I have been tracking the real estate market in Kerala for over an year now. My interest in it was sparked by our very own Chief minister when he coined the term “Real Estate Mafia”. The amount of money that flows in this business is huge.
One year back real estate business took a hit all over India except for Bombay and Kerala. Even Bangalore saw 10% to 20% price decrease. Transaction volumes decreased sharply. But Bombay and Kerala were not affected.
In Bombay, there is enough cash flow to maintain the prices. Its the business capital of India. But what is so special about Kerala ? Its the exact opposite reason. We dont have any business here.
What are the investment options in Kerala for someone with loads of disposable cash. Think of an NRI who can pump in 20 to 30 lakhs every year. Where can he invest that money ? Land is the only safe investment for him.
That’s the beauty of the socialist attitude we have here in Kerala. We never allow good business to stay here. We are very hostile to new businesses. And we have earned that reputation among foreigners also. Every foreign delegation that comes to Technopark asks this question. “Ive heard that there are labour problems here. Is it safe to invest here”.
For Keralites, the only safe investment is in land and crores are being pumped into the market every year. This is the only reason why the prices are increasing.
No land reform or no law can remedy the situation. People will continue investing in land as long as we dont provide them with other options. No point in calling the real estate people a Mafia. They are rich helpless people looking for a place to invest their money.
Check my earlier post on Real Estate Mafia and Share Trading Mafia
Kenney – You have to add a very crucial point – the buzz. Look at the Cochin, almost every single poor sod who is pumping money in believes that paper projects like the so-called Smart City are going to bring in zillions of job in the next year or so. The owner of one of the leading builders in Kerala once tried to convince me that there were already 100,000 techies working in Cochin and that Wipro is building a centre for 100,000 people! The truth is that the respective numbers are 7000 and 6000 respectively. And that such paper projects tend to remain on paper, just as the TECOM venture is still on the drawing board 2 years after the signing of the contract. The kind of hype projected by the real-estate industry is almost too much to believe, if you are a sane man. Unfortunately, the image is so well built, that few people choose to take a second look and fall hook, line and sinker for it. Anyone who has been to the major cities in India will find it surprising that 8 or 9 out of every 10 billboards in Cochin are of builders!
And it is not that the property industry in Kerala is not suffering in this down turn. DLF opened its Kakkanad project at about Rs 2850/Sq ft but has now cut its “launch” price to Rs 2350/Sq ft. Similarly, major builders like DLF, Puravankara and Prestige are carrying significant inventories because demand has tailed off.
Sure, there might be lot of money out there but that doesn’t mean it has to be thrown away. Places like Kakkanad and Pallipuram will have real development coming up, but the asking prices have run away from reality in quite a few places. There needs to be a correction.
And from my perspective within the industry, everybody has realised it is long due and may indeed be already happening.
Comment by Ajay — October 3, 2008 @ 10:32 am
// Ive heard that there are labour problems here. Is it safe to invest here”. //
We dying to vallarpadam and vizhinjam ports … and cochin shipyard has got hell lot of problems, which increased very recently .. strikes hit the port a lot .. so, thats how Kerala is ..
Comment by dinu — October 3, 2008 @ 2:57 pm
good thinking..
Comment by jaleel — October 3, 2008 @ 3:22 pm
kenney , good thinking
Comment by PRAMOD — October 3, 2008 @ 3:35 pm
There is a key point that you had failed to touch upon here.
“Think of an NRI who can pump in 20 to 30 lakhs every year”
– Me personally being an NRI working for an MNC in the US of A at a senior management position, I dont think that kind of money can be generated annually in any economy US, UK or Middle east- just from your salary/employment. Yes, that can come from entreprenuers or people who run businesses. But what percentage of an average NRI Malayali is of that capacity? My guess work would be a 10-15%
I have had personally known people who dropped off from school and had been jobless for quite a lot of time. And one fine day they decide to go to ‘dubai’. A year later, they come back with an investment capital running into crores. Where does that money come from? Is that legal?
