The real estate sector in Mumbai has been a witness to fast changing spectacle of developments over the last two years. The prime land locations in this metropolitan region have been aloft with fresh approvals for redevelopments which are being executed on the already existent residential assets. Furthermore, the rapidly evolving suburbs of Mumbai and the affordable assets here are major attractions for the home buyers during the present day.
Along with the brighter prospects of affording a habitation in this sought after commercial hub of the country, the Eastern Mumbai District is yet another region which has been the focus during the present times. As reported by The Times Of India, the Eastern Mumbai region property rates have projections to be doubled over the next 3 years.
The areas like Neral and Khopoli in the Eastern Mumbai District are expected to receive tremendous appreciation over the coming future. Faring well owing to its lower investment quotient (as compared to other regions in Mumbai), these areas are reassured with various upcoming realty projects which are well connected to all other directions in the city. The leading developers in this region have developed options of contemporary habitations like the Green Valley Acropolis and Palm Beach Residency.
The available residential units in the eastern region along with the web of market areas and supportive civic/social infrastructure have accentuated the worth of a living in this part of Mumbai. Moreover, the forecasts of healthy appreciation for these properties in the coming future have even further elevated the property market in the Eastern Mumbai District.
More to the substantiation of statistics vouching for property appreciation are the upcoming civic infrastructure and other attributes which enable a gratifying living in this region. These attributes include the extending railway connectivity and the expansive multimodal corridor which are envisioned to significantly boost the trade and commerce in this part of Mumbai region.
Eastern Mumbai District is the region which hosts affordable assets to suit the budget of home aspirers belonging to various segments of affordability. This region is emboldened with optimal infrastructure and civic amenities to cater self-contained habitation which comes with bright prospects of returns in the next few years. Subsequently, owing to the factors mentioned above, the Eastern Mumbai District is now being preferred by the end users and investors of the realty assets across all its residential pockets.
Kolkata, the cultural and educational core of East India, has been aloft with its real estate sector faring robust on fresh approvals for realty projects. Kolkata has been one of the most preferred metro cities for habitations which are priced comparatively lower than other urban nodes in India. This city offers ample civic and social infrastructure with a recuperated interest of leading developers who are developing contemporary projects to suit the budget of home aspirers across all the segments of affordability.
Being one of the most expansive realty projects in North Kolkata, the latest project to have received the government’s approval will be developed in proximity of Dunlop Bridge, overseeing a lake off B T Road. It will be a cutting-edge PPP project which has received approvals based on the tremendous response from the promoters and their advance funding.
As reported by The Times Of India, to be known as Siddha-Eden Lake View, this project will ideally host hundreds of refugee families within its sprawling campus. This project is envisioned to be a reassuring abode to the prospective beneficiaries who will be facilitated with all contemporary amenities like children's parks, swimming pools, landscaped gardens and community halls, amongst others.
Expected to thrive and be completed soon, this project will be run on self-financing scheme and hence will not incur any extra cost owing to the delay it has undergone over last seven to eight years. The initial investments will be made from the earlier amounts earmarked for this project and more shall be sourced out from sale of developed flats to the buyers.
The Siddha-Eden Lake View project is supposed to be completed within next two years which shall witness the bringing down of existent, vacated homes and reconstructing this expansive land for the families who have been vowed their dream homes by the current ruling establishment. The inclusion of amenities in this project along with its advantageous location and competitive pricing are few of the highlights which have induced the buyers with hope of a worthy habitation in the near future.
The prices of property have incessantly been on the rise and despite the promise of affordable housing, it still seems a distant dream for many. Although the government has been taking several initiatives to promote affordable housing in the country, especially in the Metros, this segment has not been able to capitulate upon its potential and while so many are in search of that elusive perfect house, seldom find it.
According to a report by KPMG, the housing shortage is estimated at 18.78 million households in 2012. Out of these, the most prominent housing shortage has been found for the economically weaker sections and the low income groups. Together, they constitute for over 95% of the total housing shortage.
However in the four year period from 2009 to 2012, there has actually been a 25% decline in urban housing shortage. This has largely been the work of private developers who have launched many affordable housing projects. Even though the performance of the real estate sector has matched the growth targets and expectations as per the development and the increasing population of the country, there still remains a shortage of around 18 million houses to be fixed.
