Give infrastructure status to the real estate sector: NAREDCO

1/19/2021 11:16:00 AM

Stating that a housing revolution is the need of the hour much like the IT revolution and the green revolution, the National Real Estate Development Council (NAREDCO) has urged the government to provide an infrastructure status to the real estate sector to enhance its borrowing capacity. The real estate body also emphasized on the need for an increase in tax deduction on home loan interest from the current Rs 2 lakh to Rs 5 lakh to boost sales. There should be more stressed funds on the lines of the SWAMIH fund for providing funding to stuck projects and incentives for rental housing, NAREDCO said as it presented its wishlist for Union Budget 2021-22 on January 14. “The ongoing COVID-19 pandemic has impacted global economies and Indian real estate is not spared from the depths of despair. The fiscal impetus announced under (the) Aatmanirbhar Bharat has led to renewed consumer demand that led to the emergence of green shoots in (the) Indian economy and real estate sectors. The laudable measures like tax rationalisation, additional stress fund, ample liquidity tools will keep the momentum going and propel India towards a $5 trillion economy,” said Niranjan Hiranandani, National President, NAREDCO. “We want that the real estate sector be given infrastructure status to boost its borrowing capacity,” he told reporters. Maharashtra has cut stamp duties and this has helped boost the sector. The recent cut in premium is also likely to rationalise housing prices in the state. "We want a housing revolution like the IT revolution and the green revolution," Hiranandani said. Two segments - rental and affordable housing - need an impetus in Budget 2021. For rental housing, enhanced HRA Tax Exemption; increase depreciation rate for the rental projects like in commercial buildings and allow ‘carry on’ of loss from rental income, NAREDCO said. Similarly, affordable housing will benefit from increasing completion period to six years; while enabling concessional lending rate for affordable housing projects. Extending the Credit Linked Subsidy Scheme (CLSS) for all segments will support homebuyers. To promote rental housing, deduction of 30 percent from the annual rental income (for purpose of maintenance) should be increased to 50 percent. This will not only improve ROI, but will also encourage citizens from investing in residential properties for giving on rent, it said. As for the government-backed SWAMIH fund worth Rs 25,000 crore, Hiranandani said the Centre should allow more such stress funds to help facilitate the last-mile funding for stressed and stalled projects. "Industry demands estimated Rs 1,25,000 crore via many HFCs/NBFCs who are ready to establish such funds for ailing real estate sector. This will allow for faster appraisals and sanctions," he said. As an incentive to homebuyers, the deduction on home loan interest should be enhanced to Rs 5 lakh from Rs 2 lakh under section 24 of IT Act 1961, it said. It also recommended long-term capital gains at 10 per cent (on par with the provision of section 112 for equity shares and reduction in the period of holding house property to up to 12 months from existing 24/36 months to qualify as a long-term capital asset. Rajeev Talwar, Chairman, NAREDCO, said the “Interest on housing loans should be fully allowed under Income Tax Deduction without any ceiling. The current limit of interest deduction under Section 24 of IT Act 1961 on housing loan of Rs 2 lakh should be removed to incentivise homebuyers and spurring overall demand. Also, loss from house property should be fully allowed to be adjusted against other heads of income. In case of unadjusted loss, it should be fully allowed to be carried forward to subsequent years.” “The RBI, through a notification in 2017, allowed a loan to-value ratio (LTV) of up to 90 percent for home loans for affordable houses of Rs 30 lakh or less. Same facility should be permitted for other housing including MIG and HIG as well,” he said. Talwar also said the government should lift the ban on subvention schemes. Under subvention schemes, homebuyers pay the initial amount, and the bank pays the loan amount to the developer according to the construction stage, while the interest portion on the loan disbursed is paid by the developer until possession. What this means is that the real estate developers pay pre-EMIs (equated monthly instalments) on behalf of homebuyers for a certain period specified in the contract or the date of possession. In 2013, the RBI had advised banks to exercise caution while financing purchases under the interest subvention schemes “in view of the higher risks associated with such lump sum disbursal of sanctioned housing loans and customer suitability issues.” In 2019, the National Housing Bank (NHB) had asked HFCs to "desist" from offering loans under interest subvention scheme after there were complaints of default. The result of the two advisories was that several banks and later the HFCs stopped funding under the scheme. NAREDCO said the one-time restructuring of loans will play an important role in improving the liquidity situation. "The requirement of the unit being 'standard unit' if done away and restructuring permitted for all units as per mutual agreement with the financing enterprise and the borrower would have a positive impact," it added. The realtors’ body also said External Commercial Borrowings for the sector and reforms for Special Economic Zones should be allowed, including extending notification date for IT/ITeS SEZs and withdrawal of MAT. “This will go a long way in ensuring green shoots in the real estate sector,” they said. Source: Money control Chandigarh

Luxury housing sales rise in Delhi-NCR

1/18/2021 2:16:00 PM

The luxury residential market in Delhi NCR made a promising comeback in 2020 with developers selling 929 units priced over Rs 1.5 crore during the year. Thoughsales were down 34% Y-o-Y, market watchers say the numbers will rise as demand is mainly being driven by NRIs and HNIs, who are exploring projects with world class amenities and property management, among other factors. Developers and analysts point out that 2021 will witness more traction in the luxury segment as NRIs and HNIs who have been scouting the market for deals will finalise their transactions in the first half of 2021. Although sales in luxury housing in Delhi NCR in 2020 were lower on an annual basis, its share of total sales have risen marginally. As per Anarock research, NCR saw total housing sales of more than 23,220 units, of which nearly 4% was luxury, priced at Rs 1.5 crore and above. In 2019, total sales were 46,910 units, of which 3% was luxury. Anarock Property Consultants chairman Anuj Puri says the scintillating highs that luxury housing experienced in earlier years, especially as a good investment class, are over for good. Today, end users are driving majority of sales. Ever since demonetisation, in late 2016, developers have also significantly curtailed supply within this category, which positively impacted the segment in shedding its previous unsold stock. “In 2020, while affordable and mid segments continued to drive housing demand, luxury sales saw some movement in NCR despite the pandemic. This is also because the pandemic did not hit this buyer-class economically as much as it did the middle class,” Puri said. Square Yards principal partner and head (India sales)Rahul Purohit notes that the segment’s promising comeback in Q3 2020 was aided by low interest rates, strong asset value and an appreciation of the need for space owing to shifting work patterns. “Trend is mainly driven by NRIs and HNIs looking for projects that offer convenience, better property management standards, touchless luxury specifications and an ecosystem with world-class amenities,” Purohit explained. Properties in Gurgaon locations like Golf Course Road, Golf Course Extension and central Gurgaon commanding prices in the range of Rs 2-5 crore, and Sohna Road quoting prices above Rs 1 crore witnessed significant demand from aspiring homebuyers, he said, adding that luxury homes in Noida Expressway and central Noida with price estimates of above Rs 1 crore also drove much of the demand, with developers resorting to price corrections and recasting payment plans to accelerate buying decisions of consumers and liquidate pending stock. Going ahead, ABACorp director Amit Modi expects the luxury segment to perform well. “In 2021, the movement will be a little faster as HNIs and NRIs have expedited their search, and will finalise deals in first half of 2021. The deals for homes ranging up to Rs 1.5 crore are likely to be closed in first quarter itself,” he added. BPTP’s senior VP (sales & marketing) Amit Raj Jain points out that there is a lot of traction on properties upwards of Rs 1.2 crore, as people started to realise that this is the best time to buy houses. “We consider affordable and mid-housing at up to Rs 1 crore. Then from Rs 1-5 crore is premium and luxury is over Rs 5 crore. Our villas start at Rs 5 crore, where we have not seen much movement. But we are seeing movement in properties from Rs 70-80 lakh to Rs 2 crore. For us premium and affordable are doing fine,” he added. Raheja Developers COO Achal Raina says Covid-19 has created convergence between luxury real estate and quality living. “With millennials, too, looking forward to own their own luxury dwellings, we expect 30-40% increase in sales in the segment during 2021 calendar year. A major demand has also come due to people spending a lot of time at their homes. The same people have now started searching for bigger and spacious homes with all luxury amenities within the same vicinity,” he added. “Trend is mainly driven by NRIs and HNIs looking for projects that offer convenience, better property management standards, touchless luxury specifications and an ecosystem with world-class amenities,” Purohit explained. Properties in Gurgaon locations like Golf Course Road, Golf Course Extension and central Gurgaon commanding prices in the range of Rs 2-5 crore, and Sohna Road quoting prices above Rs 1 crore witnessed significant demand from aspiring homebuyers, he said, adding that luxury homes in Noida Expressway and central Noida with price estimates of above Rs 1 crore also drove much of the demand, with developers resorting to price corrections and recasting payment plans to accelerate buying decisions of consumers and liquidate pending stock. Going ahead, ABACorp director Amit Modi expects the luxury segment to perform well. “In 2021, the movement will be a little faster as HNIs and NRIs have expedited their search, and will finalise deals in first half of 2021. The deals for homes ranging up to Rs 1.5 crore are likely to be closed in first quarter itself,” he added. BPTP’s senior VP (sales & marketing) Amit Raj Jain points out that there is a lot of traction on properties upwards of Rs 1.2 crore, as people started to realise that this is the best time to buy houses. “We consider affordable and mid-housing at up to Rs 1 crore. Then from Rs 1-5 crore is premium and luxury is over Rs 5 crore. Our villas start at Rs 5 crore, where we have not seen much movement. But we are seeing movement in properties from Rs 70-80 lakh to Rs 2 crore. For us premium and affordable are doing fine,” he added. Raheja Developers COO Achal Raina says Covid-19 has created convergence between luxury real estate and quality living. “With millennials, too, looking forward to own their own luxury dwellings, we expect 30-40% increase in sales in the segment during 2021 calendar year. A major demand has also come due to people spending a lot of time at their homes. The same people have now started searching for bigger and spacious homes with all luxury amenities within the same vicinity,” he added. Source: Financial Express Delhi-NCR

Growth of the affordable housing segment in India in 2021

1/16/2021 12:52:00 PM

The lasting effects of the outbreak of Covid-19 have ensured that 2020 has been a difficult year for economies across the globe. While the effects seem to have been muted to a certain extent in the last quarter of the calendar year, in general, several nations and organizations are still coming to terms with a different future than the one initially envisaged. Work from home has become a reality for many and therefore the value of owning ones home has become that much more important for several families. Furthermore, aside from just work, people have moved several parts of their life to digital platforms such as online education, video-based medical consultations, increased e-commerce and business-related video conferencing and webinars etc. thereby further accentuating the need for a spacious home. This has contributed to the increased demand for residential real estate in major cities across India. Certain trends in housing and more particularly affordable housing will remain crucial in maintaining the momentum of home sales in 2021. I have highlighted a few below. Housing for All Mission: The government’s ‘Housing for all’ initiative that it aims to achieve by 2022 has boosted this segment. Various rules and regulations such as the Pradhan Mantri Awas Yojna (PMAY) and the GST rate cut from 8% to 1% for the affordable housing segment-have been made to help the economically weaker section get affordable housing. These new schemes and rules imply that houses below Rs 45 lakh will be exchanged with a GST rate of 1%. Furthermore, the government’s effort to extend the deadline for Credit Linked Interest Subsidy Scheme to March 31, 2021, under PMAY has brought a positive impact on the middle-class and has encouraged them to buy properties with their limited budgets. Affordable Rental Housing Complexes (ARHCs): The ARHC has been envisaged as a sub-scheme under Pradhan Mantri AWAS Yojana-Urban (PMAY-U) with a view to provide ease of living to urban migrants engaged in informal sectors of the economy. During the lockdown, migrant workers suffered the most as a result of poor communication and lack of welfare schemes. Affordable Rental Housing Complexes scheme will help unlock existing vacant housing stock and make them available for affordable rental. It will also encourage investment and promote entrepreneurship in the rental housing sector by providing the right incentives for private companies and public entities to utilize their vacant land for developing ARHCs. SWAMIH Investment Fund: A Special Window for Affordable and Mid-Income Housing Investment Fund has been formed to complete construction of stalled, RERA-registered affordable and mid-income category housing projects which are stuck due to paucity of money. The fund is expected to provide relief to homebuyers and fast track stalled projects by providing last-mile funding on a LIFO basis. Lucrative Investment Prospects: This is the right time for investment in the realty sector as developers are offering cheaper rates for the best properties to clear unsold inventories. Further, interest rates on home loans are extremely attractive at the moment, making this a good time for residents as well as NRIs to take the home investment plunge. Model Tenancy Law: The much-awaited model tenancy law is expected to come out in 2021. The model tenancy law will eliminate anomalies and give a boost to the real estate sector. Provisions announced in the Act would make renting a viable option for tenants as well as property owners. Though the real estate market has suffered during this pandemic, there are green shoots of recovery, which are visible since the start of the festive season. It is important that Covid-19 cases in India continue to show a decline, which in turn would help more activities to restart and ultimately push the economy towards recovery. Recent news of successful vaccine trials will only continue to improve this positive market sentiment. There are high hopes from the upcoming budget which is expected to focus on reviving the stalled economic sector. Source: Times of India India

Realty sector bucks pandemic blues, ends year high on optimism

1/14/2021 1:35:00 PM

Early in 2020, the Indian real estate sector was enjoying a cautious recovery, with its momentum picking up briskly amidst a renewed fervour. And then, without any inkling, the pandemic swept across the nation, changing the whole panorama, and cratering the expectations of realtors. It did not take much time for the property sector to comprehend the ruthlessness of this biological storm as its physical machinery went for a toss, housing sales nose-dived to almost 80% in Q1 & Q2 2020 and construction activity came to a standstill, with a pandemic-induced nationwide lockdown. Key sectors like automobile, hospitality and tourism took a fair share of the blow throwing the economy into a tailspin, as its GDP contracted by 23.9% in Q1 2020 and 7.5% in Q2 2020 While the economy unlocked in phases, financial crisis, piling unsold stock and flagging consumer sentiments, brewed the perfect storm for consolidation. Increasing supply constraints, migrant crisis, international trade restrictions and immobilized citizens also pulled the plug on the residential realty sector – the primary driver for India’s real estate growth. Looking at flagging fortunes of the real estate sector and the ‘Housing For All’ mission deadline nearing, the Government of India pitched in with financial stimulus and incentivisation measures to haul the realty sector out of the abyss. Government stimulus fuelled red-hot homebuying activity The reduction in stamp duty rates on transaction of immovable property to the tune of 2-3% by states like Maharashtra and Karnataka has perked up the mood of the realtors and jolted the realty sector back into motion as it helped developers to sell inventory and liquidate stocks that have been lying idle for months. The extension of CLSS (Credit Linked Subsidy Scheme) for affordable housing from March 2020 to March 2021 with a liquidity boost of Rs 70,000 cr, last-mile funding of Rs 20,000 cr for stressed developers and an additional outlay of Rs 18,000 cr for PMAY, also brought the much needed relief to the flaccid property sector. In addition to that, proactive government measures in the form of moratoriums, tax cuts, construction premium cuts and project timeline deferrals, helped sow green shoots of recovery for the property sector. As per industry reports, Q3 2020 saw more than 35,000 affordable housing units sold across top 7 cities, an increase of 85% from previous quarters and sale records of most real estate developers touched 80-90% of pre-covid stats. The supply side saw 19,865 units launched during the three-month period, a 58% QoQ increase, out of which 43% came from the sub-Rs 45-lakh price bracket. Digital prowess opened a new realm With gradual easements and increased sector buoyancy, real estate developers digitized their business modules to increase resilience and enable business continuity. This digital leap was a revelation for realtors as they could connect with homebuyers, drive transactions with convenience and make use of a limitless playground to showcase their inventory. Realtors signed accords with digital realty platforms like Square Yards to make homebuying simple, hassle-free, credible and transparent. It was a whiff of fresh air for homebuyers too as they interacted with a myriad of properties leveraging digital knickknacks like 3D walkthroughs & virtual tours and transacted seamlessly with multiple payment gateways and digital signatures. Constant feedback from consumers about this neo-homebuying experience helped developers to invent new business strategies that sync with the current consumer preferences and create the perfect alibi for the physical counterpart. Housing sales across tier 1 markets shot up to 2x levels QoQ and new projects got sold out in two weeks, something that was last seen during pre-Covid days. Looking at how this celluloid-like contactless homebuying experience resonated perfectly with homebuyers, realtors spent exponentially on an array of tech solutions, inducted digital tools and prepped themselves to the core to tackle the changing environment of the sector and expectations of the consumers. Consumer confidence on a high as key sectors snap back While it’s true that the pandemic has accentuated the importance of owning a home bringing a larger sense of security, realtors witnessed higher demand this time since real estate investment became easier and more affordable, thanks to rock-bottom home loan rates, stunning payment plans and property price corrections. The economic turnaround of the nation with key sectors like agriculture, automobiles, FMCG and consumer durables displaying strong recovery figures during Q3 and improving the 2022 growth forecast to 19%, on the backdrop of policy reforms and relief, fiscal & monetary measures by the government, also played a stellar role in restoring calm and confidence in homebuyers. It augured well for the real estate market too as fence sitters trooped back to cash in on the once-in-a-lifetime opportunities at play. Buyer sentiment improved significantly in Q3, turnaround time between enquiries and conversions on online portals got reduced and people started to look at homebuying as a necessity rather than a luxury. Renewed buyer interest helped developers clear existing inventory and come up with better options that tally with the changing housing demands of homebuyers. Despite the seemingly adverse economic conditions, the real estate sector has had a record-breaking performance with unsold inventory taking a dip in Q3. A silver lining which deserves mention here is the fact that India, which was not an investor market for real estate, has slowly started moving in that direction as buyers take advantage of low prices conjured up by the pandemic. While it is too premature to announce that the sector has recovered, it would not be erroneous to declare that the housing market has bucked the economic storm with aplomb and is poised to remain strong as we head into the new year. Source: Financial Express India

