Demand Beats Supply in Residential Realty

The residential sector saw a steady demand across almost all the major cities with capital values in majority of the micro-markets remaining stable across high-end and mid-end segment properties, according to a study. ET Realty reports.

As the number of new launches of housing units in almost all the cities in the country has declined, their prices have either appreciated or remained stable. If the pace of the new launches does not pick up, the prices are likely to rise further in the short to medium term. According to a study conducted by global consultancy firm Cushman and Wakefield (C&W), an estimated 17,500 residential units were launched by organized developers in the second quarter of 2012 in major cities across the country, registering a decline of nearly 44% over the previous quarter. This decline in launches, the report said, can be attributed to a number of factors like delay in approvals, significant inventory in certain locations, as well as postponement of project to coincide with the new launches in the festival season. Of the 17,500 units launched, C&W said 70% catered to the mid-segment, as it continues to see maximum demand from end users and investors.

Read more: The Economic Times

Ireo Skyon, located in Sector 60, Gurgaon, features smart home capability and a well planned infrastructure within Ireo City

Smart cities: India needs $1.2 tn investment

Investment of about USD 1.2 trillion is required over the next 20 years across areas like transportation, energy and public security to build cities of tomorrow, IBM India Managing Director Shanker Annaswamy said on Thursday. Speaking at the IBM Smarter Cities Forum, Annaswamy said it is estimated that USD 1.2 trillion capital investment is needed to meet projected demand in (Indian) cities to transform the cities going forward.” IBM has hosted similar events across cities like Berlin, Shanghai, New York City and Rio de Janeiro. “By 2050, it is estimated that 70 percent of the global population would live in cities as people migrate to urban areas for better opportunities. “This would mean that cities need to be planned in a way to effectively handle the situation. Technology can be used to support the system and transform cities,” IBM Corporation Chairman of the Board Samuel J Palmisano said. IBM is working with countries like Saudi Arabia, the US and Philippines on systems like water and waste management.

Read  more:  The Financial Express  

Packaging realty

Edited excerpts from an interview with Anjan Rangan, Managing Director of Cedilla Group of Companies:

What exactly is lead management and how does it pertain to real estate?

Developers and promoters of projects can only focus on the development of the project and hence they outsource marketing of their properties to an external agency. Lead Management pertains to being associated with a project right from its infancy in many cases, from being consulted as a sales and marketing partner to first gauge the kind of development and interest it will raise, to taking on the onus of the entire advertisement campaign. Lead generation is based on the response from people. This means that the entire creative strategy with respect to a project is given over to the lead management company. This is conceived in association with the developers and promoters of various real estate projects.

Read more:  The Times of India (Chennai edition) 

Trump Card

trump

via Wikipedia

Trump Towers is the new Pune code. That is, after years of speculation whether to set up shop in India, the Donald Trump-led Trump Organization has brokered a deal with the Pune-based Panchshil Realty to set up a project in the country’s self-proclaimed Oxford of the east. Last month, the Pune-based Panchshil Realty made headlines by announcing a branding tie-up with the New York-headquartered Trump Organization for Trump Towers. Business tycoon Donald Trump’s son, Donald Trump Jr., Executive Vice-President-Development and Acquisitions, played a pivotal role in ensuring the deal went through. Responding over email, Trump Jr. explains, “I have had the privilege of visiting India many times and just over a year ago, I met with Panchshil Realty. I visited many of their projects and was drawn by their attention to detail, commitment to quality and love of real estate, similar to our core values at the Trump Organization. As the developer of Trump Tower Pune, Panchshil Realty plans to deliver a project that is second to none and truly will elevate the standard of the luxury in this region.” With work already underway at the Pune site and expected to be ready by 2015, Trump Towers seems set to be the first Trump branded property in India with Junior clearly emerging as the new architect of Don Trump’s multi-billion dollar empire.

Read more:  The Economic Times  

End users target Sohna Road, while Dwarka Expressway attract investors

Sohna Road and Dwarka Expressway have been creating ripples as the most sought after real estate destinations in Gurgaon. However five years ago Sohna Road was just any other locality on the outskirts of Gurgaon and Dwarka Expressway did not even exist on the realty map. While the former has emerged as a preferred residential location in the last two-three years, the latter is touted to be the next big thing in the real estate industry, once the work is completed.

