Saturday, March 7, 2009

Now, rental dip threatens real estate investors

If you want to sell your 2nd flat, write about it in the comments:

According to Ravi Varma, president of the Estate Agents Association of Pune, this is especially true about high-price apartments along Airport Road, Viman Nagar, Kalyani Nagar, Koregaon Park, Boat Club road, Mundwa, Wanowrie and Kondhwa.

Realty agents say low rentals will put pressure on builders to reduce prices further. “Potential property buyers will continue to live on rent. Nobody will want an upgrade now as they are looking at every opportunity to cut costs,” an agent said.

“Many 3 BHK fully-furnished apartments that were earlier priced Rs 80,000-90,000 a month have now been renegotiated at Rs 60,000-Rs 70,000,” said Vivek Seth, a real estate agent in Koregaon Park.
To read more, please, visit - Now, rental dip threatens sales

Are you still holding your 2nd flat?

Don't you think it is wise to sell your 2nd flat? An investment done at a high property rate when Pune real estate market was booming?

You must have realized by now that your 2nd flat is going to give you less rental and may not appreciate at all.

What are you doing about it?

Please, share your experience and if you want to sell your 2nd flat write about it in the comments.
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12 comments:

  1. Hi Ravi:
    Great blog. Who rents an apt for 50k to 70k. Those who are renting at that value are not this blog reader. I think your viewers here are typically like me. A 2 or 3 BHK buyer with combined family income of 50-60K. I am sure I would not like to live in fully furnished Taj Mahal in best of the location at that rental if my monthly income is 50k.
    So no relevance of that story here.
    I typically rented my home from 7.5 to max 13k in 2005 to 2007

    ReplyDelete
  2. Hi Ravi,

    When Mont Vert is going to reduce the rent. The scheme launched last week had high rental which is the stopping even potential tenants.

    ReplyDelete
  3. Once the recession comes to india by end of this year them things would become realistic. Till then the builders can be in denial.

    ReplyDelete
  4. I have been asking for price on emails from Mont Vert and many other builders a( about6 of them) from time to time. Many are refusing to send it on email. Many sends higher price on mail and then when I visited them they start reducing.
    Mont Vert sent me one about 4 months back and then sent me one day before yesterday. Even they are giving into market pressure.
    Their Grand and Biaritz was quoted at 3588/- now down to 3133.
    Their Tropez was at 3200 now at 2800.
    Kumar and Paranjpe, Rohan all reducing by about 10-15%
    If these industry leaders reduce the rates, smaller builders will follow them.

    ReplyDelete
  5. # Ref: "Mont Vert sent me one about 4 months back and then sent me one day before yesterday. Even they are giving into market pressure.
    Their Grand and Biaritz was quoted at 3588/- now down to 3133.
    Their Tropez was at 3200 now at 2800.
    Kumar and Paranjpe, Rohan all reducing by about 10-15%
    If these industry leaders reduce the rates, smaller builders will follow them."

    If you don't opt for "Rent Today Own Tomorrow" and decide to book - purchase - right now, you get 11 months rent as a discount on above mentioned property rates at Mont Vert! Just take it as price cut of 100 Rs. per sq.ft.!!

    ReplyDelete
  6. Ravi,
    Really failed to understand as why you are recommending people to buy montvert at such a huge price when good ready posession apartments are available in same area at 2300/2400 rate. you are really losing your credibility man. Seems like you have been influenced by Montvert too much.

    ReplyDelete
  7. Friends,

    Don't do any deal in today's time.
    Rental offer is a trap set to catch you, nothing else and no great benifit.
    Rs. 100 psqft price discount is nothing compared to how it went up by 300% in last 3 years.

    Today, whar we see are marketing and sales techniques, not real offers. So be careful and save yourself. Time is going to be tough in next two years, India will hit hard by slow down post elections, wait and watch.

    ReplyDelete
  8. # ref: "Who rents an apt for 50k to 70k. Those who are renting at that value are not this blog reader. .....So no relevance of that story here."

    - "If you want to sell your 2nd flat, write about it in the comments" Now, this is relevant! Right?

    ReplyDelete
  9. # ref: " The scheme launched last week had high rental which is the stopping even potential tenants."

    - Rental is at par with the rent in Mont Vert Projects.

    - Idea is not to make renting but buying property easy.

    ReplyDelete
  10. # Ref:"Really failed to understand as why you are recommending people to buy montvert at such a huge price when good ready posession apartments are available in same area at 2300/2400 rate."

    - On the day Mont Vert launched "Rent Today Own Tomorrow", my friend who is a Director of the project in Wakad and sells his ready possession flats at 2600 rs. per sq.ft. asked me, "why anybody will go for Mont Vert's offer when his ready possession flats are available for lesser budget?" I asked him, "Are they buying your flats?" He said, "I received 300 visits in last 2 months but i could sell only 8 flats." "Why?" i asked him. "People are not in buying mood." he answered. "That's the point." i said.

    - Listening to buyers is good.

    - About exceptionally few who are buying.

    These projects not only has less property rates but their sizes are also small.

    In the budget of 2 bhk flat at Mont Vert's Tropez at Wakad, where property rate is Rs.2,790, including discount of 11 months rent, in these low budget projects you can get 3 bhk flat!

    Point is every project has it's own customer base. Those who are price conscious and don't bother for quality homes and projects are not going to opt for this schemes. I know this and i am not telling them to go for this offer.

    - If you want to go for the project where rate is less, go for it. But please, ask for 11 months rent in those projects. If you are buying, ask for the discount!

    - For me important is you should be benefited form this offer. Rent or discount. At any project.

    ReplyDelete
  11. # Ref: "Friends,

    Don't do any deal in today's time.
    Rental offer is a trap set to catch you, nothing else and no great benifit.
    Rs. 100 psqft price discount is nothing compared to how it went up by 300% in last 3 years.

    Today, whar we see are marketing and sales techniques, not real offers. So be careful and save yourself. Time is going to be tough in next two years, India will hit hard by slow down post elections, wait and watch."

    -- Yes. my friend is absolutely right.

    - Watch all this happening from the rent free flat and walk away after 11 months. I am sure, you would have to take very little efforts to find someone who is happy to buy the same flat and you will be richer by saving 11 months rent.

    ReplyDelete
  12. For some reason you seem to have concluded that the slowdown will last a year. Most people seem to miss the fact that this was an it boom fuelled by outsourcing from america. And the recession in the us is being compared to the great depression. Going by that it would last at least 5 years. So if it people dont buy the homes, would prices remain at pre it boom levels?

    ReplyDelete