well as good resale prices. Hence take the decision based on developers reputation and your budget
red asked, Sir, I am planning to buy a commercial property and give it out for rent. do u think its the right time and any goverment charges to be given if i give it for rent??
Shyamsunder answers, Commercial properties should give you a yield of between 7% - 11% depending on location. It is a good investment, however the emphasis is again on location and future development. As per the last union budget, Service Tax has been imposed on rents of commercial property, which means the rent will increase to the extent of service tax
nkkj asked, Hi, I am purchsing a ready move in premium property in outer ring road bangalpore 1800 sqft for 90 lacs should I buy it or go for under construction property
Shyamsunder answers, The descision will depend on how fast you want to kove into your property. If there is no hurry and you are dealing with a developer of repute, an under development property will be better as you will get a better rate. In case the ready property can give you a good rent yield immediately, you may as well go for a ready property.
anilgodbole asked, What is your opinion on 12% assured return investment in IT park. How risky / rewarding is the investment.
Shyamsunder answers, Hi Anil, can you please tell me how this scheme works?
jagdish asked, i want to buy a house in mumbai(mulund) please let me know what is right time to buy at present i stay in 1bhk and likely to go for 2bhk
Shyamsunder answers, It is the right time to buy at Mulund
BRIJRAJ47 asked, How do you forsee the residential real estate market in kolkata and is it wise to buy now?
Shyamsunder answers, The real estate market at Kolkata looks bright
rajeshgoswami.2009 asked, I am living in ahmedabad last three years. I watched that, in last year price of flat are doubled. so I need to wait or buying a home now?
Shyamsunder answers, Hurry up... act now
vasubobbili asked, I want ot buy a flot in hyderabad pls let me know is it right time to ivest in hyderabad as Telagana issue is going on.
Shyamsunder answers, In fact, this could be the right time, as this sentiment will change once there is a decision either way. The city of Hyderabad with its infrastructure and potential will remain where it is irrespective of which state it finally belongs to.
ranga asked, is it right time to buy flat in pimpri-chinchwad, pune area.....or should i wait....
Shyamsunder answers, If you have the resources , you should not wait
tomji asked, looks like mr Shyamsundar is saying that real estate will boom like before, I guess its the time to smell the coffee mr Shyam
Shyamsunder answers, Real estate will boom on the back of increased demand driven by higher disposable income. This time there will be no bubble. Cheers!
neel asked, which is the best place in mumbai to invest
Shyamsunder answers, Whats your Budget?
d456 asked, Dear Shyamsunder...is this a good time to invest in Mumbai (Andheri W) where the prices are already inflated...will remain invested for 7-8 years for sure but with higher EMI's will it make sense as a stable investment..not very high rent income too (ratio of EMI to Rent)
Shyamsunder answers, It depemds where in Andheri West. Considering the prices in Mumbai at present, some places are inflated, no doubt. Hence you need to spot the opportunity as an investor which can justify rental yields and cover the EMI to some extent.
OsamaBinLaden asked, Anyone who want to buy a dream house in Afghanistan?..Special Offer...with discounted rate...kyaa ye 1BHK & 2BHK ke chakkar main pade ho...Afghanistan aao..aur pura Pahaad le lo...
Shyamsunder answers, What rent are you offering at the caves of Tora Bora?
tomji asked, Hello Shyam, Please tell when is the next housing crash. Would love to hear that.
Shyamsunder answers, Hopefully, we have all learnt our lessons. In India only places like Mumbai, NCR and Bangalore where prices had gone through the roof in 2008 saw a correction of 30-40%.Other places like Chennai, Kolkata, Indore etc where pretty steady. There will be corrections wherever housing becomes unaffordable!!
6682R asked, would you suggest investment in any real estate or investment in Real Estate Fund??? which is a better option??
Shyamsunder answers, My bet would be on Real Estate
manavbob asked, i think shyamsunder hates biharisss that's why he not answering my question..... sir do u knowledge about patna realty... is yes than please suggest meeee. why in patna realty sector is costing more than any other city.. In recent economics times report land cost in patna is ranked 6th in india. I am still not able to figure out why.. So can you suggest me weather i should buy land in patna or not
Shyamsunder answers, Sirji, nothing against anybody. Sorry dont know much about the markets in Patna..
amul asked, I am looking for a house in western suburbs. But prices have again risen after last year's correction. Is there a correction expected soon? what is your view on this area?
