Saturday, 3 November 2018

As real estate churns, it’s the customers now calling the shots

Real estate developers are customizing products and are paying attention to what buyers really want from their residential properties.

Bengaluru/Mumbai: Compact homes in the city or villas in suburbs? Credible developer or deep discounts? Ready-to-move homes or an under-construction projects? What is the elusive homebuyer looking for?

As the residential market undergoes a churn, it is the customer who is calling the shots, forcing developers to customise products and pay attention to what buyers really want.

Manasi Lahoti, 31, and her husband Manish, 35, both employed in the financial services sector in Mumbai, are house-hunting with a ₹60-65 lakh budget, for a home within city limits.

“We don’t mind compromising on the size and settling for a one-bed home but it can’t be too far, and be easily commutable. Today, price is negotiable but there are not many options,” Manish said.

In Mumbai, India’s most expensive property market, developers are shrinking home size and making them more affordable, with not many takers for luxury units.

An October survey of 300 builders by QuikrHomes said 50% of developers are launching affordable projects for under ₹50 lakh per home, with Mumbai, Chennai and Kolkata leading the trend.

Builders also think that the blend of social media and customer experience can work wonders for sales. Virtual tours, presentations and customer experience play an important role.

“...Fulfilling customer experience matters now more than ever as the decision to take that final leap into buying a house depends on it,” it said.

Navin Makhija, managing director of property developer Wadhwa Group, said apartment sizes have significantly shrunk to make them affordable for the larger population. “There has also been a demand for homes sub-₹1crore. Large, credible developers never tried entering that space in a big way but with government’s Housing for All initiatives, they are seeing the mid-income and affordable housing segments as lucrative,” Makhija said.

This year, Wadhwa launched its township project Wisecity, Panvel on Mumbai’s outskirts with one-bedroom apartments (289 sq. ft to 400 sq. ft) priced at ₹25 lakh upwards. Nearly 1,500 units have been sold in the last six months.

Om Ahuja, chief operating officer—residential business at K Raheja Corp, said it is planning to launch a mid-income project in Airoli, with 3,000 units because of its huge potential.

Affordable homes, because of high land prices in Mumbai, are still being taken up only in the far-flung outskirts of the city, said analysts. Mumbai’s Marathon Group managing director Mayur Shah said the company is trying to bring in buyers into the city from the outskirts. Its newest project NeoSkies, in suburban Bhandup, is selling 199 sq. ft studio apartments for ₹43 lakh along with other kinds of units.

Anuj Puri, chairman, Anarock Property Consultants, said buyers in Mumbai prefer compact homes and want an all-inclusive price, with no added costs.

“Developers have realized that the luxury story will not work. Prices have corrected and more buyers are coming out because prices are getting more affordable,” Puri said. There is demand for smaller homes in the National Capital Region (NCR), but places like Gurugram have density norms so they can’t make smaller apartments. “NCR buyers research on the developer’s credibility and delivery track record. Besides the location, buyers want a sweet deal or an outright discount,” said Getamber Anand, chairman and managing director of Noida-based ATS Infrastructure Ltd.

Price is usually the main determining factor for young buyers, and affordability and compact homes are a common pattern in newly launched projects.

M. Murali, CEO and managing director of Shriram Properties Pvt. Ltd, said the brand of the developer is important to sell in Bengaluru and Chennai. Price and location, preferable closer to workplaces, come next. Homes priced at ₹40-50 lakh in Chennai and ₹40-70 lakh in Bengaluru are preferred by buyers.

“Even if you have a good price, but the developer is unknown, it’s difficult to sell. Buyers are more informed today,” said Murali. To tap into a broader buyer base, Shriram is launching 700-850 sq. ft homes for around ₹20-30 lakh.

“...Everyone is trying to work around products to fit in one-bedroom and studio apartments. Smaller size apartments that cost below ₹1 crore were hardly there in the past. This is what the market wants today and developers will only make what the market requires,” said Gaurav Gupta, director, Omkar Realtors and Developers. It has launched three projects in Mumbai with flats (1 BHK) priced at ₹76 lakh up to ₹1 crore. Apartment sizes are between 333 sq. ft to 387 sq. ft.

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Friday, 17 August 2018

Getting ‘Real’ About Mumbai Real Estate

  • 17,000 ready-to-occupy homes for sale in Mumbai.
  • 1.50 lakh to be delivered in next 3 years.
  • Overall unsold inventory would fill 2,300 football fields or 7,700 cricket stadiums.
  • 46% of supply in Q2 2018 was affordable housing.
  • Cash creeping back into realty, but pace curtailed by the new regulatory environment.

Real estate is close to the heart of most Indians who at some point want to buy or sell a property. The reasons could be emotional and investment-driven, and often both. And, of course, nothing defines Indian real estate quite like Mumbai does.

Call it by any name you want to - India’s financial capital, Maximum City, or the city of dreams and opportunity. One thing is sure - it is India’s most expensive housing market. Property prices here had increased by as much as 7-10 times over the past 20 years.

Today, the average number of monthly incomes required to own a home in the city is the highest among its other counterparts. Depending on where in Mumbai you want to buy a home, you are putting anything between 67-90 times your entire monthly income on the line.

Growth Constraints

While Indian real estate is rarely out of the news, probably no city's real estate market gets as much media attention as Mumbai's. That’s not surprising, considering that merely 5% of the people living in the city today can actually afford to buy a home here, either outright or with a home loan.

Mumbai sees roughly 50 new people coming to live and work in the city every hour. Approximately 2-3 lakh Indians arrive in the city every single year, looking for jobs or to make their entrepreneurial dreams come true.

However, the city itself is not growing in tandem. It is hemmed in by water on three sides and cannot accommodate the circular kind of development - the kind that spreads outward from a central focal point - that we have seen in most other Indian cities.

In Mumbai, development can literally take place in only two directions - from the south towards the northern suburbs, and upward.

The Problems with Going Vertical

While building super-tall skyscrapers is one way around this limitation, how many can one build before the whole system breaks down.

A fully-occupied 40-storeyed skyscraper with 1600 apartments roughly consumes 6.5 lakh liters of water and 4,800 kilowatts of electricity per day.

Each new apartment must now by law have a car parking space, and the building itself must have a minimum saturation of amenities that make life worth living in it.

Moreover, every skyscraper puts immense pressure on the existing traffic infrastructure - and creates yet another urban heat island that degrades Mumbai's already depleted environment even further.

The Bane and Boon of Speculators

The major factor responsible for sky-rocketing prices in Mumbai were the speculators - investors who bought homes with the sole objective of selling them in the short-term but earning the fattest-possible profit.

Speculators made Mumbai their Mecca because of the impossibly high property prices, and they drove the prices even higher.

Many are tempted to believe that it is the developers who are responsible, but they are responsible only to the extent that they avidly courted speculators because they could sell many flats off to them in bulk.

By the time everyone realized the long-term implications of speculative activities, the damage was done. Today, Mumbai is right up there with Tokyo, New York and London as a city where everybody wants to live and very few can afford to, except perhaps in the most constrained conditions.

Price Correction

One of the major developments seen in Mumbai real estate in recent times was the slight price correction - meaning that Mumbai's notoriously unrelenting and ever-increasing property prices first stopped growing and then began falling. Over the last 3-4 years, prices in the city have dropped anywhere between 3-5% across several areas.

In the last one-and-a-half years alone, property prices corrected by 2-3%. One of the major reasons for this was the new regulatory regime implemented by the central government including DeMo, RERA and GST. This correction in property prices was largely seen in the secondary market where investors were in a hurry to exit.

Meanwhile, developers became more focused on launching only those projects that were high in demand – affordable housing. As per ANAROCK data, out of the total units launched in MMR, a whopping 46% comprised of affordable units in Q2 2018.

How DeMo Changed the Status Quo

In one stroke, the Modi Government sucked the wind out of many sails - but in the case of the real estate business, it literally burned the sails, tore down the mast and almost sunk the ship. Demonetization decisively addressed the infamous 'cash component' in Indian real estate.