Do you know where the costliest land deal in Kerala had happened so far? It is not Kochi or Kakkanad or Thiruvananthapuram or Kozhikode. It happened early this year in a small village called Koppam – border of Palakkad dist. The deal for 4-5 cents of land. The deal was around 2 crores for a cent!!! “Mohavila” as you call it in malayalam.
If it was you or me, earning a legitimate income – would you be paying such a big sentimental value price for any piece of land? whatever be the background? I will not. because I know that my income is my sweat. If somebody has not really sweated for their money, they might…
So that is the point!
- Santosh
Comment by Santosh — October 3, 2008 @ 6:03 pm
@Santhosh
I know NRIs who invest 20 laksh every year here. Might not be a single person income, but a familes income. They are not entrepreneurs or business people. As a coincidence My cousin yesterday close an investment stuff with an NRI in cochin in which he will invest 10 lakhs every year in some scheme from SBI Life.
Regarding going to dubai and returning with crores – Even my father has this notion that people who get rich quickly are always doing it by illegal means. Its a typical jealousy scenario. There are illegal activities going on, but that doesn’t mean every one is doing it.
There are legal ways of getting rich quickly.
Income = effort (Totally wrong). Making money is an art in itself and it not at all proportional to the effort you put in.
The intention of my post was to point out a scenario in Kerala where people hesitate even to start a “Murukkan kada”.
Comment by Kenney Jacob — October 3, 2008 @ 6:16 pm
I have to disagree with Santhosh on this.
Investing 20 lakhs a year while working in the US is a piece of cake if you are single. When you start a family, it gets tighter but assuming you also go up the ladder, it is conceivable.
Comment by Issac — October 3, 2008 @ 6:51 pm
@Kenney;
I guess you got me totally wrong. I did not equate income to effort and neither am I jealous.
I myself am an avid investor & I would put in my money only where I think it would give me the returns that I plan for.
My point is that if somebody is putting in money – that too to the tunes of crores – for its sentimental value, it is difficult to believe that you earned it yourself. I think you agree to the point that any investor would want to get returns from the investment.
On the NRIs part, I did not say that they cannot invest. Take a look at the NRI malayalees. What percentage of the total does these investors constitue? (I might have gotten it wrong with the salaried class, may be)
Thanks for responding!
Comment by Santosh — October 3, 2008 @ 6:52 pm
//No point in calling the real estate people a Mafia. They are rich helpless people looking for a place to invest their money. //
What a way to define “Real Estate Mafia”.
Quality thoughts there, Kenney.
Comment by Aravind Jose T. — October 3, 2008 @ 8:05 pm
“One year back real estate business took a hit all over India except for Bombay and Kerala.”
Cant quite agree with this. Real estate is really facing a slowdown in kerala.. I know many people working as agents. They used to make avge 3-5 transactions a month, now they telling like.. not even a single transaction in last 5-6 month..
We had a bit or property near our home and a year back i used to see 3-5 people coming to our home “asking is it for sale? ” everyday!! We said it was not for sale.. BUt now as i need money for further studies we called them up and said this plot is for sale. and none has even turned up!!
Now govt has put a valuation for all properties and tht much amount should be shown in agremetn..and some other tight rules also made.. SO its now difficult to find much transactions.
Its now difficult to put ‘black money’…
The biggest attraction of real estate is that.. its the best place to invest black money.. U can invest black money in banks/or shares..so only way is real estate!
Comment by Cijo — October 3, 2008 @ 9:11 pm
A very interesting story about bankruptcy explains the problem USA is facing currently :: I got this through a forwarded mail. But this makes sense and we can foresee this in Kerala’s case because the supply of land is smaller and finite and could be compared to an island.
====================================================================
Once there was a little island country. The land of this country was the tiny island itself. The total money in circulation was 2 dollars as there were only two pieces of 1 dollar coins circulating around.
1) There were 3 citizens living on this island country. A owned the land. B and C each owned 1 dollar.
