Barter back in fashion!

Sorry guys!

Have been rather busy of late and so have missed out on important info. But this one beat all...

If you haven’t read it already in the HT under the headline ‘Realtors look to barter deals’ here’s this – Real Estate firms are getting into ‘barter deals’ with manufacturers and suppliers of construction materials to tide over the slump.

Pretty good I must say.

This is another innovation that they are doing to cut cost after using mobile phones as a medium of advertising.

Interesting…very interesting!

And now houses you can afford…

I may have written about this earlier but it’s worth mentioning again.

People keep asking me if this is the right time to buy a house?

My answer is YES

The recession in the realty sector has certainly helped bring property prices down and that has given rise to the new mantra – affordable housing.

That’s exactly what builders today are focusing on. Look up any newspaper and you would find many schemes for 2BHK and 3BHK houses, which are affordable.

What’s more there are builders who have devised newer strategies to sell their apartments especially the ones, which are off the city limits or not easily accessible.

To lure the buyers many not only give proper layout plan of the area around the site but also provide with transport facilities, in case there aren’t many.

There are builders who have promised luxury busses offering pick and drop facilities at nodal points.

The idea is to provide affordable and easy to reach destinations to the customers.

Today’s ET too sheds light on the trend of affordable housing.

Here’s what an article with headline – Affordable housing: New mantra of realty companies says –

With real estate market facing considerable slowdown, a new trend of building affordable houses is emerging in the National Capital Region of Delhi. After Ghaziabad, Indirapuram , Noida, Greater Noida and Faridabad, a number of projects in the range of Rs 20 lakh to Rs 30 lakh for an apartment, have been launched in Gurgaon.

So far, Gurgaon has been known for its luxury apartments. In the last two years, the township witnessed the development of apartments in the price range of Rs 3,500 to Rs 10,000 per sq ft. On top of this, the size of most of the apartments used to be upwards of 1,800 sq ft.

Thus, the cheapest apartment available in the area was priced around Rs 60 lakh. This affected demand in the residential real estate sector here. At the same time, as most builders were into the construction of premium apartments, these properties are in oversupply and witnessing correction in prices.

Once again I would say go for it!

Of those SMSes and advertising gimmicks

A couple of days ago I got an interesting SMS suggesting an investment opportunity. Better put, it was an advertisement relating to real estate investment.

I am sure you would have tumbled upon such SMSes in the past. Considering that your mobile phone has now become good advertising tool that delivers personalised messages and at negligible costs…the fad certainly is on the rise.

And it isn’t just restricted to real estate but stretches across the board with many companies especially the ones in retail using this method to promote their wares.

This one was from GoDirect.in and here’s what it said:

“Property investment next to Expressway, Noida, Buy at 11.88 Lakhs and (earn)
rent for 9 years at 11,880 to 22,300 per month.”

Seems like an interesting proposal, but here I must add that there always are some hidden clauses in such cases. But, if you are interested do check out their website www.godirect.in.

Here’s another one. It was from a Noida-based BPO and it too offered a similar proposition. The site too was located near the Expressway, Noida and it said:

“Book an apartment in JP Wish Town Klassic on Expressway – Noida and pay no
interest or EMI from next two years.”

The options in this case were 2/3/4 bedroom apartments with a starting price of Rs 35 lakhs.

No doubt, good investment avenues…but the point is are there any takers considering the hoopla surrounding the recession.

Satyam - the fallout continues

In my last post I had said that the ‘Satyam saga’ will carry on for some time and have it’s effect across the board especially on the IT and real estate sectors.

And that’s exactly what is happening now, the fallout is continuing.

The government on Monday decided to widen its sphere of investigation and look into realty firms Matyas Infra and Maytas Properties.
The Serious Fraud Investigation Office (SFIO), which is conducting the investigation against Satyam, has been asked probe the accounts and other assets of the two companies.

No end to Satyam saga

Satyam Chairman B Ramalinga Raju did he wanted to do. He maybe behind bars but the fallout continues and my bet is that it will carry on for a pretty long time.

Today, both IT and realty stocks took a beating pulling the BSE Sensex to a one-month low before ending with a loss of over 323 points at 9,046.74.

Realty stocks suffered after Maytas Infra fell further in the lower circuit to end in the red. The primary reason for the nosedive by the news that a high-level probe would be ordered into the projects sanctioned to the company.

