Malaysia has probably the best housing model than anywhere in the world. First Malaysia has corruption but they have cleaned the nexus between politician and builder and top corruption. Malaysia has 4-5 times more average salary than India and housing 2 times less than India. A two bedroom apartment with all facilities from home furniture, kitchen equipments, dining and interiors around 22,000 rupees which is 1500 ringet. In mumbai it will be around 70,000 and higher for furnished flat. Why? There is corruption nexus between corporator and builde where they charge bribe every sqft amount or lumsum. Then there is sand mafia, water mafia, cement mafia, bricks mafia who manipulates price and control price monopoly because indian government hardly care for people like malaysia.
Then in India an air condition starts from 25000, it starts from 7000 which is 120 ringets, furniture like queen bed starts from 4000 in malaysia, here it is 18-20 thousand. Why in a country where average salary and labour is three times less than malaysia charges three times more commodity price..this is where indian system and corruption fail its people and work for crony capitalist with high taxes and loot.
Re: Malaysia housing model
by Raja Krsnan on May 11, 2018 09:45 AM
it looks like more than 50% of the cost must relating to bribe related factors.
the example of queen bed is very apt. i think for 70 years India remained a costly economy where everything is priced ugly and common man encouraged this willingly. common man always lives in a fantasy land. he struggles through out his life just to pay off the lifestyle.
even if we take into account the material inputs and labour involved in a queen bed, it will be less than 50%, considering we take everything at the highest possible price. there is corruption at every level.
Reminds of Winston Churchill once famously said about Russia during World War II
"It is a riddle, wrapped in a mystery, inside an enigma".
The above quote fits the description of Indian real estate. Np one can fathom the pricing. How they are decided and who jacks them up etc.
Guess the real estate was let to run amok till about 10 years ago. No regulations . No checks and balances.
Every one expected a crash in prices. But it did not happen as people are already got stuck with overpriced properties which they can not sell for lower prices. And there are not many new buyers in a market which is so volatile.
Affordable housing is another gimmickry where the numbers are doctored to make believe that every one else can afford by you can not.
Of late , all these tactics are coming out and people are realizing how they are being taken for a ride.
Re: Real estate in India is a black box
by Raja Krsnan on May 11, 2018 09:35 AM
common man loves to be taken for a ride. he was made to believe that in real estate, prices do not crash. even today many people dish out that logic. i personally feel it is a one time investment that drains out one's life's savings and generates unlimited difficulties and tension for the rest of life.
everybody wants to live in a fake world. so they go to any extend to show off while not realising that this is draining out their precious savings and forcing them to work under tremendous pressure till retirement. this benefits another set of crooks - doctors, pharma companies, hospitals etc.
i personally wont invest in real estate as the yield is very pathetic. add maintenance, tax and other costs, it is not worth investing while we can get better returns from instruments that offer tax benefits and provides easy liquidity.
It is like you create a fictitious problem, doctor the statistics, litter it with unsupported data and generously insert sales pitch, then offer a solution to this fictitious problem. This is your typical Indian real estate for you.
The real problem is not a PROBLEM of supply. It is problem of meaningless pricing of real estate.
The real estate prices make NO SENSE in Indian Metros. It is not as much a housing problem as it is an issue of affordability.
Classic example is Mumbai. Lets talk - how many people can afford a 2 bed room apartment ANYWHERE upto Thane on the central line, Upto Mira Road on the western side and Panvel in the NAvi Mumbai side.
Now, lets talk about Hiranandani gardens in Powai, Thane or even Panvel. What is the percentage of people who can afford a ONE BED apartment in these places? bet it would be less than 1% of Mumbai population. Same goes with any major developer project in Mumbai.
So , inability to afford should not be misconstrued as HOUSING PROBLEM.
Second - it is false statement that whole India is facing housing problem. The housing problem is endemic to Mumbai and to an extent Delhi. Other Metros like Kolkata, Chennai or even Hyd have no such issues. Even in these cities and cities like Pune, Bangalore, the problem is meaningless prices. It is not the supply.
Re: Problem ? It is meaningless real estate prices . Not supply.
by Raja Krsnan on May 11, 2018 09:14 AM
I agree with you whole of India is not facing any kind of housing problem. this perception is created by the corrupt syndicate of builders, politicians, bureaucrats and other govt. officials and others directly or indirectly associated with these activities. that includes real estate agents, cement, steel companies and so on.
Bangalore has more than 2-4 lakhs vacant flats. that is a conservative number. Many houses too are vacant, that adds up the number to a higher figure. Rents are very ugly. Prices of many projects are ridiculously priced. Not worth putting your hard earned money which generates very low yield while other instruments yield better returns. real estate today is a place to park black money and nothing else.
