Real Estate Sector
Indian Real Estate is witnessing high demand and a shortage of supply. It is evident in all the tier-II cities which are rapidly expanding. This expansion is not only occurring in the IT-cities of the south (Chennai, Hyderabad, and Bangalore), but also in the north (East Delhi, Gurgaon, etc.).
Alongside the demand soaring, a new concept of housing is becoming the new trend – integrated townships. IREO also takes pride in developing its own integrated townships. The integrated township concept especially in the NCR region is almost crucial because at the foot of any homeowners footsteps are “playgrounds, hospitals, schools, and shopping malls” (excerpt taken from here). The features of a clubhouse, landscaped jogging/walking paths, mini-theater, squash and tennis courts makes life even more luxurious in India. Even that concept here for NRI’s is not as accessible making the thought to NRI’s to buy real estate in India even more attractive.
The government of India wants its NRI community to invest back and visit more frequently and thus is taking the time to look into ways to make it even easier for NRIs to feel assured and buy property in India (excerpt taken from here). Developers also want to cater to a global audience and many of them have multiple payment plan options to make the act of purchasing a property more convenient.
For more details, please read below with specific articles.
Real Estate Trends…Expansion
REALTY BOOM RIDES ON SOARING DEMAND
Rumu Banerjee, New Delhi, October 25, 2010
The Times of India
When realty market was feeling the pinch of global meltdown, east Delhi was soaring, riding high on the 25-30 percent increase in the prices of land. The appreciation started in 2005 and the good times are likely to continue into 2011 too.
This is the rate analysis based on data collated by property consultants CB Richard Ellis, which terms east Delhi as one of the fastest growing markets in Delhi, both in the residential and commercial markets. Anshuman Magazine of CBRE says: “If you look at east Delhi as a separate entity, and don’t factor in the NCR like Noida and Ghaziabad, then this (east) part of Delhi has seen phenomenal growth compared to the rest. The entry of malls, commercial complexes and even hotels underlines this. In the past four years, a number of malls like Cross River in Karkardooma, Metro mall in Shahdara, Star mall in Mayur Vihar, and several others across the district have come up.”
REAL ESTATE PAYMENT PLANS-HOW TO CHOOSE
Reuters, Mon Oct 25 2010, 04:39 hrs
When you buy an under construction property from a developer, you will likely have a choice of how to pay the seller. But do you know which is the best option for you to choose from given your personal situation and terms and conditions that will be imposed upon you under each option?
Here we share with you the different types of plans and how to choose the right payment plan for yourself.
What are the different types of payment plans?
Typically the structure of the plans that a developer offers to customers has a combination of both a construction-linked plan and a time-linked plan. There are 3 main types of payment plans that are popular in India:
Construction-linked plan (CLP): In a CLP, you will have to pay the instalments to the developer as per the progress of the property development. At predetermined construction related milestones, you will be expected to make a payment to the developer. Compared to time-linked and down payment plans, you are unlikely to get any discounts under this plan.
Time-linked plan: These plans require you to make your instalment payments based on predetermined timetable, irrespective of the progress that the property has made towards completion of the construction. Some developers also tend to offer discounts in a time-linked plan.
Down payment plan: As the name suggests, under this option you will have to pay the entire (or almost the entire amount) in a down payment plan to the developer at the time of booking your property. Because you are paying this money upfront, you can get a discount of up to 8% – 10% on the purchase price under this plan.
DEMAND FOR COMMERCIAL SPACE RISING IN BANGALORE
Anjana Chandramouly, October 24, 2010
The Hindu Business Line
Bangalore will soon overcome the slowdown of the last two years in the commercial real-estate segment, when demand for office space had dipped severely. With the IT/ITeS sector back on the path of recovery now, the city is again emerging as a preferred destination for multinational companies wanting to set foot in India or expand their existing operations. Demand for office space in the country’s IT capital is expected to gather pace in the next few years.
According to a recent Cushman & Wakefield report, the city emerges as a clear preference for sectors such as office and retail, while being a close third in hospitality. On the other hand, demand for retail space is also expected to be the highest in Bangalore with approximately 7.6 million sq.ft, while demand in the hospitality sector is expected to be 9.8 million room nights and in residential, it is expected to be approximately 2.3 lakh units over 2010-14. Manish Aggarwal, Executive Director – Investment Services, Cushman & Wakefield India, explains that the overall demand for commercial office space is subdued in comparison with the supply, which is estimated to be approximately 400 million sq.ft during 2010-14, “implying caution and the need for quality supply at the right prices”.