Model Tenancy Act likely to be approved by March: Housing secretary

1/13/2021 11:05:00 AM

The Model Tenancy Act is in advance stages with the template having been shared with the state governments and is likely to be cleared by March, housing and urban affairs secretary Durga Shanker Mishra has said. “It is in advance stages and we have sent the template to the state governments. Within a month we will be taking it to the cabinet. It should definitely be through by March,” he told reporters. “We have also been holding consultations with the public on the Model Tenancy Act and we have received their views. The law has been translated in almost all the languages - Tamil, Telugu, Malayalam, Assamese, Punjabi, Gujarati among others and we have again sought their opinion. In some cases received no comments from the states but we have gone in for consultations,” he said at the annual press conference of the ministry. The housing and urban affairs ministry had floated the draft model tenancy law in July 2019. It proposes to establish an independent authority in every state and Union Territory for registration of tenancy agreements and even a separate court to take up all tenancy-related disputes. The draft model tenancy law has proposed limiting the advance security deposits to two months’ rent, and has also suggested heavy penalties for tenants who decide to overstay. Those who do may have to shell out double the rent for two months and even four times. On Real Estate Regulatory Authorities (RERA), Mishra said that the housing ministry was working on finalizing some changes to the Act, the difficulties faced by RERA while implementing orders. Housing Minister Hardeep Puri said that RERA had “demonstrated its effectiveness”. States/UTs have notified rules under RERA while the state of Nagaland is under process to notify the rules. West Bengal has enacted its own legislation which has been challenged in the Supreme Court. Around 60,000 real estate projects and 46,000 real estate agents have registered under RERA across the country. Around 60,000 complaints have been disposed-off by the Real Estate Regulatory Authorities across the country, the ministry statement said. Following COVID-19, MoHUA issued an advisory to all states/UTs and their Real Estate Regulatory Authorities for issue of orders to invoke force majeure clause and extend the completion date ‘suo moto’ or revise or extend completion dates for all real estate projects registered under RERA for a period of six months, where completion date expires on or after 25th March, 2020 and further for a period up to three months, if the situation arising out of COVID-19 so demands. In so far as the Affordable Rental Housing Complexes (ARHCs) scheme which is a sub scheme under PMAY-U is concerned, it was approved to provide ease of living to urban migrants/poor in industrial sector as well as in non-formal urban economy to get access to dignified affordable rental housing close to their workplace, the secretary said. So far, 29 states/UTs have signed MoA (Memorandum of Agreement) for implementation of ARHCs. Gujarat and UT of Chandigarh have become first movers by identifying existing Government vacant houses and furthering allotment processes. The UT of Chandigarh has identified 2195 such houses, out of which 1703 have been already allotted to urban poor families. In Gujarat, RFPs have been issued for Rajkot and Ahmedabad whereas concessionaire has been selected for Surat, the ministry said. The Union Cabinet on July 8, 2020 had approved the ARHC scheme for urban migrants employed in the industries, service sector and manufacturing sector close to their workplace in industrial as well as in non-formal urban sectors. The scheme was announced by Finance Minister Nirmala Sitharaman as part of the Rs 20 lakh crore economic package to deal with the COVID-19 pandemic. With regard to the PMAY (Urban) scheme, the ministry said that there were over 1.09 crore houses sanctioned under PMAY so far and that construction was in different stages in more than 70 lakh houses. As many as 40 lakh houses have been delivered. It said that extension of CLSS for MIG would benefit 2.5 lakh middle income families mobilising an investment of Rs 70,000 crores in financial year 2020-21. The Credit Linked Subsidy Scheme (CLSS) for Middle Income Group (MIG) under PMAY-U was extended to March 31, 2021 as a measure to ensure that homebuyers do not suffer due to any delay in completion of housing projects in the wake of COVID-19 pandemic. Source: Money Control Chandigarh

Haryana amends registration manual to curb fraudulent property transfers

1/12/2021 10:41:00 AM

In a decision to protect the rights of property owners by checking fraudulent transfers, the Haryana government has issued a notification amending the Haryana Registration Manual. Additional Chief Secretary and Financial Commissioner, Revenue and Disaster Management Department, Sanjeev Kaushal said here on Tuesday that the amendment had been made to ensure that persons with valid titles would not have to seek legal recourse to get the deed of the fraudulent sale cancelled, and may continue to have the liberty to enjoy their property. The amendment would empower registering officers to accept and register cancellation deeds cancelling the sale deeds earlier registered fraudulently by a person who is not entitled to transfer such property. If a person has a right in the property and someone else transfers it without his consent, the right in that property still continues to subsist in the true owner and the transfer has no effect on such title, he said, according to an official statement. The notification to amend the Manual, which contains instructions related to registration, transfer and sale of property, was issued on December 23. According to the amendment, if a document relating to transfer by way of sale, gift, mortgage, exchange, lease or otherwise, is registered of 'Shamlat Deh' (village common land) land vested or deemed to have been vested in the Panchayat Deh under the Punjab Common Lands (Regulation) Act, 1961, or in Municipalities, the Block Development Panchayat Officer, Secretary or Executive Officer or Commissioner, Municipal Corporation or District Municipal Commissioner, would get the cancellation deed registered after seeking approval of the Deputy Commissioner or other superior authority. 'Panchayat Deh' is the property owned, managed and controlled by a panchayat. Source: ET Realty Chandigarh

Real estate, infrastructure sectors in 2021: The road ahead

1/11/2021 11:52:00 AM

The pandemic has been the single most disruptive force that we have seen in our lifetimes, with disruptions and uncertainties unleashed globally. Needless to say, transactions in the real estate and infrastructure sectors also got impacted by it. One of the main outcomes of the pandemic has been the enhanced desire for risk mitigation by real estate developers. This manifested in two of the largest office space portfolio divestments this year. These transactions provided the owner-developers with an avenue to monetise the development margin as well as the ability to move to sustainable leverage positions. They also marked a continuity of the trend of institutional capital’s appetite for the office space asset class. Tailwinds for commercial real estate to continue in 2021 This continued interest is despite the pandemic’s oft-stated impact on office space due to the rising work-from-home trend. Some of the factors that play contrary to this hypothesis are the need for quality office spaces that meet the safety and well-being requirements, enhanced physical distancing norms which require a reversal of the office densification trends, and the positive impact on the IT sector which is one of the largest occupiers. Monetary trends such as low interest rates and global liquidity have also bolstered the appetite for these transactions. Another key development with respect to office space was the successful listing of India’s second office REIT in these pandemic times. The tailwinds for this asset class should continue in the future. Residential demand to depend on ensuing economic and employment scenario Amongst other real estate asset classes, residential has seen a marked recovery in fundamental demand over the last few months given the low housing finance rates, the need felt by some for owned spaces and reduction of stamp duty in some states. However, the overall trend remains subdued and the sustainability of this demand will depend on the ensuing economic and employment scenario where the silver lining is that the worst seems to be over. Transactions in this asset class can gain some traction with themes like inventory funding, last mile funding and affordable/mid-market housing gaining ground. The challenge for last mile funding or refinancing continues to be the thin slice of residual equity in projects and hence transaction activity is likely to be moderate at best. Investor activity in retail segment expected to remain subdued Retail will continue to be a challenging asset class for some time from an investment perspective. It has been the most affected by the pandemic in the short-term through lockdowns, social distancing norms and the concerns around closed spaces, and the medium term impact through potential consumer down-trading, the strengthening of online shopping trends and the lower income growth rates. Investor activity in this sector is expected to remain subdued. Warehousing and data centre segments to hold investor interest Finally, the green shoots are the warehousing and data centre asset classes. Both these asset classes have gained traction due to the sustainable demand boost provided by the increasing digitisation of all aspects of the economy and significant investor interest is expected in the coming years. Infrastructure sector to continue attracting new long-term investors Covid-19 has had a mixed impact on transactions in the infrastructure sector. While transactions continued to be consummated in the power transmission (10 transactions with disclosed deal value of US$721 million) and renewable energy sectors (28 transactions with disclosed deal value of US$2.2 billion), several transactions in the transportation sector (especially toll roads) were put on hold or cancelled. Surprisingly transactions continued to be completed in the airports sector underlying the attractiveness of the sector to foreign and Indian developers. After the stupendous success of the privatisation of six airports last year, foreign interest continued in the sector with Aéroports de Paris taking 49% stake in GMR Airports in one of the largest deals this year. The Adani Group reaffirmed its strong interest in the airports sector by taking a 74% stake in MIAL and signing concession agreements for three of the six airports it won last year and accepting Letter of Intent (LoI) for the other three airports. The expected rebound in domestic and international travel post the vaccine will help the process for privatisation of the next round of six airports which we expect to be launched and completed next year. The year also saw renewed activity in the power distribution sector with Tata Power acquiring 51% in Odisha’s Central Electricity Supply Utility and getting LoI’s for supplying electricity to the consumers of two electricity distribution companies in Odisha—the Western Electricity Supply Company of Odisha Ltd (WESCO) and the Southern Electricity Supply Utility of Odisha Ltd (SOUTCO). With the upcoming privatisation of the electricity distribution companies of the Union Territories and several states looking to invite private sector participation in power distribution, we see significant activity in the space in 2021, both from developers and financial investors. The year 2020 also saw the bid process being launched for award of passenger trains operations on PPP basis for 12 clusters comprising more than 150 origin-destination pairs of routes. The bid saw 120 applications out of which 102 applications have been selected for the RFP stage. The RFQ process for the New Delhi Station redevelopment project on PPP basis was also launched this year. The project involves redevelopment and operation of New Delhi Railway Station for a period of 60 years along with real estate development rights. We expect that these efforts will finally pave the way for much increased and much needed participation of private developers and foreign investors in the railways sector. Since road traffic has picked up in H2 2020 and toll collections are now similar, if not higher as compared to pre-Covid levels, we see several transactions which were earlier put on hold getting consummated in the roads and highways space in 2021. Already, in October 2020, Cube Highways completed the acquisition of the TOT Bundle 3 from NHAI for around Rs. 50 bn amongst other acquisitions. Investors such as NIIF and Edelweiss also completed transactions in the road sector in the second half of 2020. The annuity nature of the Hybrid Annuity Model (HAM) projects continue to attract investors. Now that the Government of India (GoI) has eased the equity lock-in conditions permitting 100% sale of projects once 6 months from Commercial Operations Date (COD) has passed instead of the 2-year requirement earlier, we see several HAM assets being transacted in 2021. The infrastructure sector was also attracting new long-term investors such as pension funds and insurance companies. Post Covid, these investors had put their investment plans on hold till they recalibrated their investment strategies. Investors who did not have India offices were not able to evaluate direct opportunities unless they were a part of a consortium of investors. With the Indian economy recovering and expected to pick up further pace post the administration of the vaccine and removal of travel bans; we expect these investors to soon return to the Indian transactions’ scene. Given that M&A and fund raise transactions are expected to continue in renewable energy (GoI has set a target of 450 GW of Renewable Energy Capacity by 2030), power transmission and HAM assets, the transportation sector (Toll Roads, Airports and Ports) is coming out of the Covid shock post the administration of the vaccine, the renewed interest in Power Distribution sector and the emergence of new sectors such as Railways, we see a number of transactions in the infrastructure sector in 2021. Source: Money Control Chandigarh

Haryana offers sops to realty sector to boost affordable housing

1/9/2021 2:04:00 PM

In a bid to boost affordable housing, the Khattar Government has amended the state's Affordable Housing Policy-2013 by doling out major sops to the recession-hit realty sector. Under the new policy, the builders have been extended major incentives in the matter of project area norms, commercial component and parking area norms. These incentives are intended to draw the big real estate players into the affordable housing sector which is set to become popular in the post-Covid scenario. While the minimum area norms for setting up the housing project has been reduced from 5 to 4 acres, the maximum area norms have been extended from 10 acres to 30 acres. The commercial component has been increased from 4 per cent to 8 per cent of the net planned area. A notification issued by AK Singh, Principal Secretary, Town and Country Planning Department, said the builders would also be able to provide 0.5 equivalent car space (ECS) to the allottees on chargeable basis(not more than 5% of the flat cost) under the new policy. The allottees already get 0.5 ECS free under the existing policy which would mean that now the car parking problems of the allottees would be taken care of under new policy. Meanwhile, the under-construction projects would also be able to avail these benefits with some riders. BK Sanghi, a real estate expert, opined that the new policy would make the housing in the affordable segment more affordable as the more commercial component in the projects would make go along in keeping the prices competitive." Moreover, provision of car parking for all allottees would draw more end-users and end users into the affordable segment boosting sales," he asserted. Policy implications: *Relaxed area norms to draw big realtors into the affordable housing segment. *More commercial component to keep prices of apartments competitive. *Individual car parking to boost sales in the housing projects. Source: The Tribune Haryana

Mid-Segment Ruled 2020, May Continue Good Run In 2021: Developers

1/8/2021 1:37:00 PM

Some of the leading real estate developers in Delhi-NCR are of the view that the ease-out in home loan interest rates triggered the much-needed revival in mid-segment housing in 2020 which they predict is expected to improve further in 2021. Though the year saw a decline in sales by almost 40-45% compared to the previous year, it has to be seen in light of the economic crisis arising from the global pandemic. Mohit Goel, CEO, Omaxe Ltd., says, “The overhang of subdued demand from last quarter of 2019 continued into 2020, and with the COVID-19 pandemic induced lockdown in March, the sector went from bad to worse. The migration of labours and disruption in the supply of raw materials saw a stoppage in construction activities. On the back of government stimulus and RBI’s liquidity measures, there was some uptick in demand post the partial opening of the economy.” Nevertheless, the positives that have emerged from the COVID-19 crisis will form the cornerstone of the coming decades of growth in the real estate sector and overall Indian economy, Goel adds. Talking about the year ahead, he says, “The increased investment in infrastructure development by governments and businesses in developing tier 2/3 cities as centres of economic activity along with increased consumer spending and activity will write the story of growth, employment and opportunities in the coming decades in India.” Majorly driven by the mid-segment, major cities' housing sales value saw a significant jump over pre-COVID-19 levels. Chennai saw almost 3.5 times jump in Q3 2020, NCR recording a jump of more than 150%, Hyderabad went up by 152%, MMR witnessed an increase of 145% over the previous quarter, Pune saw a 125% increase, Kolkata witnessed 121% jump, and Bangalore saw an increase of 81%. Throwing light on 2020, Ankit Kansal, Co-Founder & MD, 360 Realtors, says, “As the Black Swain event spread like wildfire, markets started staggering, with a drastic slowdown in sales. The industry showed some limited maneuvering with embracing the digital medium. The repo rate cuts and liquidity infusion by the government were also helpful as it reduced home loan rates. The developer fraternity also introduced attractive payment plans to arrest any steep decline in sentiments. Once the lockdown was suspended, markets started reviving, despite a slowdown in business activities weighing on the overall economy. Finally, in the last quarter, the previous year’s growth numbers were restored, and the industry reached near normalcy. The euphoria that started with the festive season should lead up to year-end, clocking a 75-85% quarterly growth in sales.” Though starting with challenging times, 2020 is ending with many positives for the real estate sector. This is the year when home loan interest rates got reduced to a 15-year low, and steps were announced to help stuck projects and liquidity issues, says Vimal Monga, Vice President of Sales & Leasing (commercial), TDI Infratech Ltd, adding that “The year also witnessed the movement of people towards tier II and III cities, thereby increasing the scope of real estate far and wide. The coming year will see an increasing demand owing to the people’s likeness for gated communities post-COVID-19. In 2021, we will also see interest in well-planned commercial developments as the requirement of malls and office spaces will go up.” Saying that the reverse migration among the working professionals from metros and NRI's lead to an increase in demand of property in Tier II and tier III cities, Raman Gupta, Director (Branding and construction), GBP Group, adds, “When it comes to analyzing the northern region, Tricity and its peripheries witnessed an upsurge laying the foundation for a market that is going to grow exponentially from here. The year 2021 promises favorable returns, as people's lifestyles will change drastically after overcoming the pandemic effects. Residential spaces that promise holistic living, unique amenities, an ideal location would become the epitome of an ideal home. We will be witnessing a wave of tech-based innovations, apart from the construction technologies which will be evolving the traditional sector of real estate further.” Drawing a conclusion from the renewed interest of buyers in 2020, Ashok Gupta, CMD, Ajnara India, says, “The buyers in NCR are likely to see more number of housing units hitting the market in 2021. Around 6 lakh units were launched in the region from 2013 to 2020, and only 30 per cent have been completed till now. With the focus of developers in NCR on project delivery, many mid-segment units will be up for grab. The market in 2021 definitely looks promising as the measures taken by the Government to boost buyer sentiment will start showing result starting from Q1 2021.” Source: Business World Chandigarh

India's costliest housing market gets a boost as levies slashed

1/7/2021 2:30:00 PM

Homes prices may fall in Mumbai, India's costliest housing market, after the local administration slashed levies by as much as 50 per cent until December 2021. Maharashtra state cut various levies on construction projects on the recommendation of a government-appointed committee headed by Deepak Parekh, chairman of Housing Development Finance. The move will likely bring down development costs for most builders and result in lower home prices for buyers in addition to boosting stocks of realty developers. This will "help development at lesser input cost and, over a period of time, there is a possibility of lower price for new inventories that shall come into the market", Niranjan Hiranandani, president, National Real Estate Development Council, said in a statement. "This reduction in premiums will help in quick turnaround of projects and uplifting industry sentiments." The latest move may fuel a market that's starting to recover in the past few months after a prolonged slump due to reasons ranging from unfavourable government policies to a shadow bank crisis. With the pandemic putting millions out of work, a resurgence in house sales and corresponding increase in building could boost output everywhere from banks to builders to consumer goods factories. Construction creates the most jobs in India each year. Due to scarcity and high cost of land in Mumbai, developers prefer to build vertically, often more than what the ratio of floor space to total plot area allows. Developers pay a variety of charges for being able to build more, including premiums for more floors and deficient open space. According to the Parekh committee, Mumbai had 22 different levies, the highest among Indian cities. The move follows the state government cutting local tax on home purchases by around 60 per cent last year, leading to an 80 per cent jump in Mumbai home sales in October- December. The S&P BSE Realty Index has surged almost 50 per cent since the decision, Oberoi Realty 60 per cent, Godrej Properties 72 per cent. Source: Business Times Chandigarh

Digitalisation Boosting The Next Wave Of Growth And Transformation Across Real Estate

12/28/2020 10:45:00 AM

The fluidity resulting from the COVID-19 pandemic has required us to constantly rethink and recalibrate the way we have operated so far. Real estate (RE) too is witnessing the changing relationship with its end-users and stakeholders. This has required RE stakeholders across sectors to structurally reimagine their strategies so as to ensure a sustained recovery. Doing so has generated the need to shift from traditional approaches and embracing new, more transformational methods — primarily accelerated by widespread tech adoption. Technology has emerged as the key enabler during these times. In April 2020, according to the Department of Telecom (DoT), India’s internet consumption increased by 13% since the nationwide lockdown in March. Similarly, an EY report (released in June 2020) stated that India's data usage per smartphone has grown by more than 20% over the last two years, averaging at about 11 GB / month; however, it increased further by about 20 – 25% within a period of two months since the lockdown. In the RE space, the use of tech as a key trend has accelerated post the outbreak. Tech such as PropTech, augmented reality (AR), virtual reality (VR), artificial intelligence (AI), cloud, and blockchain, which were previously considered unattainable, are now being widely and innovatively used. There is no doubt that tech in construction management would be widely used in the future as companies realize long-term efficiencies and cost savings of such techniques. OFFICE Touchless tech in the form of door sensors, apps for operating lifts, and infrared thermal scanners are being assessed closely to minimize touchpoints at the workplace. FM services to are gaining a tech edge with several occupiers considering techniques such as UV sterilization to cut down manual cleaning work. Employee collaboration and engagement over digital platforms is now becoming a norm, as is monitoring their productivity through digital tools. At the same time, ensuring data security is becoming more critical, causing occupiers to ensure that adequate IT infrastructure is in place along with their data security protocols. Various occupiers have used VR to conduct site visits and interior viewings, while artificial intelligence (AI)-enabled people-flow controls have been deployed by FM teams to monitor the body temperature of building visitors and mitigate the spread of the virus. Post COVID-19, we believe that the implementation of these technologies is likely to have a long-term and far-reaching impact on the office sector in India. To ensure team collaboration and high employee productivity, workplaces could have a provision for tech-enabled rooms of all sizes with intuitive tools to connect everyone virtually. Telephone-only conferencing may no longer suffice. Providing meeting participants with virtual tech to see and hear each other whether in or out of the office could be the way forward. FM would also see increased deployment of tech including the use of biometric technologies to monitor workforce densities. I&L Before the COVID-19 pandemic reached Indian shores, occupiers from the e-commerce and 3PL sectors had started automating their facilities, while the use of fleet management software for live tracking of goods and automated pallet storage was becoming more widespread. Currently, we are witnessing growing automation of the warehouse and industrial units as well as tech percolation across all facets of the supply chain, such as warehouse management systems and robotics for sorting facilities. Going forward, the widespread deployment of AI, IoT and Big Data is expected to create ‘smarter’ warehouses that would significantly improve supply chain efficiencies. Tech would also play a key role in efficient inventory management and increasing flexibility across the supply chain. RETAIL Post COVID-19, retailers are progressively investing in touchless tech to digitize merchandising and transacting mechanisms in India. Both developers and retailers are increasingly embracing tech such as predictive analytics to collect data on consumer profiles and behaviors and in-store automation. In the long term, all of this could eventually pave the way for a personalized shopping experience – wherein retailers and developers would be able to build consumer profiles by leveraging information such as browsing history, purchase records, etc., and perform hyper-personalized marketing and advertising activities. RESIDENTIAL Against the backdrop of COVID-19, developers are using tech-based solutions that enable buyers to inspect properties online and finalize deals digitally which involves a mix of AR/VR tools. Virtual tours, online platforms, chatbots, and drone shoots have gained more prominence as buyers are adopting digital means at a fast pace. Construction project management is also witnessing an increased deployment of tech in the form of widespread use of prefabricated construction techniques as well as Building Information Modelling at the design stage. We are also witnessing a growing launch of property apps that deploy statistical analysis over the cloud to provide homebuyers with trends, property value forecasts, and other insights to enable better decision-making. Further, e-commerce portals that allow residential developers to directly offer ‘ready-to-move-in’ homes for digital sales are now growing in number. Going forward, we believe that there could be a surge in the preference for smart homes as homebuyers become more aware of the rapid tech advancements. OUTLOOK Post COVID-19, the widespread deployment of tech is likely to become a hallmark of the new normal. It would require developers and occupiers alike to start investing in a workforce that is trained to handle the advancement in technology. Investing in digital solutions through M&A deals, identifying potential tech partners, and upgrading the IT infrastructure would also be vital. In this highly competitive digital age, property listings platforms could also give an added advantage to RE firms to strengthen their online presence. For instance, CBRE’s Commercial Listings Platform is a one-stop solution for clients – from providing floor plans, brochures, photos, and location maps to conducting cost analysis and arranging site visits of commercial spaces including flexible workspaces and I&L sites. Source: Business World India

