Stamp duty waiver in Maharashtra on property gifted to heirs and family

 

In a bid to appear business friendly and competitive, the Government of Maharashtra has waived the 2 percent stamp duty applicable on the transfer of immovable properties to heirs or family members. This welcome announcement was made by Eknath Khadse, the Revenue Minister of the state, at the Legislative Assembly, last week. 

Many of us look for resale properties in Mumbai and it is important for them to consider these factors primarily and then go ahead with their search. Infact, as a home buyer or investor, one must be geared up with the revised real estate laws, prices and other relevant information in the industry.stampdutyMaharashtra

As far as stamp duty registration is concerned, the norms that prevailed earlier entailed the inheritor to pay a stamp duty of 2 percent on the market value of the property or its ready reckoner rate, under Maharashtra Stamp Act. In case the property did not qualify as ancestral ones, then the stamp duty required to be paid was 5 percent. This would have to be paid along with the Rs 200 as stamp duty on the release.

The minister has also announced that these properties would have to be registered with the state government. A policy similar to this one was adopted by the Government of Punjab earlier. The state government has also announced that the online registration processes for property sales transactions would be permitted. This would allow home buyers to register their properties without visiting the registration offices. These facilities have been applied already on voluntary basis for licence and leave transactions. The government shall make them applicable on sale transactions as well.

For those who are looking to hunt flats for sale in Mumbai, must consider the parameter of stamp duty registration on their selected property and make sure to do the needful. 

No matter what you requirement is, if you consult a well versed property advisory firm, you can always can help in finding the right property for sale in Mumbai or your other preferred locality. So, go ahead and search the best residential property as per your budget and specific requirements. 

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Everything you need to know about home insurance

General insurance companies offer home insurance policies usually for covering your home in case of natural calamities such as earthquakes, floods, fire and landslides. Aside from these, there are several sections in the policy which broadly cover for the house’s structure alone or your possessions such as fixtures and furniture, appliances and jewellery or both. Some policies also cover up rental expenses in case you need to move elsewhere when your house has been damaged because of some of the calamities covered by the insurer.home insurance India

Calculating the sum to be assured

For home insurance, it is very important to consider the value of one’s possessions and property. For instance, you should not insure your home at market value or the purchasing price which prevailed ages ago. The cost of construction materials go up every year. Instead, you should seek to get the furniture, fixture and fittings and building insured on reinstatement basis because in case of a loss both must be replaced at the present replacement or construction cost. Therefore, in case of any mishap you will be capable of replacing your loss completely without having to bear depreciation. Insurance consultants claim that most people incorrectly insure their houses, factories or offices even at book (the price paid for the property) or market value. When insured by book value, you under insure your property which results in claims which are paid by the underinsurance average while if you insure according to market value, then you become over insured.

One of the simplest ways of insuring your structure is on the basis of per square foot. For instance, if the cost of replacement for a new house is Rs 1000 per square foot then for 2000 sq. ft. you will have to buy insurance of Rs 20 lakhs. The land cost must not be taken into consideration of the sum insured. For including the cost of land, a valuation must be conducted by a professional for justifying the sum insured. The sum insured shall be adequate as replacement cost on the loss date.

Insurance of Household Goods

It is better to steer clear from insuring household goods at their book or purchase price as when adjusted for depreciation, you will get back very little as claim. Also, knowing the replacement cost for it is not easy. Therefore, you will have to use some form of an approximation and also have a list of contents separately in some place safe (apart from your home) so that in case of a big loss, you will know what items were there at home. You should get the reinstatement value clause written in your policy so that the claimed amount paid is enough to refurbish and rebuild your home.

Premium Payable

The premium payable belongs to a vast range based on the factor variety related to geographical location, construction type, home’s size and jewellery among other valuable assets in your house. For instance, if your home is valued at Rs 60 lakhs and your possessions such as appliances, jewellery and furniture cost an added sum of Rs 12 lakhs, then the amount payable as premium would be Rs 5000.

