Vinny’s Blog

Today, I have not so good news in short run but it could be a good news in the long run so, bear with me for a while and see where this is going. Once again this is my view read it but draw your own conclusion.

As we all know that property rates in India have soared in the recent year. I mean doubling value of a property to 100% in 4 short years is no big deal. Owners have started to believe in it and so have future buyers of those properties. But this is not sustainable we all know this and it’s only a matter of time when this comes to a halt, either of it’s own or due to some external factor. This same trend continued in US and in UK and in most of European nations and today they all have problems related to housing. So the sooner correction happens in India the better it is. Longer this trend continues bigger problems one may expect down the road.

Now , why exactly is this a problem who does not like their house values to double in 4 short years ? well, everyone likes that there is no doubt about it. But the way it goes is like this…Once you buy an expensive house, you’re pretty much declaring that you cannot work cheap ! now how can you afford to work cheap when you have to make big payments for the house you own. That means you would be pushing employers to pay you more, let us say they do, then they will charge more to their clients and you see someone in the end will have to bear the cost. If everyone does that then that city, town, country becomes expensive to do business with because everyone would want higher wages.

Top this off with a higher value currency (like USD or Euro) and you see it becomes even more expensive to do business with that country. Who would want to pay that much money specially if all those living in expensive cities are providing common services or goods, you could get them from else where cheaper.

Get it !!

I now hope you’re ready for whatever is coming next ..yes ! you guessed it. Actually the property value in India has started to decline. It’s true that always big cities take the hit first and then smaller ones follow.

Bombay seems to be in the grip already property rates are down and they are likely to fall by 15% .

Check this out.

Property prices in Mumbai to fall by up to 15%

Now just because this is for Bombay does not mean, Pune or else where it’s safe, trend will follow and corrections will happen, Pune will be no different.

Once prices fall, it’s sure to attract fresh new buyers who were waiting to get into buying but did not do so due to higher prices, only problem is that when prices fall buyers tend to wait longer because they think they can get better bargain.

But let me tell you again certain correction in this market is good as it will allow companies to offer lower cost to their clients and will in turn attract more business.

Now, let us finish this with a fine note, if you do have investment properties this might be good news (tip) for you.

Service apartments increasingly growing in demand

I won’t write much about it just read the article it is plain and simple to the point.

FOCAL POINT

The trend of service apartments started ever since hotel rooms became unffordable or unavailable.

The business of serviced apartments is growing at the rate of 15-20 % every year.

Service apartments not only ensure timely availability but also a scope for customisation of services as per the requirements of the person hiring it.

Click here to read

If you’re a buyer a good opportunity is coming up for you. If you’re a seller…well choose carefully, when you want to get out…..study the local markets…..good luck !