Bangalore: Real estate or Reel estate?

In 2005, sometime in Jan, I had gone with my friends to have a look at a piece of land somewhere in Mars… okay.. I confess, somewhere in the outskirts of Bangalore .. (this place surely looked like it was in Mars) and the place was called Pride Vatika and was 25+ Km from the city.
The price we thought the land was worth: 100 Rs / Sq ft. We were taken aback by the quote.. 260/ Sq ft for a normal site and around 320 if it was an East facing / Main road site… we had an argument that only frustrated us by his adamance of ‘not a rupee less’ kinda talk..
We intelligently(????) rate the land as over valued beyond imagination.. and come back empty handed.

Fast forward to 2006 March… same place but a few roads laid out.. few more things to jazz up.. but no significant developement in horizon… and guess the price…..

Well, I am not kidding… its Rs 800 / Sq ft.. (atleast thats what one person quoted and another confirmed the same).. I almost fainted…. Not a single house in sight.. and the place was closer to the moon than to Bangalore.. (okay, I confess I am not good in judging distance… but the only thing I was able to see from there was the moon and a few deserted mini hills.. certainly not the city)

Not only that.. take the case of a stupid looking place near Hegde Nagar, not the best place in Bangalore.. called M S Nagar.. a place that is not approved by government, BDA, BMRDA, …. ABCD (okay okay.. this one is non-existent)…and certainly not approved by Mr.Me…..
Price in 2004 Sept – Rs 140/ Sq ft… fast forward to Mar 2006… a whopping Rs 600 /sq ft.. and not a single house in sight..

I wish I could turn around and give my ass a nice hard kick for having thought that I was clever and the real estate in Blore was saturated….
But only time will tell if this frenzy can last…. I certainly see some shivers here..
1. A lot of people own more than 2-3 sites.. and are vacant and they never probably will build on it and are waiting for a better (they probably think the current prices are undervalued.. value investors .. ) price to offload at a huge profit…
2. 2 years and no houses means not a single person really bought it for building or is waiting for his neighbour to build first..
3. If demand is huge…then why the hell are so many sites vacant ?????

I am at my wits end trying to value land in these frenzied cities.. prices doubling in 1 year or less is a call for caution.. but who cares..