Indian Real Estate Sector

rohitvats · Post by **rohitvats** » 09 Jul 2012 18:57

One small data point to those who talk about India not being land starved - please to be remembering that it is not about how much we have, it is about how much is allowed to come in the market as supply. Simple only...after all, what is Master Plan of a city? A boundary which defines to what extent the development is allowed. And this sets the tone with respect to supply of land for development.

Example - please go to the Chennai development authority website...look up the master plan and you'll see a table which gives break up of land distribution under various usages. Land under R-Zone (residential zone) is invariably the largest but - FINITE. If Land is limited, so is the development potential - which is given out to builders in form of licenses. So, when people talk about the land prices and variations therein, what one ideally needs to understand is how much of land (and hence, development potential) with in the R-Zone has been consumed and what is balance. This will tell you whether the future development is sustainable or not OR in which areas the prices are likely to stay higher. Again, for example ( sorry, can't help it...after all me consultant only

) if in an area with substantial development potential balance, the prices rise quickly, then the next level of appreciation will be that much slower or there will be stagnation.

Bottom line - in spite of land availability, the development potential is controlled and this leads to interlocking of land and apartment prices.

Example (there we go again...

) - in Gurgaon, only 20% of the sector land area can be given as license to Group Housing. One can calculate the number of licenses granted and balance...and you can see the fun in terms of prices being quoted and asked.

Aditya_V · Post by **Aditya_V** » 09 Jul 2012 19:11

Theo_Fidel wrote:Vijay,

The jobs will rapidly move to wards the suburbs and the inner city will depopulate. Large chunks will turn condemn worthy.Some of the elite property will stay TFTA the rest will deteriorate to zero value. .

Ayyo, Poachi, Here I am squeezing and paying EMI right now for a Nungambakkam appartment.

rohitvats · Post by **rohitvats** » 09 Jul 2012 19:20

^^^Don't worry, have curry....never going to happen in India. While large Indian cities have started witnessing multi-centric development (than mono-centric as they were earlier) with suburban and peripheral areas emerging as self-sustaining development zones, the center or CBD, will always remain the core.

Bade · Post by **Bade** » 09 Jul 2012 19:59

So how is all this controlled development different from that of our birathers in PRC. Looks like local govt and builders are the only ones to benefit

with such artificial restrictions in place to hold the prices up.

There is a NDTV program which looked at four tier-2 cities in the South (Kochi, Coimbatore,Vizag and Mysore), and they mentioned unsold property in the market in the first two cities at close to a 4-5000 or so units. So why does not the Chennai IT-Vity move to Coimbatore in larger numbers with land no issue from the looks of it unlike say Cochin which is sea locked and terrain restricted on the east side too for infinite growth. Besides Coimbatore weather is many times better than Chennai.

Singha · Post by **Singha** » 09 Jul 2012 20:12

I have activated my retirement plan-B. my son has been asked to patao in college and marry into a rich patrician family here

let me ask the question, there are miles and miles of endless rolling hills just south of the bay area on Rt-101 towards LA. so why dont cos move there for cheaper offices and people will also move.
its some kind of of self-reinforcing cycle -
cos dont want to move because they want to be close to other cos to poach from
people dont want to move because they want to be close to many cos for choice of employment , friends, education...

only the Govt can do some huge greenfield setup and make people move there which might induce pvt sector to cluster around. a big univ, factory or federal research complex maybe.

else there is no social infra.

Theo_Fidel · Post by **Theo_Fidel** » 09 Jul 2012 20:17

Nungambakkam is TFTA area only. I'm talking about areas like Thousand Lights and Vepery, maybe even a Triplicane.

Rohit, I very much agree with you that land supply is restricted, still I'm just pointing out that prices are seriously out of whack per global norms. Back in the 1990's, these very same apartments went for 15 lakhs to 20 lakhs. Yes even in Nungambakkam. Ground of land in Velachery was about 12 lakhs. $40,000. Exchange rate was Rs 38 to $. Back then these apartments were worth $50,000 or so and it made sense per global norms. Now the very same apartment in Nungambakkam is on the market for 3 Crore. Or $600,000. People are buying thinking price will be 10 crore in 10 years. Or $2 Million. This is craziness. The Apartment is not worth more than $100,000. Hence my feeling that we are in a bubble, partially due to restricted land supply. But I very much remember those color coded maps and charts which are mostly ignored. Residential in Chennai has always been about 50% to 60% of land area and if anything this is increasing. We are bedroom city for a reason.

