How to arrive at the right price of a house in the resale market
Property prices in resale markets are fixed arbitrarily by sellers. Home buyers should do their research well
Property prices have either remained stagnant or have corrected during the last 5-7 years, both in the primary as well as the secondary markets. Besides, home loan interest rates are at historic lows, making this a good time to buy property, especially for end-users.
Given that real estate is a heterogeneous product, each property commands its own value, based on location, size, quality of construction, design, age, direction and so on. Even in the same apartment tower, prices may differ based on the floor, the views that each house offers and so on. Therefore price discovery becomes a difficult task for a buyer, especially while buying in the resale market.
Shares of real estate companies continued their northward movement, with the Nifty Realty index surging 4 per cent on the National Stock Exchange (NSE) on Wednesday on hopes of revival in demand. Indiabulls Real Estate advanced 17 per cent to Rs 80 on the NSE on the back of heavy volumes. A combined 17.5 million equity shares had changed hands on the counter on the NSE and BSE. Godrej Properties, DLF and Oberoi Realty were up in the range of 4 per cent to 5 per cent, while, Sobha, Sunteck Realty and Omaxe from the index were up between 1 per cent and 3 per cent on the NSE.
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