Process of Claim

You must inform the insurance agent or firm in case you need to claim money. Put forth a written claims document to your insurance company within a stipulated period. The written claim should bear a complete account of your articles damaged or lost along with the actual value of the article. The claim request shall then be forwarded claims department of the company. The insuring company appoint the surveyor who shall submit the FSR or final survey report alongside the documents that you have submitted. Upon receipts of these documents, the department of claims process the claim. Upon approval of the appeal, the letter shall be sent to the insured party that states the amount payable as settlement along with the voucher of discharge. 

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URealty Magazine 2015 Edition

A Unesta Homes Publication

INDIA REAL ESTATE: POISED FOR HIGHER GROWTH

In the 3rd Edition of the URealty Magazine, we would like to revisit this mantra. A popular quote by Warren Buffett and just apt for the current market scenario for India Real Estate.

The performance of an economy has a direct effect on the real estate market, something India has experienced all too well. Last year, the economy battled against a weakened rupee, political uncertainty ahead of the general elections, and rising rates of deficit and inflation. This lead to many developers slowing down plans to build, and many investors waiting to see what the market would hold. However, the latter part of 2014 saw real estate activity pick up, and experts have projected that 2015 will be a year of prosperity and growth where real estate is concerned.

In this issue, we examine in-depth the factors that have lead to the turn around, as well as what is expected in terms of GDP and economic growth. We explore the potential of current and up-and-coming markets, consider the changes to regulations and legislation, discover the government’s plans for “smart cities”, and analyse the supply and demand for properties in three of India’s major cities. In addition to examining micro-markets, we also take a general look at what this year holds for India as a whole, a country that is now predicted to have one of that fastest growing property markets in the world. Within these pages lie facts, statistics, expert tips and buying advice, designed to help you make sense of the current state of the market. We hope you enjoy this issue, and learn from it more about the potential real estate investment opportunities that await NRIs in India.

Click Below To Download

URealty Magazine 2015 Edition

Saurabh Agrawal

Editor

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Realty sector hopes high with second rate cut by RBI

For the second time in this year, the Reserve Bank of India  (RBI) has cut the repo rate by 25 basis points (bps) to 7.5 percent from 7.75 percent. Realty sector hopes high with second rate cut by RBIThe reverse repo rate accordingly, have been adjusted to 6.5 percent, while the cash-reserve ratio is kept unchanged at 4 percent by the central bank. It came as a huge surprise right after the budget was announced.  However, for those who doesn’t know, the repo rate refers to that rate on which the commercial banks lend money from the central bank. And the cash reserve ratio is the total amount of net liabilities of the commercial banks, which they require to keep in cash.

Earlier in January this year, RBI has reduced the repo rate by 25 bps. This twice rate cut by RBI is most likely to bring ‘ache din’ for the real estate sector for both the developers as well as for the buyers. This step has indeed brought smiles on the face of the country’s drowning property sector with a hope of improvement in the prices and sales of the properties.

With this move RBI has clearly indicated that the institution is all set to improve the economy while curbing the inflation, which in turn will be helpful for the real estate sector. Projecting this rate cut as a right and positive move, the real estate industry is further looking for a cut in interest rates, which can help the common man to buy or invest in the property market with the reduced EMI mount that they have to pay.

Now the question arises,  whether this rate cut will revive the home sales position or not? Because of  the fact that the benefits of lowered interest rates are yet to pass on the to the customers, as the banks hasn’t reduced their rates. As soon as the banks will reduce the interest rates and transfer it to the customers, the real estate industry in India will get a boost in a huge way. With more spending power due to hassle free availability of loans, the realty sector along with the economy most likely will experience a rapid growth.

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How the inclusion of Land Acquisition Act will help the real estate sector

The Union Cabinet has recently announced the decision to adopt the ordinance method for bringing amendments to Land Acquisition Acts. This has been a welcome decision by the real estate sector in India. The draft ordinance visualises that projects in the fields of rural electrification, industrial corridors and rural housing shall be exempted from seeking eighty percent approval from affected persons as needed previously. Farmers shall continue to receive compensations at four times the rate prevailing in the market for lands in rural areas and twice the value in urban zones. Private educational institutions, private hotels and private hospitals, must be included in the public purpose definition. These projects shall also be exempted from studies on the social impact that industries have felt delay project approvals. Land Acquisition Act will help the real estate sectorAlso, eighty percent land owners who have been affected by the sale shall have to give consent for land acquisitions in private projects. The ordinance shall have to be cleared by the coming parliamentary session that has begun in February 2015.