Say you have 2 Crore. You can put it in ICICI fixed deposit 9.45%for 20 years. It turns into 13.5 Crore. Guaranteed. Now how is that 1 ground of land in Velachery worth 2 Crore again. You would be better off to deposit your cash in CD's and rent. Of course assuming your money is white.

Let us take it from another direction. India is land restricted by regulation but for city development we are not land starved. Chennai has gone from 450,000 people in 1960's to 8 million in 2010. Increase of 20 times population! With our population growth crash Chennai is likely to get to 15 million or so by 2040. Per my calculation earlier if 1,000 sqkm, 1/2% of TN's land, is available, this is roughly 1.6 million grounds of land. This is enough land for every family to live on 1/4 grounds of land. A recent apartment complex I saw in OMR had 120 apartments on 14 grounds of land. This is 8 families per ground. This is too dense for 2040 numbers. I would not buy that apartment.

Singha · Post by **Singha** » 09 Jul 2012 20:20

>> You can put it in ICICI fixed deposit 9.45%for 20 years. It turns into 13.5 Crore. Guaranteed.

30% taxes will get eaten sire.

Theo_Fidel · Post by **Theo_Fidel** » 09 Jul 2012 20:22

Everyone I know sends money out and has NRI types open account.

Singha · Post by **Singha** » 09 Jul 2012 20:26

you mean they are resident indians, but somehow round trip indian income back into a illegal NRE account opened sometime in the past when they had NRI status?

bahut sangeen jurm hai as a delhi cop would say.

Theo_Fidel · Post by **Theo_Fidel** » 09 Jul 2012 20:32

.....or in others name. Gift clause. I think I have said too much. Hope no hellphyre missile takes me out.

rohitvats · Post by **rohitvats** » 09 Jul 2012 22:13

Bade wrote:So how is all this controlled development different from that of our birathers in PRC. Looks like local govt and builders are the only ones to benefit with such artificial restrictions in place to hold the prices up.

Bade saar, one very important usage of master plan is to ensure regulated development; another is to ensure that municipal infrastructure can be laid in a systematic manner. After all, you cannot have people building houses where ever they like and then expecting power/water distribution companies to reach out to you or for roads to be laid.

But what this does do is restrict the supply side of the equation - and the game here is that the top builders and politicians and almost anyone with leverage buys land in areas for which master plan is yet to be announced. The land acquisition in these areas happens 4-5 years prior to plan announcement - land gets bought at price X and by the time master plan is anticipated or announced, the price is already 8-10X. Many wonder why real estate prices do not crash in India - the real reason is the entry pricing for land. Smart developers have bought land at historical/low values and hence, their holding power is that much higher. On the contrary if someone buys land during rising/peak times and then launches the project, he is under tremendous pressure to ensure that per month sales velocity is maintained. One of the main reasons that many RE focused PE funds shut shop is because their Joint Venture deals with developers were at land valuations during peak time - and to support those land valuations, some very funny assumptions were made - which were simply not sustainable. The developers took cash out options and made money before even the first di was done in the ground.

There is a NDTV program which looked at four tier-2 cities in the South (Kochi, Coimbatore,Vizag and Mysore), and they mentioned unsold property in the market in the first two cities at close to a 4-5000 or so units. So why does not the Chennai IT-Vity move to Coimbatore in larger numbers with land no issue from the looks of it unlike say Cochin which is sea locked and terrain restricted on the east side too for infinite growth. Besides Coimbatore weather is many times better than Chennai.
Sir, one simple dictum of IT Industry in India - 'birds of feather, flock together". And other biggest issue - manpower - where will you get the manpower to staff your operations. The more up the value chain a company, more serious the manpower issue. As for Kochi - most of the smaller IT/ITES companies are set up by Kerala expats - and more so Europe based than USA. That at least was the scene in late 2000s when I went around assessing the demand from IT/ITES Segment for Office Space in Kochi.

Bade · Post by **Bade** » 09 Jul 2012 22:53

I know Kochi is a recent entrant to the IT/ITES club so has some ways to go. Add to that the general bad rap that KL gets from its past and also internal politics between the two major cities to site new projects.