Private equity investment in real estate likely to bounce back to $6 bn in 2021: Report

12/25/2020 1:06:00 PM

While PE investment in real estate in 2020 is expected to contract at $4.6 billion due to decline in economic activity, investors are likely to adapt themselves in the altered world order and steadily return to the market with evolved strategies. Private equity investment in real estate is expected to bounce back to $6 billion, registering a 30% year-on-year growth in 2021, on the back of an improving economic sentiment supported by policy reforms and growth in key emerging sectors, according to the latest report by Savills India, a global property consultancy firm. The next wave of investments will be driven by growth in warehousing, affordable housing and data centres apart from the commercial office segment which will continue to see steady improvement, said the report Beyond The’20: Private Equity in Indian Real Estate. A likely repair of the bruised economy, improving trade relations, policy support and progress on the vaccination front are the key factors that would drive the sentiment henceforth. Savills India’s estimates for private equity investment in the sector are based on factors like overall economic and infrastructure growth, growth in sectors such as manufacturing, logistics and e-commerce. Geopolitical scenario and policy enabling environment are also considered to be key determinants. While PE investment in real estate in 2020 is expected to contract at $4.6 billion due to decline in economic activity, investors are likely to adapt themselves in the altered world order and steadily return to the market with evolved strategies. As per the report, the warehousing and logistics segment has been among the most resilient asset classes in the ongoing pandemic. Warehouse leasing is expected to increase by 60% in 2021 as compared to 2020, keeping investors riveted and on the lookout for investment opportunities. Savills Research also expects private equity investors to assess an opportunity of around $330 million in the industrial and warehousing segment in 2021. This is approximately 17% higher compared to the average annual investments during the period of 2016-2020. “2020 has been a watershed year for businesses and industries across the globe. Indian economy has weathered this unprecedented crisis fairly well, which is indicative of its strong inherent fundamentals. Going forward, policy steadfastness and implementation will hold the key to revival of investment. In our view, the investors will proceed with caution in early days, but 2021 is likely to experience a fair amount of PE investment owing to inherent strengths and potential of alternate asset classes in real estate,” said Anurag Mathur, CEO, Savills India. From 2000 to 2015, almost 60% of PE investment was in the residential segment until the focus of fund managers shifted to ready office assets supported by buoyant demand from 2014 onwards and the segment has attracted approximate 40% of investment. Interestingly, the last 2-3 years have seen notable interest in newer asset classes such as student housing, data centres, warehousing and opportunistic assets. “For the investor community and private equity players, the warehousing segment is becoming an asset class of choice in times ahead. While the leasing activity in the industrial and warehousing segment has declined year-on-year, we expect rentals to see a steady rise as quality supply gets added to the stock. The world of private equity would be aiming for some of their most lucrative opportunities in the time to come,” said Diwakar Rana, Managing Director, Capital Markets, Savills India. Source: Financial Express India

Housing sales up 51 per cent in October-December across 7 big cities: JLL India

12/24/2020 11:40:00 AM

In Bengaluru, sales fell to 10,440 units in 2020 from 26,453 units last year. Housing sales in Chennai declined to 6,983 units from 13,967 units, while in Delhi-NCR demand dipped to 15,743 units from 29,010 units Sales of residential properties are estimated to grow 51 per cent across seven major cities during October-December compared with the previous quarter driven by festive demand, but demand is likely to fall 48 per cent in 2020 due to the impact of the pandemic, property consultant JLL India said. According to the data, housing sales are estimated to rise at 21,832 units during December quarter as against 14,415 units in July-September. “GDP in July-September quarter of 2020 showed higher than expected recovery. During the same quarter, the housing market showed some initial signs of recovery as well, with sales increasing by 34 per cent on a sequential basis. In the backdrop of issues like job security and fall in income levels, this uptick in sales was a significant achievement,” JLL India CEO and Country Head Ramesh Nair said in a statement. The fourth quarter has witnessed 51 per cent improvement in residential sales, with recovery evenly spread among all seven cities, he added. “The housing market is set to chart a new chapter of growth in 2021, fuelled by affordability, reinforced desire to own a house and renewed interest from certain buyer segments such as NRIs,” Nair said. According to the JLL India data, housing sales in 2020 could drop 48 per cent to 74,451 units from 143,923 units from previous year as demand slumped in all seven cities. In Bengaluru, sales fell to 10,440 units in 2020 from 26,453 units last year. Housing sales in Chennai declined to 6,983 units from 13,967 units, while in Delhi-NCR demand dipped to 15,743 units from 29,010 units. In Hyderabad, sales decline to 9,926 units from 16,025 units. Kolkata witnessed sharp fall in demand to 2,568 units from 7,463 units. In Maharashtra, Mumbai saw housing sales of 19,545 units in 2020 as against 32,138 units last year while demand in Pune went down to 9,246 units from 18,867 units. Realtors’ apex bodies CREDAI and NAREDCO do not compile data of new supply and sales of their around 25,000 developer members. The housing market data are being provided by property consultants and data analytics firms on a quarterly basis, but with wide variations. Listed real estate companies also provide their own quarterly sales bookings and launch numbers along with financial results. Source: Financial Express Chandigarh

Indians prefer buying 2-3 BHK houses; millennials contribute the largest chunk of homebuyers: Survey

12/23/2020 12:29:00 PM

The real estate sector has seen a decent recovery in the last two months in terms of housing sales. The prominent markets such as Mumbai recorded a robust 67 per cent year-on- year growth in home sales volume at 9,301 units in November 2020. The growth was largely augmented by the festive period of Diwali, the stamp duty cut in many states and the reduction of home loan interest rate. Other measures by realty developers such as deferred payment plans, discounts and offers have also helped entice homebuyers. These factors have inspired 82 percent of customers to buy property in 2021 as compared to 64 per cent in 2020, according to a survey by “It has been historically observed that whenever the difference between home loan interest rates and rental yields are less than 4.5-5 per cent, there is a massive surge in housing sales and we can expect this to happen now,” said Saurabh Garg, co-founder and Chief Business Officer, The millennials contribute the largest chunk of homebuyers. The 25-40 demographic constituted about 49 per cent of buyers until last year. This percentage has now rocketed to 63 per cent. "The year 2020 ha has re-emphasised the importance of owning a physical asset and changed the priorities for the millennials," Garg said adding that it shifted criteria from ‘closer to the workplace’ to ‘spacious house’ for working professionals as work from home kicked in. The survey also finds that the homebuyers are preferring bigger two or three-bedroom homes to accommodate study and work from home lifestyle, steered by the COVID-19 pandemic. The percentage of people looking to buy a 3 BHK is 29 per cent, a rise from 7 per cent last year. Meanwhile, around 48 per cent of homebuyers this year are looking for 2 BHK, a growth of 10 per cent from last year. The survey indicates a sizable increase in a number of people looking to buy property in Rs 80 lakh to 1 crore bracket. There has also been a rise in online rent payments. The majority of this is led by the fact that post-pandemic people prefer contactless means of rent transfer. Meanwhile, 57 per cent of buyers prefer ready to move in homes with Delhi –NCR and Chennai leading this trend. Hyderabad leads the choice for independent houses where 46 per cent were looking for an independent house, whereas Delhi tops the chart when it comes to buying a plot with 15 per cent. Source: CNBC TV 18 Chandigarh

GMADA hands over land to NHAI, Zirakpur ring road project back on track

12/21/2020 10:58:00 AM

Delayed for nearly seven years, the Zirakpur ring road project is likely to take off soon as the Greater Mohali area Development Authority (GMADA) recently transferred around 100 acres of land it has acquired to the National Highways Authority of India (NHAI) to start construction. The 200-foot-wide and six-laned road will decongest Zirakpur by providing an alternative route to Shimla-bound traffic from Ambala. The NHAI will build the 8 km road from McDonald’s on the Ambala-Zirakpur highway, passing through Peer Muchalla, Sanoli, Gazipur, Nagla, all Mohali villages, to join the Sector 20/21 dividing road in Panchkula. A senior NHAI official who spoke on condition of anonymity as he’s not authorised to speak to the media, said: “We held a meeting with senior GMADA officials and requested them to hand over the land (for the project).” Confirming this, another senior official with the highways authority said the land had been transferred and work would start in a month. “We are hopeful of completing the project soon,” he said GMADA superintending engineer Davinder Singh, too, said, “We have handed over around 100 acres of land to NHAI and they will begin work soon.” Work halted in 2014 Work on the route, which started in 2013, came to a halt in February 2014 when some of the landowners went to court seeking higher compensation. With its completion, Shimla-bound traffic can take this road, bypass the bottleneck at Zirakpur, and join the Shimla highway at the Panchkula end. Similarly, Ambala or Delhi bound traffic from Shimla can avoid Zirakpur. The road will also open an alternative route from Panchkula to the Chandigarh International Airport in Mohali, but it will be much longer than the existing route via Industrial Area and the Zirakpur-Chandigarh road through Aerocity and IT City in Mohali. However, Chandigarh traffic will then be given a miss. No traffic congestion The project will also help prevent around 1.5 lakh vehicles from Punjab and Haryana from entering Chandigarh daily, something that has also been proposed in the city’s Master Plan for better traffic management. The road project had been approved in 2017 by the then Union home minister Rajnath Singh during a meeting of the Northern Zonal Council in Chandigarh in August. The project holds more significance in the wake of Rajnath Singh putting the brakes on the much touted Metro project for Chandigarh in July 2017, and asking the UT administration to look for alternative models of transport, as a metro was not viable in Chandigarh. According to the proposal, the road will be connected to the Shimla-Kalka highway, Pinjore, Baddi, Yamanunagar and Majri Chowk in Panchkula. According to the Master Plan committee, traffic between Mullanpur and Panchkula, and that from Kansal, Zirakpur and Panchkula not headed for Chandigarh could be diverted and significantly reduce congestion on the arterial roads in the city’s Madhya Marg and Dakshin Marg. Chandigarh

Affordable housing to drive realty growth in 2021

12/18/2020 11:21:00 AM

2020 started on a positive note with the real estate sector hoping to improve upon the mix bag performance of 2019. The first heartbreak came when the Union Budget 2020-2021 almost neglected the real estate sector, barring some good tidings for the affordable segment. The sector took respite in the government’s focus on infrastructure, which would mean opening up of peripheral areas and creating new avenues of growth. Then came the global pandemic, leaving everyone clueless. However, during the lockdown, the sector pulled up its socks to minimize the impact, and also made its voice heard by the Government of India. Realizing the gravity of the situation, the Government of India came out with a slew of measures and announcements over a period of six months that helped the real estate sector stay firmly on ground. The government granted an extension to complete projects, funds to ensure liquidity, steps to help stuck projects, rationalized risk-weightage norms, announced the restructuring of loans based on the projects, and linking home loans to LTV. Reeling under liquidity crunch and lack of activity in initial lockdown months, the sector utilized digital platforms for communicating with the buyers. The impact was immediate as buyers, who were sitting at homes and had ample time at hand, realized the importance of owning a home. The digital outreach programmes resulted in increased inquiries, and quite a few developers of repute booked units using online channels. The year saw rainfall when it comes to using digital, innovative schemes, and lucrative offers. The affordable housing segment, on the other hand, survived the onslaught merely because it caters to the price bracket that has maximum demand. Several factors worked in favour of affordable housing, including Rs 3.74-lakh crore liquidity infusion announced by the RBI on March 27, 2020, the CLSS extension announced in May, relief under EPF, etc. The biggest takeaway for the buyers, however, was the unprecedented cut in the repo rates, which resulted in home loan interests coming down to sub-7%. The tragedy also came as a blessing in disguise for the sector, especially the affordable housing segment, as the middle class was facing challenges in staying at rented accommodations. The sector made a comeback in Q3 with sales and new launches rebounding to almost 70% of the pre-COVID-19 levels. Maximum sales were seen in the Mumbai Metropolitan Region (MMR), National Capital Region (NCR), and Pune; all three regions accounted for almost 80 per cent of the sales in the July-Sept quarter. The reduction of stamp duty charges in Maharashtra followed by Karnataka coupled with developers’ incentives and all-time low home loan interest rates became the catalyst of recovery for the real estate sector. Though new supply in NCR was not much, it still contributed almost 15% of the overall launches that happened this year. The affordable housing segment comprised almost 70% of the total new supply in the July-Sept period in major cities. The market is promising, and with the apex bank being optimistic about the economic growth, the real estate sector would see a marked change in 2021. The measures taken by the RBI would help the sector reap rich dividends as the sector is riding high on the increased demand in the post-COVID-19 situation. The market for affordable housing is robust, and in the coming months, there will be more movement. People have realized the importance of owning a home, and this feeling is going to persist. Source: Financial Express India

2021 real estate sector outlook: Healthy economic indicators to push revival

12/17/2020 10:51:00 AM

After facing tough COVID-19 challenges, like many other industries, the real estate sector too is now betting on a better 2021. With sky-high expectations based on the slew of measures, the government took in 2020, the real estate sector expects the new year to unfold with people continuing to consider it as the safest investment option. After a gloomy time of lockdown, the sector picked itself up and developers did cash in on the pent up demand, but several economic indicators and virtual platforms are now giving an additional edge to the sector. The optimistic expectations are attributed to the economic growth predictions of the Reserve Bank of India (RBI). In the first quarter of the next fiscal year, the RBI suggested growth could be 21.9 percent (largely because of the base effect as the economy contracted by 23.9 percent in Q1 2020-21) and overall 6.5 percent for the first half of 2021-22. Nagaraju Routhu, CEO, Hero Realty adds, "Real estate witnessed the new dawn with digital integration in terms of virtual tours, online sales etc. as an alternative to no physical interaction between homebuyers. Gradual unlocking of states and industries helped the sector go back to normalcy. The festive months were bright in terms of project deliveries and possessions. Tier II and Tier III cities as compared to metros have seen robust demand in the residential segment due to reduced home loan rates and buyers' inclination towards integrated living." Based on the overall economy, the sector feels comfort is here to stay. Sector watchers foresee the momentum sustaining in 2021 due to revival in customer sentiment. "We expect that 2021 will see a consolidation of the industry in favour of organized developers, leveraging of technology to enhance customer experiences and customer-centricity as the key objective of developers. In the commercial segment, the high-street concept has gained momentum as compared to malls and this will continue in the coming year. The residential segment is already on the path to recovery owing to the pent-up demand and the need to invest in well planned, spacious homes amidst extended work from home. The mid- segment in the range of Rs85 lakhs to Rs1.5 crores will witness the highest demand in residential real estate. We recorded sales worth Rs 2,500 crores from Apr-Nov 2020. We are eyeing to close this year with a 10 percent increase in revenue in 2020, up from Rs 4200 crores last year." says Pankaj Bansal, Director, M3M Group The retail segment looks promising, especially after the pandemic time, as people are likely to prefer visiting places that can provide them with a safe environment. Amarjit Bakshi, Chairman & Managing Director, Central Park says, "The pandemic has played a part in shaping sentiments, tastes and preferences. There is an emerging trend of settling into townships due to the availability of a plethora of amenities available to the residents within the vicinity. Integrated urban areas with spaces that are multi-purpose for use will gain more momentum. There will continue to be increased focus on sanitization, hygiene, cleanliness & wellness in apartments and on creating work-from-home office spaces to work out of." The reduced home loan interest rates, which are around sub-7 percent, is giving additional comfort to the residential real estate sector. “The extended support from authorities in terms of slashing the repo rate, RERA extension for project completion were some major initiatives that helped us maintain positive stance among buyers. Plotted developments and affordable housing witnessed increased enquiries and stable demand respectively. The mid-segment housing may take 6-8 months of 2021 to bounce back to pre-COVID levels due to the reeling market, but festive times did register a certain momentum due to the lucrative offers," added Achal Raina, COO Raheja Developers. “Since the time home-loan rates were reduced, we have been witnessing an increased number of inquiries; the same trend is going to continue in 2021. The demand for gated communities has increased as people are concerned about the healthy lifestyle; the pandemic has also made people realize the importance of having their own abodes,” says Harvinder Singh Sikka, MD, Sikka Group. In the announcement after the latest Monetary Policy Committee review, the RBI mentioned that it would continue to employ instruments to ensure ample liquidity. Some of the announcements during the year include Rs 18,000 crore additional funding for PMAY for Urban area, income tax relief for developers and homebuyers for houses that cost up to Rs 2 crore, approval of the Union Cabinet to set up a Rs 25,000 crore (US$ 3.58 billion) alternative investment fund (AIF) to revive around 1,600 stalled housing projects in top cities, 1.12 crore houses sanctioned under PMAY in urban areas, creation of Affordable Housing Fund (AHF) in the National Housing Bank (NHB) with an initial corpus of Rs 10,000 crore, etc. “The sector has always been saying that liquidity is an issue for the real estate sector. The government of India announced several packages that are likely to have a positive impact in 2021. Looking at the response in 2020 after the Unlock, the coming year looks promising,” says Ashok Gupta, CMD, Ajnara India. Similarly, Mohit Goel, CEO, Omaxe Ltd. adds, “The positives that have emerged from the COVID-19 crisis will form the cornerstone of the coming decades of growth in the real estate sector and overall Indian economy. The reverse migration led to the emergence of heightened demand for homes in tier 2/3 cities including rentals. Demand for bigger homes inside an open, hygienic and green complex with facilities like healthcare, daily necessities and everyday rejuvenation within walking distance formed the crux of increased demand for branded and reputed developers who would not just provide value for money products and services but also had the ability to deliver those projects. The increased investment in infrastructure development by governments and businesses in developing tier 2/3 cities as centres of economic activity along with increased consumer spending and activity will write the story of growth, employment and opportunities in the coming decades in India.” When it comes to residential space, in particular, affordable housing segment is what is expected to continue to excite buyers next year. Pradeep Aggarwal, Co-Founder & Chairman, Signature Global and Chairman, National Council on Affordable Housing, ASSOCHAM says, “The market for affordable housing is robust, and in the coming months, there will be more movement. People have realized the importance of owning a home, and this feeling is going to persist. We are coming up with multiple projects, and the response that we are getting is an indication that the affordable housing segment will not face any problem.” Talking on the sector, from the market perspective, Sharad Mittal, CEO & Head, Motilal Oswal Real Estate says, “In 2021, we believe that most of these office assets will continue to remain stable. However, as companies explore the WFH strategy, developers may review the launch of new supply, especially where it is speculative and not build-to-suit. Most companies will review new space requirements to align it with their WFH strategy. Developers will build new supply but will albeit with a cautious approach." "In the case of residential real estate, pent-up demand, developer discounts and stamp duty waivers may have created a temporary spurt in demand this year, however, we believe that some of the following factors augur well for a more long-term growth in residential real estate over the next 2 to 3 years. Lastly, COVID-19 has led to a clear preference for staying in an owned home. We believe that this will spur home demand over a period of time and give rise to a new phase of growth in residential real estate, one that will be led more by volume and less by price,” he added. Source: CNBC TV Chandigarh