Attempts are being made by the central government to aid in this problem of housing shortage for the low income groups by introducing a draft policy that is expected to allow for the allotment of affordable houses for the economically weaker sections (EWS) and the lower income groups (LIG). The process for passing this draft is underway. This draft provides for households with an annual income of less than 2 lakhs to register for subsidised houses. These low cost houses will have a proposed area between 21-27 sq meters and 28-60sq meters for the LIG and the EWS categories respectively. The houses, expected to cost between 4 lakhs to 10 lakhs will be developed in partnership with either the state housing boards or private developers. The individuals to which the houses will be allotted will be selected through a random draw at fixed rates determined by the government.
This also presents an opportune moment for private developers to utilise and take advantage of the huge supply-demand deficit in the affordable housing market. This could prove to be even more beneficial to the real estate industry if the government decides to implement a single window clearance mechanism for all affordable housing projects.
Delay in project approvals can result in a 25% to 30% increase in the cost. Keeping in mind the low-ticket size, procedural delays cannot be afforded, neither can the cost be passed on to the end user. Hence, for the intervention to be successful, the draft needs to be approved quickly and project approvals need to be obtained as soon as possible.
After a lurking delay in the grants of permissions for the redevelopments, upcoming projects and infrastructure assets, the Brihanmumbai Municipal Corporation’s Tree Authority has now begun issuing No Objection Certificates (NOCs) for the realty sector’s expansion in Mumbai. Effecting a respite to the ongoing discom in Mumbai, the latest approvals for asset construction is being welcomed across the real estate sector in the city.
As reported by The Indian Express, the uplifting of freeze to the permissions for projects lined up in Mumbai, is a relief for around 57 proposals of real estate projects and infrastructure works. Validation of the number of trees replanted after the numbers cut over the last year, has enabled this decision which qualifies the sustainability factor.
As witnessed, the housing and development spectacle in Mumbai has evolved to accommodate more redevelopments and new projects over the last year. As, the norms of proximity to the fire stations have been eased to enable the development of higher residential turrets, the norm of enabling asset expansion in Mumbai has gained tremendous momentum. Today, the new developments in Mumbai are not only offering fresh homes in the suburban locations but also redeveloping assets to accommodate more habitants at prime locations.
The areas like Nerul and Panvel have evolved to host an exodus of immigrants who have been longing for a habitation in Mumbai, their dream city. The enabling connectivity to city centers, ample investments in creation of civic and industrial infrastructure and the cheaper rates of properties at these locations have significantly accentuated the worth of living in these nodes of the state.
In the present day, the ruling to permit real estate construction in Mumbai is being envisioned as yet another boost to this sector. The developers have been reassured with the prospects of monetization for their investments which had been clogged due to the unforeseen freeze put earlier this year. Furthermore the investors and the home buyers have also been assured with promising prospects of owning their dream homes in Mumbai city.
The Indian real estate sector has been judiciously striding ahead and sustaining its growth over the last few months while the times were tough for economies around the world. Along with the rapidly evolving micro markets of real estate growth around the metros in India, the developer fraternity has marched ahead of the conventional practices and encouragingly collaborated with other sectors to develop contemporary and cost effective projects.
As in reports of Financial Times, captivatingly, the value added services have become essential for the home aspirers to choose assets for their end use in the present day. Subsequently, the developers across the urban regions in India are witnessed to be offering all the modern day amenities like fitness zones, swimming pools, landscaped gardens, terrace lawns etc. as permanent fixtures in their upcoming projects.
In tandem to the transforming preferences of today’s home aspirers and their desire to upgrade their lifestyles, the developers are reassuringly adapting to the present day trends and hence accentuating the inevitability of impanelling expertise of ancillary services like interior designing, modern architecture, vastu consultancy, and landscaping amongst others.
In order to sustain the market presence and to gratify their patrons, the developers are fast shifting towards the practice of developing integrated projects. These projects host numerous amenities ranging from healthcare facilities and office/retail spaces to recreational zones like banquet halls and multipurpose zones. Based on the target home buyers, the projects are now being planned in consultation of expert architects and planners, to suit the preferences of discerning clients.
Furthermore to the collaborations, the developers are now eagerly associating with international majors of real estate development and other supportive sectors in order to offer their domestic buyers, the assets of world class quality and features. In the present day, the real estate sector is unfurling to embrace the best global practices of habitation which have strikingly risen in demand over the last decade.
Owing to the unjustified rates of properties in Noida, the housing and development department of this city now proposes to reduce these rates, acting as a respite to asset aspirers. Noida, the New Okhla Industrial Development Authority, is the city which ranks one of highest for its per capita income all across the Delhi NCR. Incepted owing to the drive of urbanization, Noida has witnessed massive infrastructure development and hosted an exodus of immigrants from the neighboring states and cities over the last decade.
