Price, connectivity key criteria for first-time homebuyers, says study

Anish Pai, working in Mumbai, has a Rs. 60-70 lakh home-buying budget and two undesirable alternatives to choose from. One is a 650 sq. ft resale apartment in Ghatkopar or Kanjurmarg near Kurla, where he lives in a rented flat. The second is a more spacious two-bedroom apartment in Navi Mumbai, but one that will double his commuting time. Pai’s struggle to buy his first home in India’s most expensive real estate market reflects the findings of the recent ‘First Home Survey’ conducted by real estate website makaan.com. More than 3,950 first-time homebuyers from across the country participated in the online survey that ran during May-June. Many of the respondents were from Mumbai, the National Capital Region (NCR) and Bangalore and most of them were male, in the age group of 26-45 years. Price and connectivity (public transport) over location emerged as the top two buying considerations, with the average budget at below Rs.40 lakh.  “The biggest challenge for first homebuyers is that what they want they can’t afford and what they are getting is too far away,” said Pankaj Kapoor, chief executive, Liases Foras. “The reality is far from the aspirational aspects associated with such buyers.”

Read more: Mint

No service tax on remittances to India by NRIs: PM to Chandy

Prime Minister Manmohan Singh has dismissed reports of any plan to bring under the service tax ambit foreign remittances by overseas Indians, Kerala chief minister Oommen Chandy said today.

Singh has also sought details from the Finance Ministry on the issue, said Chandy who raised objections before the Prime Minister over the reported move by the Government to levy the tax on the money of Indians working abroad.

“Prime Minister has dismissed reports that the Government is planning to charge 12.36 per cent on all foreign remittances to India,” Chandy told reporters after meeting the Prime Minister here.

Read more: The Times of India

More houses for the poor

The Delhi government on Wednesday gave its nod to construct 7,400 economically weaker section (EWS) houses for slum dwellers under Jawaharlal Nehru National Urban Renewal Mission (JNNURM) at Bhalasawa, Jahagirpuri. It was also decided to construct a community hall at Trilokpuri at an estimated cost of Rs 3.75 crore at a Delhi Urban Shelter Improvement Board (DUSIB) meeting chaired by chief minister Sheila Dikshit. Dikshit said the EWS houses approved by the board would have five floors and come up at an estimated cost of Rs 356.79 crore. “They will also have water supply, toilets, electricity and drainage facilities. Roads, paths, boundary walls and sewerage will also be built,” she said underlining the need for quality construction and proper maintenance. On the question of regularization of unauthorized colonies, she said things were moving in the right direction and some of the colonies will be regularized in the next couple of months. According to urban development minister A K Walia, the process of regularization of unauthorized colonies will begin on August 15.

Read more:  Deccan Herald  | The Economic Times 

Private equity players see depressed realty market as big-ticket investment

Private equity investors continue to put their faith in India’s real estate sector, despite a slowdown in home and office sales across cities. Property advisory firm Cushman & Wakefield said during the Jan-Mar 2012 quarter, PE investments in the sector more than doubled from Rs 1,060 crore a year ago to Rs 2,100 crore, and was 26 percent higher than Rs 1,670 crore the previous quarter. The average deal size in development projects also increased from Rs 80 crore in Q4 2011 to Rs 190 crore in Q1 2012. “Close to Rs 15,000 crore worth of private equity deals are in the pipeline today and are expected to be concluded over the next 12 months,” says Sanjay Dutt, executive managing director, South Asia at Cushman & Wakefield. “There are many funds, independent investors and institutions, who are seeing the current depressed market as an opportunity, as valuations are very attractive.”

Read more:  The Economic Times  

Interest subvention on housing loan extended by a year

The government has extended the 1% interest subvention scheme on housing loans for a year. The decision was approved by the Cabinet in its meeting on Tuesday. The then Finance Minister Pranab Mukherjee in Budget 2012-13, had proposed to extend the scheme of interest subvention for loans up to Rs 15 lakh by another year.

Already a budgetary provision of Rs 400 crore has been made for implementing the scheme in 2012-13.

The limit of subsidy for an individual borrower would be Rs 14,912 for a loan of Rs 15 lakh and Rs 9,925 for a loan of Rs 10 lakh. The extended scheme will benefit all house loans availed in 2012-13 fiscal.