Real estate in India poised to take off in 2021

12/16/2020 2:55:00 PM

With India having entered the unlock phase and an encouraging response seen in real estate during the festive season, one can surely be optimistic about the sector's growth prospects in 2021. Over the past few years, the real estate sector has witnessed a rapid evolution in the policy landscape in India. Consistent government initiatives laid the groundwork for transparency and facilitated ease of doing business in the past few years. The year 2020 began on a positive note, but a global lockdown, together with disrupted supply chains, temporarily frayed hopes. However, with India having entered the unlock phase and an encouraging response seen in real estate during the festive season, one can surely be optimistic about the sector’s growth prospects in 2021. A report by Colliers India has highlighted the commercial space absorption shot up to 58% for the quarter ended September 30th, 2020. This development is a good indicator of improved consumer confidence and growth. It is likely to sustain the retail segment for now while boosting the demand for commercial real estate in the long term. While India is witnessing a wave of COVID-19 cases, the plummeting of the positivity rate to below 5% has inspired confidence. Most Indian corporates have returned to office, while international corporates seem to have adopted a ‘wait and watch’ approach. Moreover, in June this year, the Securities Exchange Board of India declassified the status of a sponsor for REIT and InvIT. This move is likely to restore investor confidence in a sector that had slowed down in the face of unintended consequences of the lockdown. Following the SEBI’s amendment of the rules of REITs, one can expect an inflow of investment in commercial real estate that guarantees stable and lucrative returns, as compared to alternative segments. India is among the fastest-growing economies. Moreover, many NRIs are eyeing India for real estate investment amid the pandemic that has accelerated the sense of insecurity. Real estate has traditionally been considered a safe investment and continues to dominate the preference of investors. This trend of continued investment in the real estate sector is likely to accelerate further in the wake of a politically stable environment, rapid urbanization and expectation of economic stability in 2021. The overall hygiene and wellness concerns imply that consumers are more likely to have confidence in organized developers with sound credentials. The COVID-19 pandemic has accelerated the trend of digitization in real estate to boost efficiency and enhance the customer experience. In the retail space, we foresee trends such as video shopping, omnichannel delivery and high-street retail to gain currency. The retail spaces built on the ‘under one roof’ concept with integrated facilities for shopping, food and entertainment will be the norm. We also expect a tectonic shift in commercial and retail spaces investment. Savills India predicts an uptick of 42% in the leasing activity by co- working spaces in 2021. With global companies inching towards the option of flexible working, one can expect a robust demand for co-working spaces. Our iconic projects, Elan Mercado and Elan Town Centre, are too ready for possession and we will see globally renowned brands opening their retail stores here. A combination of the conducive policy landscape, re-opening of workplaces, restored consumer confidence and increasing interest from international investors augur well for commercial real estate to embark on a growth trajectory in 2021. Source: Financial Express India

Commercial Property: An emerging asset class for investors

12/15/2020 10:35:00 AM

The rental yield from commercial properties is anywhere between 5% and 12% whereas in case of residential properties, it is currently at 2%-4%. The need to get good returns in the short and long term has made the investors with real estate knowhow to divert their attention towards commercial real estate, which has become more attractive now. If the location is good, then the property attracts good rentals over a longer period of time. The rental yield from commercial properties is anywhere between 5 and 12% whereas in case of residential properties, it is currently at 2%-4%. Even the capital appreciation of commercial properties in right locations is far better than the capital appreciation of residential properties. As of now, the demand for good commercial property, which can yield good rental returns, is on the rise because of the coming up of REIT and increasing requirement from new employment generation options. When it comes to commercial real estate investment opportunities, the best proposition is in vibrant zones where physical and social infrastructure is superior to other areas. The projects near international airports attract high leasing activities and provide unprecedented investment benefits. With REIT, the commercial space has the upper hand; the likely trend will be further liquidity infusion in commercial property, and developers will come up with more projects in this segment. Earlier commercial spaces were in major cities of India, but now Grade A spaces are coming up in tier II and tier III cities also. Many SEZs and IT parks have come up in these cities. Then we have logistic parks, and industrial parks in these cities as these areas support effective transport. In fact, all the areas in smaller cities falling on industrial corridors have witnessed growth. Also, the IT/ITeS sector and InfoTech companies are looking to rationalise their spending and hence moving to smaller cities as real estate is becoming expensive in major cities. This development has led to the development of such commercial assets in these cities, and the trend is likely to pick up the pace in the future. Due to the investment potential of commercial spaces, developers are also responding to the demand, which will automatically generate demand for residential around these projects. So, this symbiosis of commercial and residential bodes very well for the real estate market. Earlier, return on investment in the residential sector was good depending on the choice of location and builder’s brand. The ROI was high due to capital appreciation, which was better than the low rental yield. However, the scenario has changed as capital and rental yield are not as high as they used to be. A stagnant scenario has emerged in this segment, and this led the investors to look at the commercial segment. As of now, office properties are yielding returns to investors that are higher than the returns that residential properties once yielded. A shift in focus of NRIs and HNIs towards the commercial real estate has also led to this upsurge in interest. In Chandigarh, for instance, commercial is becoming popular with the advent of the IT/ITEs sector, rapidly developing infrastructure, and world-class education and medical facilities. A few prominent upcoming investment locations in Tricity are Airport road Mohali, Zirakpur, and New Chandigarh. We can foresee a demand for suitable quality office spaces in the future as well. Many big firms will likely end their long-term leases to reduce operating costs and move to tier II cities. If this happens, more commercial spaces will enter the market in these areas. Source: Financial Express India

Technological Advancements In Indian Real Estate Sector

12/14/2020 10:56:00 AM

From the advent of the Real Estate (Regulation and Development) Act (RERA), 2016, to the rapid technology growth, various trends are shaping the Indian real estate sector in the last few years. During the global pandemic, the role of technology in our lives has significantly increased, and there is no denying the fact that the Indian infrastructure and real estate sector has made inroads with a multitude of technological developments and innovations that are bringing about some fundamental shifts that will reshape the industry’s future. Here are 5 tech advancements that are giving re-birth to India’s Real Estate Sector: 1. Virtual and Augmented Reality: To boost construction worker safety training, to offer enhanced visualization of the project to the client, and to enable project managers and stakeholders to better imagine and properly plan the construction site – even for extreme conditions, Virtual Reality and Augmented Reality is being adopted in India and around the world. By integrating VR/AR technologies with Building Information Modeling, the builders and developers will be able to design virtual walkthroughs to have more control over designs from the early stages and save time, effort, and cost. 2. Artificial Intelligence with Machine Learning: Artificial Intelligence (AI) alongside Machine Learning (ML) is changing the face of construction everywhere across the world and is one of the most impressive and revolutionary advancements expected to disrupt the real estate sector in India in the current times. The integration of AI and ML is helping real estate players scrutinize and solve different variations of construction problems that may hamper the infrastructural progress. 3. UAV (Unmanned Aerial vehicles): With the projection of USD 885.7 million by 2021, the Indian UAV market India is amongst the fastest adopters of UAVs (also known as Drones) globally. The use of this technology has expanded over the last couple of years in India. It is further expected to grow because it is cost-effective, quicker, and enables safer construction to build futuristic buildings. Drones will enable developers to map a site and build images in 2D and 3D and may also help in sketching precise measurements based on coordinates. 4. Robotics: The real estate industry is moving towards the adoption of robotics in various construction work processes such as brick-laying, which will not only reduce labour costs drastically but also improve quality and bring precision to the project. Presently, SAM (semi-automated mason) is the first commercially built brick-laying robot available to improve the efficiency of the project up to fivefold when incorporated in partnership with human masons. 5. Light Gauge Steel Framing Structures and Modular Construction: One of the significant disruptive breakthroughs in the Indian construction space is the adoption of LGSF structures and modular construction, as they have sped up the overall construction time in every segment – industrial, commercial and residential. Though the current demand for this technology is comparatively less with traditional construction methods, but the advent of the pandemic has given a massive push as it enabled the setting up of hospitals, COVID-19 testing centers, and other such required facilities within a short span of time. Way Forward The Indian Real Estate sector is no more insulated from the impact of the new age technological developments as the traditional ways of construction are changing at a very drastic speed as the developers are becoming agile to save cost and time and offer more robust structures that stand against the test of harsh conditions. Several players in the industry will have to evolve and innovate their offerings or form strategic alliances to survive and thrive in the impending future. Source: Business world Chandigarh

Noida brimming with opportunities for modern commercial spaces

12/11/2020 12:33:00 PM

In the North Indian realty market, Noida has been a developing realty hotspot with developments around the six-lane Yamuna Expressway, adding on to the property market momentum. A 177-km Yamuna Expressway from Greater Noida to Agra was primarily built to reduce travel time, but it also revolutinized the habitation and lifestyle of people flocking to stay here. Ever since the pandemic has struck, state Government here has pledged to create a roadmap for UP’s growth and development, looking at the immense potential the region can offer. The UP government has received over 50 investment proposals worth Rs 7,000 crore from international investors who are planning on shifting their base from China to Uttar Pradesh. Three manufacturing firms have already been allotted 15,000 sq metre land near the upcoming airport in Gautam Buddh Nagar’s Jewar, and more are in the pipeline. The move will lead to investments and creation of job opportunities. A rise in population density directly translates into the need for creating more social structures such as business parks, retail hubs, entertainment zones, recreational centres etc to satiate the growing desires and aspirations of people as per the urban lifestyle standards. The recent announcements of Jewar International Airport and Film City make Noida a region with limitless possibilities, especially for residential and commercial spaces. Once the residential population of an area starts increasing, the movement of commercial segment becomes obvious. And, Noida is witnessing a similar phenomenon. A mega infrastructure project helps in uplifting the property market of the region. The benefits such as price appreciation, increase in population are only visible once the project is near completion. Seasoned developers, however, have started developing futuristic projects which will be unlocking multiple opportunities for investment and boosting economic activities. The year 2019 also registered a positive occurrence for commercial spaces, as the government reduced the circle rates for Noida to make it an investor-friendly location. The reduction was around 21% for floor-wise commercial property and 21.5% for individual commercial property. Furthermore, the Central government is also providing tax relaxation to budding startups for three years from the date of their commencement of operations. All these signals translate to investment benefits. Commercial real estate has arisen for private investors as well as institutional funds as an enticing investment proposition. The collaboration of commercial and residential will be very healthy for the real estate market. Noida and Greater Noida have been offering affordable price points in comparison to their counterpart in Haryana; this makes it an ideal location for developing commercial spaces that will be so much more than a retail and office hub. Such projects will be an experience zone, catering to the visitors’ needs and safety in the best way possible with the help of advanced and certified technology systems. Once fully operational, the demand for such spaces will be on the rise, as every individual looking to earn a second income would prefer a prime location such as Noida. Source: Financial Express Chandigarh

It Is Time for Americans to Invest in Indian Real Estate Sector: Mo Abboud

12/10/2020 10:41:00 AM

The Indian real estate industry, currently on a healthy growth trajectory, is likely to offer a good market for investment for the Americans as its organic growth can be foretold due to the ongoing trend of expansions. According to Mo Abboud, a realtor, the Indian realty segment is clocked for positive growth as it attracted US$ 6.26 billion in investment in 2019. Explaining this positive investment trend, Mo Abboud said realty in India is attracting both the Private Equities (PE) and Institutional Investments (II) following fast urbanization, high demand for residential and office premises across India. He said optimism in this sector could be realistically analyzed from the fact that it saw the PE investment of around US$ 1 billion in 2019 and a strong II of US$ 712 million during the quarter ended March 2020. Quoting the property consultant Anarock, Mo Abboud said by 2022, over 100 new shopping malls are to occupy the landscapes of the top seven metropolis which will have 69 malls and the remaining 31 malls in Tier 2 & 3 cities in India. Explaining how India is offering very lucrative markets for investments by the Americans, Mo Abboud said the real estate industry currently is upbeat as one of its reasons being the Government’s approval in March, 2020 to two corporate giants TCS and DLF to set up SEZs for IT sector in Haryana and Uttar Pradesh. He said Blackstone’s investment of a hefty US$ 12 billion is virtually a milestone in the realty sector in India. Further arguing why the rapidly expanding realty in India now opens up new investment vista for the Americans, Mo Abboud said the SEBI has given its approval for the Real Estate Investment Trust (REIT) platform. Beside, the realty in India now is 100% open for the Foreign Direct Investments. He said the REIT-approval by the SEBI further makes the realty sector more attractive as it will allow all kind of investors to invest in the Indian real estate market which has the potentiality to assume an enviable market size of US$ 19.65 billion in immediate future. Pointing out the recent changes in Indian realty market, he said the players in the country’s real estate developers will be more open to the FDIs and foreign investments as they are shifting from family owned businesses to that of professionally managed ones in view of globalization. Moreover, Mo Abboud commented, the major factors in coming years to act as robust drives in this sector emanated from expanding consumer bases, further spurt in globalization and emergence of India as one of the preferred destinations for investments. Over the years, he said, the realty sector saw drastic paternal changes with the educated promoters streamlining the whole system with managing multiple projects across cities in India and investing in centralized processes to source material and organize manpower and hiring qualified professionals for project management, architecture and engineering. Source: Forbes India Chandigarh

Noida authority approves plot merger scheme; over to state for final nod

12/9/2020 10:42:00 AM

Bringing much cheer to residents, the Noida authority has approved a scheme which allows the merger of two residential plots. Earlier, two adjoining residential plots couldn’t be merged in the absence of a policy. The proposal will now be sent to the state government for a final nod. Earlier, the authority, on February 2, 2007 in its 142nd board meeting, had approved a proposal for the same but the same could not get approvals from the state government. Later on December 21, 2016, the authority had again approved a proposal in this regard without getting a success at the state level. On Friday, the authority again approved this proposal with the hope that it will get requisite approvals from the Uttar Pradesh government. If approved, plot owners will now have to deposit ₹10,000 as processing fee to merge two plots. “Earlier there was no policy to merge two plots, which are adjoining in any sector across the city. The board approved this proposal in the interest of the general public, particularly those whose plots are adjoining and they want to merge the same,” said Ritu Maheshwari, chief executive officer of the Noida authority. If it is approved, then those who have two adjoining plots in any residential sector can merge them, said officials. The authority does not have data on the exact number of pending cases related to the merger of plots. “There are many residents who have two adjoining plots in the city but cannot merge them in the absence of a policy on this. But now, they can merge two plots and use them, if the policy is approved,” said Prempal Singh, a resident of Sector 135. As per rules, merger will be allowed only with certain riders, such as two plots will be merged only if both plots are owned by the same person; after merger, the ground coverage, floor area ratio and set back norms will be as per the applicable building bylaws-2010; after merger, the two plots will be considered as one plot and these will be sold in the future only as one plot; the plot owner will not be able to de-amalgamate these two plots in the future; if the plots are mortgaged then the owner will have to obtain a no-objection certificate from the bank or financial agency that has mortgaged the plots. “The Noida authority has taken a much-needed decision in the interest of residents who own two plots and are willing to merge them. It was a long-pending demand of residents and it will be in the interest of the real estate sector as well,” said Anchal Bohra, a real estate expert. Source: Hindustan Times Chandigarh

RERA introduced to remove problem of trust deficit between builders, buyers: PM

12/8/2020 10:42:00 AM

Prime Minister Narendra Modi on Monday said that there was a trust deficit between builders and home buyers, and the Real Estate Regulatory Authority (RERA) Act was introduced to remove this problem.While inaugurating the construction of the Agra Metro project via video conferencing, Modi said, "People with wrong intentions brought disrepute to the entire real estate sector, upsetting our middle class." The prime minister said that there was a trust deficit between the builders and the home buyers, and the RERA law was introduced to remove this problem. He added that some recent reports showed that middle class homes were getting completed quickly after the introduction of this law.He also said that all-round development, from modern public transport to housing, was going to make life easier in cities.Noting that the Pradhan Mantri Awas Yojana was inaugurated from Agra, the prime minister said that more than one crore houses have been approved for the urban poor under this scheme. Modi said help is being provided to middle class families of the city to buy houses for the first time. He said so far, more than 12 lakh urban families have been given help of about Rs 28,000 crore to buy houses. The prime minister said infrastructure like water and sewer are being upgraded in several cities under the AMRUT mission, and help is being given to local bodies to make public toilets better in cities and to implement a modern system of waste management."Dreams of today's new India are big ('badhe') and enormous ('viraat'). But, visualizing the dreams is not enough, courage is needed to fulfil them. When you move ahead with courage and dedication, no obstacle can stop you. The youth of India and smaller cities are displaying this courage and dedication," he said."The role played by metro cities in the 20th century is now being played by smaller cities like Agra," the prime minister said. He said that metro rail coaches are being made in India under the Make in India mission. When it comes to the matter of metro network, India is becoming self-reliant, he said, and added that Agra is the seventh city of Uttar Pradesh to have the metro rail facility. "Agra has an age-old identity. Now, a new dimension of modernity is getting attached to it. The city which has treasured history of hundreds of years is all set to march in tune with the 21st century," Modi said. "In the past six years, the speed and scale with which work has been done on the metro network in UP and in the country, shows the identity ('pehchaan') and commitment of the government," he asserted.Modi also remarked that cities of western UP have everything, which is needed for self-reliance. "The farmers here have a tremendous potential. In the matter of animal husbandry, this region is a leader in the country. There is a huge scope for the dairy and food processing industry here, and this region is also moving ahead in the service and manufacturing sector," he said.He added that with modern infrastructure and modern facilities, this potential of western UP is increasing. The first Rapid Rail Transport System (RRTS) is being constructed between Delhi and Meerut, he said, adding that a 14-lane expressway between Delhi and Meerut will soon serve people. Source: ET Realty Chandigarh

