Re: General Trading Chat
Open land investments have different problems like encroachment, land grabbing, local land mafia after the plot appreciates, haftas to be paid to the goons...it is not easy to hold the land bought in 1975 without any of these issues unless one is a powerful person politically.......and if someone is so powerful, he has many other means of wealth creation some legitimate and many illegitimate.I have suffered in the above troubles...
Against that if you have 5 Cr in equity mutual funds, your next door person also wont know about it as it will lie in your demat account or just a account statement in physical form......
Smart_trade
Good Afternoon St Da
I totally agree with you..
Investing in real estate (whether its flat or its open land) has its own problems.Here Might is Right!..
I am sharing incidents of my own life regarding it..My parents purchased in 3 lands..between 1975-1980 period ..out of the city..areas which are developing..& 1 small house for living in old city around 1985..the lands were brought around price range of 5000-10000 rs..its not small amount when govt salaries were just 500 rs per month..there was no loan fascilty by banks at that time..all were loans from family & friend..
around 2003-2005, we sold those lands..5lacs,5 lacs & last one which was very posh location in 15 lacs..so 25 lacs in investent of 25k-30 k..so around 100 times..not bad...but till 1990-2000..land purchase was safe..but we noticed as land price increases exponantially as flat builder comes in picture..& increasing value of lands make them a dangerous affair..land mafia is everywhere ...as st da told right, if you have power, you can keep land but otherwise your crore rs plot will be zero + tensions free..
I had to sell them..as my father died..I am too young to handel all this..& my other was a lady ..so we were weak so we were most vulnerable for land mafia..today that all 3 lands worth of more than 2 crore..but i had to sell them only at 25 lacs..we didnt need money at that time..we sold it just because of fear of encrochment, land mafia..
dont think that only land mafia encroch..my 1 land was near a temple ..even temple society encroch some of my land by tactics..here with whom you fight ?? ..no goons ..but no person ..you have to fight with a whole system & society ..a group of person which have power of religious matter..if somebody just put a stone with sindoor on your land & called it temple..your next 10 generation will not take that land back from them..
till 1990, real estate was a good investment, but after that it becomes constier & dangerous afffair..
after that now talk about constructed house..the house we bought at around 1 lacs in 1985..its just around 10-15 lacs in present day..just because its in old city...i calculated if my parents invested same amount in FD..it will give more ..so this real estate investement is giving a negative return..plus house maintenance & other thinsgs extra..so house is now become a liabilty..I live in a capital of a state..which is very much booming in real estate but out of old city..& even banks dont give reverse mortgage on this properties..
Now 3 point that real esate gives rental income..one of my grand parents bought house to live in after retirement..they give it on rent around 1975-1980...after 1-2 years, tenents stop giving rents..& my parents fought a long battle of courts, police, goons ...even my grand parents couldnt live in their own house..round the courts in old age ..they both died ..after that my mother & her brother fought case...but still matter in court..2 crore of worth of property in drain..no use , no capital plus tension extra...
You people will argue that now new rent law is there..but only maharashtra & karnatka etc have good law ..landlord have lot of right in mumbai also..but if you talk about old tenants law..no hope..I have seen lot of examples where tenents took over the peroperties..
so I fully agree with St Da...even I say, the time comes where only powerful people should buy properties...even when i listen that how builder is cheating, I am afraid of buying a house for my own living..here only Might is right!..jiski lathi uski bhains...the people like my grandparents, parents & me who busy in their Jobs , dont know any politicians ( even dont know a local corporator) , dont have any relation or approach to goons..there is no hope of real estate investment..
through my experience, I think equity is more safe investment..& after seeing todays real estate price, middle class person is not ble to buy a singel preoperty..wo bechara apney rahney key liye 1bhk hi kharid ley wo bahut hai..investemnt to bhool jao..ezquity gives opportunity to start with small capitals only..then some will argue that not every bodu have knowledge ..so you can go by mutual fund route..& for retired people , its safe to keep their a big portion of money in Bank fd only...
thanks
