Its pretty new topic / its not a technical topic and no way related to my blog topics. But, to create an awareness among our people (particularly software engineers). I scheduled my time to analyse the facts and express the same in my own words.
People who are involved / affected:
- Mostly software engineers (70%) , people in very good position (Government job)(10%), business people (10%) and other people (10%).
- One day, I wish to buy some flowers for my wife and went to a lady(she is selling flowers in the road). I asked flowers for Rs.5. She told about the increase in flower rates and I will be getting very less flowers for Rs.5. I replied her back. "No, i need it for Rs. 5. Its more than enough for me." Immediately, she enquired about my profession, and I told, "I am a software engineer" Immediately, she replied me back "Boss, You are earning lots and lots of money. But, you are not ready to buy flowers" She gave some flowers and forced me to give Rs.10. Its not a huge amount for me, but once, if someone comes to know about our profession, i wondered to see the rates reaching peaks. Are we cursed like this?
- No one knows the pain and hard work behind our earnings. To Complete an engineering couse is not an easy job. Clearing all the subjects (arrears too)..and after getting a degree with first class distinction. I can remember those days (Carrying resume and requesting others for job - we need to get employee referral - First round , Second round, Third round of interviews). Many people will loose their opportunity in the final round. Its hard time for us to get a good job in software industry.
- After getting job, we need to survive in this ever changing IT field, daily we need to update our knowledge to survive in this world, need to face lot of junk politics, lots and lots of restriction in the name of cost cutting, no job surety, no proper healthy food (as we are modernised with fast foods and hifi junk foods), no proper timeline to work, cant adhere to particular technology, no proper growth, no proper recognition. Atlast, we become more flexible as a non technology cum non human being (Entire brain loaded with junk politics).
- No one thinks that, we (software engineers) dont have good money in hand to buy a single toilet room too. Its because with the help of banks we are buying houses. Do we have time to think, if my software job is gone . What I will do? How to repay the loans? We may think that, am having house right. I will sell the house and repay my loans. Then, Whats the reason for buying a house and stretching ourselves under pressure and huge headaches. What happen, If the rates went down. Now, In US market we can get a house for Rs.82,000. But, no one is there to buy that house. Do you think, it wont happen in india?
Increase in rents:
- Our software engineers will be seeing huge money in the initial stage - Fresher (an average of Rs.20,000 per month). Immediately, they will target to buy a good bike and ready to shift their residence near to their office. Mostly, they(Bachelor) will stay in sharing basis and they wont think about the rent (10,000/5). Obviously Rs.2000 is not a huge rent for them. This makes house owners to think more. Nowadays, house owners were targeting inviting software engineers to their houses.
- Once after marriage, software engineers will come to know about paying huge rents from their pockets. It becomes a huge headache for them after marriage. So, they are trying to marry a working women to survive. But, they dont find time to rethink about the reason behind. Its because of them, the rents got increased.
Reason for buying a house:
- Increase in rents.
- To avoid conflicts and pressure from the house owners to maintaining the
- Sense of satisfaction - We used to think that, if we have our own house. Then, we will get a satisfaction like, I've got settled in my life.
- Greediness, to get more income from the houses.
- To avoid lot of conflicts from neighbours.
- Very good investment for rich people.
- NRI were trying to invest their dollars in India.
Reason for reducing land values in india :
- Due to increase in interest rates. If we calculate the interest rates, How much am getting money and How much am repaying? You will surely get heart attack. Suppose am getting 20 Lakhs as loan amount from a bank. I need to pay around 50 to 60 Lakhs (Includes interest). Is it really worth? Instead, you can earnt / save / invest money and you can buy the same house with out any debts right . Why dont we think in that angle? Instead, unnecessarily we are paying more money to builders and banks.
- Employees fired from top software companies. Due to cost cutting, downsizing company size, merging of companies. Employees who earned lakhs become jobless on the next day.
- Due to increase in land rates, software engineers cant afford huge amount and they stopped buying houses.