2) B decided to purchase the land from A for 1 dollar. So, now A and C own 1 dollar each while B owned a piece of land that is worth 1 dollar.
* The net asset of the country now = 3 dollars.
3) Now C thought that since there is only one piece of land in the country, and land is non producible asset, its value must definitely go up. So, he borrowed 1 dollar from A, and together with his own 1 dollar, he bought the land from B for 2 dollars.
*A has a loan to C of 1 dollar, so his net asset is 1 dollar.
* B sold his land and got 2 dollars, so his net asset is 2 dollars.
* C owned the piece of land worth 2 dollars but with his 1 dollar debt to A, his net residual asset is 1 dollar.
* Thus, the net asset of the country = 4 dollars.
4) A saw that the land he once owned has risen in value. He regretted having sold it. Luckily, he has a 1 dollar loan to C. He then borrowed 2 dollars from B and acquired the land back from C for 3 dollars. The payment is by 2 dollars cash (which he borrowed) and cancellation of the 1 dollar loan to C. As a result, A now owned a piece of land that is worth 3 dollars. But since he owed B 2 dollars, his net asset is 1 dollar.
* B loaned 2 dollars to A. So his net asset is 2 dollars.
* C now has the 2 coins. His net asset is also 2 dollars.
* The net asset of the country = 5 dollars. A bubble is building up.
(5) B saw that the value of land kept rising. He also wanted to own the land. So he bought the land from A for 4 dollars. The payment is by borrowing 2 dollars from C, and cancellation of his 2 dollars loan to A.
* As a result, A has got his debt cleared and he got the 2 coins. His net asset is 2 dollars.
* B owned a piece of land that is worth 4 dollars, but since he has a debt of 2 dollars with C, his net Asset is 2 dollars.
* C loaned 2 dollars to B, so his net asset is 2 dollars.
* The net asset of the country = 6 dollars; even though, the country has only one piece of land and 2 Dollars in circulation.
(6) Everybody has made money and everybody felt happy and prosperous.
(7) One day an evil wind blew, and an evil thought came to C’s mind. “Hey, what if the land price stop going up, how could B repay my loan. There is only 2 dollars in circulation, and, I think after all the land that B owns is worth at most only 1 dollar, and no more.”
(8) A also thought the same way.
(9) Nobody wanted to buy land anymore.
* So, in the end, A owns the 2 dollar coins, his net asset is 2 dollars.
* B owed C 2 dollars and the land he owned which he thought worth 4 dollars is now 1 dollar. So his net asset is only 1 dollar.
* C has a loan of 2 dollars to B. But it is a bad debt. Although his net asset is still 2 dollars, his Heart is palpitating.
* The net asset of the country = 3 dollars again.
(10) So, who has stolen the 3 dollars from the country? Of course, before the bubble burst B thought his land was worth 4 dollars. Actually, right before the collapse, the net asset of the country was 6 dollars on paper. B’s net asset is still 2 dollars, his heart is palpitating.
(11) B had no choice but to declare bankruptcy. C as to relinquish his 2 dollars bad debt to B, but in return he acquired the land which is worth 1 dollar now.
* A owns the 2 coins; his net asset is 2 dollars.
* B is bankrupt; his net asset is 0 dollar. (He lost everything)
* C got no choice but end up with a land worth only 1 dollar
* the net asset of the country = 3 dollars.
************ **End of the story; BUT ************ ********* ******
There is however a redistribution of wealth.
A is the winner, B is the loser, C is lucky that he is spared.
A few points worth noting -
(1) when a bubble is building up, the debt of individuals to one another in a country is also building up.
(2) This story of the island is a closed system whereby there is no other country and hence no foreign debt. The worth of the asset can only be calculated using the island’s own currency. Hence, there is no net loss.
(3) An over-damped system is assumed when the bubble burst, meaning the land’s value did not go down to below 1 dollar.
(4) When the bubble burst, the fellow with cash is the winner. The fellows having the land or extending loan to others are the losers. The asset could shrink or in worst case, they go bankrupt.