Work from home a boon for real estate markets in suburbs, smaller cities

12/4/2020 12:10:00 PM

A lot has changed since the coronavirus pandemic started and the world had to adapt ways it hadn't imagined. Now, as the world inches towards the mass production of Covid-19 vaccines that will act as a precautionary cure against this fatal virus, it remains to be seen if the current state of affairs becomes the new normal, or life goes back to the way it was before the pandemic. Many things however have changed irrevocably. Indian homebuyers' preferences in the real estate market, is one such thing. Remote working to be the mainstay For a variety of reasons remote working will continue to be the preferred mode of working for corporates across the world, considering the number of benefits it has offered in an atmosphere fraught with concerns about the physical wellbeing of employees and monetary stress caused by the pandemic. Companies would not like to start paying expensive rents for office spaces, when concerns about containing the outbreak of this disease still loom large. Interestingly, it's not just office spaces that have been impacted by the work-from-home phenomenon. Trends clearly indicate that after becoming the main mode of working since December 2019, preferences are moving towards home ownership as compared to living on rent. It's also pertinent to note that the pandemic has made people change their investment preferences, with more and more people now preferring real estate investments to investing in the stock markets. Also, amid record low interest rates on home loans, stamp duty reductions and price corrections, properties across the country are far more affordable now than what it has been in the past two decades or so. Another fallout of the pandemic is how home buyers are viewing the location aspect of a property they want to purchase. Since commuting for work is no longer an issue, most people are willing to move to the peripheries where comparatively lower property values help buyers afford bigger spaces, at lower rates. Since being in the metro cities is no longer a precondition to work in an office located in that big city, migrants have either already moved back to their homes in tier-II, tier-III cities, or are planning to do so, especially since majority of them have seen their salaries getting reduced because of the economic fallout of the pandemic. Data available with show that tier-II and tier-III cities have been able to pip India’s prime residential markets in recent times in terms of demand for house property and land. High-income individuals and those who are on their way to approaching retirement are also choosing alternative locations like hill stations and beach destinations as work station. Since their home is not only going to be their personal haven but also their professional arena, buyers are now seriously considering bigger homes. This trend has also resulted in a spike in demand for plots. More and more buyers are now considering plot purchases so that they can build a house, with all amenities and facilities suited to their individual requirements. While it may be myopic to say that the real estate markets in the bigger cities are going to suffer because of the changes brought in by the work-from-home situation, it is certainly safe to say that remote working has brought the focus back on peripheral locations and suburbs of big cities, apart from tier-II and tier-III cities. For the overall real estate market of a nation to perform well, markets across the country must perform equally well. This kind of overall development is also imperative for a more balanced urban sprawl and development. This was not happening in India. Also, while large-scale migration towards the big cities substantially increased the demand for housing in these markets, it also created major spikes in prices of these properties due to space constraints and a demand supply mismatch. Despite the fact that a large number of projects were launched in the city peripheries, the suburbs in most of these markets failed to get much attention from the buyer—despite their affordability—because it involved long and often, tenuous hours of travelling from central business districts where the majority of employment hubs are located. Similar trends were seen in tier-II and tier-III cities. Despite large-scale investment by the government in these cities, demand for real estate there remained dismal because most people moved to the big cities for work-related purposes as the smaller cities were not as successful in creating work opportunities. Work from home has changed that. With the arrival and spread of the work-from-home concept, small cities and suburbs are now in a position to reach their full potential, enabling real estate in India to spring out of a prolonged slowdown that has been plaguing it for over half a decade now. Source: CNBC TV18 Chandigarh

Leasing by co-working operators to rise by 42 percent in 2021: Savills India

12/3/2020 12:14:00 PM

Leasing by co-working operators is expected to increase by 42 percent in 2021 at 4.9 million sq ft over 2020, with shared offices likely to gain greater significance as organisations reassess space requirements and look for flexibility in the aftermath of the coronavirus outbreak, a report has said. India had relatively larger co-working formats spanning to about 50,000 sq ft compared to world average of 7,000 sq ft, Collaborative Space in Dynamic World Order report by Savills India has said. In 2020, as of the third quarter, Bengaluru and Hyderabad had a combined share of around 66 percent of the total leasing activity in the co-working segment. The overall stock, expectedly, has been highly concentrated in the two cities and approximately 51 percent share is expected by 2020-year end, the report says. “Over the years, shared office space has emerged as a separate asset class bringing significant cost-advantages to occupiers. A wide rate spectrum combined with hassle free operational services on offer, have been instrumental in increasing the affinity of mid-sized firms as well as large corporations towards co-working spaces,”said Arvind Nandan, managing director, Research and Consulting, Savills India. Co-working in India has grown from a 5 percent share in 2016-17 to about 15 percent in 2019. Though the pandemic related uncertainty in commercial office market has impacted the growth trajectory in 2020, it is still expected to contribute around 10 percent of the overall leasing activity in 2021 and 2022, the report says. In 2020, co-working players are expected to lease around 3.4 million sq ft accounting for 11 percent share of the office leasing market. Although the overall leasing activity is expected to drop significantly in 2020 as compared to 2019, it is expected to increase steadily over the next two years, the report says. The share of co-working space take-up in overall office leasing activity is poised to rebound to a 15 percent share in 2021, similar to the 2019 level. As per the report, over 3,000 co-working centres across the country are likely to offer approximately 1 million desks by 2022. Additionally, leasing activity by the co-working segment is expected to grow by 29 percent during 2015-2022, the report said. As per the report, the pandemic could possibly lead to an array of trends in the co-working segment including the rise of marketplace platforms with sectoral expertise in flex spaces and increased consolidation with large investor-backed operators weathering the storm successfully. Co-working operators are also expected to tap into residential and retail market offering an integration of retail centers and office spaces. A survey conducted among occupiers and operators for the report indicated few aspects that are likely to alter the co-working offerings in the near future. About 60 percent of occupiers believe that work-from-anywhere (WFA) trend is likely to stay in the near to medium term. Hence, organisations are likely to switch to a hub and spoke model. As per the survey, 61 percent of occupiers seek shorter lock-in period and rent assessment cycles as businesses have become highly dynamic. As many as 30 percent of the surveyed developers strongly agreed that technology would shape the future of workspace. With 93 percent employees wanting a commute time of less than an hour, developers foresee a high demand concentration in the suburban and peripheral areas of cities. Apart from rental reassessments with occupiers, 79 percent of the developers recognize that they are expected to meticulously and rigorously analyse force majeure clauses among other aspects. Source: Money Control Chandigarh

Commercial real estate in NCR may report growth in Oct-Dec on better demand

12/2/2020 12:59:00 PM

The commercial real estate sector of the National Capital Region (NCR) is likely report growth in the current quarter (October-December) on the back of improved demand, said a report by 360 Realtors. The report said that as per its estimates commercial market will take a V-curve and return to normalcy by Q4, 2020, noting that NCR's ccommercial real promises growth and continues to perform more than any other real estate asset class. "Till Q1'2020, the commercial realty space was on a growth trajectory but in Q2'2020 owing to the COVID-19 crisis the sentiment remained muted but the market will again witness an uptick in the sentiments by Q4' 2020," it said. It noted that several areas of Gurugram and Noida, have turned into business hotspots. Gurugram has been a premium location for commercial office spaces in NCR for almost a decade now owing to its proximity to the national capital, apart from innumerable industries and business houses already located in the vicinity. Demand for office spaces in Noida has also been on a high growth trajectory after commercial space saturated in Delhi and availability dwindled in the national capital, the report said. Micro-markets like NH-8, Golf Course Road, SPR in Gurugram have turned out to be the most lucrative options for leasing activities. The lower rent, new supply and infrastructure development have boosted the demand in NOIDA key sectors such as Sec-16, Sec-62 and Noida Expressway. "Commercial Realty market is witnessing an upward trend and more and more buyers and investors are showing their interest in it because commercial asset class has performed much better than the residential sector over the last few years," said, Ajay Rakheja, National Head, 360 Realtors - Commercial. He added that while the residential market for Delhi-NCR has largely remained subdued in the last few years, commercial space leasing and investment has gained traction, especially in the last financial year. Demand was largely driven by BFSI, FMCG, wellness and healthcare, consulting, head-offices of big corporate and MNCs, Rakheja said. "In the wake of the pandemic, several factors will continue to affect development. Planning for office expansion or new leasing became a secondary preference due to cost optimization, social distancing, and hygiene norms. Also, the market is witnessing rising demand for Grade-B and Grade-C," he added. Source: Business Standard Chandigarh

GMADA upgrading Togan road in Mullanpur to six lanes

12/1/2020 12:08:00 PM

With the Chandigarh administration allotting work for the road connecting Dakshin Marg to New Chandigarh (Mullanpur) in Mohali, the Greater Mohali Area Development Authority has also started the process to upgrade its 8km PR-4 road from Togan to Boothgarh from four to six lanes. The six-lane road, to be connected to Dakshin Marg via a 1.2km stretch towards Chandigarh, will connect to the Siswan-Kurali road on the Punjab side. This will provide better connectivity to Chandigarh and the upcoming Punjab Cricket Stadium (PCA) in New Chandigarh, which is expected to host domestic and international matches by September next year. A senior GMADA officer said they were working on a detailed project report (DPR) and hoping to complete the project by October next year. “Three bridges will be constructed on the existing causeways, with the project estimated to cost Rs 100 crore,” he said. As part of the upgrade, the road will also be equipped with trunk storm lines for developers in New Chandigarh. “This road will help with better connectivity between Chandigarh and Punjab, and with the PCA stadium soon to be operational, there is a need for an alternative route to handle the traffic pressure,” said Taraninder Singh, president of the Confederation of Real Estate Developers Association of India (CREDAI), Mullanpur. Currently, commuters have to go through Sarangpur via Madhya Marg to reach New Chandigarh. The 1.2km road via Dakshin Marg will shorten the distance between Chandigarh and Kurali by connecting National Highway 21 and Sector 39 through Kurali. The road will also connect directly to the new international cricket stadium coming up in New Chandigarh. Being constructed by the Mohali Cricket Association, the stadium is nearing completion. Source: Hindustan Times Chandigarh

The New Tenancy Act to create another wave of affordable rental housing: Durga Shankar Mishra

11/30/2020 3:26:00 PM

After the affordable rental housing policy, the government is now eyeing to push the growth of affordable rental housing segment by modifying the age – old Tenancy Act by implementing the new Model Tenancy Act by removing the complexities and restrictions on the existing rent control laws to increase the supply of affordable housing, announced Durga Shankar Mishra, Secretary, Ministry of Housing and Urban Affairs, government of India at the inauguration of Naredco’s three–day virtual ‘Real Estate and Infrastructure Investors’ Summit (REIIS) – 2020’ in association with APREA. The new Act once implemented across the states would release over one crore vacant houses locked in the clutches of the old Act and promote investments into the real estate sector. Calling the pandemic – induced reforms to be a great booster, he informed that a slew of measures taken by the government such as liquidity infusion, Housing For All, affordable rental housing policy, stamp duty reduction across the states, revision of the circle rates and income tax reliefs have opened up avenues for fresh investments into the sector. He advocated the need for implementing global housing technologies to make housing more affordable and environment-friendly to achieve the dream of Housing For All. Naredco and Asia Pacific Real Estate Association (APREA), a leading pan Asian trade association with focus on cross-border real estate investment, along with Anarock Property Consultants, have organised the the virtual ‘Real Estate and Infrastructure Investors’ Summit (REIIS) – 2020’ with the theme of ‘India – Opportunities in the Coming Year’. Ashok Mohanani, president, NAREDCO Maharashtra, in his welcome address, said, “The real estate sector is on a growth mode, post pandemic. We are expecting a quantum leap in home buying due to the cooling home loan rates, the best ever residential housing prices and the zero stamp duty bonanza by the developers. The home loan structure has been supportive across ticket sizes and the Government’s initiative like the SWAMIH fund, liquidity infusion reforms, stamp duty reduction have accelerated housing demand, which in turn, will encourage foreign investors revising their outlook on the sector.” Attributing the revival of the real estate sector mainly to the government’s reforms and visionary decisions like a complete waiver of the stamp duty, Rajan Bandelkar, VC, said, “The sector needs more liquidity and wholesale lending by the financial institutions for further growth. While futuristic steps like levying a zero-stamp duty has accelerated demand from the homebuyers, the banking industry should infuse more funds in viable affordable housing projects and allow restructuring of loans for sustainability.” Terming India as a bright spot for real estate investment, Sigrid Zialcita, CEO, Asia Pacific Real Estate Association (APREA), said, “The year 2021 will be a better year for economic growth for India, as it will bring economic and capital revival due to the Government and the Central Bank’s support to the realty sector. With the demand picking up, we expect a greater participation from institutional investors and the REITs sector in India will also grow.” Rajeev Talwar, national chairman, Naredco, opined that the government must consolidate the affordable housing policy further to bring the government, PSUs and slums lands for construction. Naredco has pegged substantial amount of foreign investment flows into the Indian real estate sector in the next two years. The Summit partner Anarock predicted $8 billion capital inflows in Indian realty sector in the next fiscal in the new asset classes like logistics and data centres. Source: Construction Week Online Chandigarh

Government to soon come out with model tenancy law

11/27/2020 10:58:00 AM

Housing and Urban Affairs Secretary Durga Shanker Mishra on Wednesday said the government will soon come out with the model tenancy law, giving a major boost to real estate sector especially rental homes. The ministry had in July 2019 floated the draft model tenancy law. Addressing a webinar organised by realtors body NAREDCO, he said the government's Affordable Rental Housing Complex (ARHC) scheme for migrants, which was launched a few months ago, has been progressing well and the programme has the potential to stop creation of slums in cities. Mishra said the housing sales have revived after unlocking of the economy on the back of several measures taken by the Centre as well as state governments. He said some states like Maharashtra and Karnataka have reduced stamp duty on registration of properties to boost sales. The secretary said the Centre had advised all States/UTs to cut stamp duty for giving filip to the housing segment. "Model Tenancy law is ready. It has been translated into various languages as it has far reaching implications," Mishra said. The deadline for feedback on the proposed model tenancy law ended on October 31 and now States have been asked to send those feedbacks after compiling it, he said. The secretary said the model tenancy will come "very soon". Mishra pointed out that 1.1 crore homes were vacant as per 2011 census as people fear to give their homes on rent. The model tenancy law will eliminate anomalies and give a boost to real estate sector, he said. The Centre will send the Model Tenancy Law, after approval from the Union Cabinet, to States for its adoption. The draft model tenancy law proposes that landowners will have to give a notice in writing three months before revising rent. It advocated appointing a district collector as rent authority and heavy penalty on tenants for overstaying. On the ARHC scheme, Mishra said the initial response has been very encouraging and the already completed units have been handed over in cities like Surat and Chandigarh. "This scheme is the answer for ending slums in the country. No one wants to live in slums," he said. Talking about the Rs 25,000-crore stress fund to complete stuck real estate projects, Mishra said around Rs 13,000 crore has been committed so far in 135 real estate projects, which would benefit 87,000 homebuyers. He said the government is regularly reviewing the progress of this stress fund -- Special Window for Affordable and Mid Income Housing (SWAMIH). The secretary asked builders to take advantage of recent tax relief announced by the government in clearing their unsold inventories. Recently, the government relaxed income tax rules to allow primary or first sale of housing units of up to Rs 2 crore at a price that can be 20 per cent below the stamp duty circle rate. Earlier, the law restricted differential between circle rate and agreement value at 10 per cent. The secretary complimented realtors bodies NAREDCO and CREDAI for creating their own online platforms for property sales and asked them to promote them as well as take feedback from people. He said these two platforms could become Amazon of real estate with e-commerce becoming popular among young generation. Mishra said Indian real estate sector not only contributes in the country's GDP but is a major employment generator. It creates demand for 250-300 ancillary industries. He emphasized on skill improvement and use of modern technologies for faster completion of construction works. NAREDCO Chairman Rajeev Talwar and President Niranjan Hiranandani thanked the central government for helping the sector in tiding over the crisis. Rajan Bandelkar, Vice Chairman, NAREDCO West and Ashok Mohanani, President NAREDCO West also highlighted several steps taken by the Centre and Maharashtra government to boost demand. PTI Source: Tribune Chandigarh

Home Buyers Investing In Second Homes In Non-Metro Cities As Holiday Homes

11/26/2020 10:56:00 AM

The COVID-19 pandemic has given a new lease of life to the concept of a holiday home or a second home. With most of the corporate professionals working from home, geography is no longer a constraint. The need for segregation between work and personal life has fueled the concept of a weekend retreat in a holiday home. ‘Workcation’- the concept of working remotely from any picturesque travel destination amid extended work from home is also gaining currency as corporate professionals are looking to escape the monotonous routine at home. The demand for these holiday homes is driven by High Net-Worth Individuals (HNIs), expatriates, Non-resident Indians (NRIs) and C-suite corporate professionals who consider it as a form of social mobility and an attractive investment asset. The dream of owning a second home within salubrious greenery has been an integral part of Indian ethos. The overall health, hygiene and wellness concerns during COVID-19 has pivoted the focus towards spacious holiday homes set amid verdant greenery, away from densely packed Tier 1 cities. Such homes located far from the hustle-bustle of cities enable individuals to truly rejuvenate and unwind in tranquility at their property, unlike hotels and resorts. Furthermore, with competitive prices being offered by developers and low-interest rates on home loans, non-metros have become a preferred choice of investment for second home buyers. This is gradually attracting even the travel-savvy upper-middle-class, who earlier enjoyed annual holidays but can no longer opt for it due to travel restrictions. Buyers are considering option starting from plots where they can design and develop homes as per their need, to ready to move in condominiums, villas and floors, depending on their needs and budget. The benefits accruing due to COVID-19 come with built-in validity that has triggered a sense of immediacy among buyers to consider a holiday home. Strategic location within a few-hour drive from cities, state-of-the-art amenities such as gymnasium, spa, swimming pool, etc., and innovative tech-driven experiences are hallmarks of these homes. The strategic location allows buyers to meet day-to-day requirements due to good connectivity and a robust social infrastructure. For residents in Delhi NCR, nearby places such as New Chandigarh, Panchkula, Kasauli, and Shimla have emerged as sought-after destinations for holiday homes. From the investment perspective, second homes in non-metro cities are a relatively safe investment class with higher capital appreciation compared to homes in metros, especially during COVID-19, when alternative classes such as mutual funds, shares have seen diminishing returns. These properties can be rented out to home-stays and tourism businesses- a booming market promising an assured and stable source of income to investors. However, buyers must be cautious and consider several factors while buying a second home. While strategic location, good connectivity and accessibility and world-class amenities are the predominant criteria, buyers also consider other factors such as lifestyle quotient and curated experiences. The COVID-19 pandemic has invariably pivoted the focus towards organized real estate due to their ability to adhere to standard hygiene and wellness measures. Hence developers with an excellent track record of delivery and sound credentials are likely to maintain a competitive edge in the market. With the festive season approaching, consumers will likely evaluate offerings from the perspective of value-added services such as free parking space, waiver on maintenance charge for a limited time, and many more. COVID-19 has also accelerated the deployment of next-generation technologies that have subsequently fuelled the demand for smart and automated homes. Amid sustainability gaining a new currency in this unprecedented time, large open spaces such as balcony decks with lush greenery and biophilic designs are increasingly being preferred by home-buyers. Riding on the wave of sustainability and prospective investment, the holiday home has emerged as a sought-after option for the segment of buyers whose jobs and lifestyle quotient have remained unaffected in the wake of pay cuts. Source: Business World Chandigarh