But Coimbatore has a long history of business friendliness at the same scale as Chennai. So my question was why Chennai rides higher than other towns in TN despite its negative points. If you look at TN and KA, all eggs seems to have been put around the capital city. Too many people in the know and power seem to have invested just around these two places perhaps

and would like to reap the profits for themselves.

shyamd · Post by **shyamd** » 09 Jul 2012 23:36

Prices in Coimbatore tend to be slightly higher than Chennai and highly speculated. With JJ in power and many of her constituency members from Coimbatore and vicinity - Coimbatore (and vicinity - Erode, Tirupur etc) should see more development in the IT arena. The weather in Coimbatore is a lot more pleasant than Chennai.

It really does feel like a bubble in the cities and even in some of the villages outside towns people are ready to pay 70 lakh for an acre! I don't think this cash is being driven by people taking loans/mortgages to purchase land/property in the small towns etc, so I dont think a major crash is likely - just some moderation.

Property prices will moderate in rural areas as JJ govt has increased the regulations for getting approval to sell plots.

Bade · Post by **Bade** » 10 Jul 2012 00:19

So it seems price inflation is not limited to select cities and is quite widespread across the country. What does it really indicate then ? Rupee is overvalued at present and people have taken into consideration the future value of a deflated rupee ? Invest in real estate to hedge against this ? Or is it pure black money finding a place to park itself within the country ?

Ambar · Post by **Ambar** » 10 Jul 2012 07:27

Bade, i can only speak for certain towns in Karnataka, towns with absolutely no water ( even in the so called upscale neighborhoods, one needs to pay for water tankers ), no sewer, and no roads and as usual no law and order. Price / sq ft ? Anywhere from 1500Rs to a whooping 3000 Rs for a residential plot ! They say real estate prices usually is a function of value addition, but in modern India, it is a function of hype, black money, and lack of supply. It is not the prices that bothers me, but the sheer scale or urbanization without any planning. Once lush farmlands have long disappeared, lakes and ponds have been dried out for new commercial & residential neighborhoods making once green towns and cities into deserts.

The question about India is not if we'll grow at 8.2% or 9.15% for the next 10 years, the question is where will we source food and water from if this mindless urbanization continues ? What use of buying real estate in the middle of sahara desert ?

vina · Post by **vina** » 10 Jul 2012 11:59

But Coimbatore has a long history of business friendliness at the same scale as Chennai. So my question was why Chennai rides higher than other towns in TN despite its negative points

That is like asking why does Silly Con valley stick to Silly Con and maybe a few other corridors like Seattle, Bawshtun, Research Triangle and Austin and nowhere else. It is all about "industry clusters" (google for it and why industries tend to cluster).

For eg, consider Chandigarh, one of the highest per capita income cities, all gubmint, planned , "posh" etc. etc. but no IT/Vity took off. Couple of reasons. You can't find people to staff (come on, who in their right minds will move from Bangalore to Chandigarh, unless you have roots there and want to retire).. same reason for Coimbatore vs Chennai. Chennai has the critical mass of people and can suck in more from outside, already has deep existing networks, etc. The real estate scene in Chandigarh is not dominated by office space /commercial for IT/Vity and the consequent spillover into domestic, but rather very NRI oriented with money getting pumped in from the diaspora from that region .. sort of like Kerala.

Kerala is a gone case. The only way anyone will invest in Kerala is in a SEZ where the commie and other trade unionism and basic NIMBY ism are banned and unless you show a strong work ethic (which unfortunately Mallus and Bongs show Only outside Kerala and WB, but inside, they pick up the Lal Jhanda) , you can be kicked out on your Musharraf.

Kerala again is driven by "Gelf" and the consequent soft investment in "Tourism" .. None of the bulk high employment potential stuff (ok, tourism is high employment, but nowhere near IT/Vity, Engineering services, Financial services etc in earnings potential and salaries)

habal · Post by **habal** » 10 Jul 2012 12:42

Chandigarh was not developed for IT as it was thought to be not safe post the Khalistan movement and also Punjab being a border state. Hence IT industry was moved in entirety to South India. There seems to be some unwritten policy regarding govt invesment in Punjab post 80s. No big industries were initiated and energy sector was allowed to lag.