- A small awareness started among our people about this land value increase.
- Everyone around us understand our mentality and playing based on this. We are ready to buy a house of worth 30 to 40 lakhs. Targeting this budget, builders started their plan of building houses 1200 SQ Ft to 2400 SQ Ft. Even, it may worth 25 lakhs, it will become 30 lakhs for software engineers. If we ask the reason, we will get a reply "Boss, You are earning too much money" Are we earning black money? or earning money with out any hard work"
My suggestions in buying a property in 2008:
- Please dont buy property now, because due to financial break down and problems in software industry. The land value will surely reduce further. Stay for a while, rethink twice thrice before buying a property.
- Next year, the rates will decrease further....... Lot of changes will happen soon.
Some URLs for your reference :
Chennai property bubble bursts, prices dip : http://www.ndtv.com/convergence/ndtv/story.aspx?id=NEWEN20080067248
Chennai properties will be reducing soon:
Buy a flat and get BMW free: (People should think about this offer. They will dream about the gift offered and forgot to think about the property price. The business people will increase the property rates like (Actual rate+BMW car rate) and they will sell their property easily.
http://indiarealestatemonitor.com/property-news/buy-flat-get-bmw-free/
Property market gone down due to US breakdown:
http://indiarealestatemonitor.com/property-news/indian-realty-wakes-up-to-the-us-meltdown/
Land value is now Rs. 15,000 per square feet against Rs. 40,000 for a similar property in 2007
Analysts predicts that, the land value will go further down to Rs.10,000 in next 6 months.
http://indiarealestatemonitor.com/property-news/affordable-housing-is-the-new-choice/
Realtors were slowly analysing the market and they are not ready to step ahead:
http://indiarealestatemonitor.com/property-news/realtors-advance-tax-payment-falls-down/
Feel free to post your comments and kindly share this URL to your friends and create an awareness among our people.
My article on increase in rates in India:
http://venkattechnicalblog.blogspot.com/2008/10/social-article-increase-in-price-in.html
Venkatesan Prabu .J
9 comments:
In the US market you get house for 82000 (probably in a forest)
where did u get this information from?
You are correct
Hi,
Its quite interesting article .. my friend forwarded me in morning ..thanks :)
On few points .. I agree with you and on few disagree.
1) By 'Affected' , do you mean to say affected because this economy fall ? then your figures are not correct. In India, in textile industry there more then 3 lakh lay off in just last one year. and for rest of workers .. salary reused by 20% to 30% ! Do you know what is the average salary in textile/garment industry ? its just about 4500 Rs per month !!!!!
By collaborative sorces. In India, there are more then 7 lakhs jobs cuts since Apr'07 to till now, and IT layoffs is just under 60,000.
2) A agree with you .. whenever somebody knows that you are software engineer, they hike there rates, ask for more .. :) that's really bad. and specially for house rent... my god ...!
3) I disagree ! IT jobs are much nicer, comfortable. Think about those who are on border in freezing env and get chance just twice in a year to meet family .. and just for 15 to 30 days. Think about constable do more harder work if you look closely. An IAS officer lives in much more tense environment and work more then 16 hours a day .. and many times more then 24 hours. Doctors living much more hard live then any other citizen, its very hard to get one day leave from job.
4) Well its true that there is big hardwork involved to become a professional. But not you only, so many others did same hard work in schooling/college/first class/distinction .. are all they are in IT ? are all they are earning good money ? I believe a researcher in space science is doing much more hard work .. doing M.Tech.. Ph.D. and serving as scientist with salary of 3000 at start, 7000, after 2 year, 12000, after 4 year.. and 20000 after 10 year........
5) I completely agree "Its hard time for us to get a good job in software industry."
6) Well... Every industry is ever changing industry.. ! just last day Jet layoff 1900 guys ? Banking ? Real Estate ? Textile ? Export ? ... You can evaluate more industries.
7) Politics is everywhere.. and I believe its much lesser in IT industry at software engineer level. Just spend few hours in any government or govt type office.... you will get shocked.