In the '60/40' formula, people would buy homes by paying as much as 40% of the selling price in cash, which was often unaccounted money. Black money was invariably hoarded in the form of the age-old 500 and 1000 rupee note versions, which DeMo in November 2016 rendered invalid and illegal.

At first, it was believed that only the secondary sales and luxury housing markets would suffer, primarily because these segments historically saw the highest incidence of cash components. However, the DeMo effect also percolated down into primary sales - or new homes being sold by developers.

Within a year, speculators had lost most of their previously voracious appetite for real estate – and with their exit, the worst stimulus for property price growth in a city like Mumbai also departed.   

While it is true that cash is slowly creeping back into the real estate market, its pace is now severely curtailed by the new regulatory environment. Certainly, the blatancy with which cash was previously funneled into the sector is a thing of the past now.

The Impact of MahaRERA

Though RERA is still in progress, it is becoming increasingly clear that unethical and deceptive business practices – not only by developers but also brokers and, in fact,any agency that promotes real estate – will no longer be tolerated.

We are now looking at a future where everything must and will be on record, all promises must be fulfilled and heavy penalties – including imprisonment – await those who don’t toe the line.

Many other things have happened at the government policy level, but what matters the most is how they have affected end-users.

Real estate is well on its way to shedding its image as the bogeyman of Indian business, and the ghosts of disastrous home buying decisions will no longer haunt buyers for the rest of our lives. RERA is a process and not an event, but the process is underway and many of us are breathing a little easier now.

The biggest impact of RERA and other key policy changes has been on property sales - and while there was doubtlessly a dampening effect on the real estate industry, it is good news for end-users of real estate - even in Mumbai.

Within the turmoil that came in the wake of the various real estate-specific policy upheavals, the customer has finally become king. When sales plummeted to all-time lows, property sellers actually had to think about their customers’ interests for a change.

What the Data Reveals

· There are about 17,000 ready-to-occupy homes up for sale in Mumbai,and 1.50 lakh more homes under construction which will assuredly be completed thanks to the stringent MahaRERA.

· If we assume a standard flat size of around 900 sq.ft. of carpet area, the overall unsold inventory in the city right now accounts for around 2,300 full-sized football fields or 7,700 cricket stadiums.

Developers here have to pay hefty taxes on unsold inventory, and that most of them are so cash-strapped that they cannot launch any new projects until they have sold what they already have on hand.

To sell this inventory, they have literally pulled out all the stops. We have already seen property prices in Mumbai drop by 3-4% in the last 2-3 years.

Such a scenario would have been unimaginable in Mumbai 5-6 years ago.

The latest Mumbai Development Plan 2034 has opened up areas which were previously barred from development, like the CRZ and salt-pan lands. Good in one way – there will be massive infusion of affordable housing. Not so good in other ways – it is bad news for the city’s environment, and it will put a massive strain on its current infrastructure.

However, we are also seeing a steady thinning-out of the urban population in Mumbai's central locations, with more and more people migrating to the new-emerging areas.

The trend of outward migration from the MMR will continue over the next couple of decades, not only because of the astronomic property prices and crumbling infrastructure, but also because these new regions are becoming the new employment hubs.

However, Mumbai's wealthiest inhabitants will definitely stay put in the city's ultra-expensive central areas. And as we can see all around us, the main city is working hard at improving the existing infrastructure.

These infrastructure projects are basically retention magnets for the limited but influential population segment whose economic lives are linked to the primary business activities in the city, and who can afford the real estate prices involved in owning homes in Mumbai’s most expensive locations.

Environmental Change

Mumbai was originally reclaimed from the sea by joining seven islands to create a shipping and trading hub for the British. We must definitely take climate change and infrastructure to counter it very seriously because the city's sea level is rising by about 1.2 mm every year.

NASA has confirmed that over the next 100 years, glacial melt may increase Mumbai's sea levels by around 16 cm. It has been estimated that the Indian subcontinent could lose 14,000 sq. km of land if the sea level rises by one meter.

For this reason, Mumbai is at high risk from climate change. The time to start bulwarking against it with adequate infrastructure is now.

Anuj Puri, Chairman – ANAROCK Property Consultants
Original Article:

Thursday, 2 August 2018

First signs of revival in real estate after demonetisation, says Knight Frank India report

The office market performed relatively better, with the first half of the year showing the highest transaction volumes for H1s in six years.
Transaction volumes in India’s top markets were up 13 percent, with Bengaluru clocking the highest number of transactions. 

Real estate consultant Knight Frank India’s H1 realty report reveals some green shoots in an otherwise sluggish real estate market.

The good news first: sales and launches in India’s property market are the highest they have been since demonetisation.

The bad news: that’s not good enough, according to industry watchers.

Indian real estate was in a sluggish phase even before the triple shocks of demonetisation, the rollout of Goods and Services Tax (GST) and the introduction of a new real estate regulator – a return to normalcy, therefore, is not much more than a step in the right direction.

Even so, there are some things to be happy from the findings of Knight Frank India’s report on the performance of the industry between January and June 2018, that looks at country’s eight biggest residential and office markets.

The housing sector is on a slow mend – on a low base, launches for the first six months of 2018 were almost 50 percent higher than the corresponding period a year ago, with just under 92,000 housing units being launched.

Around 74 percent of new launches were housing units being sold under Rs 75 lakh, which clearly shows the affordable housing story playing out.

Mumbai and Bengaluru led the way, accounting for almost 60 percent of units launched, and the otherwise sluggish National Capital Region (NCR) market saw new launches grow by 90 percent to 9,000 units.

Bengaluru led on the sales front as well, clocking a 22 percent growth to sell over 25,000 units in the first half of the year.

Mumbai and NCR displayed modest growth of one percent and five percent respectively, together accounting for 50,000 units sold.

The average project life cycle, which is the amount of time taken between the launch of a project and the sale of the last house in that project, remains high at six years.

In a boost for potential homebuyers, prices continued to slip downwards in major markets – Hyderabad was the outlier, showing an eight percent growth in prices over last year, and India’s most expensive property market showed the biggest decline in price growth, with houses nine percent cheaper than they were last year.

Neighbour Pune was close behind, with an eight percent fall in the price of houses and NCR prices remained roughly the same as they were last year.

The office market performed relatively better, with the first half of the year showing the highest transaction volumes for H1s in six years.

Transaction volumes in India’s top markets were up 13 percent, with Bengaluru clocking the highest number of transactions.

A total of 21.5 million square feet of office space exchanged hands during these six months, but trends showed that demand for Grade A office space continues to outpace supply.

Vacancy levels across these markets dipped to 12 percent as compared to 18 percent in 2014.
In an interesting trend, co-working spaces accounted for 13 percent of all transacted space during these six months. 

Monday, 16 July 2018


Your life insurance policy can make you eligible for a home loan, and also protect your loan liability. Here's how the right kind of insurance policy can work for your family and in your favour.

Picture this - you have taken a life insurance policy to ensure your family gets a substantial amount to sustain itself when you are gone. You have also taken a home loan to make a house for your family, but have not repaid the full amount before you bid goodbye to the world. In both these scenarios, your family will have your money, but no home. Here's why: When you took a life insurance policy, the first thing on your mind was your family and a secure life for them. And, when you took a home loan, you first factored in the repayment plan.

What you overlooked was the fact that in the unfortunate eventuality of your loss, your home loan would still be unpaid and your family could lose the roof over their head to the lending bank or financial company.

To avoid such a catastrophe, it is prudent to take an insurance cover for your home loan liability. Here's what an insurance expert advises.

"There are different loan insurance plans that include reducing balance cover, full loan amount cover, critical disease cover, permanent disability, etc. The premium amount differs with each policy offering," explains insurance advisor Nagesh Sharma, founder, Vertex Group. "You must go through the details of various products and benefits of insurance companies, and compare the premium and risk coverage and then choose the one that suits you the best," he cautions.


Various life insurance policy types come with their own benefits. The term life insurance cover is the preferred one in this category.


A term life insurance policy is a basic yet cheaper type of life insurance instrument that gives immense financial protection, especially if you are a home loan borrower. This is the preferred option because it is easier on the pocket and you can choose the life cover depending on your family's needs and the different stages of your life.