(5) If there is another citizen D either holding a dollar or another piece of land but refrains from taking part in the game, he will neither win nor lose. But he will see the value of his money or land goes up and down like a see saw.
(6) When the bubble was in the growing phase, everybody made money.
(7) If you are smart and know that you are living in a growing bubble, it is worthwhile to borrow money (like A) and take part in the game. But you must know when you should change everything back to cash.
(8) As in the case of land, the above phenomenon applies to stocks as well.
(9) The actual worth of land or stocks depends largely on psychology (or speculation).
Comment by Issac — October 4, 2008 @ 6:23 am
Kenny, if someone told you that Kerala real estate is still rosy it is a very very wrong info.
Even the no: 1 player in the Kerala market is struggling to sell even 25% of what they sold this time last yr. Look at how dull and drab the past Onam was…This is the worst Onam i remember as far as real estate is concerned; with no major announcements except a couple here and there.
Prices have fallen from 3000 around to 2000/sq ft.. The situation is so bad that one of the major real estate developer in Cochin decided to sell off their land instead of launching a new project! Imagine that! Look at what DLF has done.. slashing around 600-800 off their sq ft rates..
But I’d say if you want to buy one this is the best time…provided you have the liquid.
Comment by scorpiogenius — October 5, 2008 @ 2:28 am
Flats are a bad investment cos they can be constructed as and when required. But land is different. Did land prices fall anywhere in Kerala ? Transaction volumes may have decreased, but land prices are still going up.
Comment by Kenney Jacob — October 5, 2008 @ 6:03 am
santhosh..ur judgement on dubai (middle east )people 70% wrong but i admit 30% u r right. there are lot of sales people (salaried & commission) who making 10 lakhs per month (mostly from realestate sector and banking sector-but now( in 2009) its very bad like a hell ..same guys now making 10000 rupees only may be less. 60% lost their job too!!!.) compare usa and dubai >>in dubai no need of TAX and cost of living index far below- so those who makes good income they can send huge fund to kerala (it mostly going to land transaction)without any government restriction.
my opinion>>>>>>
realestate sector now in bad shape. warning to new players better to stay way otherwise u have to face massive loss.flat business are in very critical condition most of the builders are suffering to catch their fish..
now its ur turn to decide what to do…thank u all
Comment by sheena — March 1, 2009 @ 5:21 pm
Why IT industry is not booming in kerala
Comment by Umapati — March 25, 2009 @ 7:33 am
Well land prices are comming down.It will come down.kerala has not witnessed price correction in a big way.But the though that mallus always will think of real estate and hard cash can’t be true always.There are lot of NRI’s who believe that investment in stocks,companies and other vehicles are much more liquid and lucrative that kerala real estate.I am kind of predicting that there is a reasonable chance of big price correction in kerala
Comment by Anees — July 4, 2009 @ 10:36 pm
Hey Kenney,
Really curious to know if there is any changes in the Real Estate situation since Oct 2008? Are the prices holding up pretty good or up for a bubble burst?
Comment by Krishna — August 26, 2009 @ 9:59 pm
What I heard is that land prices have slowly started to improve. Flat prices are still down.
Comment by Kenney Jacob — August 27, 2009 @ 6:39 am
what is the present situation of real estate business in ernakulam
especially from tripunittura to kanjiramattom and in kakkanad,
kalamassery,palarivattom.is it safe and profitable to invest
at this time in land and building houses.i expect an intelligent
advice from this blog.please help me in this matter.
thankyou guys
Comment by mathew — September 6, 2009 @ 11:47 am
I was totally astonished by the way land prices climbed in kerala, I am from Tvm and I am living in Canada for the past 5 yrs, here I work for a bank and it is next to impossible to raise money to the tune of 10 to 20 lakhs yearly as savings to invest back home, taxes and living expenses are too high, it is unbelievable that these kind of money is now being pumped into kochi where the infrastructure, roads, sanitation, water supply etc are extremely bad.