But, there was another reason for the slump in IT stocks. According to experts Nortel Network Corporation, which has filed for bankruptcy had an adverse impact on Indian software majors Infosys, Wipro, and TCS, which provide back-up support to Nortel.

DDA…simply amazing! Here's why

Now, here’s what I was trying to say in my last post, but stopped short. I thought it best to let you read it first in the newspaper.

If you look up today’s HT and turn through the sports pages chances are that you would notice a brief item with a headline – Playing golf just got cheaper.

But, it’s not the headline which will make you curse the DDA but follows …

Here read it for yourself…

Carrying forward its endeavour of “taking golf to the common man’s doorstep”, the Delhi Development Authority (DDA) threw open the country’s second public course on January 8. Though a practice range and three greens were in existence since 2003, the nine-hole course was commissioned last Thursday. Adjacent to the Bhalaswa Lake Complex in the northern end of the capital, officials are confident the Bhalaswa course will be a boost for “deficient” areas…

My point here is that after getting embroiled in the ‘lottery scam’ (draw of lots) the DDA had the guts to do something like this.

That’s why I had said the DDA never ceases to amaze me.

Older posts on DDA
DDA…simply amazing!
Why waste money on DDA schemes?
Good news

DDA...simply amazing!

The DDA never ceases to amaze me.

You won’t believe that after getting embroiled in the ‘lottery scam’ (draw of lots) they have embarked on another venture.

Though, there’s nothing fishy about it but the mere fact that they are into this business and at such a time beats logic.

Watch out for this space tomorrow to know what that is…

Older posts on DDA
Why waste money on DDA schemes?
Good news

Surprising, but true!

Today I got to know an interesting point about Satyam.

Now, now…Satyam has got nothing to do with Real Estate (or has it LOL), but I am still reading and writing on it as I have somewhat developed an interest in the company’s affairs of late.

Not that I wasn’t interested in it, for I was a regular user of it’s service Sify Broadband, before I decided to discontinue it after facing innumerable problems. In fact, calling it slow would be an understatement.

Before I tell you what the interesting point is let me just talk about the service itself. Last night, while chatting away with my neighbour, I said, “Its service is terrible and worst it’s expensive.”

But he disagreed saying, “Please don’t say that, it’s not so bad after all.”

He explained, “Its Internet service was initially started for cyber cafes, but was gradually put for personal use. That’s when the problem started.”

I would still say that the service is over priced.

Now that the monkey is off my back, let’s touch up that interesting fact.

Amidst all the humdrum about it’s founder Ramalinga Raju arrested and charged, and the board of directors sacked only to be replaced by government functionaries, in came an interesting observation – it was about their acting-CEO Ram Mynampati.

Here’s what…Mynampati, now being questioned by SEBI, earned more than Raju.

His total package last year was over Rs 3.5 crore, 80 per cent more than Raju.

What say?

Other related posts
Bad news for realtors across the board
Satyam – the fallout continues
No end to Satyam saga
It’s all over for Satyam’s Raju
An interesting observationSatyam vs World Bank

It’s all over for Satyam's Raju

Strangely after criticising the World Bank for the ban imposed by them on the company on account of fraudulent dealings, Satyam chairman Ramalinga Raju has finally stepped down from his high horse.

On Wednesday, after sending an apology letter to all the company’s stockholders, Raju finally resigned.

He even admitted to all the wrong doings that he had done in a bid to acquire Maytas Properties and Maytas Infra.

Subsequently, many brokerage firms including Credit Suisse, Religare and Angel Broking suspended their coverage of Satyam Computer’s shares.

Wish something similar could be down about their Internet service Sify Broadband. If you are a user I am sure you would know what I am talking about…

Why waste money on DDA schemes?

Those of you who had been wondering why I have not touched upon the DDA scam till date, here’s the answer:

I had been following the turn of events which got ‘interesting’ by the day.

Anyway, I have finally decided to write something on it. But before I do let me just do a quick flashback. Some months ago when the DDA scheme was announced, somebody urged me to go for it. But, I did not and I had cited my friend KSD’s .

KSD, currently in the US, is busy fighting a long-drawn case with the DDA. He emerged a lucky winner in their draw of lots years ago but hasn’t been allotted a flat. No doubt, that was a reason for my decision, but there was another — I had already bought a flat and wasn’t interested in wasting Rs 5000 towards application fee.