Opting for a term insurance plan that includes a critical illness health insurance policy, can work in your favour. In this insurance plan - if you are insured - in the eventuality of your suffering from a prolonged illness like cancer, you get a lump sum amount equal to the sum insured. You can then use this money towards your E M I repayment so it does not affect your home loan liability.


The home loan protection plan is an insurance policy issued by an insurance company and not by a bank or finance company. Unlike the term life insurance plan, a home protection plan is not available as a customised option. While a home loan protection plan can be taken separately from an insurance company - both, life and general insurance companies offer this - it is usually packaged by the bank along with a home loan. In fact, you are not eligible for a home loan protection plan without taking a home loan.

In the event of your demise during the home loan tenure, your insurance company will settle your loan with the lending bank under this protection policy.

Life Insurance policies above certain duration - usually after three years of commencement - can qualify for being given as collateral for seeking a loan. Most insurance companies have a predefined process whereby they can offer this facility. The lending institution would get the life insurance policy assigned to itself, which means the benefits of the policy would accrue to the lending institution till the time the borrower has not cleared the debt.

Depending from insurer to insurer, an interest is charged for the loan given. Repayment can be provided, and prepayment and foreclosure options are also provided. As a caution, one has to remember to repay the loan on time, else the benefits accrued on the policy would go to the lending institution, and in case of any exigency, the family would receive benefits only post clearance of the loan and accumulated interest and penalties.

Subhasis Ghosh,
EVP, Kotak Life Insurance


Tuesday, 10 July 2018

NRIs moving into the luxury housing market

Every one in four luxury houses sold in India last fiscal was bought by an NRI or non-resident Indian. A falling rupee, reduction in prices post demonetisation and policy reforms have increased India’s attractiveness for NRIs, who want to now head back home after earning big bucks abroad.

Properties in the ₹5 core to 10 crore bracket are the most favoured, with the maximum demand from NRIs in the UAE, followed by Canada, the UK, Saudi Arabia, the US, Singapore, Qatar, and Kuwait, Ankit Kansal, Co-founder and MD, 360 Realtors told BusinessLine.

Heavy investments

“On a pan-India basis, nearly one-fourth of the luxury market was dominated by NRI investors in FY 2018. We have markets like the UAE with a large NRI population which wants to come back to India as there are no post-retirement benefits there. Combined with the high disposable income overseas, NRIs are investing heavily in luxury projects,” he said.

Until 2013, NRIs’ bought under 20 per cent of the luxury properties sold in India. But in FY 18, the number has moved up. In the ₹ 5 crore to 10 crore backet, 29 per cent of the houses in Mumbai were bought by NRIs in 2018 while the number for NCR was 27 per cent, Bengaluru 24 per cent and Hyderabad at 18 per cent. These four cities are the most favourite among NRIs for property investment, according to 360 Realtors.

“The paradigm change due to reforms like Rera and GST after demonetisation has resulted in a radical shift, bringing in the much-needed transparency, accountability, and compliance system into the sector. This has enhanced confidence among domestic as well as global investor,” Niranjan Hiranandani, co-founder and MD of the Hiranandani Group said.

Increasing demand

A big advantage is that NRIs can benefit from reverse mortgage. “The amount taken from the bank as a consequence of this type of mortgage is not factored in the taxable income of NRIs. So they can enjoy the benefits of property in India while taking money from banks for its reverse mortgage,” said Ashish Shah, Chief Operating Officer, Radius Developers.

Hiranandani says a large chunk of NRI investment in Indian real estate comes into the luxury segment as the returns on investment in terms of rental income as also capital appreciation is very high. This is because the supply of high-end properties is limited while their demand is increasing.

The rupee hasn’t been very strong and this has been advantageous for people earning abroad, he added. A weaker rupee helps NRIs as they get more rupees in return for a dollar, bringing down their monetary outgo, Kansal said.

For both Radius and the Hiranandani group, who have been leading the launch of luxury projects, NRIs contribute about 15 to 20 per cent of sales. “The sales are concentrated around the initial launch of the project as NRI investors prefer to get in early and take advantage of the appreciation,” Cooper added.

Read More:
Source: BusinessLine

Thursday, 5 July 2018

Wednesday, 9 May 2018

Home Away from Home!

Second homes have got an impetus in the recent past,due to reformatory changes in the realty sector, thereby making them a lucrative bet for buyers.

Until a few years ago, buying a second or holiday home was a fad among people with disposable income. Thus, developers saw this as an opportunity to construct houses in far-off places and earn more profit. However, a lot of these projects failed to deliver on their promises. Delays in obtaining requisite permissions, poor accessibility / infrastructure, a lack of basic amenities and facilities and sub-standard quality of construction were some of the issues that plagued most of these projects. This left second home-buyers feeling cheated and their woes were compounded because resale on these properties became increasingly difficult. But this was the scenario back then. At present, the situation is different. It is a good and safe decision if you plan to invest in second homes today.

The introduction of pathbreaking reforms and measures such as demonetisation, RERA, implementation of GST, etc has improved the functioning of the realty industry. In the years to come, we believe there will be more institutional participation in real estate.

As per recent data, the holiday homes segment is growing at a healthy rate of 10-12 per cent p.a. There is a good demand in locations within two-four hours’ driving distance from major cities or towns. Some of the more prominent smaller towns where we have seen a marked increase in development of second homes are Dehradun and Shimla in the north, Ooty and Coorg in the south and Lonavala and Karjat in the west.

It has been observed that vacationers prefer holiday homes over hotels — cost, convenience and privacy being the major reasons. Developers too, are catching on this trend to attract more buyers. They offer to manage individual units in their projects and also lease them out in a professional manner. Thus, investors end up receiving healthy returns between eight and 10 per cent p.a.
Quality homes and wellplanned projects are available at reasonable prices. And with RERA, buyers have access to all the key information about projects, legislative protection and delivery date. Most importantly, investment in second homes also results in fair returns, which is actually sustainable, as it is on the back of an actual demand.

Read More:
Source: Times Of India

A fabulous investment in Goa that can double up as your second home as well. Check You Expat Vida Phase 2.

Friday, 27 April 2018

The Making of Panaji

Still one of the better cities in India, also chosen to be developed as a smart city, Panaji’s history isn’t just to do with fine Indo-Portuguese architecture, but is also about being a strategic location, that also saw law and administration being optimised along with trade and rapid urbanisation.
NT NETWORK traces the history and roots of how Panaji attained the glory of being Goa’s capital

Danuska Da Gama | NT NETWORK

Panaji is ever changing. It has been evolving ever since it was first invaded by Kadambas, Bahmanis and then during the Portuguese regime, and continues to witness changes- physically, politically, even culturally. About the history of its name, an inscription of the Kadamba King Vijayaditya I, dated February 7, 1107 refers to Panajim as Pahajani Khali. The other version is that Panji or Ponji means the ‘land that never gets flooded’, while the third version is that it is a variation of Pancha Yma Afsumgary or the five castles where the Muslim King Ismail Adil Shah and his wives used to live. “Panji was a fisherman’s cove also dotted with a few temples like Ravalnath. During the Adilshahi era around 1498 King Yusuf Adilshah built a palace fortress on the Mandovi banks around circa 1500,” says historian Prajal Sakhardande

The name was later changed to Panjim by the Portuguese and when Old Goa collapsed in the 19th century, and it was given the status of a city in March 1843 and was renamed ‘Nova Goa’.

The Early Years:Trade In Panaji

We have not heard much about the city in the period prior to 1500, but sources tell us of a time when a Greek ship with Buddhist monks on board is said to have touched Panaji and sank. A Roman mooring stone at St Ines tells us of Roman trade voyages too. Historian, former director of Education, Government of Goa and author of seven books including two on Panaji – Anatomy of a Colonial Capital: Panjim (2016) and Colonial Panjim: Its Governance, Its People (2017) – Celsa Pinto says: “These instances perhaps indicate that for more than a thousand years Panaji served as a trading centre and that its history should not just be traced to the coming of the Muslims of Bijapur or of the Portuguese.”

