Samir Arora has made the grim prediction that the real estate would “crash like we have not seen”. His theory is that if NAMO and AAP are hyper serious about black money, then the places where the black money is hidden, namely real estate and gold, would go out of fashion.
Samir Arora was, as always, gung ho about the state of the economy and the stock market. He advised incremental investment in his favourite sectors, namely, IT, Pharma, consumer durables, private banks and NBFCs.
Here again, Samir’s logic is that these are secular growth sectors which have done well in the past, and will continue to do well, in the future. The additional advantage is that as these companies pay the highest rate of tax, the proposed reduction in the tax rate to 25% would benefit them immensely. He also predicted that on an overall basis, the market would give gains of nearly 15 percent in the year 2015. This obviously means that individual stocks will give much higher returns.
real estate has never done quite well in this market but I think the Bangalore / South based realty companies like Purvankra , Prestige , Sobha Developers might give good returns there is added benefit of REITS which can help them..lets hope the govt. goes after black money though chances look bleak…the holders of black money are too powerful..govt. should make more efforts to curb generation of black money than chasing black money holders
Also I may add that reality sector, much as we dislike it for its malice has been a big contributor to economy growth….it has generated demand and employment added to balance sheets of banks, NBFCs…..the downturn of this sector will bring its own negative consequences
If this prediction is true, there cannot be a better outcome.
bawla ho gaya hai yeh. everyone who is sitting on physical cash is going to convert it into physical assets ASAP in next 12 months. which means you should gear up for a sudden increase in demand for real estate and bullion, 2 places were large amounts of physical cash can be absorbed.
samir arora is a person with two face…. if he hasnt invested in realty sector doesnt mean that realty sector will not boom . infact if he thinks that private sector bank dont have black money … or nbfc dont have black money… and the craziest thing he is bullish on house finance companies… so ridiculous. if realty sector cracks how can house finace companies will boom.. and private sector has given so much loan to realty sector.. in short we should have our own ideas. guys like samir arora who will always be biased.towards one sector. be smart .. and realty sector will booomm for sure ..
Real estate prices may not crash but the industry will be killed due to lower number of transactions.
Also if economy has to pick up real estate should stagnates for atleast 2 to 3 years.