Now days I do not happen to read news
paper daily. Sometimes on weekends I get chance to read news papers. But, one
thing I have noticed that first page or cover page, a page above front page
which is full of property advertisement is reaching each home everyday. They
have 1 BHK, 2BHK, 3BHK flats, row houses, farm houses, farm lands, and NA plots
advertisement. Now days customers have hundreds of options. They have various
budgets from so called cheap flats to luxurious flats with high budgets. They provide
so many amenities. It’s a matter of research how many amenities are really
needed and are used. They are present just as status symbols. People are paying
so much money extra for these unused facilities.
I want to put my views here about whole
real estate industry in India.
Home is COSTLY (?)
In India all businesses, industries, jobs
are concentrated to few particular cities. I feel this is done deliberately to
force people to stay, gather at one place. It is well known fact that in cities
like Mumbai, Pune, Banglore people from all over the country are coming every
day, in search of jobs, money for their living. Thus, by forcing people to come
at one place naturally struggle for life begins. They have to struggle for
home, for food, for education, for everything. Now just consider real estate
scene. Home or shelter is everybody's basic need. All people want their own
home. Obviously there is big difference between demand and supply in case of
homes. Demand is more. So cost goes up. But everybody has to buy house even if
it is beyond their budget. So now banks come into picture. Banks are offering
housing loan at pretty high interest rate. Now a day it is the main business
for all the banks. Everybody have to get the loan and pay it back in 10 to 15
years. If calculated everybody is paying 1.7 to 2 times money than the original
price. Thus homes are costly. But this is not natural but artificial, made for benefits
of few people. Huge mass of people are suffering for benefit of few people who
probably not even paying tax and putting all money earned by common man to Swiss
banks.
Reverse Situation.
Real estate prices are increasing by
hundred Rupees every month. Few years back there was time when people were
buying flats like anything. But after slack of 2008, people experienced the
uncertainty of job and income. The demand for flats was reduced but the
builders kept constructing the flats with same pace. So now the result is many
flats are ready and unsold. But even then builders are still increasing the
flat rates as earlier. This is not according to market demand. However these
builders are so strong that they can survive the slowdown of demand. They can
hold flats even if it is not sold. The logic is even if it is not sold whenever
it is sold they get the more money for the time they hold the flat. The result
is, now people are not buying as many flats as before 2008. Hence ideally price
rates should have been stable for some time or reduce if there is less demand.
But this is not happening. Which means the property prices are fake and
exagarated. It needs to be checked that are we going towards another subprime?
Fake satisfaction.
My friends tell me many times that they bought
flat for x Rupees and now the price is 4x. They are very happy. I feel they
have no reason to be happy, if they are living in the same flat what they are
talking about. Why? Reason is simple. Because, if they sell this flat, they
have to buy new one with more price. So if they want to be in the same city, I don’t
think there is any benefit. Ok, if they are saying this about their second or
third flat ok they have reason to be happy. I have observed that people are
dreaming that they have made good deal. I feel it is fake satisfaction. People
are so much involved in the property ups and downs, square feet rates, interest
rates of loan and how to return the loan, that they have forgotten that there
is another life beyond property and flats.
Real estate in India has made rich to many
people who do not know what to do with the huge money they have received. They
are generally the farmers who sold their land to developers. Some are using it
wisely but many are misusing it. It is increasing the criminalization of these
people. This is another problem due to land prices appreciation.
Overall real estate in India is now like a
big balloon which is swelling for no reason. It may burst anytime and hopefully
the bang won’t put many in trouble. A common man like me is unwillingly getting
dragged in this whole property race. I know it but am helpless and can just see
and pray things will be fine.
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