In the eleventh century Panaji was a part of the Kadamba Empire. “Drawn to the serene waters of the River Mandovi, Adil Shah chose to erect a summer palace at Panji, despite the fact that the latter was then a humble settlement, a fishing locality and a ward of Taleigão. In 1500 the island-palace became a place for the Adil Shah and his retinue to relax and beat the summer heat. The cool and calm waters of the Mandovi made life pleasant,” says Pinto.

After the conquest by the Portuguese in 1510, Panaji was selected as an important military station, where all the ships that arrived at Goa were thoroughly inspected and had to compulsorily obtain licences. As the River Mandovi was narrow, they could not escape this.

Panaji came to be the place of embarkation for troops or for fitting out expeditions to other parts of the East. “The city and its environs also served as a seasonal and temporary residence for the viceroys/governors on their arrival and departure to Portugal. It was customary for the viceroy arriving from Portugal prior to his solemn entry and taking charge at the capital Cidade de Goa (Old Goa) to wait at the palace in Panaji, for never would two viceroys remain at the same time in the City of Goa,” narrates Pinto.

During the first forty years of Christianisation, the Portuguese set up three main religious structures in the area of Taleigão. From a hermitage set up on Conceição Hill (1541), arose the present church Igreja da Nossa Senhora da Conceição in 1600. In Taleigão its Church was constructed in 1544. At St Ines a hermitage was built in 1584 which was raised to the status of a church in 1605. It was at this stage that Panaji and St Ines were detached and formed separate parishes.

The fort of Gaspar Dias was constructed in 1598. Marques de Pombal had ordered for its demoli. Instead, years later, it was expanded and utilised as a military barracks and still later in 1835 was the location for one of the bloodiest episodes in the history of Goa.

Pinto points out that in the seventeenth century Panaji was still dominated by fishermen and poor citizens. In 1635 it has been recorded that Panaji had 50 houses (ground and first floor) some quite large and fine, belonging to the Portuguese and others who made it their base or abode with orchards and coconut groves as a source of income. “Thus manorial estate houses built by the fidalgos dotted Panjim’s horizon. Well-known travellers of the seventeenth century Pietro Della Valle and Pyrard testify to this,” she says.

The shift: Old Goa to Panaji

Speaking about how Panaji was chosen as the capital city by the Portuguese Pinto tells us: “Years were spent in the seventeenth century deliberating upon the transfer of the capital Cidade de Goa to the safe and healthy port of Mormugão. But a deliberate effort was made in this regard in the 1680s by Viceroy Conde de Alvor citing reasons for the urgent need to shift because the existing capital was not well-fortified for hostile attack. It had narrowly escaped falling into the hands of Sambhaji in 1683 and that that the city was struck by pestilence and was unhealthy for its inhabitants.”

While the next choice was Mormugao that besides being a natural harbor, it was far off from mainland attack, the work on the project was in progress for years together. The only viceroy to shift there, albeit for a few four months was Caetano de Mello e Castro in 1708. By an order issued in 1712, the project of the transfer was given up.

Again the thought of shifting the capital came up in 1739 when Marathas attacked Goa. Ultimately it shifted to Panaji in 1759.

Pinto says, “It is clear to us that the Portuguese authorities were by 1759 certain that Panaji alone could provide them the basis of their future seat of administration and new capital. Panjim occupied a strategic location with a river front and a beach which had scope for land expansion and use. There was scope for a road network that would help connectivity. Besides, the surrounding villages were capable of taking the urban spread.”

Panaji acted as a shield for a port which provided both a safe anchorage and a physical barrier to any aggressor from the Indian mainland. “Also since in 1632-34 Portuguese built the causeway linking Old Goa with Panaji, it was a preferred choice to shift base,” explains Sakhardande.

Panaji was the unofficial capital for about 84 years (1759 – 1843). While the earliest urban plan for the city was drawn up in 1776, transformation in its true sense can only be traced to the viceroyalty of Dom Manoel de Portugal e Castro (1825 – 1835) to whom we owe the St Ines Creek and five bridges including Ponte Minerva and Ponte de Portugal, the lovely place of recreation that is today’s Campal, Fountain of Boca de Vacca, the Customs House, the Public Jail (now the Military Hospital) and above all, the massive Quartel Militar.

From around 1780 settlements grew at the fort of the Conceição Hill. “It needs to be noted that around 200 houses could be seen in Panaji by the first quarter of the nineteenth century, residences of the well-to-do, the public servants and the poor,” says Pinto.

It is a landmark structure right in the centre of the city- the largest building housing the Police Headquarters, the Collector’s Office, the Old Central Library, Institute Menezes Bragança and other governmental offices.

Sakhardande points out that there was a steady rise and growth in Panaji, 1760 onwards when palaces such as the Maquineze, Fazenda and then Escola Medica came up, followed by the beautification of Panaji at Campal, rise of Fontainhas and the Mahalaxmi temple which was built in 1819.

Rise of the capital: Early urban infrastructure

From 1759, Palacio de Pangim was the heart of the city and became the symbol of Portuguese authority. It was from this citadel that the Portuguese ruled over Goa for over 200 years. It was an integral part of the story and growth of Panaji as a capital city. Together with the area around, it formed Zona Central (Central Zone).

Pinto highlights that originally this area was characterised by just two structures, the Palace and the Conceição Church, but the scenario was different with the transference of the seat of Government to Panaji. One was able to witness the gradual emergence of a row of public and private buildings along the main road. In the second and third decades of the nineteenth century, we see the shift of governmental offices like the Customs House (1811), the Accounts House and the High Court (1818). For these purposes, edifices were either acquired or taken on lease. For instance, the High Court or Relação de Goa was installed in the house of João Baptista Goethals. Likewise the Junta da Fazenda building was purchased from Vitorino da Cunha Gusmão.

These makeshift arrangements continued even after the 1820s. A little away from the Contadoria Geral or the Fazenda, one found the jail. Still further one found the Estanco de Tabaco (today’s Head Post Office) and the Mint House (Casa da Moeda) which was shifted from Panelim in 1832 to the house of João Baptista Goethals.

Pinto says that the houses and properties of the two leading and rival merchants of Goa of the early nineteenth century, Mhamai Camotins and João Baptista Goethals, located in strategic points near the Palace, were initially a preferred choice for governmental offices.

In 1842 the Hospital Militar was shifted from Panelim to Panaji and installed in the houses of Diogo da Costa de Ataide e Tieve (Conde de Maquinez). The residence of the Archbishop was transferred to St Ines in the palace belonging to Canon Francisco da Cunha Souto Maior. During 1844 – 49 the Archbishop Dom José da Silva Torres resided in a house of J B Goethals.

“Cidade de Nova Goa was formally declared as the second capital of Portuguese India, comprising of three zones – Pangim (Panjim), Ribandar and Velha Goa (Old Goa), in March 1843. The Portuguese did not want to let go of Cidade de Goa which once upon a time brought them international fame and glory,” explains Celsa who goes on to say that the story of the making of the capital is one of land acquisition, landfill and land use. “On March 22, 1843 Portugal’s reigning Queen Dona Maria II officially declared Panaji as the Capital of Portuguese Goa with the nomenclature Panaji,” states Sakhardande.

The core works began between 1875 and 1885 with the Corte de Oiteiro, the landfill and embankment along the River Mandovi and the Fontainhas and St Ines Creeks, the construction of municipal structures like the market, slaughter house and St Ines cemetery. The filling of pools, swamps and marshes in Central Zone, with mud from the cutting of Conceição Hill and the levelling of palm groves, gave rise to a network of roads, named in 1903, that we still see in the city with minor changes. This gave rise to land use, to set up of public and residential structures. Land sale for housing first began in Fontainhas in the 1880s while urban infrastructure like drainage system, water supply, electricity, street lighting, arborisation, etc, were all part of the physical growth and development of the capital city.

While Pinto states that stop gap arrangements might have continued for a large part of the nineteenth century, the steps towards new constructions can be attributed to the tenure of Viceroy Dom Manoel de Portugal e Castro.

The capital was built in just 130 years from the times of Dom Manoel de Porgual e Castro to 1961. “The locality until the early nineteenth century was viewed by many a chronicler and foreign traveller as a humble and unhealthy ward of Taleigão. From a fishing village and an occasional docking area prior to 1759, from a land full of palm groves – Palmar Ponte, Palmar Japão, Palmar Miguel José, Palmar Arecal, Palmar Maquinez, Palmar Gaspar Dias and marshlands, during the nineteenth century, there emerged the capital city Nova Goa – quite phenomenal and transformational,” says Pinto.