Read more: The Economic Times

Mumbai residential market stagnates: Knight Frank

Developers are hard pressed to deleverage their positions in the Mumbai residential market as they are getting buried under continuously mounting debts with the market offering them little respite, according to a study by real estate firm Knight Frank. The total debt position of five major Mumbai based developers adds up to Rs 62 billion as on March 2012, while they are holding on to a total unsold inventory of approximately Rs 143 billion, which is 14 per cent of the total Mumbai residential market.

In the context of various sources of funding drying up and new launches hitting the market, the developers may re-plan their pricing strategy in such a way that the unsold inventory is monetised within four to six quarters instead of the currently estimated eight to ten quarters, as per the study.

Read more: The Economic Times

Office Space

Bangalore sees 46% drop in office space absorption

Office market across the country continues to be depressed due to lower demands from corporate. Bangalore, which witnessed the highest absorption in first half of 2012 at little over 3 million sq ft saw significant decline of 45% as compared to a year ago period, says real estate consultancy Cushman & Wakefield in a latest office market report.

The absorption was mainly concentrated in the peripheral locations of Outer Ring Road. It was noted that the occupiers have displayed a clear preference for the Grade A spaces. The city also saw 3.5 million sq ft of pre-committed during the first half of the year.

Read more: The Economic Times

Office absorption in India falls by 21% in first half of 2012

The first half of 2012 recorded total absorption of approximately 13.4 million sq ft of office space in India registering a decline of 21 per cent compared to same period last year which was 16.9 million sq ft.

Bangalore witnessed the highest absorption in first half of 2012 at 3.01 million sq ft followed by Mumbai with 2.78 million sq.ft, according to the latest office market report from real estate consultancy Cushman & Wakefield.

Real Estate: The Economic Times

Economy

Firms see India 3rd most-favored destination: UN report

Major global companies consider India their third most favored destination after China and the United States, a UN report said on Thursday, and investment inflows could increase by more than 20 per cent both this year and next.

Foreign direct investment (FDI) flows into India leapt 30 per cent to nearly $32 billion in 2011, though held back by slow pace of reforms, it still remains a long way down the league table of FDI recipients.

China drew $124 billion last year, while Brazil attracted nearly $67 billion and Russia $53 billion.

Read more: The Economic Times

India jumps to second position on Global Innovation Efficiency Index

India has jumped to the second position in the Global Innovation Efficiency Index in 2012, from 9th position last year, according to a study. Countries, which are strong in producing innovation outputs despite a weaker innovation environment and inputs, are poised to rank high in the efficiency index. While China topped the list, interestingly, Switzerland and the Netherlands ranked 5th and 9th. Sri Lanka was at the 10th position, a report prepared by CII, Alcatel-Lucent and Booz & Co said. However, it said that in Central and Southern Asia, India is the regional leader in Global Innovation Index.

Read more:  The Financial Express | The Times of India 

Mauritius offers India 2 islands in effort to preserve tax treaty

How far will a country go to secure a favorable deal for itself? Pretty far, it seems. Mauritius has offered a couple of sun-drenched islands to India as part of a trade and investment deal. While the offer has been talked about for a while, Mauritius has revived it – at a time when it’s very keen on persevering with the 1983 double-taxation avoidance treaty with India.

Mauritius foreign affairs and trade minister Arvin Boolell said that it was up to India to use the islands to its advantage. He said the “blue economy” had great potential. India could use North and South Agalega Islands (which are located 1,100 km north of Mauritius and have an official total area of 70 sq km) for setting up hotels and tourist resorts, for trade, marine studies, or for building a strategic presence in the Indian Ocean, official sources told TOI. North Agalega Island also has an airstrip.

Read more: The Times of India

Rupee gains for 4th day; hits 1-1/2 month peak

The rupee strengthened for a fourth straight session on Tuesday, its longest winning streak in four months, as foreign banks sold dollars likely on behalf of their offshore clients looking to invest in the domestic share market.

Most other Asian currencies also rose against the dollar as hopes of further monetary easing by major central banks boosted demand for riskier assets.

Read more: The Economic Times

Rupee appreciation may continue in the short term

The recent appreciation of the rupee from levels of 57.16 per dollar to 54.36 to per dollar in a span of 10 days has raised hope that it may appreciate further. CRISIL Research, assigns a two in three chance of the rupee settling at around 50 per dollar by March 2013.