Realty Scenario

Over the last one year, residential real estate values in Sohna Road have shown a significant appreciation of almost 30 per cent, as per data on MagicBricks.com. A key factor driving demand in Sohna Road is the employment generated in Gurgaon. “Om Ahuja, CEO, Residential, Jones Lang LaSalle says, “There is a large inflow of working population into Gurgaon every year, which translates into strong demand for housing in peripheral areas”. This has led to a huge rush of end users towards Sohna Road which is well connected to Gurgaon.

Read more: Magic Bricks

More homes expected in market by year end

A number of projects are in different stages of completion across the city and this is good news for prospective homebuyers, says Deepti Ganapathy.  The city’s residential property scene is driven by various factors. Proximity to the international airport, Metro lines, Outer Ring Road (ORR) and IT belts have been the most evident factors for the spread of residential catchments.

“Bangalore today is ranked by the Urban Land Institute as the 10th most favoured real estate investment destination in Asia Pacific. The city is known for its high growth and better quality of real estate developments as compared to most other Indian cities. Besides IT, there are other industries like auto, leather, apparel which are also contributing towards the commercial real estate growth in the city. Demand in residential real estate in Bangalore has been characterized by high demand for mid-value apartments. The demand for the high-end residential projects is also pretty strong and driven by both end-users and investors. A number of HNIs have invested in more than one home in the city, usually in the suburbs and peripheral areas to take advantage of the strong demand for rental homes as well as the sizeable price appreciation,” says Naveen Nandwani, Director-Bangalore, Cushman and Wakefield.

Read more: The Times of India

Policy

Builders can collect VAT retrospectively

Flat buyers hoping for some relief from paying Value Added Tax (VAT) if developers were not registered with the sales tax department are in for some disappointing news. The state has allowed builders to collect the tax retrospectively.

The department clarified that the builders could collect VAT retrospectively from 2006 onwards even if they had registered recently.  “The builders just have to give an application,” said a senior sales tax officer, on condition of anonymity.

Read more: Hindustan Times

Better deal for the better half

For the first time in India, a woman’s share in marital property has become part of the marriage-related legislation. Sachin Sandhir, the managing director of RICS South Asia, welcomes the government’s amendment to the marriage legislation, where the female spouse is entitled to 50% of the residential property. “Such amendments in legislation will ensure that women continue to have a sense of physical security, even though the marriage has come to an end through mutual consent.” He says that while this “development is welcome, the Marriage (Amendment) Bill should also address the fact that women should be entitled to a share in all other property acquired during thecourse of marriage and not just residential property.”

Read more: The Times of India

Govt allows 51% FDI in multi-brand retail

Opting for big-bang reforms, the government today allowed politically-risky 51% FDI in multi-brand retail, 49% investment by foreign airlines in aviation sector and sale of equity in four PSUs.

Battling perceptions of policy paralysis, the government announced the surprise decisions after meetings of the Union Cabinet as well as the Cabinet Committee on Economic Affairs (CCEA), prompting angry reactions from its key ally TMC as well as BJP and Left parties.

Read more: Business Standard

Home Loans

Well placed to deliver 18-20 percent loan growth: HDFC

HDFC has said that the company is well placed to deliver 18-20 percent loan growth with stable margins and asset quality driven by growth in the smaller towns. Giving their presentation at the CLSA investor forum, HDFC Chairman Deepak Parekh, Vice Chairman and CEO Keki Mistry and MD Renu Karnad highlighted that the competitive environment has been stable and HDFC can deliver 18-20 percent loan growth with stable margins and asset quality. At present, home ownership levels in India are under penetrated and considering the favorable demographics, and as the affordability levels of the masses increase, financiers can reap positive results in the long run. According to the management while metros have seen some moderation in demand due to high interest rates and property prices, growth from smaller towns is holding-up well and will be key growth driver. At present HDFC has a widespread branch reach with nearly 320 own outlets. Besides, more than 2,500 branches of HDFC Bank market HDFC’s mortgage loans. It has also tied-up recently with IndusInd Bank.

Read more:  The Financial Express  | The Economic Times 

Slowdown effect: SBI prunes home loan target to 20 percent this fiscal

State Bank of India has lowered its home loan growth target to 20 per cent for this fiscal, as lenders are grappling with a slowdown in the housing sector. “We have already cut interest rates. We expect credit offtake in this sector to pick up in the latter part of the year,” Pradeep Kumar, Deputy Managing Director and Group Executive of the bank, told Business Line here on Thursday.