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Source: The Navhind Times
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Friday, 20 April 2018

The Curious Case of Interest Rates

In the midst of fluctuating interest rates and the possible hike in them, here is a guide on how to stay on top.

 Are you prepared for a possible rise in home loan interest rate?

Interest rate fluctuation keeps home-buyers on their toes. While prospective buyers look for chances of a rate cut to lock the deal, existing buyers focus on the EMIs and chances of an increase in the interest rate. At present, the home loan interest rate is around 8.3 per cent, but the situation may change anytime, and the rate may start going up if the economic indicators become unfavourable. The US Federal Reserve has already indicated that they will increase the interest rate in 2018, which could lead to a hike in interest rate in the Indian economy. Earlier, SBI was charging an interest rate at 8.3 per cent to 8.7 per cent p.a., but recently it has revised the rate to 8.35 per cent to 8.8 per cent p.a, an increase in rate by upto .10 per cent. This is just an indication and soon other banks may follow the course.

“We believe that we are inching towards an interest rate hike. Interest rates have been static for a while now. However, an increase in global rates and domestic consumer price inflation might force the RBI to reconsider its neutral stance and hike interest rates in the near future. We, however, believe that the hike will be marginal, around 25-50 bps,” says Sunil Agarwal, associate dean and director, School of Real Estate, RICS School of Built Environment, Amity University.

If currently a home-buyer is paying an EMI of Rs 42,760 for a loan of Rs 50 lakh with 8.3 per cent interest and tenure of 20 years, then an increase in interest by .1 per cent i.e. at 8.4 per cent rate, he would be required to pay an EMI of Rs 43,075 i.e. an increase of Rs 315 per month and a total increase of Rs 75,574 in the entire repayment period.

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Source: Times of India

Monday, 19 March 2018

Zaha Hadid Architects to design Navi Mumbai international airport.

The firm, which bagged the contract from Navi Mumbai International Airport Limited (NMIAL) after a 12-week design competition, will design the new airport's Terminal 1 and air traffic control (ATC) tower.

British architecture firm Zaha Hadid Architects (ZHA) has secured the mandate to design the much-delayed Navi Mumbai international airport, being developed by the GVK group-led NMIAL. The firm, which bagged the contract from Navi Mumbai International Airport Limited (NMIAL) after a 12-week design competition, will design the new airport’s Terminal 1 and air traffic control (ATC) tower, according to a statement on Wednesday.

This will be Zaha Hadid’s first major project in the Indian sub-continent. The work on the Rs 16,700-crore Navi Mumbai international airport kick-started last month with Prime Minister Narendra Modi laying the foundation stone for the first phase of the project on February 18, after more than two decades of its being conceived.

Planned in 1997 as a secondary airport to meet the growing needs of Mumbai, the project was inordinately delayed due to a myriad of factors, including political indecision, issues of environmental clearances and the funding. “We are committed towards bringing the best global practices from the industry to design, engineer and build this most awaited (Navi Mumbai) airport project in India.

“Therefore, we decided to go with ZHA, a firm known for its path-breaking and remarkable architecture. It also has the expertise of delivering a world-class airport design through a highly professional team,” said GVK Reddy, founder and chairman, GVK and chairman NMIAL. The first phase of the Navi Mumbai airport is likely to be completed by the end of 2019, with one runway and the terminal building ready, and will handle up to 10 million passengers per annum.

The second phase, to be completed by 2022, will take the handling capacity to 25 million passengers. The third phase will be completed by 2027, and at the completion of the fourth phase by 2031, the handling capacity will increase to 60 million passengers. Established in 1979, ZHA has a portfolio of over 950 projects spread across 44 countries.

It has designed Beijing’s under-construction Daxing airport terminal, spread over 700,000 square meter, besides designing Olympic Aquatics Centre in London, the Al Wakrah Stadium in Qatar for the 2022 Football World Cup, the Guangzhou Opera House in China and the MAXXI Contemporary Arts Centre in Rome, among others.

The City Industrial Development Corporation (Cidco), which is developing the new airport along with GVK Group, expects the first flight to take off in 2019. The GVK group, which will invest nearly Rs 4,000 crore in the first phase, will hold 74 per cent stake in the project, with the rest being held by the Cidco and the Airports Authority of India.

Now this is News!

The eye-catching architectural style of the late Zaha Hadid continues to make waves across the world.

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Source: Indian Express

Wednesday, 14 March 2018

Real estate sales in India remained strong in last two years: Report

A recent report by JLL India, an international real estate consultancy firm, pointed out that sales for residential properties have remained strong, quarter after quarter. Whilst cumulative new launches across top seven cities of India in the last 2 years (2016 & 17) was recorded at 2,33,387 units, sales of residential units in the same time was recorded at 2,44,830 units indicating that more apartment units were sold.

In the last 8 quarters, the sales velocity has seen a steady upward trend on account of pent-up end user demand that uplifted the market, as soon as a stable trend in the residential capital prices was observed.

Overall unit sales outstripped the number of launched units by 5% in the period of consideration, except second half of 2017 when a large number of new units were launched. These projects launched in the second half of 2017 are witnessing good off take, which will reflect in good sales figures when the Jan- March 18 quarter ends. The fresh supply in residential in latter part of 2017 was largely on account of the lag effects of the RERA implementation, which was adopted by most states during the same period.

The market dynamics of demand and supply periodically outstripping one another, has led to a continued stability in the capital values. Ramesh Nair, CEO and Country head, JLL India, said, said “This is a good time for end users, investors and fence sitters to consider their entry into the residential market, given that prices have been stable for a sustained period.

 With lending rates from banks having significantly reduced since 2015 and at decade low, the situation provides residential buyers a most opportune moment to purchase properties as well as easily service their EMIs.”

The last quarter of 2017 saw a surge in new launches on account of the stabilizing of RERA mechanism across the country. The scale of new launches is also an indication of the confidence that the market has for the future potential demand. It also indicates the strengthening of the transparency, governance and compliance standards aligned to by the developers. Certainly, a good and controlled ecosystem to operate in, both from a developer and buyer perspective.

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Source: DNA India

Thursday, 1 March 2018

Tier 2 And Tier 3 Cities Stage Their Real Estate Comeback In India

After a protracted period where interest for real estate investment was concentrated primarily in the larger cities, we are now seeing a resurgence of the Tier 2/Tier 3 cities story in India.

Many of these cities are seeing increasing economic activity and infrastructure growth, to some extent reducing the outward migration to the metros.

This is a welcome dynamic which will eventually result in a more uniform spread of real estate demand across the country, and reduce the pressure on the larger cities.

What lies beneath
The ticket sizes for residential properties in tier 2 and tier 3 cities and towns start from a significantly lower base, owing to cheaper land prices and also the fact that developers active there are more aligned with affordability.

Buyers tend to be more cost-sensitive as economic drivers in the city may not be on par with those in the larger cities. Also, under the incumbent Government, many of these cities are now seeing significant infrastructure deployment. Quite a few have come under the Smart Cities program, which bodes very well for their real estate markets.

With increasing demand, one can expect prices in these cities and towns to assume a gradual upward trajectory. Price growth will be higher and faster in cities coming under the Smart Cities program.

This would indicate those intending buyers should not delay their purchase decisions indefinitely, since the lower existing base currently provides the ideal entry point, especially for price-sensitive buyers.

Whether a smaller city offers good options for investment depends on what economic drivers are already in place and which are expected in the short-to-mid-term. Definitely, accelerated infrastructure activity in a particular city or town indicates that price growth will be healthy going forward.

Investors need to study each market for its growth prospects, including rental demand and capital appreciation trends as well as expected employment growth. A number of larger players have now expanded into tier 2 and tier 3 cities on the back of increasing demand for quality residential offerings there.

Investors’ approach
Investors will always be driven by investment rationale, as well as their own knowledge and preference of some markets over others. Investors with better capitalization may wish to focus on the larger cities, depending on their risk appetite, while others would be more interested in India’s reviving tier 2/3 story.

