Pune Real Estate Market - Booming?

#1
Hello everyone,

I live in Pune. I am curious to know about the real estate market in pune as I am thinking to invest in it. Here is my plan, I will buy a 1 or 2 bhk through EMI and put it on rent. The rent will go to the EMI. After 1 or 2 years I will sell the flat with profit of about 20-30%. But as always there is a risk factor associated with it as with any kind of investment. The risk is what if the real estate prices go down? I am not who has a lot of money who can sustain a loss of 3-4 lakh if this idea fails. I am going to consult the real estate consultants in Pune. Your ideas are welcome.

I request everyone to pour there views about this strategy... Please guide me over deciding whether the real estate in Pune will head.

Regards,
Saurabh
 
#3
Only one thing...

Will you be able to rent it out at a rate which will take care of your EMI...? I have my own doubts as usually EMIs are much higher than the rent one has to pay in any particular area (considering only 80% of home value as loan)... this is the situation at least in Mumbai.

You also need to consider the tax exemption that you will be able to get (You will have to forgo HRA exemption if you are claiming it so far) and then you do your maths to calculate how much interest you will end up paying... even after tax saving.

If the amount of interest paid for next 2-3 years is not 20% of your home loan then probably selling at 30% higher down the line will make sense.

Otherwise risks are too many.

Hope this helps.
 
#4
pune real estate market

Hi..Mr.Saurabh

Why u are thinking that Pune market will be go down?

U know Indian real estate is such an unorganized sector that you can never be sure of anything here… whether it is about property prices or any other trend….one cannot get the exact mentioned property prices everywhere.

But I am sure that Pune Market will be booming in future.

So don't think anything and buy your dream home as per your planning.

As for investment ur idea is better.
 
#5
I think Pune realty scene is dependent on the IT sector and could be a risk factor.

The Talegaon, Chakan, Pimpri & Chinchwad belt has industry and is not heavily dependent on IT sector.

But for many projects in Hinjewadi, Wakad, Baner, Pashan, Sus, Hadapsar, Kharadi, Wagholi the buyers/renters are mainly IT folks.

If there is a downturn in IT, it will surely affect the realty prices in these areas.

Another issue is real demand vs investor buying.

Priced are relatively protected when there is real demand, i.e. people buy and stay there. Even if prices soften, people don't sell the house they live in.

For many new projects in Pune, the buyers are investor. In case of prices softening, there could be panic selling by investors who were hoping for a quick buck in 2-3 years.

During Diwali I went to visit a friend living in a prestigious duplex project in the Baner/Pashan area. There are over 100 apartments there. All are sold but few actually live there. During Diwali, I could see lights in less than 15 houses there.

My friend lives in a 10 storey apratment complex in the Sus area. All houses are sold but few stay there. During society meetings, less than 10 people turn up. Many flats are used as Serviced Apartments for serving the IT companies in Hinjewadi.
 
#6
Lot of like this happening where is a lot of outsource companies. Be very carefull cause there should be a lot of support for them in all of that price inflations over time. Probably rent is expensive or even more than in Delhi, it's very common case.
 
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