REITs can solve the funding problem of commercial developers

11/25/2020 12:03:00 PM

The Indian real estate sector is just emerging from the COVID-19 impact. Many number-game pundits had predicted severe liquidity crunch, but then, just in the middle of the lockdown, the Mind Space REIT (Real Estate Investment Trusts) was oversubscribed by 13 times over, and the strategic retail investors started all over again. And now, more REITs are coming our way, offering a funding lifeline for investors to pump in some much-needed money into the market. But what makes REITs such a plum promise? The truth is, global investors have been eying India’s burgeoning commercial real estate market for a while now. The Blackstone-Embassy REIT (2019) sent out a positive wave to many global investors and also opened up brand new investment avenues for many domestic retail investors. So, one successful REIT was all it took to cause a ripple effect on the entire realty sector, which also reaches the asset classes. This is what REITs do – they pool together investors’ capital to purchase commercial real estate assets, also allowing for it to be traded on major stock exchanges. This, in turn, leaves banks free to open up new projects by reducing loan exposures. For commercial developers, this is a win-win situation! Reasons why REITs are great for developers and investors alike REITs are the best bet for the Indian commercial real estate developers at the moment, providing them with a viable funding alternative. Some well-known, sophisticated investor REITs have helped developers to improve liquidity and raise capital by unlocking their assets’ value. For developers facing a cash crunch such REITs are a boon, literally. While the investors can get their worth, the developers get a chance to exit the property when it is at its peak value, and reap maximum ROI. The other advantages are: • REITs allow even smaller investors to add commercial real estate to their portfolio because they often come with a low entry point – which is equal to lower investment. • Since it’s mandated that 80% of the REITs listings should be of rent-generating assets, they are mostly unaffected by market instability of other investment options such as the stocks, mutual funds, FDs, etc. • REITs offer smart returns with minimal risks– the projected ROI is pegged between 12% and 14% in the long term. • For the developers – parking funds in premium property markets enables a growth in the rent of these listed properties. • REITs offer deal transparency and are a good option for investors with small real estate appetites On the other hand, for the developers, it all combines into a large ticket – this enables them to divert funds to highly cost-intensive commercial real estate market. Last year, the success of the Embassy Parks REIT saw global investors increasing their stakes in many commercial assets across India, so as to get themselves listed under REITs in future. In the clamour to invest in the Indian real estate market using the REITS vehicle were Japan’s NikkoAm Straits Trading Asia, Taiwan’s Eastspring Investments, North Carolina Fund from the US, Malaysia’s Hwang Asia Pacific REITs and Infrastructure Fund, and the Canada-based Sentry Global. And this truly helped the market tide over the COVID-19 lull quickly. It is because of REITs’ capacity to solve the funding issues of developers that it has become so popular in the global real estate scenario so quickly. And though REITs was introduced in India only a few years ago, making many investors wary of it initially, it has now begun to attract investment by showing off its power to monetise rent-yielding assets. REITs is now helping the Indian realty developers unlock their assets and enable retail participation. Source: Indian Info Line Chandigarh

A Senior Living Facilities Boom in India

11/24/2020 2:03:00 PM

India is at a nascent stage in terms of organized senior care and the demand for senior living and senior care services is likely to pick up as the world emerges out of the pandemic, said a stakeholder in the sector. Tara Singh Vachani, Executive Chairperson of senior living and senior care services provider Antara said the senior population in India is fast growing with over 20 million elders who stay alone, and the number is slated to rise in the next two decades. The senior care market is currently valued at $12 billion, she said. “India is still at a nascent stage when it comes to organised senior care but the demand for senior care services is expected to pick up due to an increase in the mass affluent elderly population, who are seeking specialized services and solutions for their changing needs,” she said. She noted that the COVID-19 pandemic has accelerated the need for dependable and professional services and solutions for seniors. India will need a robust and well- rounded senior care ecosystem to cater to the evolving needs of this population, said Vachani, who is also the Vice Chairperson of Max India. Citing the growth of elderly population as per Census data, she said, “The upward growth projections clearly signify the untapped market potential that this segment holds both in metros and Tier 1 and 2 cities.” The demand for senior living housing units is highest in the Delhi-NCR (15,050) followed by Mumbai (12,950), Hyderabad (6,200) and Bengaluru (6,000), she said, adding that over the years, tier 2 and 3 markets such as Pune, Goa, Dehradun, Ahmedabad, Coimbatore, and Lucknow have witnessed a steady rise in demand. Factors such as better environment, availability of large land parcels, and enhanced access to healthcare will also drive the demand for Senior Living facilities in tier 2 and 3 cities. On the impact of the coronavirus pandemic, she said that the pandemic has disrupted multiple sectors and the senior care industry is no exception. All senior care facilities had to pay special attention to hygiene and safety, appropriate interventions for mental health had to be introduced and new ways of engagement had to be devised. On the demand front, she said that Antara’s Noida facility received a very encouraging response from customers, indicating that both the concept and the brand resonate strongly. “We have already sold 1/3rd of our inventory after the COVID-19 pandemic broke out. In Dehradun as well, where we had already sold 70 per cent of the inventory, both enquiries and sales have risen,” she said. (IANS) Chandigarh

Festive season uplifts homebuyer sentiment, property searches surpass pre-COVID levels: Survey

11/23/2020 1:18:00 PM

Contrary to popular belief that realty transactions have virtually stopped during the pandemic-induced lockdown, industry data shows that property buyers are returning to the market. In fact, the number of property searches have already surpassed the pre-COVID numbers. Magicbricks Property Buyer’s Sentiment Survey (3rd Edition) reveals that the onset of the festive season, after months of uncertainty due to the outbreak of the pandemic and the national lockdown, has finally uplifted the consumer sentiment in the residential real estate industry as investors are making a comeback while looking for exciting deals. In the Property Buyer Sentiment Survey 1.0 (April 2020) and 2.0 (July 2020), job stability and price discovery were the primary concerns of people in property buying. However, the sentiment has changed significantly since then and in the Property Buyer Sentiment Survey 3.0 (October 2020), while the people are more certain about the prices, the festive season has also uplifted the sentiment. Beside, some of the supply side push such as all-time low interest on home loans and stamp duty waiver in some states also helped to push the fence sitting buyers to execute the transactions. After peaking in Property Buyer Sentiment Survey 2.0 (published in July), the percentage of first-time home buyers has rationalized as per the Property Buyer Sentiment Survey 3.0. The increased buying frenzy amongst the first-time buyers is induced by the sudden realization of the benefits of owning a house in a COVID-like situation. In the last six months the market had seen a dip in the number of transactions but recent trends reflect recovery with consumer searches on the Magicbricks portal surpassing the numbers during pre-COVID months by 30%-40%. The festive season led by attractive deals and discounts are also attracting investments into the market. “Our Property Buyer Sentiment Survey 1.0 and 2.0 had earlier indicated that investors had all but disappeared from the market amidst economic uncertainty. This seems to be changing with the festive mood, and now investors form one fourth of the intent to purchase a property. The trend was further confirmed by the increasing number of buyers looking for discounted/ distress deals and in the 3rd edition of the survey, more than 1/3rd of the buyers are looking to buy exclusively on availability of discounts, which coincides with the many deals launched by various developers across the country,” says Sudhir Pai, CEO, Magicbricks. With the COVID-19 effect gradually fading off, only 43% of the buyers believe that the property price will decline henceforth, compared to ~75% respondents three months back. Thus, price volatility and getting killer deals are not likely to be a characteristic consideration of the buyer market any longer. Silver lining for 2021 Pent up demand from 2020 along with anticipation of a volatile stock market has given an expectation of a healthy recovery for the real estate sector by 2021. Also with the reports coming in for a vaccine for Corona virus by early next year (by various international organizations), expectations have risen for a turnaround by the mid of next year. Waves of uncertainty coupled with falling GDP have made most big-ticket investment options unfavorable to investors in the short term. At the same time, the residential real estate segment has shown resilience against price depreciation, falling under 2% at India level during lockdown (April-June 2020). As a result, property ownership is seen as a safeguard against value erosion in troubled times. Thus, while the respondents believe that they may resist for another three months, 2021 may turn out to be a boom year as a result of pent-up demand of the last nine months. Source: Financial Express Chandigarh

Home Buyers Investing In Second Homes In Non-Metro Cities As Holiday Homes

11/9/2020 3:59:00 PM

The COVID-19 pandemic has given a new lease of life to the concept of a holiday home or a second home. With most of the corporate professionals working from home, geography is no longer a constraint. The need for segregation between work and personal life has fueled the concept of a weekend retreat in a holiday home. ‘Workcation’- the concept of working remotely from any picturesque travel destination amid extended work from home is also gaining currency as corporate professionals are looking to escape the monotonous routine at home. The demand for these holiday homes is driven by High Net-Worth Individuals (HNIs), expatriates, Non-resident Indians (NRIs) and C-suite corporate professionals who consider it as a form of social mobility and an attractive investment asset. The dream of owning a second home within salubrious greenery has been an integral part of Indian ethos. The overall health, hygiene and wellness concerns during COVID-19 has pivoted the focus towards spacious holiday homes set amid verdant greenery, away from densely packed Tier 1 cities. Such homes located far from the hustle-bustle of cities enable individuals to truly rejuvenate and unwind in tranquility at their property, unlike hotels and resorts. Furthermore, with competitive prices being offered by developers and low-interest rates on home loans, non-metros have become a preferred choice of investment for second home buyers. This is gradually attracting even the travel-savvy upper-middle-class, who earlier enjoyed annual holidays but can no longer opt for it due to travel restrictions. Buyers are considering option starting from plots where they can design and develop homes as per their need, to ready to move in condominiums, villas and floors, depending on their needs and budget. The benefits accruing due to COVID-19 come with built-in validity that has triggered a sense of immediacy among buyers to consider a holiday home. Strategic location within a few-hour drive from cities, state-of-the-art amenities such as gymnasium, spa, swimming pool, etc., and innovative tech-driven experiences are hallmarks of these homes. The strategic location allows buyers to meet day-to-day requirements due to good connectivity and a robust social infrastructure. For residents in Delhi NCR, nearby places such as New Chandigarh, Panchkula, Kasauli, and Shimla have emerged as sought-after destinations for holiday homes. From the investment perspective, second homes in non-metro cities are a relatively safe investment class with higher capital appreciation compared to homes in metros, especially during COVID-19, when alternative classes such as mutual funds, shares have seen diminishing returns. These properties can be rented out to home-stays and tourism businesses- a booming market promising an assured and stable source of income to investors. However, buyers must be cautious and consider several factors while buying a second home. While strategic location, good connectivity and accessibility and world-class amenities are the predominant criteria, buyers also consider other factors such as lifestyle quotient and curated experiences. The COVID-19 pandemic has invariably pivoted the focus towards organized real estate due to their ability to adhere to standard hygiene and wellness measures. Hence developers with an excellent track record of delivery and sound credentials are likely to maintain a competitive edge in the market. With the festive season approaching, consumers will likely evaluate offerings from the perspective of value-added services such as free parking space, waiver on maintenance charge for a limited time, and many more. COVID-19 has also accelerated the deployment of next-generation technologies that have subsequently fuelled the demand for smart and automated homes. Amid sustainability gaining a new currency in this unprecedented time, large open spaces such as balcony decks with lush greenery and biophilic designs are increasingly being preferred by home-buyers. Riding on the wave of sustainability and prospective investment, the holiday home has emerged as a sought-after option for the segment of buyers whose jobs and lifestyle quotient have remained unaffected in the wake of pay cuts. Source: Business world Chandigarh

Residential realty records 60% sales growth in Q2 FY21: ICRA

11/6/2020 5:23:00 PM

The residential real estate segment has witnessed a sharp recovery in Q2 FY2021, post a severe decline in Q1 FY2021, according to ICRA, a rating agency. Mumbai Metropolitan Region (MMR), Pune, and National Capital Region (NCR) remained the highest contributors to pan-India sales in the said quarter, the agency said. Overall the housing sales volume witnessed a Y-o-Y decline of 50% in H1 FY2021 across the top eight cities of the country. However, sales volume bounced back considerably with a Q-o-Q growth of 60%, recorded across property markets in the second quarter of the current fiscal. While quarterly average sales for under-construction units registered a decline of 78% during H1 FY2021, a significantly lower decline of 29% was noted for advanced stage/completed projects. ICRA continues to expect the overall financial and operational performance of real estate developers to be adversely impacted in the short term due to the escalated demand risks, lower collections, and Covid-related disruptions in project execution The ratings agency had earlier expected a 45% overall decline in sales volumes in FY21. However, post the lows in Q1 FY21, sales across the top eight cities of India rebounded in Q2 FY21, indicating some green shoots of normalisation. With some further recovery expected in H2, it is revising its earlier estimate of sales volume decline in FY21 to 35-40%. Shubham Jain, senior vice president and group head at ICRA said, "Increasing digitisation has played a key role in enabling sales in the current environment, with extensive use of digital marketing and digital engagement tools by the developers aiding online home sales and transaction payments. The crisis has thus pushed the sector towards widespread technology integration." Buyer preferences for rightly priced inventory at advanced stages of construction continued to be in place, although larger format units seemed to be finding increasing favour, possibly due to the requirement for dedicated work and study areas. The uptick in absorption levels during Q2 FY2021 has also been driven by the affordable and mid/upper-mid segments, indicating the higher resilience of these segments to the demand headwinds currently prevailing in the residential realty market. “Going forward though, sustainability of the uptrend and its drivers remains to be seen. Moreover, with the Q2 FY2021 sales still remaining 37% lower than the levels recorded in Q2 FY2020, a return to pre-Covid sales levels also remains a key look-out area. Consequently, the trend of market consolidation is likely to accelerate, with range-bound prices and low home loan rates expected to continue supporting sales for established players”, added Jain. Source: ET Realty Chandigarh

Reason to celebrate: With gifts galore, it’s home sweet home for buyers

11/5/2020 11:57:00 AM

Hit hard by the pandemic, real estate developers are lining up attractive offers like flexible payment plans, assured penalty in case of delayed possession and maintenance waivers for over two years to push sales during the festival season. Another reason behind the promotions is a gradual uptick in demand. A pre-festive channel check report by Emkay Global Financial Services suggests residential sales recovering by 50% of pre-Covid levels, primarily driven by record low financing rates, upfront discount and relief on stamp duty. Besides, city-centric sales are driven largely by younger customers (32-38 years), an aspirational buyer class. Sensing some pent-up demand, Migsun Group launched ‘possession proof homes’ where it is offering an assured 1% penalty every month in case of delay in possession. Homebuyers have to pay 10% initially and 90% on possession. It is applicable on projects in Ghaziabad and Greater Noida. Another developer, Gaur Group is offering a payment plan with 10% down payment within 30 days, 40% within one year, and remaining 50% at delivery on its projects in Ghaziabad and Greater Noida West. It is also offering gifts like laptop, washing machine, microwave and refrigerator. Mahagun Group is offering multitude discounts like 25 gram gold, pay 25% now and rest later, waiver of 25 months’ maintenance fee, 25% off on stamp duty and compensation of 25% in case of delay in project. Offers are valid on projects in Noida, Gr Noida and Ghaziabad. Analysts said developers are giving offers to lower overall cost by 10-15%. “They offer 5-8% discount as soon as you come, then many offer to pay registration charges, waive maintenance costs, cover EMIs, etc,” a senior executive with a developer said. Anarock Property Consultants chairman, Anuj Puri said assuming a 1,000 sq ft property in Bengaluru costs `80 lakh, including basic cost, parking, stamp duty and registration charges, plus an additional Rs 5 lakh for woodwork, the effective total cost is Rs 85 lakh. Builders are offering a discount of Rs 100 per sq ft on basic cost (Rs 1 lakh), waives car parking charges (Rs 2 lakh), waives stamp duty & registration charges (around 7% in Karnataka) and no EMI till possession (hypothetically three years), and modular kitchen (about Rs 2 lakh). Here the buyer gets an instant discount of Rs 5 lakh on basic cost, car park and kitchen. The benefit of waived stamp duty and registration is around Rs 5.6 lakh. Cumulatively, the buyer’s cost is reduced by around 10.6 lakh on a property costing Rs 85 lakh, roughly a 12.35% discount. Consultancies and listing sites, too, are coming out with attractive offers. For instance, launched the ‘mega home utsav’, running from October 7-November 14. It expects to reach over 25 million buyers through the event, which would see participation from over 100 builders. The portal has also collaborated with over 1,000 channel partners along with banking partners. Bullmen Realty India introduced Bullmen Shield, under which developers are registering their properties, which will then be verified. It is assuring buyers double their stuck amount in case of non-delivery by developers listed with its programme. Source: Financial Express Chandigarh

Delhi-NCR property sales rise 40% in Jul-Sep 2020: Report

11/4/2020 10:49:00 AM

While property sales in Delhi-NCR have reportedly seen an improvement of over 40% QoQ, property prices and rental rates have remained unchanged. Delhi-NCR reported a noticeable improvement in property enquiries and sales in the Jul-Sep 2020 quarter, as against April-June 2020 when the nationwide lockdown marred activities in the real estate market. Overall, the quarter closed with transactions numbering at around 3,100 units. While sales have reportedly seen an improvement of over 40% QoQ, property prices and rental rates have remained unchanged. The city stands with an unsold housing stock of about two lakh units, reveals Insite, which is a quarterly report focusing on capital and rental price trends in the residential realty market across eight major cities of India. Speaking on the report, Maneesh Upadhyaya, Chief Business Officer,, said, “The Jul-Sep 2020 quarter set the pace for the recovery of Indian residential real estate market. Post an initial lull in sales and new launches in the previous quarter, the current quarter came as a breather as sales resurged by almost 2.5 times of the pre-COVID levels. Both Delhi NCR and Mumbai saw a significant improvement in transactions, QoQ, as end- users flocked to leverage the lucrative deals floating in the market. Price correction, unlike anticipated, remained a far cry; however, with a negotiation window of up to 10-15%, the deals closed in at a reduced price of 2-5% of the pre-COVID levels.” Average property prices and rental rates have been calculated as per listings posted on in the studied quarter. The range of property prices may vary by 10% depending on the age and furnishing status of the residential apartments. Post a lull in housing sales and new launches in Apr-Jun 2020, Delhi NCR’s realty landscape showed some fast cropping green shoots of recovery in Jul-Sep 2020, i.e. soon after the gradual lifting of the nationwide lockdown. Brokers and developers reported a marked improvement in the quality of leads during the quarter as serious homebuyers ventured into the market to conduct site visits. Resultantly, monthly sales volume recovered by almost 50% in July. Overall, the quarter closed with transactions numbering at around 3,100 units, which is a nearly 40% increase from 2,000 units in the previous quarter, but a significant dip from 9,800 units last year. The city constituted about 22% of the total property sales across the top eight metro cities in India, second to Mumbai. The quoted property prices remained unchanged; however, sellers remained flexible to negotiate up to 10-20% in the resale segment. A few distressed sales were also reported in the quarter. Unlike the previous quarter, which went by without any new launches, Jul-Sep 2020 saw a few new projects coming up in Greater Noida, Ghaziabad and Gurgaon. The silver lining is the increased interest of the NRI community, which coupled with the festive season may fasten the process of recovery in the final quarter of the pandemic-hit year. Property enquires and sales witnessed an upsurge across Noida, Greater Noida and Ghaziabad in Jul-Sep 2020, as against Apr-Jun 2020. In addition to budget housing units priced within Rs 35-60 lakh, demand for low-rise apartments and independent houses went up as buyers sought privacy in the post-COVID-19 world. Ready-to-move-in inventory garnered maximum interest from homebuyers as confidence in under-construction projects continued to dwindle. The expanding metro network to Greater Noida, Greater Noida West, Ghaziabad and Jewar continues to hold the baton of a healthy investment scenario in the long term. The latest announcement of an ambitious Film City project is expected to benefit both capital and rental markets of Noida- Greater Noida, and establish the region into one of the biggest business hubs in North India. Coupled with the upcoming Jewar International Airport, the area might also attract NRI investments, eventually at par with Gurgaon. Demand from the tenant community seemed to shift from residential apartments to builder floor units, thus propelling enquiries in the older sectors of Noida. Any impact on rental ‘asks’ was not reported due to muted demand and excess inventory as property owners remained resilient to short-term challenges posed by COVID-19. The recovery of the property market in Gurgaon was quicker than the other zones in Delhi NCR. Some lucrative offers by reputed developers led the quarter to close with an increased number of sales in comparison to the Apr-Jun 2020 quarter. New launches, too, reported an improvement, since the previous quarter saw no new unit additions. Resultantly, the unsold housing stock shrunk marginally to about 25,000 units. Golf Course Extension Road remained the prime gainer in terms of traction in Jul-Sep 2020, closely followed by Dwarka Expressway and New Gurgaon. Excess inventory and poor connectivity, however, remained weak points for the latter, thus widening the window of negotiation to up to 15-20 percent in the resale segment. Homebuyers remained primarily interested in ready housing units, which occupy over 80 percent share in New Gurgaon. NRI demand inched up significantly in the price bracket of Rs 1.5-2 crore. Housing belts along Golf Course Road and Golf Course Extension Road received maximum enquiries from NRIs. Sales, however, remained low due to prolonged travel restrictions. The rental landscape failed to move positively as the majority of offices in Gurgaon continued with the work-from-home format. The segment is expected to remain grim for another one to two quarters, until offices reopen. The planned metro corridor to New Gurgaon and Faridabad holds the potential to propel property prices and housing demand in the ensuing quarters. For now, the unchanged circle rates played a positive inducer for the market facing severe repercussions of the COVID-19-led slowdown. The buying and renting markets in Delhi suffered at the hands of the COVID-19 pandemic. While the average weighted property prices maintained status quo, QoQ, a few areas saw prices softening to the tune of 5-10 percent. For instance, category A localities such as Vasant Vihar, New Friends Colony, Shanti Niketan and Anand Niketan saw a dip in prices owing to high disparity in circle rates and market rates and meek interest from homebuyers, as per the report. Similarly, Mayur Vihar recorded a few deal closures at a 10-15% discounted rate, depending upon the construction quality or the age and legal status of the property. A few distressed sales in East Delhi’s Laxmi Nagar were also reported to have closed at a value almost 20% lower than the quoted price. Non-conducive market conditions marred sales in the Jul-Sep 2020 quarter across zones, but particularly in South Delhi. Despite the government’s suggestions to reduce stamp duty rates, the South Delhi Municipal Corporation increased transfer duty for women from 2% to 3%, and for other buyers to 4% from 3% percent, for properties with a registered value of Rs 25 lakh and above. The rental market remained stagnant as demand from students and working professionals continued to be grim. A surge in vacancy rates hit average rentals with little scope of recovery until the next quarter. Some of the prime student housing hubs, which are impacted by the stunted demand, include Model Town, Tilak Nagar, Lajpat Nagar and Hauz Khas. Source: Financial Express Chandigarh