Bade · Post by **Bade** » 10 Jul 2012 19:27

Vina, so are you saying all Chennai human resource is local. I am sure that is not the case. So why cannot Coimbatore also suck in people from rest of TN. Not to mention it is even strategically located to suck in people from KL too. It is also not like Bangalore story was all built with local workforce over the years. Even in the late 70s there were enough outsiders over there due to large central govt institutions. That gave Bangalore a leg up. I do not see that in the case of Coimbatore. Besides IT-Vity is not like heavy industry it can move at short notice with its investments.

krishnan · Post by **krishnan** » 10 Jul 2012 19:32

coimbatore was more into mills those days...only lately other industries and companies have started coming up...problem is there isnt enough space....you have to go out of the city

Bade · Post by **Bade** » 10 Jul 2012 19:33

vina wrote:Kerala is a gone case. The only way anyone will invest in Kerala is in a SEZ where the commie and other trade unionism and basic NIMBY ism are banned and unless you show a strong work ethic (which unfortunately Mallus and Bongs show Only outside Kerala and WB, but inside, they pick up the Lal Jhanda) , you can be kicked out on your Musharraf.

Kerala again is driven by "Gelf" and the consequent soft investment in "Tourism" .. None of the bulk high employment potential stuff (ok, tourism is high employment, but nowhere near IT/Vity, Engineering services, Financial services etc in earnings potential and salaries)

Before you write the obituary, people have been doing that for 20+ years that I have followed this whine about KL being a gone case

only to show decent per capita year after year. In a sense remittance is not different from IT-Vity outsourcing income. You still work for "gelf" in IT-Vity sitting at home/desh. Income gets spent in desh, even for gelf wallahs at mid to bottom end it is not different. As money gets spent on family left behind in desh.

Coming to Tourism, it is filled by people at not the highly educated level. Why is there no samarams there ?

No unionism either.

Bade · Post by **Bade** » 10 Jul 2012 19:43

Krishnan, there is plenty just outside Coimbatore too from a cursory look around.

SaiK · Post by **SaiK** » 10 Jul 2012 19:44

I see the points in vina's post.. but at the same time, KL should have the stronger skill sets where one could find a set of industry flourish.. but a gone case sounds like a net zero expertise level in KL., which I don't think it is true.

KL should see what type of industries it would like to establish, and spread its tentacles there. Every state and zone has its specialties. More cosmopolitan/and growth oriented, the more is the spread of skillsets. sometimes, there is a truth in complains about giving into too much socialism, especially the communist mindset. I don't know why India should ever chase after communistic mindset, when the core infrastructure needs real capitalistic mindset.

pay the best, and hire the best. fire the losers.

Theo_Fidel · Post by **Theo_Fidel** » 10 Jul 2012 19:54

I wish Kerala would market its food better. It has the best food in India IMHO. In Massa stores you see stuff from everywhere, TN, GJ, MH, Dilli even Karachi but very little from KL. You would thing that there is a couple of dozen Chutney Mary's in there.

Bade · Post by **Bade** » 10 Jul 2012 20:26

Theo, you mean mainstream massa stores or massa Indian stores. I get all my mallu stuff at the local Indian store. Periyar brands from parippu vada to ila ada, rice too, even at the local paki store now, previously indian owned.

Mainstream massa stores have started carrying indian stuff only recently. Trader Joe's, Giant etc.

SaiK · Post by **SaiK** » 10 Jul 2012 20:46

yup. me too. I get everything from desi stores especially owned by malloos. couple of weeks back nice chakka for $4/lbs. expensive, but available. from puttu powder, plantains, kappa, matta broken rice to malloo movies. earlier it used to $1 rental for movies, now-a-days, it is $1 movie for keeps.

Bade · Post by **Bade** » 10 Jul 2012 20:50

Even there are some New jersey brands started by some enterprising Achayyans ! There is a American brand called 'parayil', wonder if they are relatives of someone I knew by that last name from chicago.

Sachin · Post by **Sachin** » 10 Jul 2012 20:51

Bade wrote:Before you write the obituary, people have been doing that for 20+ years that I have followed this whine about KL being a gone case only to show decent per capita year after year.

Saar, I dont think Kerala has managed to show case that it can support any good industrial model. I can understand that Kerala cannot have really big traditional industries (like mills) which may have chances to create more pollution. The state is small and people are in abundance. Yes Kerala thrives on what is known as "Money Order economy" where people move out side and send in money home. Folks who are lucky enough to remain in the state can freak out.

Coming to Tourism, it is filled by people at not the highly educated level. Why is there no samarams there ?