The ordinance has also made significant changes in the Act by removing consent clauses for acquiring lands for affordable housing and 4 other areas. Many have acknowledged that the amendments shall have a positive impact. The industry hopes are high from the newer norms easing off inordinate delays seen in the acquisition process for affordable housing and large scale infrastructure projects.

This step shall remove the roadblocks which shall aid developers gain approvals faster. Farmers shall get better deals for their lands as newer rules shall apply even to lands that were acquired under 13 different acts such as national highway act, railway act etc. The provisions shall be uniform now based on compensation aspects. The amendments shall also introduce newer segments for organised realty within the purview of faster processing norms that would benefit the construction activities across India.

The prolonged delays with regards to approvals have been major obstacles for projects and any betterment in infrastructure shall have beneficial knock-on effects for real estate sector, according to industry insiders. It is a fresh and needed development and shall hopefully make sure that land acquisitions are done for the purpose desired that it remains speedy and viable for developers.

It is a bold and positive step that shall boost sentiments. There have been much emphasis on infrastructural developments by governments and any steps needed for simplifying procedures shall have beneficial impacts for realty sectors. There were quite a few hurdles for dis-incentivising projects of large scales previously.

The Act which had come into force since 1st January 2014 under the erstwhile government was seen to have injected stringent restrictions that led to many projects in the roads, steel and railways sectors to halt. With the alteration in the Land Acquisition Act, companies can now go ahead with constructions with one road block less. 

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What is the reason behind the increasing rentals of the residential properties

Property indices in the past couple of years have unanimously noted that even if capital appreciation stagnates after a point, rental values keep on increasing. Every year, rental rates for a particular neighbourhood rise by 10 to 20 percent, depending on the added infrastructure made available or location. There are several reasons for rental rates to increase for properties even though corresponding capital rates remain the same.Rents in a neighbourhood are mostly decided by the demand of rental homes against the availability. This is when knowing the proportion of owner occupied houses becomes important. Almost 66 percent houses in Indian cities and roughly 90 percent houses in rural areas are occupied by owners. In international cities such as New York and Berlin, the occupation of homes by owners is far less, at 45 and 11 percent respectively. Therefore, the number of flats available on rent is quite low. 

Rate Hike in rental properties

Most people seek to live close to their offices and property buyers are no different. The homes are mostly taken up by end-users and little is left to spare for tenants. The number of people forming the floating population of a city, looking for employment opportunities also determines the rent. In Bangalore, roughly 57 percent of houses are put out on rent. It is one of the cities where properties are more rented than bought and lived in. In other smaller towns and emerging cities like Pune, most of the properties are bought for end occupation rather than investment. The property rental market does not move freely as rental control laws are applied on them. Delhi and Mumbai control rents on properties which keep the market out of sync with the capital appreciation one. Ideally, housing prices and rents should move in a way that people are indifferent between renting and buying. However, in reality the process is not transparent at all. The supply of homes on rent greatly reduces as many people keep their houses locked up rather than sublet them for different factors such as wear and tear caused by tenants and the timeliness of the tenant in paying rent and evacuating when asked to. Rental disputes in cases of informal agreements may also arise. The Ministry of Housing has released data which shows that more than 1 crore urban homes were empty. This considerably brings down the supply of properties and inflates rents artificially. Localised factors often drive prices and rents in different directions. For instance, in Kolkata’s EM Bypass stretch, rental rates fell by 5 percent while capital rates increased by 13 percent almost. More people are interested to buy properties for end use rather than rent and hence this observation. In Nizampet of Hyderabad, the exact opposite was observed. Short term supply and demand mismatches in a locality may also force rents to climb upwards. For instance, villas in Bangalore had shown an upward trend for rent in 2007 because the expat community wanted to live here and there was limited supply. However, since 2012, the demand decreased which also led to a fall in rental rates. A similar phenomenon has been observed in Gurgaon’s rental market for ultra-luxury properties where empty flats and zero tenants are leading to a fall in rental rates.