Home purchase affordability improves in 2020 across major cities in India JLL

11/2/2020 12:55:00 PM

JLL announced the launch of its annual Home Purchase Affordability Index (JLL HPAI) today which shows that from 2011 to 2020, home purchase affordability improved across key Indian cities which were part of the Index. This was despite a bigger fall in annual household income as compared to residential property prices. A sharp decrease in the cost of funding (average home loan rates reduced from ~8.9% in 2019 to 7.5% in 2020), more than offset the adverse impact of lower incomes on affordability, the report added. "We believe that the initial signs of revival were visible in the residential market in the third quarter of 2020, with sales of residential units witnessing an uptick. Furthermore, our analysis suggests that despite a fall in household income in 2020, home purchase affordability has increased in 2020 across all the markets under consideration," said Ramesh Nair, CEO and Country Head, JLL India. "Interestingly, in 2021, we're expecting home purchase affordability to either remain at similar levels or improve. But the broader recovery of the residential market and the likely pace of translation of demand into actual sales volumes will be dependent largely upon the economic environment and the prevailing consumer sentiments," he added. Until 2019, JLL HPAI indicated that Hyderabad was the most affordable residential market. In 2020, Kolkata overtook Hyderabad to become the best market in terms of home purchase affordability. Mumbai continued to be the only market below the affordability threshold of 100. However, the report points out that Mumbai is the fastest moving city, showing a significant improvement on JLL HPAI from 47 in 2011 to 95 in 2020. "The future of the residential market and the sustenance of the recovery process depends on the containment of the virus. 2021 can pan out in two different ways. If the virus is contained by Q1 2021 and economic activity resumes at full capacity, affordability is expected to improve across all the cities under consideration. In fact, in this scenario Mumbai is expected to breach the affordability threshold. If the virus outbreak is not contained in the first quarter of 2021 and economic activity remains subdued, affordability levels are likely to remain at similar levels in most cities," said Samantak Das, Chief Economist and Head of Research & REIS India, JLL. JLL HPAI signifies whether a household earning an average annual income (at an overall city level) is eligible for a housing loan to buy a 1,000 sq ft residential property in the city, at the prevailing market price and home loan interest rate. It analyses the interplay between three pivotal factors - property prices, income and home loan rates to determine the current and the emerging trends in the home purchase ability of urban households. The index covers the top seven markets in India - Mumbai, Delhi NCR, Bengaluru, Chennai, Pune, Hyderabad and Kolkata. Residential market turns the corner with sales up 34% in Q3 vs Q2 2020 Q3 2020 sales increased by 34% versus Q2 2020. Mumbai accounted for 29% of the total sales in the quarter, while 22% of sales was contributed by Delhi NCR. Growth in sales activity was also driven by stronger demand in Chennai, Hyderabad and Pune. Prices remained largely stable across all the seven markets when compared to the previous quarter. It is important to note that developers in certain markets are providing moderate price discounts and flexible payment schemed to kickstart sales, thereby facilitating cash flows to tide over the crisis in the short term. These could be the first signs of a broader recovery of the residential market in the country. Increased affordability has not been enough to drive fence sitters to effect purchases. Affordability is necessary when determining home purchases, but not enough to drive sales. A homebuyer considers the prevailing economic condition, employment scenario and future income flows. With the current muted consumer sentiment and uncertainty around job security, what is required is policies directed towards improving the overall economic outlook. About JLL JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $18.0 billion in 2019, operations in over 80 countries and a global workforce of nearly 93,000 as of June 30, 2020. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit In India, JLL has an extensive presence across 10 major cities (Mumbai, Delhi NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, Kochi and Coimbatore) and over 130 tier II & III markets with a cumulative strength of close to 12,000 professionals. Headquartered out of Mumbai, we are India's premier and largest professional services firm specializing in real estate. Our services cover various asset classes such as commercial, residential, industrial, retail, warehouse and logistics, hospitality, healthcare, senior living, data centre and education. Source: The Week Chandigarh

Govt paves way for all Indians to buy land in Jammu and Kashmir

10/28/2020 11:42:00 AM

Paving the way for all Indians to be able to buy land in the Union Territory of Jammu & Kashmir, the government on Tuesday issued a notification to completely repeal 12 of the laws enacted by the erstwhile state and brought about changes in 14 such Acts. According to a notification – Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Third Order, 2020 – dated October 26, the Ministry of Home Affairs said, “With immediate effect, the Acts mentioned in the Schedule to this Order shall, until repealed or amended by a competent Legislature or other competent authority, have the effect, subject to the adaptations and modifications directed by the said Schedule, or if it is so directed, shall stand repealed.” In the order, the MHA has amended the J&K land Revenue Act, 1996, as it paved the way for anyone to buy land in the two UTs with an exception of agricultural land, “which can only be transferred/sold to an agriculturist, but the government can authorise an agriculturist to alienate land to a non- agriculturist for sale/gift/exchange”. Further amending the J&K Development Act, 1970, the order said, the government might on the written request of an Army officer not below the rank of Corp commander, can declare an area as “strategic area” within a local area “only for direct operational and training requirement of armed forces”. By amending the J&K Agrarian Reforms Act, 1970 the MHA has also clipped the powers of the Revenue Minister, who citing public interest “could overturn” an order passed by a Tehsildar or Assistant Commissioner in respect of any evacuees land or state land. It is to be noted here that J&K is currently under the Central rule. In this order, the MHA has further amended the domicile law by allowing “spouse of a domicile” to be deemed a domicile. This was earlier applied only to children of Central government officials posted in J&K for a total period of 10 years, who are also eligible as domiciles. Under the order, a new body - the J&K Industrial Development Co-operation - has been set up and if it is unable to acquire land, the government could invoke the provision of the Right to Fair Compensation Act, and acquire the land on behalf of the corporation for public purposes. Reacting to the development, former J&K Chief Minister Omar Abdullah in a Twitter post said, “Unacceptable amendments to the land ownership laws of J&KI. Even the tokenism of domicile has been done away with when purchasing non-agricultural land & transfer of agricultural land has been made easier. J&K is up for sale & the poorer small landholding owners will suffer.” With the changes in the land acts, the MHA said, “The Real Estate (Regulation and Development) Act (RERA), 2016 will now be applicable in the UT.” The erstwhile state laws, which are completely repealed, include the Jammu & Kashmir Alienation of Land Act, the Jammu & Kashmir Big Landed Estates Abolition Act, the Jammu & Kashmir Common Lands (Regulation) ACT, 1956, the Jammu & Kashmir Consolidation of Holdings Act, 1962, and a few others. Source: The Tribune Chandigarh

Affordable Rental Housing Sector Set For A Boom

10/27/2020 10:59:00 AM

India’s residential rental market is set to grow manifold over the next few years, having already touched annual figures of over US $20 billion, as per findings of the International Monetary Fund. Of this, 68 per cent, or US$13.5 billion is in urban areas. Further, India’s real estate sector is expected to touch a market size of US $1 trillion by 2030 and start contributing 13 per cent of the Gross Domestic Product (GDP) by 2025. These were some of the discussion points at a webinar hosted by Invest India, management consultancy firm Primus Partners, in collaboration with Guesture Coliving. During this webinar, a report, titled ‘Roadmap to Rental Housing in India’, was also released, which highlights the unprecedented growth of Indian cities and the need to fast-track the development of rental housing. The report focuses on the need for an encouraging policy & regulatory environment conducive for investments in rental housing, to meet the vision outlined by the Government. The boom in the residential rental market got a fillip last week when the Government of India announced the Affordable Rental Housing Complexes (ARHCs) scheme, being implemented by utilizing existing state-funded vacant houses to convert into ARHCs, as also construction, operation and maintenance by public and private entities on their own available vacant land. 24 Indian states and Union Territories have already embraced the scheme and many private sector organizations have already expressed keenness to partner in the program, including funding and operating the ARHCs. “Housing in India is the paradox of 3As: Affordability, Acceptability and Availability. If acceptable and affordable, it may not be available as there may not be enough supply. However, if affordable and available, it may not be acceptable since concerns could encompass quality and inconsistent formal development control regulation standards. The lack of affordability, on the other hand, could hinder acceptability and availability. We need to overcome this issue of 3As and encourage rental housing.” Mr Gautam Chatterjee, Chairman, Maharashtra Real Estate Regulatory Authority, said. In order to encourage and make Rental Housing a Financially sustainable option, the Government needs to play a significant role. Some of the actions that need to be undertaken would include reservation in DP for cities for rental housing, ensuring correct targeting of beneficiaries of ARHC till the supply copes up with the demand, much stronger O&M of the ARHC complexes, he added. Mr Anshaj Singh, Chief Administrator, Housing Board Haryana, said: “the Haryana Government is rolling out first-of-its kind scheme for Rental housing in India and shall soon make available about 5,500 houses for rent for the Economically Weaker Sections (EWS) category at around Rs. 3,000 per month. For the first time in India such a large scale rental housing scheme is being undertaken. On success this shall further be expanded by 18,000 houses and then more. HBH shall implement this scheme in collaboration with all stakeholders including Colonisers, Housing societies, Private Rental Institutional Players and so on. HBH shall extensively leverage technology to ensure seamless service delivery and efficient monitoring ... This scheme shall pave the way for rental housing in India.” Mr Sriram Chitturi, Founder, Guesture Coliving, said: “Facilitating faster implementation of projects, private sector investments and community partnerships in rental housing will play an important role in bridging market imperfections. Granting rental housing ‘Infrastructure status’, demarcating spaces for rental housing during city planning, facilitating low-cost funding for rental housing will help attract greater private participation in the sector. Clearly, we have to focus on how the cost of living of migrant workers people can be reduced. Private players and rental management companies offer best-in-class front-line assessments to various basic components, including market size, share, net benefit, deals, income, and development rates.” Rental housing has always been an integral part of urban housing response across the world. In India, about 31 per cent of the urban population resides in rental housing. Despite this, the policy and legal framework for rental housing are underdeveloped, as all Government interventions have hitherto been more focused on home-ownership rather than rental housing. Large-scale migration during COVID-19 crisis brought into sharp focus the dire living condition of millions of migrant labourers and their lack of decent housing. “This is a timely intervention. Over the last four to five years, we have seen a lot of interest from global private equity investors,” Mr Deepak Bagla, Managing Director of Invest India, said. “The returns coming out of these projects are potentially extremely encouraging, which make it very attractive from the investment perspective. Look at the travel figures – over 8 billion people travelled on trains last year alone. That’s more than the population of the world. The New India is ready for a boom, and projects such as these under the aegis of Prime Minister Narendra Modi will fuel growth and a resurgence in the economy,” he added. “Cities are growing at an unprecedented rate, providing opportunities for economic and social growth. But as the economy grows, market opportunities grow, and migration becomes inevitable,” Ms Aarti Harbhajanka, Co-Founder & MD, Primus Partners, said. “Millions of people migrate into cities, but only a few can afford housing – such a scenario is not sustainable. To address this, the Government has added the new ARHC vertical to its flagship scheme, Pradhan Mantri Awas Yojana. This paves the way for the development of rental housing in India and brings renewed focus to the importance of residential rentals in our society.” The session participants also included Mr Mahendra Mahajan, MD ITI Alternate Funds Management, Mr Rishi Sreedharan, CEO, Dwellingo and Shri Kahraman Yigit, Co-Founder & CEO, Olive by Embassy. At the session, participants, also discussed the existing rental housing scenarios and development opportunities across the country. They also debated on how, in post-COVID-19 times, rental housing as an alternate project structure could work out both from the perspective of consumers and developers. Finally, the participants evaluated measures for ease in cash-flows for developers in rental housing projects. However, the largely unorganized and informal nature of the rental housing market has made it tough to arrive at the actual market size despite holding a massive potential to address a part of the housing shortage in India. The top 10 states and Union Territories with vacant houses contribute to 78 per cent or 8.64 million vacant census houses with a vast potential of being brought under the purview of several rental housing models in the country. Chandigarh

Govt eases norms to boost real estate

10/26/2020 3:41:00 PM

To boost industrial development and investment in the state, the Punjab Government today took a slew of important decisions, including allowing industry in agricultural and mixed-use areas, subject to certain conditions, besides reduction in non-construction fee by an allottee if he does not construct on estates developed by government and development authorities within three years. The decisions, also aimed at generating employment, were announced after a virtual meeting of the Punjab Regional and Town Planning and Development Board (PRTPD) and development authorities headed by Chief Minister Capt Amarinder Singh. A 30-day public notice would be issued by the government, after which these decisions would be finalised, an official spokesperson said. As per the decisions, industry shall be allowed in agricultural areas beyond 3 km of the Municipal Corporation cities and beyond 2 km of the smaller towns, provided the land has a 19-22 feet access. Further, red category industries should be at least 500 metre away from the village populace for the purpose of establishment of such industry. On the mixed land area use, it was decided to permit industry only along major roads. The meeting also decided on the development industrial hubs in 1,100 acres in Rajpura and in another 1,000 acres near Ludhiana. In another important initiative, the Greater Mohali Area Development Authority (GMADA), also headed by the Chief Minister, decided to set up an industrial estate in Mohali. The estate will have two parts, with about 530 acres to be developed by GMADA and comprising smaller plots, while another 250 acres will be allowed to be developed by private players. Further, to give a fillip to the residential sector in New Chandigarh, a decision was taken to allow affordable housing colonies in 25 acres and above, and other residential colonies in 50 acres or above, from the existing requirement of minimum 100 acres. Coming on the heels of the affordable housing policy, notified recently by the state government, the move will provide homes to thousands of people. Meanwhile, the Chief Minister also approved two key projects for Patiala, including cleaning up and beautification of the Chotti and Badi Nadi through sewerage system along its length and creating a water body by the Check Dam, at a total cost of Rs 180 crore. In addition, Rs 42 crore has been approved for beautifying Patiala’s main marketthrough its redevelopment as a heritage street. The meeting also decided to allow development of approximately 200-acre pocket near the airport by land owners on payment of external development charges, with the aim of promoting development in the area. Chandigarh

Affordable housing in Tier II and III cities triggers growth for realty

10/22/2020 11:02:00 AM

Covid-19 led to a remarkable change in all of our professional and personal choices made. Lifestyle being one of the most prominent aspect in it. This transition is directly translated into the demand shift witnessed in the type of housing units available and their location. Affordable housing emerged as the most preferred segment among end-users in Tier II-III cities. Reverse migration and remote working being the major influencing factors for driving this trend. A report by ANAROCK states that housing demand is likely to increase in smaller cities beginning with rental arrangement first. Cities such as Lucknow, Indore, Chandigarh, Kochi, Coimbatore, Jaipur and Ahmedabad would be the main beneficiaries. A major share of Indian residential market is in the metros which accounts to 70%, while the remaining 30% is scattered in smaller towns. This will change drastically as the scarcity of well-planned projects in smaller cities remain. The need to have a cleaner and well-maintained lifestyle is reinstated with pandemic. Builders involved in developing affordable units tend to prefer the high-rise structures due to the cost efficiency, which is opposite to the demand observed in smaller cities during pre-covid times. Low-rise apartments, independent plots were more in demand for Tier II-III cities. However, as per the current market dynamic buyer sentiment is changing. The residents here want to invest in real estate only when the deal promises multiple benefits. A similar living experience that exists in metro cities with amenities like club houses, gyms, gaming courts, pool, jogging tracks, shopping arcade etc. Also, peripheral regions in such cities are becoming the most ideal locations for new projects, due to the cost of land, resources available, improving state of infrastructure etc. Elaborating on the efforts by government in terms of infrastructure improvement and policy reforms that boost the growth of affordable housing for Tier II-III cities, Raman Gupta, director, branding and construction, GBP Group, said, “Under the Credit-Linked Subsidy Scheme (CLSS), housing for EWS/LIG/MIG beneficiaries is being sanctioned by the HFCs under the Pradhan Mantri Awas Yojana. The scheme is launched to cater the demand of housing shortage of 1.2 crores (approx.) and fulfil government vision of ‘Housing for All’ by 2022. While the benefits of this scheme post the turmoil of pandemic will undergo some time extension but the public-private efforts combined would not let this be an unfinished developmental campaign.” In order to mitigate the effects of pandemic the latest update of Rs 10,284 cr being sanctioned under SWAMIH AIF which will aid completion of 71,559 homes across 101 projects rings positivity for the developers with approved projects in this scheme. It will be extremely helpful to clear stuck projects. Kushagr Ansal, director, Ansal Housing, president CREDAI Haryana, whose one of the projects in Gurgaon received final approvals for the fund, said, “The plan was to have a Rs 25,000-crore fund, with contribution of both the government and other investors set up in 2019, but disbursement of same has been fragmented and gradual. The 101 stuck housing projects are spread across a broad mix of markets, including metros and also Tier- 2 locations like Karnal, Panipat, Lucknow, Jaipur, Nashik, Vizag ,Surat, Dehradun, Kota, Nagpur, and Chandigarh. The share of Tier II markets receiving early sanction of funds by government indicates the impact, sale of affordable housing projects from smaller cities can have on the overall real estate sector and economy.” As per a Proptiger report, 56% of all homes that were registered as sold properties in the October-December 2019 period were priced within the Rs 45- lakh bracket. Also, 52% of new project launches during these three-months period were in the affordable segment. Pradeep Aggarwal, founder & chairman, Signature Global Group & chairman, ASSOCHAM National Council on Real Estate, Housing and Urban Development adding on to the growing popularity and acceptance of affordable homes in Tier II-III cities said, “We are positive about the buyer sentiment and trust in these affordable units. During the lockdown times the response received on our online site visits and social media handlers reflected that affordable housing in these markets is driven by both end-users and investors. The buyers in the new normal can think about buying these properties and not just renting it due to its affordable price point coupled with subsidies provided, and the variety of amenities offered.” Source: Construction Work Online Chandigarh