This is purely my observation here. Is it because any Tourism associated job some how gets clubbed (or considered) as a white collar job? Say a feeling that a hotel receptionist wearing a white shirt and tie and speaking in "മുറി" English is at a higher position in society than say compared to a person who climbs coconut trees? This may also have given a feeling among the tourism related workers that they are not the so called "അദ്ധ്വാനിക്കുന്ന ജന വിഭാഗം" (the favourite jargon of the commies, meaning the working class).

BTW, there has been strikes in Tourism related industry as well. Just last week the workers manning the house boats went on a strike.
ToI report

SaiK wrote:but at the same time, KL should have the stronger skill sets where one could find a set of industry flourish..

Purely speaking from the IT industry perspective. There are many Keralites who play decisive roles in many IT companies. But even they dont want to touch Kerala with a barge pole. So even if any company does have plans to start a unit in Kochi, chances are that it will not fly. Some business units may get moved there, but soon there would be no more projects. The state (and the people) on the other hand have not been able to project any thing to the entrepreneurs that IT industry can be worked out of Kerala. Yes, I do understand that many small time IT companies do operate there. But the image that the whole place is full of people who know each and every right, but have no clue on the duties seems to have got established pretty strong.

I would say that too much communism/socialism is what ruined the state. As some one mentioned in one article, Kerala society does not generally support/encourage people who think differently.

SaiK · Post by **SaiK** » 10 Jul 2012 20:58

One thing is about people and resource availability.. the other thing is all about laws, rules and taxes that enables people moving towards KL. What it takes for BLUR, KL happen few places then it should start the inflows.. Palakkad is near CBE, they can start it off!

Real Estate and Roads go hand in hand. city and town planning must include roads, capacity and growth plans. once they start attracting, I would any day go to KL, as the place is dam beautiful to miss in one's life.

Bade · Post by **Bade** » 10 Jul 2012 20:58

Sachin, I believe your reading of the situation is wrong, IMO. When the social indices, literacy, awareness and general well being reaches that level you can be pretty much assured that similar traits will be seen in future elsewhere in India too.

I have said this before, the terrain, climate and environment does not support existence of heavy industries in KL, nothing to do with laziness or otherwise of the people. Same with Bengal too. This caricature of people from WB and KL as lazy has no basis. Some of the greatest thinkers in all fields have come from a equally "lazy" as you claim WB.

SaiK · Post by **SaiK** » 10 Jul 2012 21:05

bade, terrain can be tamed to bring in heavy industries. what is the problem here?

climate and environment? what has this got to do?

Bade · Post by **Bade** » 10 Jul 2012 21:06

You will not get past the environmental laws in India like in PRC.

SaiK · Post by **SaiK** » 10 Jul 2012 21:07

oh! ok... but then that is std law for all states right?

Bade · Post by **Bade** » 10 Jul 2012 21:15

But it largely depends on local ecology isn't it ? Try constructing anything within the Coastal Regulation Zone anywhere in the world ? Umpteen studies will need to be done before anything moves. As elsewhere there is some amount of adjust maadi even in KL, but large investors are not going to risk investing capital when regulatory authorities cannot be bought over easily.

I had heard Sobha had invested in buying an entire island (20,000 plus units planned) somewhere south of kochi in the backwaters, but it is in permanent cold storage due to similar issues.

SaiK · Post by **SaiK** » 10 Jul 2012 21:19

point taken. i see that can really effect.

but then, environment may not be a big issue for non-heavy industry growth like service sector, IT, electronics, nano-shano techs, medicine, etc.

Bade · Post by **Bade** » 10 Jul 2012 21:25

Sachin, google on strikes for each state and you will get the answer. here is a sample.
http://www.thehindu.com/todays-paper/tp ... 593108.ece

http://www.deccanchronicle.com/channels ... -looms-676
http://www.thehindu.com/news/cities/che ... 367952.ece

SaiK, there is some growth in medical tourism I believe in Kochi, but have not followed it closely. Yes all others you mention can be done in KL. Trivandrum has a leg up in IT already, but question is you cannot run IT with local talent alone, there needs to be people willing to migrate all the way south. In the case of Blur, good weather is a great attraction. But the umpteen engg colleges did create that pathway for migration too for people from all over.

SaiK · Post by **SaiK** » 10 Jul 2012 21:30

I think it is a combination of policies, laws, environment, people and needs., everything should agree.

industry+edu inst.+(for desh onlee: firangi connections to market) all matters.