Shyamsunder answers, Correction may be expected for some properties which may finally be beyond anyone's budget. Its anyones guess as of now..
Vivek8 asked, Mr.ShyamSunder! How much should one invest into property at this stage where there is so much of inflation going around in market/world?
Shyamsunder answers, Real Estate is a hedge against inflation in the long run. The inflationary situation around the world is a temperory phenomenon and will settle down.
Srinidhi asked, Dear Shyam, flats in general are actually not assets as such when compared with a villa/owned house. How do you rate an IT employee with an average salary of Rs 30k PM to buy a villa? Is it really possible? If not now, what could be the prices of villa in Bangalore in 2 years from now? Will it be affordable?
Shyamsunder answers, Given your currnt salary, I would advise you you to go for small size flat or else your resources could get streached. A villa will certainly be more expensive and the EMI's may not match your income.
piyu1000 asked, PLease give your view on Panvel
Shyamsunder answers, Panvel's future looks bright, considering the general development of the place, big players of the industries completing good projects and the proximity that it will have to Mumbai's new International Airport.
ravikanth asked, Mr. ShyamSunder, which one will be preferable buying a home at far away distance or flat near the center of the city.
Shyamsunder answers, It depends on your need and budget. Logically one must first have a flat in the city maybe close to your place of work, school, hospital, malls and other conveniences. Once this primary need is satisfied, you can certainly look at a property away from the city where you can spend quality time with family and also look for appreciation in the long run as the city grows.
piyu1000 asked, Sir, how do u see the appreciation in Panvel & Proper Thane
Shyamsunder answers, Both places hold the promise of appreciation in the future
Why asked, From an Investor's point of view, the Property Tax to be levied by BMC in Mumbai for leased properties seems to be a worrying factor as the tax amount is nearly 56% for commercial properties and 42% for residential properties of the rent received. Do you think this will be implemented and if so, will it see a huge correction in prices, espcially in Mumbai?
Shyamsunder answers, I am sure the authorities will have a relook at this proposal. However from their end too, a revision has been expected for a long time and hence lessees will be mentally prepared for an increase in rent. There may not be an impact on the prices immediately.
Pradeep asked, what is the rule of flat area calculation now? Built Up Area or Carpet Area?
Shyamsunder answers, In Maharashtra the law says that agreements muct mention carpet area.However you look at it, built up or carpet, the value of the transaction will remain the same.
amol34 asked, hi sham i am planing to buy proparty in navi mumbai area .my budget is 25-28 lach . this is for investment only. where will be good loaction in navi mumbai and waht should be the rate ...as every body selling flate just because there will be new airport in panvel ...just because of that flat price will increasing so high ..pls advice.
Shyamsunder answers, Other than the proposed airport, there is also an existing sea port near panvel and the infrastructure being developed will reduce distances. Hence Navi Mumbai is hot as per investors. Panvel could be the ideal destination for your budget.
Vikas Rane asked, What do you think of investments in second homes?
Shyamsunder answers, Investment in econd homes for self use is ideal to break away from the routine and spend quality time with family and friends. From the pure investment point of view where you are looking for appreciation , again the potential of the location matters as regards development and future growth of the place. Locations like Talegaon near Pune have given phenomenal retuns to second home investors
Sripada asked, Dear Shyamsundar, Do you think buying a 20X30 site (2500/sq ft)in a BDA approved layout in electronic city, Bangalore is wise? It is behind Infosys and nesr Wipro (~1-2 Km). Do you see prices go up in that area? Can i build a comfortable home in that small site? Please suggest which area is best bet in B'lore. Thanks
Shyamsunder answers, Sorry, I dont have much idea about this place..
rahulg asked, Hi Shyam...is boisar and locations around it a good investement decision as a investor?
Shyamsunder answers, It will make sense as the local trans will soon extent to Dahanu and there is substantial industrial development at Tarapur near Boisar.
mrkgoud asked, I am from Hyderabad, I find two sets of properties - one ready to occupy and one just starting (will take 1.5 to 2 years). Is this a good time to buy? If so which one? I have no urgency.
Shyamsunder answers, If you are in no hurry, you may go for under construction property with a builder who has a track record of completing projects. This will give you a bettr price and more time to spread your finances.
Shyamsunder says, Thank you all, My times up.. Bi Have a nice day