Just try to spend few hour in SBI behind the table...
8) "dont have good money in hand to buy a single toilet room too" ..Its true for most of IT guys. Property rates are hiked by big shot project managers, CEOs, Business owners, NRIs (who lives in foreign countries like hell and save money for buying property in India), and few more.
9) 92% of house buyers are getting loans for house. and question of repay loan is for all .. it doesn't matter buyer is IT guy or banking guy or a taxi driver.
10) "Now, In US market we can get a house for Rs.82,000" ....... NOT at ALL Man !!!! something you studied wrong. An average house in a average town ( not city ) will cost you minimum $200,000 dollars. In cities .. you will get a flat in $400,000 minimum. Obviously if you want to live in forests, it can cost you just 10,000 dollars( still higher then what you quoted ). In India, you can get a house also for 20,000 Rs in far rural/village area, and free if you go to jungle.
11) Job uncertainty is much higher in daily wages kind of jobs, building workers, house painters, repairers, cleaners, factory workers.....and so many other jobs. Top of that ..they are just getting 2000-4000 INRS per month for living a family life. However I seen many peoples .. they dont count such guys as or in a human life and I strongly believe, a human is a human and have similar rights to live in society.
In US and other European country .. wages are almost same for a clear, driver and a software engineer.
10) I still says IT guys are making big salary in comparison to all available jobs in India.
Indian middle class average salary is 9000 Rs per month. Even if you go by profession :
-B class govt officer : 16000
-IAS officer : 18,000 ( start at 12K)
-IPS officer : 18,000
- Bank employees : 7000 - 15,000
- Factory and other labors: 2000- 4000
- So many others workers: 2000-8000
( now dont say IAS/IPS officers can earn more money by correction, )
Only profession I can think gives better salary is 'Doctor'. And doctors those are making good money ..they dont have time to spend it.
Just think about 100 corr Indians and classify them by salary/wedges. Software engineers will be in top three.
An individual example can be given but we are talking about in general salary/employments.
So many things to write .. but let me stop here...
So just try to be happy .. :)
Thanks Devid,
Very useful information. But, as a software engineer. I wish to express my thoughts from my positioin and if we think in wider perspective. Everyjob and everyone has their own problems and challenges in their life.
I accept all your points and thanks for sharing your views with me.
Regards,
Venkatesan Prabu .J
Hi,
Its really a very nice article. This should be an eye opener for all the SW engineers. People please percieve that venkat is concentrating on people looting SW engineers. Please understand him and do not spend even a rupee more than what any product is worth for.
Dear Friends,
One of our friend have asked where you got the information about house rates around 82000 in US market.
I got it from newspaper am searching for the same. Will surely update those links too.
Thanks for your feedback.
Regards,
Venkatesan Prabu .J
to be frank IT fellows are the responsible for what happens in the economy...................
the lands & plots & flats rates r increased because of irresponsible buying of the properties by the IT people
THe FMCG goods has been buyed the Stupid IT people lack of thinking............ they have to think atleast what is going on in the market and why i have to pay this much before buying........
rents has been increased because of IT people lack of how to spend the money and where to invest and how to invest
becose of these 70% IT people only every thing has been increase............
just think abt the MIDDLE CLASSS PEOPLE who has the dreams of buying one house at this metropolitian cities has gone because of this purcheses by the IT people........ now they have to pay for that happen in the IT MELT DOWN......... i hope this should be prolong and continues for the next 2 years ......... thats true because of the OBAMA disinterest in out sourcing....................
now from now onwards the IT people has to feel and think from the middle class people mentality before buying or investing in any thing
the day has to come where IT has to meltdown has started........... now they have to pay for that..............
Well, Quite interesting and relevant too. I agree that house owners are like that :). But our situation is not as worse as discussed. Hard ships are there in every profession. Coming to politics, politics are everywhere. Can you think of any profession without politics... Very hard to find. I agree that every person wants to make use of our profession just by saying that we earn more.
Nice Article.
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