NCR sells twice as many homes as Mumbai in Q1

The National Capital Region (NCR) sold more than twice the number of homes compared with Mumbai in the first quarter ended June driven by affordable prices, real estate rating and research firm Liases Foras has said.

Availability of apartments below Rs1 crore has led the northern region to sell 21.33 million square feet of residential area during April-June period, while the financial capital sold 9.79 million square feet, it said in its report.

NCR sold homes worth Rs 8,227 crore in total, against Rs 7,106 crore in Mumbai. The weighted average cost of an apartment in NCR is Rs 59 lakh while in Mumbai, it stands at Rs 1 crore. Weighted average cost is the price of the total supply in the market.

However, quarter-on-quarter sales in Mumbai have seen slight improvement and have risen by 7 percent while sales in NCR have plunged 31 percent, data shows. “With excellent connectivity to Delhi by road and metro rail and the growing price of property in Delhi; NCR has emerged as a sound alternative to home buyers,” said a spokesperson of Omaxe, a real estate company. “This suggests cheaper properties available at extended suburbs were major contributor to this improvement.”

Read more:  The Financial Express  | The Times of India 

Ireo Victory Valley, located in Sector 67, Gurgaon

Economic recession forces developers to look at affordable pricing: JLL & CII study

The product has to be priced appropriately to suit consumers is one of the prime lessons that recession taught real estate developers, says a study by Jones Lang LaSalle and CII. “Projects which were launched in the price band of more than Rs 7,500 per sq ft took longer to sell. Prices of projects launched in 2009 in the under Rs 2,000 per sq ft price band escalated rapidly in 2010, thereby negatively affecting their absorption,” the report states. Since buyers of projects in the price band of Rs 3,000 per sq ft or below are price sensitive ‘Need Based Buyers’, their ability to afford houses diminished during the times of hardening interest rates. “Similarly the segments of buyers in the price band of Rs 7,500 per sq ft or more were predominantly ‘Aspirational Buyers’ or second home buyers who could choose to postpone their buying decision,” the report states. Hence projects in the price band of Rs 3,000-7,500 per sq ft have a relatively lower percentage of unsold stock as compared to the other two categories. Residential property appreciation has slowed down in 2011, however, not in all markets. “Prevailing capital values are well beyond the previous peak witnessed in third quarter of 2008 in Mumbai, Bangalore, Chennai and Kolkata. In NCR-Delhi, capital values are expected to surpass the previous peak by end-2012 and residential property rates are likely to continue their upward trajectory in select cities, although at a slower pace than in 2010,” the report states.

Read more:  The Economic Times  

Unsold units in Mumbai touch 122 million sq ft

With fewer buyers showing interest in purchasing property, the number of unsold units in the Mumbai metropolitan region has skyrocketed.

Unsold units touched 121.97 million sq ft by June 2012 from 110 million sq ft in December 2011, according to Liases Foras real estate rating and research firm. Of 121 million sq ft, the highest number of unsold units, about 25%, are located in the western suburbs from Bandra to Borivli and also in the areas beyond Thane in the central suburbs.

Unsold stock comprises roughly 10% of ready flats, while the balance comprises under-construction and newly-launched projects.  “Going by the existing absorption rate (sales), it will take approximately 37 months to clear the current stock of unsold units,” said Pankaj Kapoor, founder of Liases Foras.

Read more: The Times of India

Office space rental rise across India

Strengthening absorption of office space in the past six quarters has caused appreciation of rental and capital values in most markets,” says property consultancy firm Jones Lang LaSalle India (JLL).

Bulk of gross rental appreciation during 4Q10-2Q1 was seen in tier-I cities including Bangalore, Mumbai, Delhi and Gurgaon. Other cities like Chennai, Hyderabad, Pune and Kolkata saw this appreciation only recently during 3Q11-1Q12, rising by over 2% each q-o-q in the last six months.

