News & Views on Indian Real Estate

Tuesday, February 05, 2008


Recently i got a call from Realty Rider (the owner of Realty Digest Blog). I was asked by him to share my opinion on rental trends in my area.

Easy enough to say, but for some landlords, the greed in squeezing out an extra Rs.1000 can be costly!

Tenants know the “true” market value in rents. If you price it just Rs.1000 over, its amazing how hard it is to get good tenants.

I’ve been watching a house in my neighborhood for about two months now. Its real nice and its exactly the same floor plan and square footage as the house that I am currently living in.I am under contract on new construction and plan to close in October 2008, so I’ve been using the house down the street as a data point to compare. However, I fell off my chair when I found out that they trying to rent it out for Rs 25,000 a month! I priced my out at Rs 22,000. And sure enough , its been months, and this place is still not rented. It appears that a professional company is advertising. If I was the owner, I would not be happy.

Setting the right price can be a art, however, my investor friends rent their places using rents in the lower range. Why? They want them rented out quickly! If you lower your rent by just Rs 1000- Rs 2000 month , it might save you a rent payment because you will find a tenant quicker. Scan Magazine ads, newspaper ads, and call local rental signs for data points.
I’ve been using real estate portals as a feeler to price out the market, and I know my price range is more reasonable than the other house. At that price, the house will sit for months and the owners will just be frustrated. Maybe I’ll make an offer?.According to all of you out here what is the right thing to do?