In the present day, the proposal from the dept. to curtail the circle rates of group housing and commercial categories has been welcomed by the developer fraternity across the Delhi NCR. A correction to the earlier hike in these rates has been proposed in order to reach the targets of revenue generation which have considerably fallen short of its mark. The hike realized back in the day, has led to a significant reduction in the number of registrations of properties, and subsequently recorded the reduction in revenue generated by Noida registries.
Along with the high circle rates, the charges on facilities within a project have also surfaced to be a bone of contention for home buyers. The buyers are coerced to pay literally 25% extra on the circle rates which are already encumbering for the home buyer segment. As reported by The Times Of India, last year the circle rates were increased despite an opposition from the stakeholders and other partakers in this sector.
As witnessed, CREDAI has been the platform to host resistance to the escalating circle rates and other charges on asset transactions in Noida, the present day proposal to moderate these charges has acted as a relief to home buyers. Along with the reduced circle rates, the effect on the upcoming projects is expected to be welcoming for buyers who are constantly attracted to Noida, the urban city catering promising employment opportunities and gratifying habitation.
The Real Estate Investment Trusts (Reits) have the lawns of talk amongst the sector experts and other stakeholders of the Indian real estate sector, over the last year. What are Reits? How do they fare in the contemporary realty markets? What will be their effect in the context of Indian realty domain? These are few of the questions which interest the common man to enquire and know more about the Reits and their significance. Let us glance over the functioning Reits and consider the Indian spectacle of property transactions in tandem to the Reits which is a curiosity for investors and asset aspirers in India.
Reits are the tools of investment in the commercial property segment and are known to be the regular source of income for investors. With a proven track record of success in the US realty market, the Reits are proposed to be introduced into the Indian realm of properties in the near future.
A brief on the Real estate investment trusts:
They belong to the commercial segment of properties
The properties to attract Reits are mandated to be operational and revenue generating
A major portion of earnings via this tool is distributed amongst the investors of the property
As reported by Live Mint, Reits necessitate compliance to the corporate governance, information disclosure and financial reporting
As mentioned above, Reits have successfully performed in the major realty markets like the US over the past and have recorded a year on year, double digit expansion. Furthermore, owing to the mandate of complying to the regulatory framework and sharing information, the Reits, once operational, are expected to induce transparency and professionalism in the Indian realty market.
Moving forward, Reits are expected to broaden the stage of investments and attract more pools of funds like the pension and insurance companies. While encouraging the novel sources of funding, the Reits are envisioned to effect a respite to the ongoing liquidity crunch in the realty market.
Even how the Reits are encouragingly being awaited in the commercial realty sector, the residential domain has not yet been given the due attention for Reits and its benefits to improve the residential and other subsector’s performance over the longer run. As expected, the Reits will strengthen the investment matrix in the commercial sector and further induce positivity to the dominion of real estate across its segments of construction.
Reassured with increased funding in the commercial sector, the retail and residential sector will certainly be accentuated as the venues of upcoming constructions and demanding further participation by the investors. The properties in Bangalore, Gurgaon, Mumbai and Noida over the past have evolved to host the integration of all the realty subsectors and hence the domino effect arising from the commercial sector is expected to substantially elevate the residential sector. As witnessed in case of Gurgaon, the sprawl of commercial parks has entailed the expansion of residential estates at prime locations. Therefore, the introduction of Reits in India is expected to uphold the expansion in the residential sector and energize it with newfound sources of investments for further growth in the coming future.
In the present day, there are various types of apartments that home aspirers can choose from, ranging from high rise apartments to builder floors to villas to row houses etc. Though all of them vary in budgets depending on the location and other factors, each option has its own set of advantages and disadvantages.
Let us take a look at the difference between builder floors and high rise apartments.
Builder floor buildings generally have 2-4 floors while for high rise apartments, the number of floors vary for each project
In builder floors, since there is only one apartment per floor, there can only be one occupant per floor. However, in high rise apartments there is more than one flat per floor, henceforth many occupants on each floor
High rise apartments are generally more economical as compared to builder floor apartments. This is because high rise apartments are cost and space efficient while builder apartments fall on the expensive side, since they offer more privacy and better amenities
People living in high rise apartments share common facilities like a swimming pool, gymnasium, etc. which is not the case with the occupants of builder floor apartments
The advantages of Builder Floors:
Although builder floor apartments are more expensive than high rise apartments, a builder floor is an independent residential unit which is more economical as compared to independent villas and bungalows
The occupant does not have to pay maintenance fees etc., which are generally applicable in the case of high rise apartments
Builder floors are generally located in more developed areas of the city, hence the buyer has the option of choosing between many available locations and specifications
The returns of a builder floor are high as compared to high rise apartments because in a builder floor, the owner gets independence along with luxury
The disadvantages of buying a Builder Floor:
In case of high rise apartments, maintenance is taken care of by a separate body whereas in builder floors all such activities have to be taken care by the owner himself
There are no community facilities like gymnasium, club, etc. available in builder floors
Here are some important things to check while buying Builder Floors:
It is quite possible that the builder floor is being constructed by a small/new builder. So the buyer should always check the reputation of the builder beforehand and do their due diligence
The papers of the property should be thoroughly checked for all the licences and approvals for construction
To sum up, the builder floors provide unmatched benefits, and the risks associated with them can be smartly overcome by careful planning and market research.
