Real Estate: DLF Price War, BSE Realty index down 23% from highs
How often have we seen something like this: DLF to Push a Price War in Chennai
DLF has purchased two 60-acre chunks of land to construct 4,000 and 5,000 housing units, including apartments, exclusive villas, and row houses. The prices for these housing segments will start from Rs 2,700 per sq ft. against market price of Rs 3,500 per sq ft.
Real estate developers such as Purvankaras, the Hiranandani Group, and the Mantri Group have fixed the price of Rs 4,200 a square foot.
Does this mean that competition between builders will actually benefit us? Is it an indication of a drop in real estate prices? Perhaps someone from Chennai can enlighten us.
A quick update on the BSE Realty Index: It hit a new low @ 6485 this morning; and is now down 23% from the all-time high of 8455 on July 24. The DLF IPO & the launch of the index did indeed mark a short-term top for this sector!
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August 23rd, 2007 at 10:03 pm
I dont think we really mind that…:-)!!
Can someone point them towards Hyderabad too? Or more hopefully, can we see this as the start of a trend to get down the high prices that are being quoted in the nook and corner of any major city in India? If the people (consumers) buying real estate are not listening to any sound logic and rather pumping in money like crazy leading to high prices, then at least will the builders themselves in fierce competition amongst themselves, push the prices down?
Is there any economic theory that has been drafted and explains the above scenario?
- Chandra