I think mainly speculation by people with lot of money, made through illegitimate means, and relaxed lending policies by banks (recently I was talking to one of my friends who works for SBT, he told me that the bank has given loans to the tune of 900 crs, for small merchants, mostly without any collateral, all this got invested in real estate, most of the merchants have now stopped repaying these loans back) is fueling this boom.
But I think this had already hit the peak and will come down soon, already the much hyped shoba city is now in dumps, also recently read a report on madhyamam about Pen books investing almost 150 cr in real estate and losing all that money.
Comment by Lawrence — September 12, 2009 @ 8:49 pm
Hi Folks,
The Recession can’t be a barrier for the real estate market in kerala i think.Moreover the land in kerala especially in Trivandrum and Kochi is rocketing because of their strategic importance or business importance.Right now there is a huge scarcity in purchasing lands here,If it is going by this way the land will be of high demand here.
Comment by Sivahari builders trivandrum kerala — September 30, 2009 @ 10:17 am
The real estate “boom” in Kerala is unsustainable. Here is an example. A decent location any where in Kochi or Thiruvanathapuram has land value of at least 5 to 7lakhs per cent. If you want to buy 10 cents of land, you have to cough up Rs. 50 to 70 lakhs plus registration cost. That is US $ 110,000 to $150,000. How many people have saved up that much money? Even professionals working in America will take several years to come up with that kind of money. What is the return your “investment” is going to yield? The common answer is “prices will go up”. It was true so far. Land prices doubled pretty much year over year. But can that go on indefinitely? The land appreciation Kerala is merely based on speculation and not on any economic fundamentals. It has to come and it will. $150,000 will buy you decent houses in many US cities right now (such as Atlanta, Phoenix, Las Vegas, Orlando, Miami, Dallas or Houston). Can you compare Kochi or Trivandurm with the above mentioned cities in any way? So I don’t understand where the value is in buying property in kerala.
Comment by stokbound — October 25, 2009 @ 12:39 am
Well Kerala is unique state. Large amounts of land are not easily available for large development activities. The density of people is rather compared to USA. This makes land scarce and costlier.
Apart from NRI’s the biggest land investors are local politicians, barons, black moneyed people who have invested strategically knowing development plans of the key places in land. These same lands are monetized by launching large projects which are on paper. Well typically NRI’s end up in losses in the so called investments when the bubble worst their so called investments become worthless.
Another important thing to consider is the inflation. As shown the net asset may look higher over a period of time but at times real value the assets have depreciated. The so called correction of land prices is not so evident due to the inflation of the rupee. In actual fact there has been a depreciation of land too.
Comment by bmg — November 25, 2009 @ 8:15 pm
Real estate market in India will face a huge correction. This is especially true in Kerala with its huge reliance on NRI money especially from Gulf.
What I see today in Kerala, like many others pointed out here, is that very few transactions are happening. Sellers are holding on to properties hoping prices will go back up, but the reality is there are very few buyers in the market. This is very natural and usually the first stages in a real estate bust. At some point desperate Sellers will start selling off (and this is already happening in a lower scale), and prices are going to crash down.
Comment by binu — January 26, 2010 @ 3:47 am
Here is my plan for retirement. I am an NRI.
Buy 10 cents of land in a major city in Kerala for 5 lakhs per cent, total of 50 lakhs (approximately USD – 100,000). Every 2 yrs, price is expected to double at today’s rate. So in 2012, it will be worth 1 crore, 2012 – 2 crores, and in 2014 – 4 crores and in 2018 my land will be worth a full 8 crores (or about a whopping $4 million)!! Can you believe how Kerala can be such a smart place to invest? No matter we don’t have any other source of income, this can be a good strategy to plan your retirement.
Comment by Rajan — March 29, 2010 @ 9:41 am
@stockbound,,,,,,
am a BBA student. i can agree with what u said….in Kerala, land appreciation is based on speculations not on economical fundamentals…i plead that,investing in kerala is a good idea but no-one dares to do that due to labour prblms…….
