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DLF
Indian property bubble
Posted by :
BhattTracked by: 0 Boarder
Indian property bubble
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This article does not cite any references or sources.
Please help improve this article by adding citations to reliable sources. Unverifiable material may be challenged and removed. (August 2007)
This article is written like a personal reflection or essay and may require cleanup.
Please help improve it by rewriting it in an encyclopedic style. (September 2008)
The origins of Indian Property Market Bubble can be traced to the interest rate reductions made by the NDA coalition government in the years following 2001. Home Loan Rates fell to a (then) historical lows of 7.5% in early 2004. This prepared the basis for the massive increase in real estate property prices across India. Low interest rates triggered huge interest in individuals to borrow to own their own homes and this triggered an increase in demand for real estate across India.
The Indian Property Market has been growing fast since March 2005, when the current UPA government decided to open FDI in Real Estate. The market has been growing at a dizzying rate of 100%+,and further[citation needed]
Real estate in Indian metropolises such as Mumbai, Delhi and Chennai has sky rocketed to levels comparable with international cities like London.
One remarkable point is the real-estate boom in Chennai and its suburbs, leading to high prices in decent housing and then finally prices dropped. For example, an apartment of 1500 square foot in a Chennai suburb will cost around USD 200,000, whereas in Europe similar size costs about USD 450,000. In a class A suburb of New York you can buy a large house for around same amount (450K). Per capita ratio is around 50:1 ($50,000 to $1100); this suggests the presence of a bubble.
However, speculations aside housing prices depend a lot on various factors such as the age of the property, facilities, surrounding area etc. Hence, the property bubble will burst for the places bought over priced with no stronghold value to it.
Some have suggested that given India`s population density is closer to that of Europe than that of America the real value of Indian Real Estate should be close to European levels rather than American levels. When looked at in that way Indian real estate is still cheap. This argument assumes the rapid economic growth in India will have brought per capita income in India to European levels within the next 5 years in urban areas.
Contra argument to this is US prices should ideally move with economy/inflation rate of 2-3% while Indian prices will gallop at the rate of 10% a year and probably more as the land distribution market is inefficient.
By its very definition a bubble is a short term phenomenon while Indian real estate market has continued on a secular upward trend, apart from periodic adjustments, in the last 10 years. Bear in mind that there are almost 400 million Indians waiting to hit the middle class group and they will exert additional pressure on the system. Affordability is the most important factor when it comes to housing prices and middle class housing is much levels of affordability in most of the major cities in India. People who compare India with developed European cities, forget the huge difference in affordability in both areas. Of course there is a huge demand for housing but they can only buy what they can afford.
One of the big problem of real-estate market is that supply lags behind demand by about 5 years (Plan-Approve-Finance-Construct time).
Lack of efficient signals to market participants means that there will be periods of mismatch between suppliers and buyers hence leading to cycles of booms and busts.
As of May 1st 2008, the Indian housing market has already started declining. Prices have started to drop to some extent in few major cities.
...
Tracked by: 0 Boarder
2 week back it was at 300. You should have exit that time. Real estate sector will be out of attention from traders and investrs after some. After that it will be stagnant for long period. Incase it bounces back to 300 due to short covering rallies get out and try to minimize losses and put money in good quality stock....
In reply to:
DLF
Posted by :
jkt
I hold 500 DLF Shares @412 I Can hold it for next two years will it pullback
to this level by that time 
Tracked by: 0 Boarder
I hold 500 DLF Shares @412 I Can hold it for next two years will it pullback
to this level by that time...
Tracked by: 0 Boarder
What is the book Value Of DLF...
NSE Announcements on DLF
Posted by : MMB MessengerTracked by: 0 Boarder
Dlf Limited, JM Financial Consultants Pvt. Ltd. and DSP Merrill Lynch Limited has informed the Exchange that Dlf Limited (the "Company") is buying back its own fully paid up equity shares of face value Rs.2/- each ("Shares") from the open market through the electronic trading facilities of the Bombay Stock Exchange Limited ("BSE") and The National Stock Exchange of India Ltd. ("NSE") (together the "Stock Exchanges"). The Company has appointed JM Financial Services Pvt Ltd. and DSP Merrill Lynch Ltd. as its brokers ("Brokers") for placing orders on the Stock Exchanges. The details of the purchase orders that were executed on the Stock Exchanges on November 21, 2008, in connection to the above buyback are: 1) Date of Buyback: November 21, 2008; 2) Name of the Broker: JM Financial Services Pvt. Ltd.; a) No. of equity shares bought back on BSE: Nil; b) No. of equity shares bought back on NSE: 4,75,000; c) Total no. of equity shares bought back: 4,75,000; d) Average Price of Acquisition (Rs.):192.55; 3) Name of the Broker: DSP Merrill Lynch Ltd.; a) No. of equity shares bought back on BSE: Nil; b) No. of equity shares bought back on NSE: Nil; c) Total no. of equity shares bought back: Nil; d) Average Price of Acquisition (Rs.): NA; 4) Cumulative Equity Shares bought as on November 20, 2008: 16,21,767; 5) Quantity Closed Out on November 21, 2008 - Nil; 6) Quantity Closed out as on November 20, 2008 - Nil; 7) Total Quantity Closed Out - Nil; 8) Total Equity Shares bought back as on November 21, 2008: 20,96,767....