Bade · Post by **Bade** » 10 Jul 2012 21:35

“Technicians with 20 years of service are being paid just Rs.6,158 as salary. It is just not enough to meet ends. And the increment they are offering is very less. It is 20 per cent of the basic pay and it amounts to just Rs.800, which is dismally poor. If doctors serve for free they have private practices and also work elsewhere. We are employed only at this hospital. We want some transparency in the accounting,” said one of the striking employees.

A nurse for over 25 years at the VHS said she draws Rs.6,250 per month. “Not many people stay on for more than two years as the pay is very less. We have been asking for an increment but the response is very bad. We have been working keeping in mind that the institution has been running to serve the needy. We have been working since Dr. Sanjivi's time. We have come out on strike after a long think,” she said.

From that link above, the amount is eerily close to what the Kumarakom boat workers get. When people see what others make around them, it is but natural to see such demands, however illegal that may be or even inconvenient to some. My mom cannot live off a similar amount when all else but food and fuel is already paid. How can someone with a family to feed.

SaiK · Post by **SaiK** » 10 Jul 2012 22:28

one way to look is bumping up the minimum wage levels to an extent that strikes will not happen., but that is all socialistic ways.. which is required to basic extent.

for advanced salary structure, there is only one way to go up! capitalism.

Bade · Post by **Bade** » 10 Jul 2012 22:51

No need for that. Wages are determined by market forces only everywhere. It is only in Govt institutions that there is a fixed price to labor. In examples in all those links, the people think they are worth more. Some resort to strikes as they see no other means to get there, but there are many who don't. The few who do not like the prevailing wages go abroad to gelf. Simple market economics onlee at work there. Before that people who did not find employment there went to Malaysia and Singapore or even Sri Lanka ! This creates a scarcity and local wages go up. Right now people from Naarth have got the word and are flocking to KL for better wages and pension, yes pension.

rohitvats · Post by **rohitvats** » 10 Jul 2012 22:52

Bade wrote:So it seems price inflation is not limited to select cities and is quite widespread across the country. What does it really indicate then ? Rupee is overvalued at present and people have taken into consideration the future value of a deflated rupee ? Invest in real estate to hedge against this ? Or is it pure black money finding a place to park itself within the country ?

Bade saar, that is mucho complicated explanation for a simple phenomenon - too much money (and please read it as BLACK MONEY) chasing too few assets in Indian RE Sector. For those who are in USA, please compare the number of large cities (not by population alone) with strong economic base in India and USA. And that sir, should tell you why prices are at idiotic levels.

Take for example Gurgaon - in the entire North India, is there any other economic center with sustained demand from end-users for commercial, retail, hospitality and residential segments? NONE. Delhi has its own restricted usage regulations and NOIDA is still playing catch-up with Gurgaon. The RE Development Cycle follows a simple pattern - Commercial->Residential->Retail.

Why do you think Navi Mumbai was languishing in boondocks for such a long time? There was no commercial activity. And how many know that Government of Maharashtra had decided to shift the Mantralaya and other infra to Navi Mumbai when it was first conceived. Nariman Point realtors never allowed this to happen for they correctly surmised that w/o government machinery as demand driver, Nariman Point will not be the same again.But we digress.

This concentration of economic activity in few pockets like Gurgaon, Chennai, Hyderabad (worst of all cases in terms of speculation), Bangalore etc means that investment in RE (read black money) ends up chasing few assets in these areas. And you've the steep price rise. Even today in Noida, 80% buyer is an investor - and this investor base stretches from Rajasthan in west, Kashmir in North to TN in South.

And please to remember - BLACK MONEY does not come (always) with time value concept as fancy excel sheet gurus see it; the choice is between hiding the money below the mattress or investing in RE asset and getting something tangible for your ill gotten wealth. Do you know that people buy commercial (when I say commercial, I mean office space) assets in NCR for 6%-7% yield? Now what kind of capital value appreciation is one like to get to justify such yields?

There is one another unique feature of the Indian RE market - and especially the residential segment: The price increase does not always reflect the high volume of transactions (aka strong demand). Prices tend to increase more often than not because someone somewhere ( a location inferior to yours) achieved higher price and people automatically build premium for their properties.

Having said that - I'm a bit worried about the Gurgaon market. I think we're stuck with a situation where market will generally stagnate for foreseeable future.