Consulting|Technology|International business

Land hunt in Bangalore gets worse!

with 2 comments 

Land prices in Bangalore central and areas in/around South Bangalore and North Bangalore are still running at very high rates.

Jayanagar area – a hotbed area for most South Bangaloreans is running at about Rs. 8500 per sq. ft. (leave aside a negotiation room for another Rs. 200 or Rs. 300)

A land we saw at Jayanagar 4th block today was a small 40*60 whereabouts and costing almost a whopping Rs. 2.4 crores!

A land we saw at JPNagar (near the famous Ragigudda temple) cost Rs. 1.2 crores for a dingy 4 BHK mezzanine floor – house) with no car park and no front and back yard.

I think its ludicrous to even think about buying land in this peak of the boom cycle. Just as the US housing market bubble collapsed (, the Indian housing bubble will also see a burst shortly.

The fundamentals are not rock solid and people are already trying to sell off flats at lesser prices and bank loan disbursements have considerably reduced from leading mortgage lenders such as ICICI and HDFC.

I would strongly suggest those looking for land in Bangalore to hold their plans for now. This is not a good time to purchase land at the peak of the artificial boom cycle created (esp. with all the black money flowing into the system).

Even here, there is a segmentation of the types of developers. Most of them fall in the area of either first time builders with 3-4 individuals getting together to make hay while the sun shines or experienced builders of about 10 years in the industry such as Mantri, Sterling, Purvankara etc.

The small-time builders are not someone one would ideally like to deal with (least of all – talk to – some of them I have spoken to on casual inquiries are pretty rude and unsophisticated). The large builders do not negotiate much on prices and the real estate agents are just that – agents and brokers who have no clue of what the consumer is looking for – in most of the cases.

Its like this: Everyone is trying to grab a piece of the cake and enjoy their time in the sun but I can assure you – cyclical business up’s and down’s are a part of this world economy and they will see a trough coming in soon.

I am not being pessimistic – I am being realistic.


Written by Naveen Athresh

August 19, 2007 at 10:58 pm

2 Responses

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  1. I fully agree with the Author. In US , it has become a serious crisis and there are thousands of unsold homes waiting to be sold and prices are dropping like crazy.

    This is soon bound to happen in India as well.
    The sky-high prices will soon come down to reality.


    August 25, 2007 at 12:20 am

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