Comment by Sobin — July 31, 2011 @ 12:26 pm
Why are the land prices in Kerala increasing still? can anybody throw some light?
Comment by george — August 20, 2011 @ 1:22 am
It is a fact that good land at Trivandrum city is scarce. But the price the owners/ brokers asking for land is quite alarming. 12 or 15 or 20 lakh /per cent. Are persons who buy such land very rich to expend more than half crore for 3 cents. Or really any business of such huge amount is taking place in trivandrum citiy. But land owners /brokers are not ready to reduce the price for a bit thousand rupees. Real buyers are not able to buy even a single cent in good localities. Will there be an end to this? Can anyone please state something about ctual state of affairs of real estate business in trivandrum city ?
Comment by Shajikumar. L — August 20, 2011 @ 3:22 pm
Mr.Kenny you are totally wrong, I am in the gulf for the last 18years and I know only certain guys mostly who all are doing labour supply business, because they are using peoples as slaves, they send them for work for 15 to 20dhs per hour and give them 3-4 dhs/hour sometimes never give that also, and some poples who owns some good buiness are used to go and buy lands thats 5% of the expatriate community there are million living in the GULF all cannot afford or digest what your finding. to live in gulf a 4 member family required around indian rupees 40000/- as his monthly expense then how to score that much money you said ??????????
Kerala is under realestate mafia means the source of this income is not from NRI this all are black money rotating inside and outside the country, may be they are using NRIs name as benamis to get rid of taxation or other security issues, finally if you digg the source is not far from us. Their income is endless. they themselves dont know what to do. If a genuine person with his all time hardly earned money cannot afford some land because you need cores, A middle class man may be his life time earning you invest to the shelter then what his family eat……….
Rich or black money peoples dont want risk and never invest in different activities or business rather than real estate there is risk factor in every side of buiness or even in stock market or you have prove the source of income etc….but for bombay and kerala there is trust build up or the study shows that your money never go down if its on land thats why all are looking towards kerala.
Now you see its slowly effecting later this boom if it goes the middle class community will go poor class, because to acquire some land another 20 to 40lakhs required and to built a house minimum 20 to 50lakhs so the person who have job even he is NRI or NON NRI his salary goes to the bank as montly loan payment for many long years. All this years he’s life is miserable…………………
Comment by Mathew Kurian — September 9, 2011 @ 10:26 pm
i think it is the time for government of kerala to think.land prices up by black money and nri investment.but for poor keralian who leave in kerala how can they buy a piece of land in such high price………..the land price must corrected by law.in new rule nobody buy more than a acre land….this law will crash the land prices and a common man now buy land ,made his own house……so request to chief minister please take this advice..and provide land for everyone not for only rich……..thank you
Comment by jomu — October 2, 2011 @ 4:48 pm
Smart City and Vizhinjam port are the trump cards that the “real estate Mafia” is flashing to justify the high prices in kerala. If you could look back a couple of years, the vallarpadam project was also supposed to a project that to change the face of Kerala. But, now that the project has taken off, it is evident that it is a failure. It is not even reaching 10% of the turnover needed to break even.
I am bigining to suspect that the vizhinjam port is also such a pipe dream. Why would ships want to dock at trivandrum and load/unload from here, considering that the industrial regions of India are far to the north in Gujarat and Maharastra; and these places already have ports. Containers unloaded in Trivandrum will have to take the road to reach industrial belt, and i believe that road transportation is considerably more expensive than sea. Even if there is some logistical advantage to taking such an oblique route, the companies will still have to use Kerala’s delapidated roads. Why would they do that considering tamil nadu(and probably gujarat …) has an excellent highway system — Chennai has a 17 KM express highway from the port to the main highway.
