Comments on: A Real Estate Triggered ‘Stimulus’ Idea

By: Shobhit

Shobhit — Tue, 31 Mar 2009 19:23:31 +0000

The recession has once again unfolded the big scam that was cooked by some of the big real estate firms and government bodies in general. If we see the land records and the land bank of some of these firms, It is quite clear that The land Bank possesed by these entities was inflated thanks to the High valuation acorded to them by the stam valueing authority and a benchmark used by banks to value the land bank to extend credit lines. I close scrutiny brings forth that the land which these entities bought at say x Rs got valued at 5x times thanks to the prevailing circle rate fixed by the government body 4 collecting stamp. And why such absurd valuation by the gov. body.. any body can guess…well vested intrest…..Only a fool will not leverage by pledging an asset of value x to get 4 times the money…..STILLL all these so called analysts slept….And this was the prime reason as to why we saw unpresidented flow of capital into this sector, it was sheer leverage so bought which was feeding the bubble. Other wise how come an asset class becomes so valuable that it makes an individual HNI overnite surpassing all forms of his life long earnings….In real terms except for few pockets of land this is simply not possible….

By: Kamal

Kamal — Sat, 21 Feb 2009 07:22:42 +0000

Can Someone help me understand, Whom are the Realtor wants to benefit ie The Reltors Themselves OR The property Dealers OR The Buyer ???

If you look at DLF , Unitech, Parsvnath, BPTP websites, They declare all their flats are SOLD OUT. So where is the money thay have collected from the Market ??

The Q2 results of DLF showed an EBIT of 55% , outstanding from any corner, Then why do they need Government Assistance.

Seems, these builders have sold their flats in bulk to property dealers, Who are now putting pressure on the Builders to pressurise the government to announce stimulous schemes for the buyers, Anyone who tries buying property will realise this phenomenon.

By: Ajay

Ajay — Mon, 16 Feb 2009 05:24:16 +0000

How does putting more houses for sale when there aren’t many buyers going to help property developers?

Property prices, specially commercial properties, do not make any sense. I saw a USD 4 MM property in Punckula whch was leased out as a photocopy shop. With commercial borrowing at 14%, how is this effective used of money? Some would call this old economics but at least old economics makes sense.

If real culprit is black money or alt money, should that not be put to effectve use by brining it into real economy? How come India ends up with so much of secondary economy every few years?

I believe this capital gain waiver should be done away with completely. Let it reduce the price of property. Let more people afford to buy a houses and in the way create more jobs.

By: Nitin

Nitin — Thu, 29 Jan 2009 14:53:48 +0000

Hi there!

I dont think that a small factor like this could have any significant impact on real estate market.

However, if there are other measures that the government had taken to pull the markets up, I would like to know.

Thanks
Nitin

By: Praveen

Praveen — Mon, 05 Jan 2009 19:40:08 +0000

Complete agreement with Piyush. The Indian property market is already a super bubble. Residential property need to be taxed based on occupancy levels. This will go a far way in providing affordable housing.

By: Sri

Sri — Mon, 05 Jan 2009 03:48:19 +0000

Agree with Piyush, why should the goverment inflate over heated property bubbles? India would probably end up with a super bubble based on value less money created in US. Indian goverment should do everyting to keep the propery market subdued(hard to do in India!), so it doesn’t suck up capital and generate no value.