With this scam coming to light, I am actually thanking my stars that I didn’t ‘go for it’.

And, you won’t be surprised to know that KSD’s case isn't an isolated one. Last night, a news channel telecast brief interviews of people who hadn’t been allotted a flat by the DDA since decades. On person even claimed that his name had appeared in DDA list in 1981 and yet he hasn’t been allotted one.

Here, I would say it’s not just the DDA, which is at fault, for if you look up the google, chances are that you may find many such cases all over India. Closer home, the Ghaziabad Development Authority (GDA) comes to my mind.

Incidentally, in Indirapuram itself there are apartment blocks, which could have matched the Archaeological Survey of India’s list of ‘protected buildings’ considering their ruined look. Surprisingly though, many such blocks are up for sale though at a cheaper rate than the prevailing market price.

But, what’s even more interesting is the reason how they achieved that state. A decade ago the GDA along with the EIL (Engineers India Ltd.) had planned a society and construction began in full flow. The apartments were completed in good time only to lie vacant and unattended for more than 10 years.

Why?

Because of a legal soup. Now that case is over and these flats are up for sale.

The point that I am trying to raise here is that there is no point investing money in such schemes for seldom do these meet your expectations.

What they say…

Today, I was surprised at the number of contradicting reports and opinions that have emerged on the realty horizon.

While Mr Pradeep Jain, Chairman of Parsvnath Developers, feels the boom is back in the real estates sector, the Economic Times in it’s article - Real Estate: Correct time to innovate – feels otherwise.

It says:

It is quite clear now that after a fairly long bull run, the Indian real estate sector has begun to show signs of slowing down to a more realistic equilibrium rate of growth. In fact, the present changes that Indian economy and real estate sector is going through can also been seen as the test of the resilience of the economy and our real estate sector.

And then, Moneycontrol.com has quoted The Minister for Urban Development Jaipal Reddy as saying that he is not too happy with the second stimulus package.

In a letter originally written to the PM on Thursday, a day before the package came out, Reddy wanted banks to lower interest rate on home loans from 9.25% to 7.5% for loans up to Rs 30 lakh. The minister also asked for the doubling ofincome tax rebate on home loan interest to Rs 3 lakh and income tax exemption on rentals to be raised from 30% to 50%.

However, my understanding says that the boom has yet to come, but the process 'towards stability' has begun. In other words it’s not exactly a bad time to buy a house.

Is it the best time to buy a house?

This is for those of you who are facing the dilemma over the purchase of a house.

Is it the best time to buy a house? If that’s the question crossing your mind then you ought to read today’s Economic Times.

Here are the excerpts fron an article under the headline - Can borrowers expect a further fall in rates?

Some banks are yet to offer the reduced rates to their existing customers. In such a scenario, a floating rate loan would be an ideal choice. Since there is a possibility of reduction in rates, floating in these turbulent times is better than being locked at a high rate. Those who are unsure can wait for the turbulence in the markets to quell.

Real estate has been an ideal hedge against inflation over a long term. Limited land resources, a growing economy and increasing population make real estate an ideal investment avenue. When demand for housing goes up compared to supply, prices shoot upwards. With a fall in rates on the horizon and lucrative bargain deals offered by developers, it is time you seriously explored owing a house.

And this is the time, because many industry experts feel that soon the market will stabilise and when that happens property prices may rise again, especially considering the fact that the government is leaving no stone unturned to boost the realty market.

Also read And now houses you can afford…

Some cheer for realty stocks

There was some good news for the real estate firms on Thursday with the realty index of the BSE gaining valuable points on fresh buying by investors.

The realty index gained as much as 6.52 per cent to settle at 2,422.43 points. During the day, the index surged to a high of 2,445.93 points.

But, the major news for the day was Goldman Sachs Investments Mauritius (India) buying shares worth Rs 30.84 crore in Indiabulls Real Estate through open market transactions.

Led by Indiabulls, which surged nearly 18 per cent, the BSE Realty index ended in green. Indiabulls rose as much as 18.30 per cent to Rs 155.15 points.

The major gainers were Unitech (9.61 per cent), Housing Development Infrastructure Ltd (8.20 per cent), Ansal Infrastructure (7.23 per cent) and Parsvnath Developers (6.67 per cent).
Apart from Indiabulls’s acquisition, expectations of further cut in interest rates also influenced the market operations.