DEVELOPERS MOVING TOWARDS GHAZIABAD
A K Tiwary
The Times of India (Delhi edition)
After Noida, Greater Noida and Gurgaon, it is the right time to invest in Ghaziabad, which is developing into a hot destination and is also known as the gateway of Uttar Pradesh. The budding city is slated to have multiple projects like a number of shopping malls, multiplexes, and residential and commercial development. Keeping the pace of development and rising demand, a lot of developers and builders are moving towards Ghaziabad, which is 19km east of Delhi and 46km southwest of Meerut.
The city is the headquarters of the Ghaziabad district. Initially, it was part of the Meerut district after Independence but now, it is a full-fledged district.
The trend of integrated cities has gathered momentum in the northern region and it reflects a significant change in the demands and expectations of home buyers. Sanjay Rastogi, who is Director of Saviour Builders Pvt. Ltd. and spokesperson of Gaur City project that is coming up in the Noida Extension area talks about this trend.
How relevant is the integrated township concept especially when we talk in the context of NCR region?
Nowadays, customers try to seek those properties or areas where facilities like playgrounds, hospitals, schools, and shopping malls are within their reach, and integrated townships fulfill these expectations. NCR has emerged as a favorite destination for mid-segment buyers and IT companies. In terms of transport, there is excellent connectivity between Delhi, Noida, Faridabad and Gurgaon through Metro now. Besides this NHAI is also working out a plan to widen the existing national highways, which will further ease the congestion on roads and reduce the commuting time.
IT REBOUND PERKS UP SOUTHERN REALTY
V. Rishi Kumar, October 24, 2010
The Hindu Business Line
With the IT sector in a rush to recruit to match its expansion plans, there is increased off-take of commercial and office space in the IT hubs of the three southern cities of Hyderabad, Chennai and Bangalore, and in select micro markets within these cities. The trends in the commercial and residential sectors show that there are signs of developers shrugging off the slowdown blues and beginning to launch new projects to cater to specific segments.
Ram T. Chandnani, Deputy Managing Director, CB Richard Ellis, South India, told Business Line it is not just capital values but also office rentals that are showing signs of firming up. This is particularly so in the IT hubs of the three major southern cities, where the demand has gone up and supply is less. According to the Chief Marketing Officer of Lodha Developers, R. Karthik, the company has launched several projects during the slowdown in Mumbai and Hyderabad and has managed to register good sales. The Senior Vice-President of Prestige Group, Swaroop Anish, said that the company has launched a Rs 140-crore project, Royal Woods, wherein it plans to construct luxury villas. In another major project, Manjeera Constructions has announced a mixed use project that entails an outlay of Rs 600 crore. This includes a large mall, commercial space and residential township near the busy IT corridor.
Infrastructure: Oman and India join hands
OMAN TO HELP INDIA IN INFRASTRUCTURE PROJECTS
Ashok B Sharma, New Delhi, October 24, 2010
The Financial Express
The $ 100 million India-Oman Joint Investment Fund would be raised to $ 1.5 billion and would be deployed for infrastructure projects in India, according to the visiting foreign minister of Oman, Yusuf bin Alawi bin Abdullah. India would be invited by the GCC countries in discussions about security issues for the Gulf region. Also Iran, Iraq, Pakistan, US, EU countries, China and Russia would also be invited.
PROTECTING PROPERTIES OF NRIS
The Times of India (Delhi edition)
Recently, there was shocking news in a leading daily, which highlighted the plight of a Zambia-based teacher whose house was grabbed by his own sibling.
The case pertained to a Meerut-born teacher who was settled in Zambia for several years and had purchased a house in the name of his mother. A couple of month after he returned to Zambia, he got a message from a friend informing him that there was a flurry of activity in his new house. A new floor was apparently being constructed over his house, without his knowledge to boot. When the teacher inquired of his mother, she told him that his younger brother was building the second floor. And one can imagine the shock of the teacher over this news. But he was helpless to take any remedial measures.
Top government officials routinely assure NRIs that their grievances would be addressed – and the whole matter is forgotten once the PBDs are over. According to Arun Mohan, “Shady people make a survey of properties which are lying unattended and on which taxes are not being paid. Such properties are more likely to be grabbed by unscrupulous people.”
“It is not a matter that is only considered in respect of wealthy NRIs. There is a great need to make our laws more stringent so that nobody dare try to grab properties of anybody through forged documents or through other illegal means,” Devinder Gupta, head of Century 21 India says.
SEARCH REPORT SHOWS CLEAR TITLE
The Times of India (Delhi edition)
A search report traces the history of a property -who was the original owner of the property and how it has moved hands over a period of time before reaching the present seller. This is an important part of a housing loan process. A search report is usually prepared by an advocate, who after visiting the registrar’s office and inspecting the property documents, issues a title certificate.