Hi All...
Let me first start with current premiums at 6.00 PM on 28.10.2009
(Those who think by providing these numbers I'm speculating, please ignore...
those who wish to know present prevailing premium, may please take a
note).
1,000 sq. mt. = Rs. 700 - Rs. 1,100
2,000 sq. mt. = Rs. 400 - Rs. 700
4,000 sq. mt. = Rs. 250 - Rs. 500
Jitender, as far as allotment transfers are concerned... popular
RUMOUR is that transfer charges will be Rs. 110 per sq. mt. Transfer will be
allowed AFTER depositing the allotment amount of 30% or 50%, as the case
be. Un-limited transfers will be allowed up till Lease Deed and
Registration are started in 4-5 odd years. Remember, all of these are
RUMOURS. I can't confirm OR deny any of these.
That said, it makes sense, at least to me. By first ensuring that
allotties deposit allotment amount, YEA is securing the buyers for its plots.
YEA then continues to profit by allowing multiple allotment transfers. In
fact, by allowing multiple allotment transfers, YEA might make more money than
it would be allowing Lease Deed and Registration up front.
Next Point...
Sanjay, as for the premium of 1000 sq. mt., 2000 sq. mt. & 4000
sq. mt. shooting to negligible amount after the draw of 300 sq. mt. &
500 sq. mt. plots takes place on 17.11.2009, I seriously doubt that. I have my
reasons for that...
It is popularly anticipated that opening premium of a 300 sq. mt. plot
will range between Rs. 1,000 per sq. mt. (Rs. 3,00,000) to Rs. 1,500 per
sq. mt. (Rs. 4,50,000) and opening premium of a 500 sq. mt. plot will range
between Rs. 750 per sq. mt. (Rs. 3,75,000) and Rs. 1,250 per sq. mt (Rs.
6,25,000). Should the premium of a 500 sq. mt. plot reach Rs. 1,500 (Rs.
7,50,000) at any stage, it will be naive to imagine that a 1,000 sq. mt.
plot will continue to stay in range of Rs. 100 (Rs. 1,00,000) to Rs.
500 per sq. mt (Rs. 5,00,000). Naturally, in such a scenario, the premium
of a 1,000 sq. mt. plot will remain higher than that of a 500 sq. mt. plot and
may again reach in range of Rs. 1,000 (Rs. 10,00,000) or more.
For those who couldn't understand jumbled figures, please let me explain in
depth... but before I make my point regarding relationship between
premium of 500 sq. mt. plots and 1,000 sq. mt. plots, let me
first draw your attention to another issue...
OFFICIAL PLOT CATEGORIES AND HOW I DIVIDE
THEM...
Although officially there are 5 plot categories... I club them in 3
categories/sub-categories...
Category LARGE
1. 4,000 sq. mt. (125 plots)
2. 2,000 sq. mt. (300 plots)
TOTAL 425 plots
Category MEDIUM
1. 1,000 sq. mt. (1,250 plots)
2. 500 sq. mt. (2,500 plots)
TOTAL 3,750 plots
Category SMALL
1. 300 sq. mt. (16,825 plots)
TOTAL 16,825 plots
I firmly believe, over a period of time, the premium for above clubbed
categories/sub-categories will rise and fall in tandem with each other,
independent of what takes place in other categories.
Some would ask why?
Ok!
Generally, LARGE category buyers are financially affluent people and can
afford to purchase either/both, 2,000 sq. mt plot and 4,000 sq. mt. plot.
However, for obvious reasons, people in MEDIUM & SMALL category can't afford
to venture in LARGE category. Therefore, LARGE category has niche
market and as a result, LARGE category has been allotted least number of plots
(425). What happens in MEDIUM & SMALL categories will not effect the buyers
or the seller of LARGE categories. They will be guided by their own
dynamics.
Similarly, most MEDIUM category buyers can afford either/both, 1,000 sq.
mt. and 500 sq. mt. plots, however, very few/limited customers of SMALL category
will venture in MEDIUM category. I know, many would argue that those who can buy
a 300 sq. mt. plot can also afford a 500 sq. mt. plot. Yes, I agree... but going
by market feedback and my interaction with, literally, HUNDREDS of people over
last month... it seems very clear to me... most people who want to buy a 300 sq.
mt. plot are focused end users and generally, first time buyers. Most buyers of
300 sq. mt. plots have very limited budget and are unable to stretch
their pockets. Based in my personal experience, I would say that almost 85% to
90% are focused 300 sq. mt. plot buyers only. They will not venture into buying
and selling of 500 sq. mt. plots.
NOW back to relationship between premium of 500 sq. mt. plots and
1,000 sq. mt. plots. Before explain the same in detail, let me once
again attract your attention to another important issue. I am sure many must
have already noticed it.
2,000 sq. mt. plots (300 nos) are almost double in number
than those of 4,000 sq. mt. plots (125 nos)
500 sq. mt. plots (2,500 nos) are precisely double in numbers than
those of 1,000 sq. mt. plots (1,250 nos)
300 sq. mt. plot is the only category that is a separate CATEGORY in
itself. 300 sq. mt. plots constitute 80% of all plots on sale.
Now, coming back to the relationship between premium issue... I
have few points to make...
1. 1,000 sq. mt. plots witnessed most hectic trading in last few days.
Naturally because it was the cheapest of the lot AND because it had maximum
numbers of plots (1,250).
2. 500 sq. mt. plots will witness next wave of hectic trading by
speculators/short term investors/RE agents.
3. 500 sq. mt. plots are in unique position. One... more people
(including speculators/short term investors/RE agents and end/final users) can
afford to buy a 500 sq. mt. plots. Two... although, the number of 500 sq. mt.
plots on offer (2,500) is double of that is offered in 1,000 sq. mt. plots
(1,250), the number of potential buyers of 500 sq. mt. plots will be at least 4
times more compared to the potential buyers (including speculators/short term
investors/RE agents and end/final users) of 1,000 sq. mt. plots.
4. Locational advantage. 1. There is not a single village in blocks housing
500 sq. mt. plots. 4 out of 5 blocks (R, S, T & U, except Q) has clear
approach via blocks housing 4,000 & 2,000 sq. mt. plots. 2. 500 sq. mt.
plots are housed quite away from 300 sq. mt. plots.
5. In spite of being 16,825 plots in all, 300 sq. mt. plots will hold on
its own. Mainly due to its price tag and affordability. For e.g., Even a
auto-rickshaw wala in Delhi can afford to buy or invest in one. My take is,
for 1 300 sq. mt. plot, there are at least 5-10 potential takers.
I believe, similar to 1,000 sq. mt. plots, over trading of 500 sq. mt.
plots will take place (mainly because they are few in number, when compared
to 300 sq. mt. plots AND also the fact, that they are just double in
numbers compared to 1,000 sq. mt. plots, yet over 4-5 times more people can
afford 500 sq. mt. plots compared to those who can afford 1,000 sq. mt. plots),
which will result in 500 sq. mt. plots witnessing smart premiums (in range of
Rs. 750 to Rs. 1,500... and possibly up to Rs. 2,000). As a result, rising
premium in 500 sq. mt. category will create pressure (temporary or
otherwise) on 1,000 sq. mt. plots, resulting in instant hike-up of premium
to above Rs. 1,000 per sq. mt.
I'm aware, quite a few members of this forum will yet again not
subscribe to my thoughts. Fair enough... everyone has the right and independence
to think and believe in their own manner.
However, this is my analysis and I am hope I will be
proven correct. And then, I maybe wrong. Only time will tell...
Cheers...
Safal