DLF Ltd, India’s largest listed real estate firm, sees signs of recovery in the country’s beaten down residential property sector and expects prices to start firming up, a senior official said on Monday.This is something I've started to hear from other sources - that prices are holding. But there are still very few transactions. Construction, though, seems to be back - in Gurgaon, I see hitherto abandoned projects getting a new lease of life. This is good - getting houses complete is important, because when some of them eventually go bust, there will be something left for the vultures to buy. Let's face it, there is oversupply in the premium segment, so some will go bust.Still, Rajeev Talwar, group executive director at the developer, said projects needed to be priced aggressively in order to sell.
Talwar told Reuters in an interview a stable government and a view that the economy may be improving would help demand for real estate, after a property slump that analysts said has seen prices crashing by up to half.
“I think we’ve done a fair amount on price correction, realistic pricing or aggressive pricing as it may be called,” Talwar said.
“I think all Indians have imposed their faith to very immediate economic revival, rather than long term,” Talwar said.
There doesn't seem to be an index or any real data on the residential segment so I can't say if prices really are holding. I see that brokers are trying their level best to keep listed prices steady. Real estate is a very slow and opaque segment so it could take months or years to really correct.
Interestingly, DLF is not quite so bullish on commercial properties. Their Andheri project in Mumbai is on the block, and it opted out of it's Kolkata SEZ project among others.
In other news, DLF dropped 10% today, to end at 365. With a past P/E of 27, it's not exactly cheap, but hey, residential prices are picking up!
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>http://zerohedge.blogspot.com/2009/06/intraday-spy-indication-of-interest.html
Can you please explain the content in this article. Most of the posters claim FED is fused with other institutions to prop up the market.
06.08.09 at 10:55 PM
>You mentioned in the post that there is no index for residential housing prices in India.
Just to correct you on that National Housing Bank does have an index for residential real estate prices. It's called Residex.
Check out the following links –
http://www.nhb.org.in/Residex/About_Residex.php
http://www.nhb.org.in/Residex/Data&Graphs.php
http://economictimes.indiatimes.com/ET_Reality/Residex_a_benchmark_for_all_stakeholders/articleshow/2673496.cms
HTH
Ankit
06.09.09 at 7:20 AM
>All lies. They are just talking their book. After this "reflation"/"recovery"/"green shoots" madness is over, then the real decline will begin. They are just looking for bagholders.
06.09.09 at 8:36 AM
>Real estate developers have a vested interest in keeping public perception of housing prices high.
If people start realizing/believing that real prices are falling, they wait for further fall. We have observed this behaviour of people many a times, most famously in stock markets. If they wait for further fall, sales decline and cash flow of realtors is affected.
On the other hand, if people believe prices will rise further, they hurry up and buy quickly hence improving cash flow of real estate.
Because of this heavy vested interest, DLF is the least trustworthy source if you want to know about real estate prices.
06.11.09 at 5:18 AM
>Ankit: Thanks! Didn't know about that. I will take a look and get back!
06.11.09 at 8:52 PM