Buy DLF from current price for 3 months
Posted by : mukutTracked by: 1 Boarder
Satta market i was short in DLF from 300. When motilal oswal given buy call in DLF i went short heavily. I have closed all short positions but Brokers fooling people as everybody know that real estate sector will not perform for next 3-4 yrs....
In reply to:
Buy DLF from current price for 3 months
Posted by :
sattmarket
Best buying price 35-125 ,then we can adjust any risk in this range
DLF should cut price of FLATS in the range of 45-77 percent ,bec their Flat 3-4 bedroom was 400 time costly from acutal cost ,
if DLF,UNITEC,OMAXE ,and many other builder will not down price then ,they will be
Buy DLF from current price for 3 months
Posted by : sattmarketTracked by: 1 Boarder
Best buying price 35-125 ,then we can adjust any risk in this range
DLF should cut price of FLATS in the range of 45-77 percent ,bec their Flat 3-4 bedroom was 400 time costly from acutal cost ,
if DLF,UNITEC,OMAXE ,and many other builder will not down price then ,they will be ...
In reply to:
Buy DLF from current price for 3 months
Posted by : nicknamechanged61
aamir bhai,
leave these souls, don`t give them reply. their nick itself speaks a lot.
Buy DLF from current price for 3 months
Posted by : The D CompanyTracked by: 1 Boarder
Yaar , satta market u always talk about ...
In reply to:
Buy DLF from current price for 3 months
Posted by : sattmarket
No chance for 5-10 years it will be decline whole world ,FM said if realestate will be now cut price ,then they will be Diwalia very soon ,they cannot run their companies in this panic recession,and FII will not come,FII is not fool and retial investor will loose jobs ,they have lake of money,
so that 40-70 pecent Cut in price is very uregent to save REAL ESTATE,AUTO,AND CAR LIKE MARUITI
,MARUTI,INDICA IS VERY COSTLY IN INDIA as per world market price they r 2-3 time costly,`
Leptop very costly ,digital camera,fmcg ,moible product r very costly and weak in Quality thats y always people give prefrence to buy from outside india as per these product r coslty and life is short
NSE Announcements on DLF
Posted by : MMB MessengerTracked by: 0 Boarder
Dlf Limited, JM Financial Consultants Pvt. Ltd. and DSP Merrill Lynch Limited has informed the Exchange that Dlf Limited (the "Company") is buying back its own fully paid up equity shares of face value Rs.2/- each ("Shares") from the open market through the electronic trading facilities of the Bombay Stock Exchange Limited ("BSE") and The National Stock Exchange of India Ltd. ("NSE") (together the "Stock Exchanges"). The Company has appointed JM Financial Services Pvt Ltd. and DSP Merrill Lynch Ltd. as its brokers ("Brokers") for placing orders on the Stock Exchanges. The details of the purchase orders that were executed on the Stock Exchanges on November 20, 2008, in connection to the above buyback are: 1) Date of Buyback: November 20, 2008; 2) Name of the Broker: JM Financial Services Pvt. Ltd.; a) No. of equity shares bought back on BSE: Nil; b) No. of equity shares bought back on NSE: Nil; c) Total no. of equity shares bought back: Nil; d) Average Price of Acquisition (Rs.): NA; 3) Name of the Broker: DSP Merrill Lynch Ltd.; a) No. of equity shares bought back on BSE: Nil; b) No. of equity shares bought back on NSE: Nil; c) Total no. of equity shares bought back: Nil; d) Average Price of Acquisition (Rs.): NA; 4) Cumulative Equity Shares bought as on November 19, 2008: 16,21,767; 5) Quantity Closed Out on November 20, 2008 - Nil; 6) Quantity Closed out as on November 19, 2008 - Nil; 7) Total Quantity Closed Out - Nil; 8) Total Equity Shares bought back as on November 20, 2008: 16,21,767....
Rental V/s. EMI
Posted by :
AtheistTracked by: 0 Boarder
Guest,
Man.....never thought someone could be so Intelligent(or is it dumb)!
You beat Henry Paulson and Ben Bernanke for intelligence(or is it dumbness)
LMAO!!! You deserve an applause!
...Singh......
In reply to:
Rental V/s. EMI
Posted by : Guest
Firstly, the person is talking US Dollars and not INR. What is the use of taking a 200000 lakh loan today to buy a house in India. Those who take such amount of loan typically take it to stay in the house.
First change your mindset and write in $.
For example, you take of loan of USD500,000. What you should see is the % reurn you get annually, it should be equal to or more than bank rate of say 10%. So for a property of $700,000, the rental should be about $70000 pa. Whether you take the loan for 5, 10 ro 25 years is not relevant here and so is the amount of loan. If the rental is below $70000 then your house, if mortgaged, has potential to become subprime case.