Every time one speaks to a property investor who is looking for an investment opportunity in the real estate sector, there is a huge possibility that he is considering the residential properties. Either he is looking for a second home with a scope of appreciation or an apartment which he may let out in the future. Although, some buyers may have a well-thought strategy for investing in residential properties, in most cases, it is just a default option.
Read on to find out the differences between a residential and a commercial property:
Generally, the cost of a commercial property is much higher compared to that of a residential property. While it is always possible to invest in small stand-alone shops and small offices at prices comparable to price grades of apartment, but generally the premium commercial properties like shopping malls, office blocks, etc., will cost you almost double of premium residential apartments
No two commercial properties are the same and this makes it difficult for investors who want to get an accurate valuation of the property without seeking help of experts. Professional advice is necessary for anyone considering direct investment in commercial property. On the contrary, it is relatively easier to compare the prices of apartments in a particular area
Another major difference is that of lease. In the case of a residential property, the lease is generally for a period of one year or less and the security deposit is smaller. But, in the case of a commercial property, the lease is for longer period and the security deposit is also quite high
Owing to a deficit in supply of residential properties, it is certain that investments in this sector will continue to reap benefits in terms of capital growth.
Let us see why you should invest in a residential property:
A principal reason why investing in residential properties is more lucrative as compared with commercial ones is the smaller amount of the deposit. Going by estimates in the past, it is possible to borrow the entire purchase price in a residential property scenario, whereas in commercial mortgages, about one-third of the deposit is necessary
Lower mortgage rates on residential properties, as and when, compared to commercial real estate
Owing to larger costs involved, any delays in payments or other processes in commercial properties are more complicated. Buyers can be subjected to extra charges
Investments in residential properties are safer as the market in this sector is more predictable
Simple lease agreements in the case of residential properties make it easier to find new tenants. This is not so in the case of commercial properties, where this may take months or years
Residential sector in the day today, promises a reassuring spectacle of investments and prudent monetisation. Along with the rapidly evolving destinations of hot properties (suburban locations around Gurgaon, Bangalore and Mumbai), the residential sector has once again gained significant prominence in the domain of investors heading for profitable incomes and premiums in the Indian real estate sector.
The Indian real estate sector is riding robust with the expectations of a significant recovery in the coming year. As noticed, the construction domain in the country upheld its expansion and growth into the newfound peripheries of metro cities, which evolved as the latest hotbeds of property development in 2013. Moving forward, few triggers of growth which are gearing up to effect further progress, are the focus of partakers in this sector who have maintained a positive stand throughout the last year while the Indian economy struggled to clock substantial growth.
In the day today, the realty sector has been witnessing a recuperated interest of developers who are eager to develop affordable residential units in the metro and tier 2 cities of the nation. Supported with the facilitative housing and development policies and the eased land acquisition spectacle, numerous affordable projects are being launched by the leading developers of India.
Giving a considerable push to the expansion of real estate beyond the metropolitan regions, the residential projects with reasonably priced units are catering a respite to the ongoing imbalance in the demand and supply equation of such assets. The tax relaxations and the public-private partnership model of development have encouraged the developers to develop such properties which are in huge demand and have a reassuring absorption track record.
Lately, the risen inflationary pressures and subsequently the increased cost of construction and manpower have been harsh on the home aspirers belonging to the economically weaker (EW) section of the society. The prominent business parks and central locations in the metro cities have gone far beyond the affordability of EW home buyers. However, the upcoming suburban locations and the availability of cheaper homes have been a relief for the home buyer segment.
Furthermore, the upcoming general elections and the regulatory framework to be operationalized post the awaited deliberations by the authorities are opinioned to be a ray of hope for the Indian realty market during the coming years. The noteworthy performance of this sector while the Indian economy was sluggish last year and the triggers of growth advancing by the day, bring in expectations of further heights to be scaled by Indian realty across its subsectors in the year 2014.