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IndiaHomes joins the league of Hackathon

IndiaHomes.com is dedicated to quality service. In order to improve the service further, it keeps on innovating new form of tools and provide hassle free options to the users. In line with this, IndiaHomes conducted ‘Hackathon’ on February 16, 2015 among all its branches across the country. The event was free and open to everyone — with or without technical skills.hackathon

The term Hackathon basically refers to an event wherein different groups are formed to identify certain problems with an aim to make usable software, applications or any process. The focus of a Hackathon depends on different concepts.

IndiaHomes for the first time organised Hackathon for its four key applications that included Mobile Site, NRC Workflow, Magic Broker App and Main website. It was conducted pan India through Polycom. Overall, there were thirteen teams with interesting names such as Core Team, Team Spartans, The Sting Bees, The Hurricane Rush, The Fast and Furious, Tech Ninjas, Avengers, Dominators, Transformers, Control Freaks, Technical Knockout, Terminators and Snipers. The event was participated by various team members from across the country.

As a part of the event, all the participants were asked to identify issues or bugs in all the four applications and raise it in front of the judges. Then the team judges examine the bus and if they accept it as a bug, then it goes to the team’s bucket. The judges for the Hackathon were Mayank Ravi- AVP Ops and Rajesh Kwatra – VP Secondary Sales.

The problems were divided into three categories– Issues, Beetle bug (small) and Scorpion bug (big). The Issues were worth Rs 2000, Beetle bug (small) for Rs 3000 and Scorpion bug (big) for Rs 5000. Therefore the participants were awarded with prize money depending on the kind and number of problems identified.

The Core Team from North comprising Samar, Rahul Aggarwal, Shailender, Manish Mehta and Naveen Jain, Manish Goel won the maximum amount; then Team Spartans from North comprise by Ahsan, Sai Prasad, Biplab and Prashant. Followed by Sting Bees from North as well, included Saurabh Agrawal, Manish, Madhurima Sil, Sonakshi Bajaj and Neha Chopde; Transformers from West, Navi Mumbai had Abdul Razzak Khan, Sachin Patil, Prakash Patil, Sushit Dutta and Manoj Bohra. Then came Fast and Furious again from North comprising of Manish, Manas, Nikhil, Prabhjot, Chaitanya; Avengers from North included Piyush Chandra, Sudhanshu Agarwal, RajKumar and Amitesh Kumar. Further Snipers from West, Andheri consist of Amit Gupta, Ajay Tiwari, Malank Dandotia, Anup Almal and Dominators format with Sangeet, Taniya, Sanghamitra and Sumit as the team members.

The event was organised at the corporate office of IndiaHomes in Gurgaon and witnessed lot of enthusiasm and interest not only from the participants but also from the audiences side.

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Extension in Metro line will boost real estate in Greater Noida

If you are looking to buy a property in Noida Extension or in the interior regions of Greater Noida, but not sure whether to buy or not, because of the proper connectivity and unavailability of a public transportation system, then your wait is over. Delhi Metro is all set to expand the present Dwarka-Noida City Center line to Sector 62 and  further extending  the line to Greater Noida. 

As part of the new plan, the upcoming metro line will go through sectors  34, 51, 59,  62 and to Electronic City. It will connect Noida with Delhi very closely and  will be among the longest lines. The station at Sector 52 station will be an interchanging  station towards the Greater Noida Metro line.


Metro line will boost real estate in Greater Noida

The extension of the new metro route will mark a positive development for the real estate sector in the Greater Noida area. It will encourage the industry to build several new property in Noida Extension fulfilling the existing housing demands of the aspiring end users as well as the investors. This step will also be a step forward to save the degrading state of the of real estate in Noida market, especially around the Greater Noida and Noida Expressway area. The new line in Greater Noida will improve the connectivity and lessen the travelling time between  Delhi and Greater Noida, which can be a major factor to encourage the property sector in Noida to develop new flats in Noida Extension. Also, due to the smooth connectivity buyers will be inspired to move towards the interiors of the Greater Noida and will not have any doubts to settle down in that region.

However, it is needless to say that, the growth of the real estate sector in any state is directly proportional to the development of its infrastructure.  As the infrastructure will be improved and developed, the realty sector will simultaneously experience growth. Such as in Delhi, Gurgaon and in main Noida, since the inception of the Metro, it played a crucial role in developing the property market with the rise in property prices and new projects.  