DLF is running out of cash (Economic Times)
Posted by : GuestTracked by: 0 Boarder
DLF requests Haryana to refund licence fees worth Rs 235 crore
========================================
NEW DELHI/CHANDIGARH: In a bid to seemingly boost its cash reserves, DLF, India’s largest real estate company, has requested the Haryana government
to refund licence fees worth Rs 235 crore for various commercial and residential projects in Gurgaon. The company refused to respond to an email query sent by ET.
In two separate letters to the state government’s director of town and country planning department, DLF requested the authority to refund the licence as well as the scrutiny fees for commercial and residential projects in various sectors of Gurgaon.
Developers usually acquire agricultural land from farmers and pay the government a conversion fee, or a fee for change of usage of land, and a licence fee seeking permission to construct a commercial or residential project on the land. The government also charges a nominal scrutiny fee, which is a kind of a processing fee. The licence fee is higher for commercial projects.
The Haryana government charges licence fees of Rs 6.70 lakh per acre for group housing and Rs 2.15 crore for commercial projects with a floor area ratio (FAR or actual developable space) of 1.50 and Rs 2.70 crore per acre for FAR of 1.75, one of the highest such fees levied in the country.
DLF has sought refund for about 110 acre comprising 16 commercial projects in almost as many sectors, including 57 acre in sector 88 and 14 acre in sector 89. The company has sought complete or partial withdrawal of licence fee in the scheduled projects.
Similarly, in another letter to the government, DLF has sought refund of licence and scrutiny fees worth Rs 8.6 crore for multiple projects spread over 103 acre in Gurgaon. The company has not given any specific reason for withdrawal of licence applications in either case, but only mentioned that the licences were pending and were formally being withdrawn.
Even as realty players are struggling with a cash crunch, DLF chairman K P Singh on Tuesday said that the company faces no liquidity issues. However, he added that some projects have been deferred and some jobs cut due to weak demand.
Seeking a refund of licence fee is not an ordinary way of shoring up liquidity at any firm.
Changed usage of land and the licence to construct a project on it is what differentiates raw land from development land. Development land fetches far higher value than a piece of agricultural land. In India, getting these licences is a mammoth task.
Several multi-million dollar foreign investments, which came into the realty sector in the past few years, attached a huge premium to the land. Developers` equity was mostly limited to the land. The ability to obtain licences for construction in Indian is what put developers in a strong position vis-a-vis other investors, including private equity players. ...
Rental V/s. EMI
Posted by : GuestTracked by: 0 Boarder
Firstly, the person is talking US Dollars and not INR. What is the use of taking a 200000 lakh loan today to buy a house in India. Those who take such amount of loan typically take it to stay in the house.
First change your mindset and write in $.
For example, you take of loan of USD500,000. What you should see is the % reurn you get annually, it should be equal to or more than bank rate of say 10%. So for a property of $700,000, the rental should be about $70000 pa. Whether you take the loan for 5, 10 ro 25 years is not relevant here and so is the amount of loan. If the rental is below $70000 then your house, if mortgaged, has potential to become subprime case....
In reply to:
Rental V/s. EMI
Posted by : Atheist
Sir,
But the EMI depend on the tenure of the loan...
Say a person(call him A) has taken a loan of 200000 rupees for 5 years
and his EMI is 5000 and the rent he is getting is 3000
.
Say an other person(Call him B) takes the same amount of loan of 200000 rupees for a 20 year period and his EMI works out to around
2000 and the rent he gets is 3000
.... In the above example though both A & B are getting 3000 rupees as rent.....the same 3000 for A is substantially less than the monthly mortgage payment
....Whereas for B the 3000 rupee rent is substantially more than HIS monthly mortgage payment.
So how do we calculate and judge when the mortgage payments vary from person to person..
Or did i miss a point in your message which has a answer?
...Singh...
Hold DLF: Indiabulls Securities
Posted by : MMB MessengerTracked by: 0 Boarder
Indiabulls Securities Research has maintained its hold rating on DLF. DLF’s net sales grew 15.2% yoy but fell 1.7% on a qoq basis. Net profit fell 4.1% yoy....
Rental V/s. EMI
Posted by : AtheistTracked by: 0 Boarder
Sir,
But the EMI depend on the tenure of the loan...
Say a person(call him A) has taken a loan of 200000 rupees for 5 years
and his EMI is 5000 and the rent he is getting is 3000
.
Say an other person(Call him B) takes the same amount of loan of 200000 rupees for a 20 year period and his EMI works out to around
2000 and the rent he gets is 3000
.... In the above example though both A & B are getting 3000 rupees as rent.....the same 3000 for A is substantially less than the monthly mortgage payment
....Whereas for B the 3000 rupee rent is substantially more than HIS monthly mortgage payment.
So how do we calculate and judge when the mortgage payments vary from person to person..
Or did i miss a point in your message which has a answer?
...Singh...
...
Rental V/s. EMI
Posted by : stocks4usTracked by: 0 Boarder
Land prices will not go down much (depending upon where the land is). They could go down by 15 to 20 percent. And in some areas only 5 to 10 percent. Of course ANYTHING WHICH WAS RIDICULOUSLY PRICED (whether plots of land being sold or apartments) will go down a lot. Apartment prices have to go down at least 25 to 30 percent from current levels or around 50 percent from peak levels....
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