He was in Hyderabad to inaugurate the first ATM in Andhra Pradesh under the brown label arrangement, envisaging TCBIL, a Tata Group company, as the outsourcing agency. (A brown label ATM is one where an outsourcing agency will install, maintain and service the machine, with the bank providing only cash and connectivity.)

Read more: The Hindu Business Line

Infrastructure

Gurgaon rapid Metro ready for trials

In a move that promises better connectivity in the city soon, the first train set of the Rapid Metro Rail that had arrived in the city on Tuesday from China was placed on the tracks on Thursday. The trial runs are all set to begin in a fortnight. The authorities claimed that the operations would begin in March as scheduled. However the Shankar Chowk station, one among the six on the network, would be initially closed as the work is lagging behind here.

Read more:  The Times of India 

Govt to support 19 Metro rail projects: PM

metro

via Wikipedia

Noting that an efficient transport system was ‘critical’ for orderly growth of cities, Prime Minister Manmohan Singh today said the government has decided to support preparation of Detailed Project Reports (DPR) for Metro rail in all 19 cities with a population of over two million. Laying the foundation for the Rs 5,181 crore Kochi Metro project here, Singh said DPRs had already been prepared for 12 cities and Metro rail projects were being implemented in seven cities covering a total network of length 476 km at a cost of over Rs 1.15 lakh crore. The Delhi Metro is carrying about 22 lakh people daily, he said. Kochi is the eighth city in the country to get the Metro. The newly sanctioned Metro line will run 25 km from Aluva to Petta. The central government will contribute Rs 1,000 crore for the project out of the total project cost.

Read more:  The Financial Express  | The Hindu Business Line | The Indian Express | Business Standard 

Delhi Metro to introduce eco-friendly rickshaws

Delhi Metro is on the verge of coming out with a solution for a perpetual problem that has been forcing many to take to the wheels, relying less on public transport.  Eco-friendly rickshaws, the Delhi Metro Rail Corporation feels, is the best way to help people reach Metro stations from their homes where a bus or a van cannot go due to a variety of reasons.

Though feeder bus is one option that has been tested with less success, the Delhi Metro feels battery-run e-rickshaws will help ferry people from their homes to stations which are either far away or located at a not-so-walkable distance.

Read more: The Hindu Business Line

4,000-km highway projects to be awarded through EPC route

Government is targeting awarding road construction projects of 4,000 km length in the current fiscal through the engineering, procurement and construction (EPC) mode.  Of this, bids for road projects of 2,650 km length has been invited by ministry of road transport and highways (MoRTH).

The remaining will be done by the National Highways Authority of India (NHAI), MoRTH secretary A K Upadhyay said here on Thursday. He was speaking on the sidelines of an event organized by International Centre for Automotive Technology.

Read more: Business Standard

Planning Commission pegs outlay for roads at Rs 9.2 lakh cr in 12th Plan

Aimed at sprucing up the country’s roads and bridges to bolster economic growth, the Planning Commission has projected Rs 9.2 lakh crore expenditure over the next five years.

“The total investment is projected at Rs 9,02,071 crore during the 12th Plan (2012-17), of which Central and States’ investments’ will be Rs 3,58,845 crore and Rs 2,66,851 crore respectively,” Planning Commission has said in a note.

Read more: The Economic Times

Hooda pitches for Delhi-Alwar rapid transit via Gurgaon

Haryana Chief Minister Bhupinder Singh Hooda on Thursday proposed to develop a regional rapid transit system along the Delhi-Gurgaon-Rewari-Alwar corridor to provide efficient and cost-effective transport to the people.

The proposed rapid transit system would act as a catalyst for economic activities along the route, he said while speaking at a conference on Smarter cities: Transforming India, City by City, organized by IBM’s Smarter Cities Forum in Gurgaon.

Praising the state’s public-private partnership (PPP) model for urban development, he said: “Haryana has shown the way in executing PPP projects in urban transport sector. Our intra-city monorail project (Rapid Metro) in Gurgaon is being developed primarily on the PPP mode.”

Read more: Indian Express

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