Its Time for Real Estate Consolidation

[msn1270]

As all of us know, the real estate prices have crossed the peaks of 2007 by XYZ methods, still the developers and brokers are looking for more to gain. On the other side now its time for the price consolidation. My views are based on

1. with the recent announcement of BBMP decision to regularise all the unauthorised Layouts by way of one time penalty of Rs. 150/sq.ft onwards and which will go for the approval from the Govt in this session. With this all those BDA and BBMP approved plot owners who were claiming more value for their assets as they're having khata and bank loan eligibility will face new competition. This will help the owners of the revenue/non BBMP site owners to get the Khata for BBMP and their plots will also eligible for the banks loan. This inturn makes more option for the buyers, as they're worried all these days only b'cos of the documents and non-eligibility of those plots for loans were the main hurdles.

2) Majority of the banks have raised their Lending rate by 1% from January this year and hinting for another round based on the RBI Economic review this month. As the Food inflation has already crossed 18% and the RBI is getting ready for another round of Rate revision. This will make more barrier for the money availability of money in the banking system and their by increases resistance for the borrowers.

The above 2 reasons will definitely cool the real estate prices to some extent in the coming months.

[kumar_kumar06]

Just to had couple of points
In some parts of bangalore there is serious demand supply Mismatch,
According to experts in next 6 months there more chances where interst rates may jump upto 300 basis points.

[jackalbda]

I dont want to comment on weather the prices will come down or not because I dont think I am an expert in timing the RE market.

But I would like to make a point here that the prices of BDA plots are at a premium not just because of one factor that we would get loans on it. Its due to many factors like the the credibility on the BDA plots as far as the title ownership is concerned, reasonably well maintained roads/avenues/park etc, cavery water availability and many sundry facilities provided ( one BMTC bus service from every BDA lay out/Hop Coms etc). Overall anyone would admit that, BDA areas in Bangalore are reasonably well maintained and quite OK places to live in. I dont want to compare it with very posh private gated communities where you have to pay premium rate during purchase along with a continuing maintenance charges !!