Likewise, due to this upcoming Dwarka-Noida City Center metro line, the stagnant sector of property in Noida Extension or Greater Noida can expect a boost on the developer’s side as well as on the buyers and investors’ side. The extended metro line will help in attracting more prospective buyers, interested investors and moreover the developers can clear off the remaining inventory and plan for developing newer projects.

In line with this new metro line the Authorities of Greater Noida and Noida have already proposed to escalate FAR by 0.5 within 500 metres of an area around the present and upcoming metro lines. With this step, the authorities aim at increasing the population around the stations and providing metro station at a walking distance from the residents’ respective places.

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Assessing the Impact of Digital Technology on Real Estate Markets in India (White Paper)

Impact of Digital Technology_001

The  impact   of  digital   technology  (internet, mobile  phones and  tablets) has  greatly  affected our lives.  Telecom Regulatory Authority of India (TRAI)  had  announced  that   there   were  164.81 million internet users in India as of March, 2013, of whom  7/8th made  use  of handheld devices such   as   smartphones  and  tablets.  Currently, India  holds   the  third  position among   nations with the most number  of internet users, after US and  China. Therefore,  it is  quite  palpable that digital technology would influence the third most important sector  that affects the economy.

 

This white paper  makes use of a study conducted by  Google  India  on  “Real  Estate in  India:  The Digital  Influence”   to establish the  pivotal  role that  would  be  played  by  digital  technology in determining the course of real estate in India. The survey  was  conducted over  15 cities  with  6196 respondents spanning over  residential renting, residential buying and commercial  renting  to determine answers to two main questions.

1. How far would the internet impact the growth of the real estate market?

2. Understanding consumer behaviour in pre- purchase phase.

 

The  following  white paper   acknowledges the growing  presence of  digital  media  in  the  real estate market and addresses issues of harnessing the true potential of digital technology.

Download the complete White Paper: Impact of Digital Technology

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Which is a better option buying or renting ?

Given the skyrocketing capital values of residential properties, more home seekers are opting for rental properties. However, this phenomenon has led to a new kind of problem where rental values of certain areas, particularly those close to commercial properties are increasing rapidly. Today’s home seeker is therefore left in a dilemma over whether to buy a home or rent it. If you are stuck in a similar situation, then here are some pointers to aid you out.

  1. Risk Analysis- Rise in property prices is exponential in developing nations such as India as prices may be artificially floated over a long period. However, rental earning grows at a realistic rate as they are proper functions of demand. Most rental agreements have clauses where rental rates are hiked by 10 percent annually. Price of property in metros normally double every 5 years in urban areas, which is around 20 percent in a year. You should carefully weigh your options of investment as stock markets too offer an annualised return of 20 percent almost.
  2. Price to rent ratio- This tool is fast catching up with Indian property buyers where the cost of the property is divided by the rent payable annually for it. If the value of the ratio is lesser than 15, it would be better to buy the house than rent it.
  3. Financial strength- Your financial position must be the backing force behind your stand to purchase an apartment. If your family earning is around Rs 1 lakh in a month, then you shall be entitled to take out a loan of Rs 40 lakhs to Rs 50 lakhs for a period of 20 years. However, if you need to balance your budget in a way to be able to meet expenses with a residual pay after the EMI is deducted. Moreover, you have to spend 20 percent of the cost upfront. For a house valued at Rs 50 lakhs, you have to down pay Rs 10 lakhs or so. Before you set out to buy an apartment, you should set aside an amount of Rs 5 to 6 lakhs as emergency fund. Also, you should be left with some savings after bearing home expenses and monthly EMI. The surplus shall cover the needs of investment and any increase in interest rates. Once you fulfil the conditions, you should look out to purchase an apartment.
  4. Stability of earnings- Home loans are normally for long tenures (more than 20 years or so). Unless you have a stable employment record, getting a home loan may be difficult. You must be confident about the stability of your job particularly if you are employed in a privately owned enterprise. Loan agreements normally come with built-in insurance which would take stock of the outstanding loan in the event of death.

Besides, prior to buying a new apartment you must factor in the salary increases you hope to see in the coming years because your EMI may increase when the rates are revised. Or else, go for flats on rent under your budget in a preferred locality.

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