Not all tier 2 and tier 3 cities are performing uniformly well, though it is true that supply will generally follow demand. In other words, cities which are performing well economically will attract more migrant population which will need rental housing.

Simultaneously, local home buyer sentiment will also be higher in such a city. Both investors and end-users would have a very decent inventory to choose from, which enables them to fine-tune their final choices according to location, amenities and ticket sizes.

At the end of the day, end-users will purchase homes in their cities of residence – or, in the case, of NRIs, in their cities of origin. Investors obviously have a much larger playing field

Listed below are a few smaller cities where residential property prices are significantly lower than in the top cities. These cities also hold considerable growth potential due to their key growth drivers:

Ahmedabad: Demand drivers– Massive presence of home-grown firms and businesses, favourable business ecosystem. Average residential real estate prices: INR 3,500 – 4,900/sqft
Indore:Demand drivers – Government support, good IT policy leading to the growth of the IT/ITeS industry. Average residential real estate prices: INR 2,500 – 3,800/sqft
Coimbatore: Demand drivers– Significant talent pool, enterprising community. Average residential real estate prices: INR 3,200 – 5,000/sqft
Chandigarh: Demand drivers – High literacy rate, favourable business environment. Average residential real estate prices: INR 5,000 – 7,000/sqft
Jaipur: Demand drivers– A key IT/ITeS destination, a planned city. Average residential real estate prices: INR 3,000 – 4,000/sqft
Kochi:Demand drivers – Good talent pool, favourable business environment, massive NRI investments. Average residential real estate prices: INR 3,500 – 4,800/sqft

Anuj Puri

Tuesday, 27 February 2018

Guide to smart banking: Know your home loan: It’s your life’s biggest financial decision

It is perhaps the single most important purchase that anyone makes in their lifetime, and the realisation of a dream. But owning a home is also, in a sense, a basic necessity. Securing a home loan, therefore, is one of the most important personal finance decisions an individual will make.

Today, home loan tenures vary from 10 to 30 years depending on the borrower’s age and the loan amount. Home buyers now have the option of going in for home finance from banks and financial institutions that not only help them with the best finance options based on their individual eligibility but also help them in the entire process of owning a home.

With so many incentives, more and more Indians are confidently embarking on the journey that leads to their dream home. In view of this renewed vigour among consumers, various Housing Finance Companies (HFCs) have enhanced their customer support programmes to encourage prospective home buyers to avail themselves of home loans. However, it is imperative from the borrower’s perspective to understand various aspects of home loans.

The right loan for you

There are an assortment of home loan schemes available in the market. Since a home loan is probably the biggest financial commitment you’ll take on, you will need to take the time and read through the fine print carefully before signing on the dotted line. A few of the options that individuals can go in for are: loans for purchase of ready property; loans for purchase of under-construction property; loans for self-construction; loans for purchase of plot; loans for renovation/extension of existing property; loans against existing property, and so on.

Based on the income criteria, some borrowers may qualify for the Pradhan Mantri Awas Yojana (PMAY), where an individual can avail of a credit-linked subsidy of up to ₹2.67 lakh, depending on eligibility. Borrowers can avail of benefits under this scheme for purchase/construction/extension/ improvement of their home.

But while negotiating the paperwork maze, you will need to get acquainted with a few technical terms and a few operational details.

Some of the critical ones are:

Loan-to-value ratio
Loan-to-value defines the ratio of a loan to the value of an asset purchased. Earlier the LTV was 80 per cent of the value, but now it has been increased to 90 per cent of the home loan value for properties up to ₹30 lakh.

Equated Monthly Instalment
One of the most critical factors that influences a home loan decision from the borrower’s perspective is the EMI, which is the monthly outflow of money that will go towards repaying the home loan. As a golden rule, never let your EMI exceed 40-45 per cent of your net monthly income. Also, note that there are no prepayment charges or penalties levied if the customer prepays his/her home loan.

The interest rate
Home loans typically come with two types of interest rates — fixed and floating. Under a fixed-rate arrangement, the interest rate on your home loan remains constant for a period of 3-5 years (depending on the scheme offered by the financial institution) or, in certain cases, for the full tenure of the loan. Under a floating interest rate regime, the interest rate on your home loan varies depending on the movement of cost of funds for the financial institution.

The rate on your home loan may increase or decrease in line with the trend in the cost of funds. A fixed rate will typically be higher than a floating rate; you should opt for a fixed-rate regime with caution, keeping in mind your judgment of the interest rate scenario. There are also options to switch between a fixed and floating rate of interest at anytime during your tenure of your loan.

A borrower’s credit score is a critical consideration for a financial institution while making an assessment of the individual’s home loan eligibility and the interest rate component. The credit score of an individual defines the credit-worthiness of the person and is one of the key determining factors for the approval of a home loan. While a good credit score is one of the most critical factors for the lender to ascertain home loan eligibility, it is not the only criteria. Banks and financial institutions prefer to lend to borrowers with a credit score higher than 750 since it reflects stronger credit-worthiness.

Over the years, securing a home loan has become a hassle-free procedure, with financial institutions increasingly focussing on providing the best deal to the customer. Affordable housing has emerged as a priority focus area for the government as well, which has been steadily laying out supportive measures and building a conducive environment with new and innovative policy measures to enable home ownership. With the expanding industry landscape, both new and existing home buyers have ample home loan options to choose from. They should embrace it at the earliest to make their home ownership dream a reality.

The writer is Joint Managing Director and CEO, DHFL

Read More:

Source: The Hindu Businessline

Monday, 19 February 2018

Real Estate in India: Co-working space may be next growth driver

Co-working is one of the predominant new trends that are having both real-time and long-term impacts on the Indian real estate.

Driven by a thriving start-up ecosystem as well as growing demand from corporates, freelancers and consultants, among others, co-working spaces are growing like never before. So much so that by the end of 2018, as per industry estimates, India’s co-working space is likely to receive $400 million in investments and by 2020, the number of branded co-working spaces is estimated to grow to 400 centers across the nation from less than 100 in 2017.

Industry experts say that co-working is one of the predominant new trends that are having both real-time and long-term impacts on the Indian real estate. The Indian start-up ecosystem is in a boom mode and entrepreneurship is being strongly supported by the government. This has created a huge demand for flexible office spaces which meet the specific needs of start-ups which are beginning from a low capital and manpower base. The Indian business scene is now a hotbed of freelancers and consultants which are strongly supplementing the formal workforces.

Simultaneously, “even large corporates are opting for co-working spaces in some cities, either to cater to specific clients or as incubation centers in new cities which will later lead to expansion into formal office spaces. It, therefore, comes as no surprise that co-working office spaces have become so incredibly popular, and they are now cropping up all over the country – from Tier 1 right through to Tier 2 and Tier 3 cities. These spaces make it possible for start-ups to avail of a high degree of flexibility in their work environments, in terms of locations, facilities and of course costs. There are about 110 formal co-working office space players in the Indian market now,” says Anuj Puri, Chairman, ANAROCK Property Consultants.

Talking about the growth potential of co-working spaces in India, Vineet Taing, President, Vatika Business Centre, one of the largest Indian business centre providers, says, “Co-working spaces will continue to prosper ceaselessly, for long. By 2020, the number of seats in licensed commercial setup will grow by four fold. The growth is favored by rapid urbanization in India, start-ups culture, arrival of MNCs, positive signs by investors and of course, boundless client advantages offered by business centres or co-working spaces. Co-working spaces are just the extension of business centres which are in use since 1995. Business profitability will be commanded by extra services offered via successful integration of business requirements and hospitality services.”

It is expected that both international and domestic co-working operators will establish a presence in the central and suburban districts of main cities in the country. The number of co-working spaces is likely to further increase in Mumbai, Bengaluru and Gurgaon owing to the availability of opportunities for start-ups and adequate infrastructure in those cities.

Read More:
Source: Financial Express

Tuesday, 13 February 2018

Private equity investment in real estate to touch $100 billion by 2026: JLL India

In the past 12 years (2006-2017) India has seen investments of USD 42 billion, while in the next 10 years (2017-2026) it is expected to see inflows to the tune of USD 58 billion.

