1.0 The Electorate Delivers Emphatic Messages to the Country
You must have reviewed the election results already. Once again, the exit polls have been proven wrong with Congress gaining comfortable majority at the Center as well as in the State. The election results indicate that the public wants stability and is not too much concerned with price rise. The large rural masses has benefited by the Rural Employment Guarantee Program and higher Minimum Support Prices for farm produce while the urban electorate finds Congress in a better position to offer stability & reforms.
As counting started, it looked as if there would be a close fight between TDP and Congress but hats off to YSR for pulling off the victory! The voters have found that Congress is a better bet than the Kichdi formed by TDP, which looked fragile and a bunch of contradictions. In fact, the voters were proven right with KCR dumping Naidu when he felt that BJP was going to win at Center, after the first phase.
May be if Naidu had gone alone without CPM and TRS, he might have fared better. Look at how Congress gained in UP by going alone and delivering message that smaller parties are a pain in the neck and they will never be able to bring development.
2.0 NO MORE UNCERTAINTY. Telengana unlikely in our lifetime?
The one large community which is drinking away all the blues and is getting ready for tomorrow, is the Real Estate Sector.
With Telengana being reduced to a matter of academic interest and not a possibility for for scores of years, all the stake holders in the Hyderabad real estate scene including current owners, investors and builders, would be absolutely overjoyed.
A TDP win with TRS support would have been a disaster for the Real Estate sector and corers put in by investors and genuine buyers, would have simply vanished in the next few months, as uncertainty would have ruined the business.
Today, with Congress firmly in power at Center and State and voters in Telengana emphatically saying NO to splitting of the state, there is no way that Congress would even discuss the issue. Moreover by running to BJP before the counting, KCR has done no favor to the Telengana cause.
The forgettable performance of TRS has proven beyond doubt that the people of Telengana wants development and not a separate state. Obviously there is NO widespread yearning in the masses for a separate State. Just because a few people want to have power, can the state be divided? Divide to make few people Ministers?! The movement by KCR is turning out to be a laughable exercise for self improvement, with no mass support.
With congress still requiring allies, TRS would have been wooed by Congress. But with KCR scoring self goal, TRS will not even get into central Govt. since Congress will look for others, to fill up the numbers, to reach half way mark.
3.0 What would be the after-effect of election result, on Real Estate Prices?
A stable central Govt. is definitely going to enthuse the corporate business community. We should see positive movement in Indian Stocks. Punters are predicting Sensex to hit high during next few days. This buoyancy will help the corporate sector with rising stock prices helping companies to raise capital in many ways. That could put the manufacturing and service sector back in action, at least to some extent.
Once sentiment improves, money will move into real estate too and we believe that the AGE OF LOW PRICES FOR FLATS AND HOUSES WOULD BECOME HISTORY. BUT The plot rates in remote areas will continue to stagnate due to oversupply.
Prices for flats may not ramp up immediately. BUT we can take it for granted that the lower levels reached in February-March 2009 could most probably be the LOWEST POINTS. Whoever have bought during last couple of months, would have bought at the lowest possible prices. Try negotiating during next few weeks and those who evaluated properties & obtained rates but did not book till 16th May, are going to find a changed situation.
4.0 Expect Initial Demand for Projects in Construction Phase
Buyers will go in for fully or partly finished apartments, initially and as the inventory comes down with demand, prices will start inching up.
This process may continue for 6 months, by which time there would not be much of constructed space left for sale and that is when new projects under early stages, would get bookings.
5.0 One of our Recommended Developers has won at the Elections!
We are happy to inform that the Developer of APH220, Mr. Ram Kotaiah, Retd HUDA chief Engineer has been elected to state assembly from Nuziveedu as TDP Candidate. The current rate for the project is Rs.2400/sft. May be you could get some discount during next few weeks as he celebrates victory!