Similarly i am not buying the Smart City project either. It is expected to generate 1 lakh jobs? If this is the case, which are the companies that are going to invest here? Why would they want to invest such huge amount of money here when there is no shortage for SEZ elsewhere. Only thing i can think of, that kerala has an advantage in is human resourses. But Keralites are more than willing to go outside and work. And we all know that the cost of operation and setting up in Kerala i bound to be higher.
To me all this seems like a bunch of myths perpetuated by the “real estate mafia” for furthering the prices in Kerala. When i came back to kerala after 2 years, i was really shocked by the amount of money that was there with the prople. Every house had a car and people where spending money lavishly on jewellery. I was left wondering where all this money had come from. There definitely wasn’t any industrial growth to speak about. IT had grown a bit, but is still nothing in scale comapred to Bangalore. tourism supposedly has reduced. Only thng looking up was the Rubber prices; But that alone cannot account for the 100′s of branches of Muthoot group adorning every corner of every city. So, i am left to draw the conclusion that all the money is coming from the real estate deals. Savings that NRIs had that they decided to invest in flats in Kochi and money spent by big name real estate players in building flats that have gone unsold.
Comment by Ambush. — October 7, 2011 @ 10:44 pm
[...] following is a well written comment which I got on my blog post about booming real estate market in Kerala. He is skeptical about it, but some of his points are valid. Read the comment [...]
Pingback by Smart City and the Vizhinjam Port – Real Estate Conspiracy ? — October 9, 2011 @ 12:25 pm
In UAE, doctors’ salary is about 3 lakhs. Working NRIs earn almost the same in European and Western countries. If they work for a year, they can buy 1 cent in Cochin. In UAE, lot of Indian, make money illegally like robbery, cheating, etc. Medias in UAE publish those Indian’s cheating, robbery, etc. in their crime section. Those cheaters, robbers and some successful NRI business people (those numbers are very less) earn bigger money in UAE as well as European and Western countries. Returns from such land buying are nothing.
1. How many NRI business people can buy land in Kerala very often? Then who are the real buyers of land in Kerala?
2. Land price in rural area increased because of buying the land by people who sold their land in prime area of the towns or cities in Kerala. How long it will happen? It will end when their land in prime area of the towns or cities in Kerala will be sold fully or when the buyers stop to buy land in prime area of the towns or cities in Kerala.
3. Compare land price in Kerala with land price in UK, US and the like. Then one can understand how much bubbles are created in Kerala’s property market.
4. Keralites saw many things like money chain scam, private banks scam, mangium teak scams, lottery scam and so on. In future they can see real estate bubble bursting.
Comment by sree — November 21, 2011 @ 5:32 pm
Real estate in Kerala is an absolute bubble and time only proves it. I feel sorry for the people throwing their money at the peak. Real estate and housing markets grow and sustained through infrastructure and new business developments, not to mention fundamental land use or government/city regulations. I see any of these exist in Kerala for the past 30 years or even now. Only difference is the so called “Anybody can be a real estate agent/broker” can use the internet media to publish color pictures and raise price overnight. Smart people will sell their investments at high (now) and wait for the burst and buy back at half price. NY, CA, FL and all around the Western world doesn’t teach anything else. India’s economy mainly depended on US, Middle East and Europe. A new US administration can change the course of this flow, may not be so fast but in certain extend. We need to see a great input from the government or even private industries to step in planning, building and sustain developments in a fashionable way as seen in China. Govt and ministers lived for inaugurating showrooms and ribbon cutting 30yrs ago; they do the same today, only through the same potholed street or no street. Poor Kerala, lots of money but no real growth so people will give up soon. I wish I was wrong.
Comment by Dan — December 10, 2011 @ 5:58 pm
my daddy is right
chris
Comment by Dan — December 10, 2011 @ 7:18 pm
What Kerala needs is good infrastructure and rail and public transport network so people can travel in ocomfort and freely without driving much. Kerala has the unique ability to a state metropolis. We need great leaders who don’t loot it’s national weath. Respect for ones fellowbeings an an investment in growth. God bless
Comment by B Thomas — January 4, 2012 @ 6:30 pm