Private equity inflow in the real estate sector is estimated to touch USD 100 billion by 2026 and tier-1 and tier-2 cities will be its primary beneficiaries, property consultant JLL India said in a report.

Private equity in the last few years has been concentrated in Mumbai, Bengaluru and Delhi-NCR, with Mumbai seeing the highest percentage at 31 percent of PE investment, followed by Delhi-NCR 27 percent and Bengaluru at 12 percent. Tier-2 cities and other markets have seen limited activity in terms of private equity funding, JLL said.

In the past 12 years (2006-2017) India has seen investments of USD 42 billion, while in the next 10 years (2017-2026) it is expected to see inflows to the tune of USD 58 billion. According to the report, the flood gates will open wider when REITs (real estate investment trusts) get listed.

In terms of asset classes, the largest investments went to residential sector, which has seen a total of 44 percent of all private equity investment in the sector so far. Although the percentage share has reduced in the last couple of quarters, the attraction of the residential sector remains strong as the exit route is clear for this asset class, JLL said. It added that IT and commercial account for around 27 percent of PE investment.

“India’s attractiveness as a global investment destination has been steadily rising. We have seen numerous measures that have created a positive economic environment, bringing in key factors like transparency, accountability and ease of entry into various sectors in India. This gives India a fillip in attracting capital. This would be the key factor for private equity to bet big on the sector in the future. We will see the flood gates open the time REITs are listed in the market. As this would give the developers a good option to exit or convert their holdings in to tradable stocks, through income generating assets. Further, with the current size of the economy and its steady growth with GDP pegged over 7% year – on – year for the next 3 to 5 years,” said Ramesh Nair, CEO & Country Head, JLL India.

Private equity inflows, over the last 3 years (2014 – 2017), in office and IT / ITES rose by 150 percent, with a strong attraction towards office sector. Although the residential sector remained the highest invested sector, the rise in the same period was a mere 5 percent of total investment flows in pure equity.

Debt structures dominate fund inflows in the residential sector, which is a key reason as to why developers are overleveraged. This is on account of the general sluggishness in residential markets and investors unwilling to take downside risk.

With increased transparency and regulations, we can expect a return of equity to residential markets in 2018. Another key insight is that except office and residential sectors, all other sectors together account for only 30 percent of total investments since 2014, according to the report.

“Investors are yet to explore the possibilities of new asset classes which will show strong trends in the near future. Alternate assets classes such as retail, industrial, warehousing and alternatives will be promising,” said Nair.

Read More:
Source: Money Control

Friday, 9 February 2018

Budget 2018: How Jaitley's circle rate move will impact real estate deals

If a property's sale value is up to 5 per cent below its circle rate, the buyer and seller won't need to pay additional tax.

Property buyers and sellers in metros, especially in upmarket localities, won’t need to pay additional tax if the difference between the agreement and stamp duty values of the property is less than 5 per cent. The finance minister has proposed this relief in the Budget.
At present, if the sale price of the property is lower than the circle rate, the difference is added to the buyer’s income and taxed. Even the seller needs to calculate capital gains based on the circle rate and consequently, pay higher taxes due to the difference. Circle rates are state governments’ benchmark or reference property prices on which they calculate the stamp duty payable. It’s also known as ready reckoner or collector rates.
If there’s a transaction of property valued at Rs 10 million, but the circle rate is Rs 10.5 million, the buyer earlier would pay tax on Rs 500,000 based on his slab rate. An individual in 30 per cent tax bracket, for example, would pay Rs 150,000 in tax. The difference is considered as a ‘profit’ for the buyer under Section 56(2) of the Income-Tax Act. Now, he doesn’t need to pay any tax for variation up to five per cent.

A seller needs to calculate capital gain based on the price considered for stamp duty under Section 50C. Now, the seller’s tax liability will be slightly lower. If the gains at present were, say, Rs 798,120, it would come down by Rs 100,000 (see table).

But what if the difference between the property value and the circle rate is more than five per cent? In this case, the buyer and seller will not get the proposed tax benefit. “It has to be either 5 per cent or lower. Else, it will follow the current taxation system,” says Naveen Wadhwa, general manager, The changes are also made only for income tax purposes. “If the circle rates are higher, the buyer would still need to pay stamp duty based on those benchmark prices of the respective states,” says Wadhwa.

Experts say that such difference is usually seen in the upmarket localities in metros. “In suburbs, mostly, the circle rates are closer to actual property prices, and in tier II cities they are much lower,” says Pankaj Kapoor, managing director of real estate consultancy Liases Foras.
The proposal will essentially benefit buyers and sellers in areas where property prices have seen a much higher correction in the last two-three years. “If you look at Gurugram in Delhi NCR, prices in some localities are still below the government’s benchmark rates though the state government has lowered the circle rates in the past two years. But the regulations are such that buyers and sellers need to pay the tax out of their pocket on the difference,” says Ashutosh Limaye, head – research, JLL India. He further adds that there are times when two properties situated next to each other sell at different prices, but circle rates are the same for both. The government now recognises such disparity.
During his Budget speech, Finance Minister Arun Jaitley had explained the reason for this change: “Sometimes, this variation can occur in respect of different properties in the same area because of a variety of factors including the shape of the plot and location.”
Property buyers and sellers in metros, especially in upmarket localities, won’t need to pay additional tax if the difference between the agreement and stamp duty values of the property is less than 5 per cent.


The finance minister has proposed this relief in Budget 2018.
At present, if the sale price of a property is lower than the circle rate, the difference is added to the buyer’s income and taxed as ‘income from other source’. Even the seller needs to calculate his capital gains on the basis of the circle rate which means a higher tax payment. Circle rates are state governments’ benchmark or reference property prices on which they calculate the stamp duty payable. They are also known as ‘ready reckoner’ or ‘collector rates’.
For example, according to the present practice, if a property being sold is valued at Rs 10 million, but the circle rate is Rs 10.05 million, the buyer has to pay tax on Rs 500,000 based on his slab rate. An individual in the 30 per cent tax bracket pays Rs 150,000 in tax. The difference is considered as a ‘profit’ for the buyer under section 56(2) of the Income-tax Act. However, according to the Budget proposal, he will not need to pay any tax in case the variation is up to 5 per cent.
A seller needs to calculate his capital gains on the basis of the price considered for stamp duty under section 50C. Now, the seller’s tax liability will be slightly lower. If the gains at present were, say, Rs 798,120. It would come down by Rs 100,000 (see table).
But what if the difference between the property value and the circle rate is more than 5 per cent? In this case, the buyer and seller will not get the proposed tax benefit. “It has to be either 5 per cent or lower. Else, it will follow the current taxation system,” says Naveen Wadhwa, general manager, The changes are also made only for the income-tax purpose. “If the circle rates are higher, buyers would still need to pay stamp duty based on the benchmark prices in their respective states,” says Wadhwa.
Experts say that such a difference is usually seen in the upmarket localities in metros. “In suburbs, mostly, the circle rates are closer to actual property prices, and in Tier-II cities they are much lower,” says Pankaj Kapoor, MD of real estate consultancy Liases Foras.
The proposal will essentially benefit buyers and sellers in areas where property prices have seen a much higher correction in the past two-three years. “If you look at Gurgain in Delhi-NCR, prices in some localities are still below the government’s benchmark rates, despite the state government lowering the circle rates in the past two years. But the regulations are such that buyers and sellers need to pay the tax out of their pocket on the difference,” says Ashutosh Limaye, head of research, JLL India. He further adds, in some cases, two properties situated next to each other might sell at different prices, even as the circle rates is the same for both. The government now recognises such disparity.
During his Budget speech, Finance Minister Arun Jaitley had said: "Sometimes, this variation can occur in respect of different properties in the same area because of a variety of factors, including the shape of the plot and location."

Read More:
Source: Business Standard

Monday, 5 February 2018

Indo-Anglians: The newest and fastest-growing caste in India

An influential demographic or psychographic is emerging in India  – and it is  affluent, urban and highly educated.