Read more: The Economic Times

Economy News

Giant leap for hiring: Facebook, Amazon lease space in Bangalore, Hyderabad

Some of the world’s biggest technology companies have booked acres of office space in Bangalore and Hyderabad, real estate agents said, indicating that investments are proceeding apace in the software sector despite a generally gloomy mood for businesses. Facebook, Amazon, Xerox and chipmaker AMD are among the companies that have leased office space in India’s technology capital Bangalore, or in Hyderabad, which is home to companies such as Google and Microsoft. Including tax preparation software maker Intuit, these five companies have in recent weeks leased more than 6 lakh sq ft, a precursor to hiring thousands of professionals. The general rule of thumb is to provide 75-80 sq ft of usable space for every employee. By this estimate, Facebook’s Hyderabad office can accommodate approximately 500 staff and Amazon about 5,000.

Read more:  The Economic Times  

Indian IT companies supported 2.8 lakh jobs in US last year: Nirupama Rao

Indian IT companies supported as many as 2.8 lakh jobs in America last year amid a gloomy employment scenario in the US and have invested a whopping over five billion dollars in FDI through acquisitions and green-field projects, according to India’s top envoy here.

Addressing the Asia Society here yesterday, Indian Ambassador to the US, Nirupama Rao said, “Our IT companies supported 280,000 jobs in the US last year. “The IT companies have invested more than 5 billion dollars in FDI through acquisitions and green-field projects.”

Read more: The Times of India

Allow FDI in multi-brand retail: US to India

India should allow foreign direct investment in multi-brand retail besides taking other economic reforms to further enhance the country’s economic growth, US Ambassador to India Nancy J Powell has said. “For India to return to faster growth, new policies and economic reforms need to be

put in place by the government in areas such as opening multi-brand retail up to foreign direct investment,” Powell said at an Indo-American Chamber of Commerce (IACC) programme here.

She said that as the global economy slowed in 2011, India’s Gross Domestic Product (GDP) growth too slowed to about 7 per cent. “Yet despite the economic challenges we all faced over the past year, each day, my embassy colleagues and I are uncovering new ways to link one the world’s fastest growing economies – India – with the US,” she added.

Read more: The Hindustan Times

NRI News

With MBA from US, Indians return to do business at home

More and more Indians graduating from top global business schools, including Wharton, Harvard and Stanford, are spurning traditional job offers in favour of starting up new business ventures back home.

Wharton’s MBA batch of 2012 had 70-80 Indians, of which 10-15 turned entrepreneurs. And in the current class of about 100 Indians, 15-20 are already entrepreneurs or are actively working towards founding their own businesses, according to ET estimates based on interviews with 10 alumni. Such instances were uncommon even as recently as 2009.

Harvard Business School saw 5-6 out of 30-35 Indian students turning entrepreneurs from its class of 2011, according to alumni estimates. It hardly had any Indian entrepreneurs five years ago. Similarly, Stanford’s B-school saw a record-breaking 16% of its class of 2011 starting their own firms, with a significant number of Indians in the group.

Read more: The Times of India

NRIs filing India tax return: Don’t forget deemed rent

Investing in Indian real estate is a hot favorite among Non Resident Indians (NRIs). And like every other investment, real estate comes with its share of tax challenges. As we approach the due date for filing tax returns in India for the year 2011-2012, let us look at a tax law relating to real estate that is peculiar to the Indian Income Tax. This law is applicable to both residents as well as NRIs. However, unless they have a regular relationship with a chartered accountant in India, NRIs tend to miss this particular law.

Deemed rent

According to the Indian Income Tax Act, if a taxpayer (resident or NRI) owns more than one house property, only one of them will be deemed as self-occupied. There will be no income tax on a self-occupied property. The other one, whether you rent it out or not, will be deemed to be given on rent. If you have not given the second property on rent, you will have to calculate deemed rental income on the second property (based on certain valuations prescribed by the income tax rules) and pay the tax thereof.

Read more: The Times of India

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s