However, skeptics believe rupee is unlikely to gain significantly in the near term. “GDP growth is slowing down, the monsoon has been delayed, interest rates may not come down significantly. Hence foreign investors may not come back to India in a hurry,” says Abhishek Goenka, Founder and CEO, India Forex Advisors.

Read more: The Economic Times

Hedging gets tough on rupee volatility

When a private banker advised a jewelry importer to only partly hedge the US dollar payable in March, he did not realize that his client would end up losing money on that strategy.

The advice at that point was based on expectations that the worst for the rupee was over since the currency reversed the trend climbing 4.5% in the March quarter after collapsing 21% between August and December 2011.
Read more: The Economic Times

IBM takes made-for-India technologies global

In the Bay of Bengal, floating across hundreds of nautical miles, are about 1800 small buoyant sensors, which record wave height, speed and changes in ocean current. These sensors transmit the information to a satellite, which relays to the Indian National Centre for Ocean Information Services in Hyderabad, helping it alert coastal towns to the likelihood of any tsunamis.

Put in place three years back by the India arm of world’s second largest technology company, IBM, the system can send out alerts 2-3 hours before catastrophes strike. “India can rest assured the aftermath of the tsunami in 2005 will never happen again,” says Pradeep Nair, who heads the software group at IBM India, which is developing such technologies out of Bangalore.

Read more: The Times of India

International Business

IMF cuts US 2012 growth forecast to 2.0%; says at risk from Eurozone crisis

The International Monetary Fund on Tuesday pared its growth forecast for the US economy and warned that the Obama administration could be slicing the deficit too fast for the weak economy.

It also said the economy was under threat from the pre-programmed “fiscal cliff” combination of sharp spending cuts and tax increases at the year-end, and a worsening of the Eurozone crisis.
Read more: The Economic Times

22 companies have called off their IPOs so far in 2012: SMC Global Securities

As many as 22 companies have called off their initial public offerings so far in 2012, according to stock broking firm SMC Global Securities. They were planning to raise about Rs 8,392 crore in aggregate.

The list includes Reid & Taylor, Tata Autocomp, Micromax, Embassy Property, Joyalukkas, Lokmat Media, VRL Logistics, Aravali Infrapower and Semantic Space Technologies, among notable examples.

Read more: The Economic Times

Infrastructure

India for stepped up investment in infra to create jobs

India today stressed on the need to significantly scale up investment in infrastructure, technology and skills development to create jobs as the world grapples with high unemployment rates amid economic slowdown. “Overcoming the challenges of global unemployment is a pre-requisite to banish poverty and achieve the Millenium Development Goals. “We must take concerted action to create an enabling environment at the international and national level for promoting full employment while improving productive capacity,” India’s Permanent Representative to the UN Hardeep Singh Puri said. He said the sovereign debt crisis in the Euro Zone continues to cast its shadow on the process of economic recovery, and has further exacerbated an already serious worldwide unemployment problem.

Read more:  Financial Chronicle  | The Financial Express | The Economic Times 

Begin work on Gurgaon pod car project: Hooda

Setting the ball rolling on the Personal Rapid Transit (PRT) transport service project, popularly known as pod car, in Gurgaon, Haryana Chief Minister Bhupinder Singh Hooda has directed the agencies concerned to complete all formalities for the commencement of work on the ambitious project within three months. Hooda issued the directions at a meeting on the PRT project. He also announced that Haryana State Industrial and Infrastructure Development Corporation Managing Director Rajiv Arora would be the nodal officer for the project.

Read more: The Hindu

Delhi-Mumbai industrial corridor project gets legup

The $100 billion Delhi-Mumbai industrial corridor project moved a step closer to implementation with the government now working to secure pre-environmental clearances after completing perspective plan for the corridor. “The detailed environmental impact assessment for all six cities is currently in progress and we are aiming to secure pre-clearances to ensure speedy implementation,” commerce, industry and textile minister Anand Sharma said. He added that the ministry has completed perspective plan for the entire corridor that is spread across six states. According to Sharma, the government will finance the entire trunk infrastructure in these townships while the internal infrastructure would be developed on a public private partnership model.

Read more:  Financial Chronicle  

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