I was thinking of taking some exposure in real estate in 2018 but I read an interview of a reputed builder in my city saying that he is casting 9th slab in his 10 storied housing project of 52 flats and the number of flats booked so far are just 3. He says he has taken bank loan and after completing the project if he is unable to sell, the bank will take over the project and sell flats at reduced rates.....that is a scary outcome.
A relative working as an advocate in a legal department of another builder tells me that in last 2 years they have not sold a single new flat and they have a large inventory of ready to move in flats....his parents had FD with the builder which they have withdrawn prematurely.
IT department has send notices to 35 builders of my city to pay income tax on the ready but unsold flats they are holding....this is one more straw on the camel's back.....
Another interview says that 2018 will see panic situation in property markets with many distress sale projects...
I met a relative at a family wedding and he started asking about which mutual funds to invest etc....on probing further I learnt that he and his wife togather has FD of Rs 32 Lacs ( many small FDs put togather ) with D.S. Kulkarni( a listed real estate development company ) which is facing bankruptcy. That explains sudden interest in mutual funds....very sad for the couple who are retired senior citizen.
So real estate plans on hold for next 1 year atleast as capitulation in real estate market is some time away .....I will look to buy the dips in stock markets and mutual funds.... will be too happy if we get a deep correction in 2018 upto say 9800 nifty or so....
Smart_trade