Sometime around 2012 or 2013, my daughters stopped speaking in Konkani, our mother tongue. It isn’t entirely clear what provoked it. Perhaps it was a teacher at their Mumbai school encouraging students to speak more English at home. Or perhaps it was something else. It didn’t matter. What did matter was that our home became an almost exclusively English-speaking household, with the occasional Konkani conversation.

We were not alone. Clustered throughout the affluent sections of urban India are many families such as ours, predominantly speaking English and not the tongues they grew up with.

Some of these families, or at least parents in these English-speaking households, do make an attempt to speak their mother tongue as much as they speak in English. But even in these bilingual households, English still dominates. It takes an effort for the kids to speak in the Indian tongues, beyond a few simple phrases. English, on the other hand, comes naturally to them; the larger vocabulary they possess in English helping them express complex thoughts and propositions far easily.

I have been looking for a term, an acronym or a phrase that describes these families who speak English predominantly at home. These constitute an influential demographic, or rather a psychographic, in India  –  affluent, urban, highly educated, usually in intercaste or inter-religious unions. I propose to call them Indo-Anglians.

Friday, 2 February 2018

Why One Should Choose New Projects Over Resale Flats?

People thinking of buying a house always encounter this dilemma of whether to go for an old property or buy a new one. So, let me help you in figuring out why it is always better to go for a new project instead of a used property.

Your home will be an integral part of your identity. It is very difficult, if not impossible, to paint a unique masterpiece on a used canvas. Previous owners will always leave a certain imprint of their personality on the property.

When you go for a new project you are flooded with options. Right from modern amenities to developers offering you exclusive deals, pre-launch monetary benefit schemes, etc. The kind of amenities new projects provide are too good to resist. Today modern residential projects functions like a city within a city, these townships include amenities such as a club house, gymnasium, swimming pool, sport complexes, gardens, children’s play area, security and more. When you go for a new project you are not just offered a house, you are offered a lifestyle. The chances of getting these amenities in a resale flat is far too less.

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Source: Prrop

Friday, 19 January 2018

At home with Ultra Violet

Complex and contemplative in equal parts, ultra violet is often associated with mindfulness practices. A reason why you are likely to spot purple-toned lighting in meditative spaces. The colour is said to fill people with energy and positivity and inspire connection. Why not embrace the hue to bring some happiness and tranquility into your home?

Decor expert Astha Khetan says that ultra violet adds a certain depth to a space. Whether you are using a statement pillow, painting, accent wall, a few sprigs of lilac or a vintage rug - a simple touch of the magical hue is all you need to transform your space. Her advice: "The easiest way to start decorating with a new colour is to take baby steps and not go overboard."
Ultra violet, with its bold and vivid blue, is a perfect match with raw materials such as concrete and natural wood. For statement corners, try ultra violet in different combinations; with sage green, lemon yellow, or vermillion. "In small spaces, avoid using ultra violet vertically like in curtains and walls. Use in small accessories on floor and below eye level," suggests decor expert Vaishnavi Pratima. In large spaces, experiment with walls in ultra violet juxtaposed against contrasting furniture.

Pick jewel tones for a strong visual punch. But the idea is to make an impact without being garish
Make sure your colours stay sophisticated by choosing shades from the same family that are not all too bright
Mix dark and romantic purple with other super-saturated dark colours and rich fabrics like velvet
Use flowers like pansies, iris, phlox, hydrangea, petunia, verbenas, freesia, and columbin
Use vases made in violet assortment
A tricky hue for homes, if you play it right UV can be the pop of colour that your house needs.
Violet can be used in dining couture too. Think a white table with UV napkins.
Bring in violet accessories like candle stands, lampshades, vases to add a splash of colour

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Source: Time of India

Wednesday, 10 January 2018

Real Estate: Understanding the interplay between residential and retail segments

An area which houses middle-class families will attract lot of unorganised retail outlets, while luxury destinations mostly juxtapose with high-end retail.

Whenever I am asked how real estate is performing in India, I have to ask the questioner to be a bit more specific. Real estate is not a single industry but consists of various categories/asset classes, and each behaves differently at the same time and at different times. Residential, commercial and retail real estate each serve a separate and distinct purpose, respond to a different type of demand and attract different types of investors.

However, it is equally true that all three categories are inter-related because they all depend on each other to drive growth. Residential projects tend to crop up around commercial office catchments, because that is where jobs are created, and employment drives the financial ability and appetite for home ownership. Likewise, retail real estate developments are only feasible in and around residential and commercial catchments, since retail needs customers. What differs in these three asset classes are the ticket sizes, investment rationale, and investment horizon. To invest in either residential, retail or commercial office, real estate calls for different degrees of financial capacity, risk appetite, patience and understanding of what drives growth in each of these asset classes.

Among the various interplays between these real estate categories, the relationship between residential and retail is particularly interesting. In any given location, a certain type of retail follows (or sometimes even spawns) a corresponding type of housing. An area which primarily houses middle-class families will attract a lot of unorganised or mom-and-pop retail outlets, hypermarkets which enable value shopping for daily needs, and malls with a lot of mainstream brands. Likewise, luxury housing destinations are most logically juxtaposed with high-end retail. At the same time, India’s urban real estate landscape cannot really be clearly defined in terms of mid-income and luxury housing, as a significant number of residential areas in our cities are home to both middle-class and HNI residents.

This fact has allowed for a generous bandwidth of retail to become feasible in and around major residential catchments across the country. However, luxury still begets luxury, as well. Let us examine some of the notable instances:

Indiranagar, Bengaluru: The high-street retail area in this location is located in an upscale residential precinct. The stretch has a good mix of F&B and fashion retail, attracting the affluent population near the market. Its strategic location has been the main growth catalyst for the retail market. While the inherent catchment of prime residential areas in and around Indiranagar contributes to steadily growing footfalls along this stretch, IT parks and offices in the vicinity also act as footfall drivers for this high street shopping destination.

Galleria Market, Gurgaon: This is an upscale neighbourhood shopping area juxtaposed with one of the most developed areas of Gurgaon where plotted developments, residential colonies and high-rise apartment complexes coexist. Galleria Market has a mix of fashion and mainstream retail stores offering convenience-based categories in addition to F&B. Other categories in the retail tenant mix here include apparel, medical stores, accessories, stationery and gift stores.

Hiranandani Estate, Powai (Mumbai): The iconic Hiranandani Estate is very close to major commercial office destinations within the Powai precinct. Nestled amidst high-end residential apartments and landmarks like the Powai Lake, it attracts footfalls from upper-middle-class to HNI residents. F&B is a dominant category in this high street with multi-cuisine restaurants, ice cream parlours and a few pubs.

Mehar Chand Market, Delhi: This market is situated near Lodhi Colony in heart of New Delhi and is more or less a ’boutique’ shopping destination for residents living around it. It includes an eclectic mix of retail categories such as designer stores, organic grocery stores, quirky apparel stores, trendy bistros and stationery shops, among others. Mehar Chand Market attracts steady footfalls as it is surrounded by the upmarket residential neighbourhood of Jor Bagh, Defense Colony, Golf Links and Sunder Nagar.

Road No. 36 Jubilee Hills, Hyderabad: Road No. 36, situated in Jubilee Hills’ upmarket residential area, is a prime and upscale shopping street in Hyderabad. Traditionally a posh residential area, Road No. 36 has transformed into a prime destination High-Street of Hyderabad. Due to its location, this high street has attracted a number of national and international retail brands, as well as exclusive cafes and restaurants.

Breach Candy, Mumbai: This is one of the core South Mumbai areas known for its elite high-end residential neighbourhood. Most of the shoppers on this high street belong to the immediate or nearby catchment areas. Breach Candy hosts some of the legacy high street brands and has attracted a lot of local high-end fashion designers, as well.

While it is always tempting to claim that real estate development in India evidences no clear planning, the logical manner in which residential and retail spaces follow each other seems to tell a different story. Granted, there is in most cases no pre-determined town planning involved — but the fact remains that Indians can nevertheless match their shopping preferences with their inherent purchasing power. Like water, lifestyle appears to always find its own level in India.

Source: Indian Express

If you are interested in Retail and Residential properties, you might want to check out Vida Uptown Township, Goa.

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