Reserve Bank of India announces steps to boost credit flow to real estate sector

10/21/2020 3:34:00 PM

In a bid to increase flow of credit to the real estate sector, the Reserve Bank on Friday rationalised the risk weightage to LTV (loan to value) ratio for all new housing loans sanctioned up to March 31, 2022. As per a notification issued by the RBI, new housing loans will attract a risk weight of 35 per cent where LTV is less than 80 per cent and a risk weight of 50 per cent where LTV is more than 80 per cent but less than 90 per cent. This measure, according to the RBI, is expected to give a fillip to bank lending to the real estate sector which is critical for economic recovery, given its role in employment generation and the inter linkages with other industries. "As a countercyclical measure, it has been decided to rationalise the risk weights, irrespective of the amount. The risk weights for all new housing loans to be sanctioned on or after the date of this circular and upto March 31, 2022," the notification said. The requirement of standard asset provision of 0.25 per cent will continue to apply on all such loans, the notification added. Commenting on the RBI's move, Square Yards CEO Tanuj Shori said, "The linking of risk weightage only to LTV ratio vis-a-vis the earlier practice of risk weightage with both pricing and LTV augurs well for the sector particularly for high end properties which have been facing severe downward demand pressures." Anarock Chairman Anuj Puri said the LTV ratio is calculated by dividing the amount borrowed by the value of the property in percentage terms. For instance, if one purchases a home valued at Rs 80 lakh and for this makes a down payment of Rs 10 lakh, Rs 70 lakh will need to be borrowed. "The risk weightage assigned to LTV will free up banks' capital for additional lending. It will also help them to bring down the lending rates because they will have spare capital to lend," Puri said. ince banks will have additional capital to lend, availing home loans at attractive interest rates will be possible, he added. Source: Economic Times Chandigarh

Reserve Bank of India announces steps to boost credit flow to real estate sector

10/20/2020 11:14:00 AM

In a bid to increase flow of credit to the real estate sector, the Reserve Bank on Friday rationalised the risk weightage to LTV (loan to value) ratio for all new housing loans sanctioned up to March 31, 2022. As per a notification issued by the RBI, new housing loans will attract a risk weight of 35 per cent where LTV is less than 80 per cent and a risk weight of 50 per cent where LTV is more than 80 per cent but less than 90 per cent. This measure, according to the RBI, is expected to give a fillip to bank lending to the real estate sector which is critical for economic recovery, given its role in employment generation and the inter linkages with other industries. "As a countercyclical measure, it has been decided to rationalise the risk weights, irrespective of the amount. The risk weights for all new housing loans to be sanctioned on or after the date of this circular and upto March 31, 2022," the notification said. The requirement of standard asset provision of 0.25 per cent will continue to apply on all such loans, the notification added. Commenting on the RBI's move, Square Yards CEO Tanuj Shori said, "The linking of risk weightage only to LTV ratio vis-a-vis the earlier practice of risk weightage with both pricing and LTV augurs well for the sector particularly for high end properties which have been facing severe downward demand pressures." Anarock Chairman Anuj Puri said the LTV ratio is calculated by dividing the amount borrowed by the value of the property in percentage terms. For instance, if one purchases a home valued at Rs 80 lakh and for this makes a down payment of Rs 10 lakh, Rs 70 lakh will need to be borrowed. "The risk weightage assigned to LTV will free up banks' capital for additional lending. It will also help them to bring down the lending rates because they will have spare capital to lend," Puri said. Since banks will have additional capital to lend, availing home loans at attractive interest rates will be possible, he added. Source: Economic Times Chandigarh

Real estate developers welcome RBI's decision to lower risk weightage on home loans

10/19/2020 10:38:00 AM

Real estate developers on Friday welcomed the RBI's decision to lower risk weightage on housing loans, saying it would boost credit flow to the sector, but demanded that more steps should be taken to revive the industry. The RBI decided to rationalise the risk weights by linking them only with LTV (Loan to Value) ratios for all new housing loans sanctioned up to March 31, 2022. With lowering of risk weightage, the requirement of capital provision for banks will come down. Commenting on the monetary policy, CREDAI National President Satish Magar said linking of housing loans to LTV would boost housing demand. The move to extend co-lending scheme to non-banking financial companies (NBFCs) and housing finance companies (HFCs) may infuse additional liquidity, he said, but added that realty sector might not get benefit due to strict due diligence norms and eligibility criteria. "Now that RBI has recognized realty sector as the largest employer, it should also announce steps that are imperative and crucial for the sector's survival and then introduce measures that will aid the sector's revival," Magar said. He sought that all loan accounts that were SMA 1 & SMA 2 as on March 1, 2020 should be made eligible for restructuring. Naredco President Niranjan Hiranandani said the RBI's decision to rationalise the risk weights on home loans and link them to LTV ratios will give a boost to the sector. "Particularly this step would benefit borrowers of higher value loans. It would ensure that more credit is available to borrowers. This move is a much appreciated step recognising the role of the real estate sector in generating employment and economic activity," he added. Anshuman Magazine, Chairman & CEO - CBRE India, South East Asia, Middle East & Africa, said, "RBI's decisions to relax LTV guidelines and rationalize risk weights for home loans will further encourage homebuyers." Anarock Chairman Anuj Puri said the announcement will definitely encourage banks to lend more to individual homebuyers without feeling the stress on their balance sheets. PropTiger and CEO Dhruv Agarwala said it will effectively result in higher credit flow to the real estate sector. Square Yards CEO Tanuj Shori said, "The linking of risk weightage only to LTV ratio vis-a-vis the earlier practice of risk weightage with both pricing and LTV augurs well for the sector, particularly for high end properties which have been facing severe downward demand pressures." Welcoming the move, Hardayal Prasad, MD & CEO, PNB Housing Finance said rationalising the risk weights for all new housing loans until March 31, 2022 and the relaxation extended for LTV, shall give the much needed impetus to the housing sector. "At the same time, home loans will become accessible and competitive for the customers. This move by the central bank addresses the urgency required to boost the real estate sector in the country. This will also lead to the desired recovery of the construction sector which has a very important role to play in creating employment and growth," Prasad said. JLL India CEO and Country Head Ramesh Nair termed the move as timely and a step in the right direction and said this would provide a fillip to housing loans and have a positive impact on the residential sector. Knight Frank India CMD Shishir Baijal said the measures like rationalisation of risk weights to all new housing loans until March 2022 would give a fillip to housing loan growth. The RBI has extended the scheme for co-lending to all NBFCs and HFCs which will ease credit availability for the real estate sector, he added. Meanwhile, Siddhartha Mohanty, MD & CEO of LIC HFL said that in recognition of the role of the real estate sector in generating employment and economic activity, it has been rightly decided to rationalise the risk weights and link them to LTV ratios for all new housing loans sanctioned up to March 31, 2022. Savills India CEO Anurag Mathur said the rationalisation of risk weight of housing loans is a welcome step by the RBI that could potentially boost housing demand. "With this move, housing loans would eventually get more affordable, thereby benefiting the homebuyers in this sluggish market," he added. Emami Realty MD & CEO Nitesh Kumar said the RBI's move on housing loans willl boost credit sentiments and bring much needed positivity in the sector. Sunteck Realty CMD Kamal Khetan said homebuyers across all price points will be able to access more capital with ease. Additionally, it would help lenders on capital adequacy front and enable them to provide more loans, he added. Gaurs Group MD Manoj Gaur said the lowering of risk weightage on home loans and linking it to LTV only will ensure more credit to customers and thereby to the sector. Signature Global Chairman Pradeep Aggarwal said the loan on LTV will be helpful for real estate sector. S Raheja Realty Director Ram Raheja said it will provide the much-needed boost and encouragement to home buyers ahead of this festive season. Honeyy Katiyal, founder, Investors Clinic said the announcement by the RBI to extend the scheme for co-lending to all NBFCs and HFCs will help ease credit availability. "The move by RBI to link risks to loan to value will help banks shred the cautious lending approach. The move is bound to offer a much needed jump start to lending and liquidity cycle in the marketplace," said Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory. The RBI's stand to rationalise risk weightage on home loans is a step in the right direction and homebuyers will benefit immensely from this move, said Ankush kaul, President (Sales & Marketing) - Ambience Group. Jyoti Prakash Gadia, Managing Director, Resurgent India said retail credit and real estate shall also get a fillip with regulatory relaxations announced with an increase in the limit to Rs 7.50 crore for retail credit and rationalisation of risk weight linked to loan value for housing loan, respectively. Source: New Indian Express Chandigarh

Govt to give benefits for affordable housing

10/16/2020 11:53:00 AM

Incentives and benefits including free floor area ratio (FAR), concessional project finance, and trunk infrastructure facilities free of cost will be part of the affordable rental housing complexes (ARHCs) for urban migrants and poor, Union minister for housing and urban affairs Hardeep Singh Puri said on Wednesday, even as he launched a portal for the scheme and released the guidelines. The scheme under Pradhan Mantri Awas Yojana—Urban has been launched to provide dignified and affordable living spaces to urban migrants and the poor, including industrial and construction workers, migrants working with market associations, educational and health institutions, hospitality sector, long- term tourists, visitors, and students. “To make this a lucrative and viable business opportunity for entities, the central government will provide concessional project finance under affordable housing fund and priority sector lending, exemption in income tax and goods and services tax and technology innovation grant for promotion of innovative technologies in ARHCs. Further, governments of the states and Union territories will provide use permission changes, 50% additional FAR free of cost, single window approval within 30 days, trunk infrastructure facility and municipal charges at par with residential property," a statement by the ministry said. The scheme was announced by the central government in May and received cabinet approval in July. This comes at a time when the extended lockdown to control the spread of covid-19 saw a large number of migrant workers head to their villages. Source: Mint Chandigarh

Real estate sector is recovering faster than the market's expectations, says HDFC Securities, picks 4 stocks as top bets

10/15/2020 11:02:00 AM

A leading brokerage says it is "positively surprised" by the recovery in pre-sales in the real estate, has picked out some of its key names for potential stock upside. "We are positively surprised by the pre-sales recovery momentum building up in the sector post the unlocks,", said an HDFC Securities report. It added that while the market is expecting a slow recovery in the real estate sector, the brokerage's channel checks suggested an accelerated recovery is taking place, at least for the organised developers. "Mixed-use players will outperform as compared to pure-plays, with office segment least affected followed by residential, retail and hospitality," said the note by HDFC Securities. HDFC Securities' top sectoral bets are DLF, Brigade Enterprises, Phoenix Mills and Prestige Estates. It added that the recent stamp duty cut in MMR will trigger deal closures in the region. Therefore, the completed projects will be sold out soon followed by under-construction projects. For instance, Sobha recently reported pre-sales at 88 percent of pre-COVID levels, the broker pointed out. Sobha has risen about 16 percent in the last seven sessions. Real estate, Nifty Realty Office sales continue to see strong collections Realty players are bullish about the office segment and expect at least 28-30 million sq ft commercial space absorption this year. "There will be a demand bounce back. Currently, things are moving slow but maybe next year, we will see the momentum picking up," Mindspace Business Parks REIT CEO Vinod Rohira said during a virtual real estate summit organised by CII. According to HDFC Securities, the office segment continues to see strong collections of 95-98 percent but clarity is awaited on how ‘work from home’ will impact overall office demand and vacancy. The pricing in the near term is expected to remain soft as owners try to retain tenants. Mortgage rates at all-time low "The underlying low-interest rates and loss of confidence on unorganised players are aiding pre-sales of our coverage universe. Demand will continue to consolidate to a few players in each micro market. Strong brand positioning, 5- 15 percent discount and lowest decadal mortgage rate shall aid residential recovery," said the brokerage report. Cash flow management will be crucial; land acquisition/commercial capex will get deferred, it further added. Source: CNBC TV18 Chandigarh

Ladakh notifies RERA rules, ushers in new era in real estate development in UT

10/13/2020 1:04:00 PM

Ladakh has become the 34th union territory to have notified the rules under the Real Estate (Regulation and Development) Act leading the way for property development to take place in the region. “Extremely happy to share that Ladakh becomes the 34th State/UT, which has notified Rules under RERA. It was done on 8 October 2020. It paves the way for implementation of this transformative legislation in the Union Territory, opening new vistas of real estate development journey," secretary, ministry of housing and urban affairs, Durga Shanker Mishra tweeted. In August, the union territory of Jammu and Kashmir had notified the rules under RERA becoming the 33rd state/union territory to do the same. “The move will open up new vistas for the development of the union territory J & K by ensuring efficient & transparent transactions. It will also ensure timely delivery & quality construction of real estate projects,” Mishra had tweeted then. Also Read: RERA disposes of almost 50,000 complaints in three years According to statistics provided by the MoHUA more than 52,000 real estate projects and 40,517 real estate agents have registered under RERA across the country. Nearly 50,000 complaints have been disposed-off by the Real Estate Regulatory Authorities across the country. Out of this, nearly 57 percent cases or approximately 27,581 complaints were resolved in the last one year alone. Uttar Pradesh takes the lead with as many as 18,509 cases disposed off by the UP RERA authorities so far, against a mere 5,989 cases a year ago. Haryana is at a distant second with nearly 9,919 cases disposed of currently as against 3,123 cases in the corresponding period of 2019. Maharashtra's MahaRERA has so far disposed of nearly 7,883 cases, an analysis by Anarock property consultants has said. Project registrations have seen a 24 percent annual jump – from 43,208 projects as on July-end 2019 to nearly 53,364 projects presently, the analysis said. The states with maximum project registrations currently include Maharashtra, Gujarat, Karnataka, Madhya Pradesh, Uttar Pradesh, Telangana and Tamil Nadu. Following the coronavirus pandemic over 23 states RERA Authorities have so far extended registration of projects by six months and one by nine months following the situation created by the coronavirus pandemic and this has been done to safeguard the interests of homebuyers. Source: Money Control Chandigarh

Building plan approval goes online in Chandigarh

10/9/2020 11:54:00 AM

Citizens can now submit the building plan application along with the required documents online, with no human intervention Standing in long queues in government offices to get your building plans approved is now a thing of the past in Chandigarh, as UT administrator VP Singh Badnore on Thursday launched an online system to provide the service. Online building plan approval system (OBPAS) has been identified as one of the key reforms agenda under government missions such as Atal Mission for Rejuvenation and Urban Transformation (Amrut), with focus on improving the ease of doing business. Citizens can now submit the building plan application along with the required documents online, with no human intervention. It will be followed by online scrutiny of the plan as per the Chandigarh Building Rules, and applicants will get regular updates through SMS and email. The fee will be auto-calculated and can be paid online too.The system will ensure timely approval of the building plan drawing, while making the entire process transparent with well-defined roles of each department/employee, stated a release. MC commissioner KK Yadav said: “Chandigarh Smart City Limited as part of the smart city mission endeavours to improve the ease of doing business and enhance citizen services.” He said the main objective is to facilitate citizens by providing online delivery of services, minimise manual intervention, and ensure faster application submission, tracking and monitoring, besides timely resolution of issues and increased transparency.” Registration form will be provided to architects on MC and CSCL web portals ( and Registration form will be approved by the department of urban planning (architecture wing) Username and password will be shared with the architects through email 24x7 help desk (0172-2787200) will be available to support citizens/architects SMS and email notifications related to the application status will also be sent Source: Hindustan Times Chandigarh

Festival cheer for real estate sector, housing sales up 104% in top 7 cities

10/8/2020 12:34:00 PM

The real estate sector is perking up with home sales showing a 104 percent increase in the top seven cities of the country for the July-September period from the previous quarter, as Delhi and its suburbs top the shopping table, a report has said. As many 50,983 houses were sold in the third quarter against 24,936 in teh second quarter of 2020, the report by PropEquity, a real estate data, research and analytics firm, has said. “Indian real estate sector is showing some recovery, as many projects were launched in the last quarter and with various schemes and offers, developers were able to clear significant inventory,” PropEquity managing director Samir Jasuja said. “As we move into the festive season, we forecast this recovery to continue with more offers, discounts and attractive payments schemes to attract customers,” he added. The coronavirus outbreak hit the real estate sector, which was already under stress, hard with inventory piling up as uncertain economic climate, job losses and salary cuts kept buyers away. On a year-on-year basis, however, housing sales were down 35 percent to 50,983 units. At 78,472, new launches in the quarter, too, were down 30 percent year-on-year. The new supply or launches of housing units increased by 126 percent during the July-September period to 38,131 units from 16,808 units in Q2 2020 as developers got back to work with easing of lockdown restrictions, the report said. The Delhi-National Capital Region saw a 295 percent increase in the sale of homes against the previous quarter. Bengaluru, Chennai, Hyderabad, Kolkata, the Mumbai Metropolitan Region (MMR) and Pune clocked a growth of 86 percent, 131 percent, 159 percent, 89 percent, 70 percent, 72 percent, respectively. This data includes lottery housing projects. In MMR, new launches witnessed a growth of 113 percent to 8,056 units from 3,785 units and the absorption increased by 71 percent to 16,652 units from 9,750 units. In industry parlance, absorption is the rate at which homes that are available in a market are sold over a specific time period. It is calculated by dividing the number of homes sold in the allotted time period by the total number of homes available in that market. In Hyderabad, new launches went up 370 percent to 6,580 units from 1,402 units and the absorption increased by 158 percent to 4,677 units from 1,803 units. Bengaluru, however, saw new launches dip by 2.42 percent to 6,049 units though absorption increased by 86.2 percent to 6,098 from 3,275 units. Pune saw 8,664 houses being sold in the third quarter against 3,655 units in the previous quarter, a jump of 137 percent. Absorption increased by 73 percent to 9,539 units from 5,515 units. While the numbers have improved from the previous quarter, but when compared to last year, fewer houses have been sold in all the seven cities. In Bengaluru, the drop in sales is whopping 44 percent to 6,098 units from 10,878. Housing sales in MMR dipped 30 percent to 16,652 units, while demand fell 23 percent in the NCR to 9,375 units from 12,237 units. Source: Money Chandigarh

Real estate likely to bounce back in Tier II & III cities post Covid-19

10/7/2020 12:10:00 PM

With the recently-issued Unlock 4.0 guidelines, it would be interesting to see how does the real estate market perform in the coming months and how much time does it take to bounce back. Realtors meanwhile are optimistic about the recovery scenario particularly in Tier II and Tier III cities, especially after a recent KPMG report ‘Time To Open My Wallet Or Not’ said that 22% consumers in Tier II and 30% consumers in Tier III cities felt that their spending would either increase or remain the same as before the spread of the COVID-19 pandemic. Realtors say that if one takes the inflation into account, fixed deposits are yielding a negative rate of return currently. The equity market is way too volatile and even the RBI governor has recently warned about a possible correction as it is way too ahead of the fundamentals. “Considering these aspects, real estate is being seen by many as an attractive investment option. According to a recent survey conducted by in association with NAREDCO, around 35% of the participants consider real estate as one of the best investment options with 28% opting for gold. Lower interest rate along with stable prices also works in favour of the sector. Tier II and Tier III cities have witnessed rapid infrastructure development and are also emerging as new employment hubs. With the government’s focus on encouraging self-employment, these cities are also witnessing a kind of reverse migration and hence, it is expected that the demand for property is likely to improve soon. The upcoming festive season could be the biggest trigger towards the same,” says Mani Rangarajan, Group COO,, & There is no denying the fact that the impact of the pandemic has been higher in metros than in Tier II and Tier III cities. Therefore, upon unlocking, these cities are witnessing favorably well consumer interest and willingness to spend. “It is also about moving forward with the digital wave and being prepared for the festive season. Business in malls is already touching 30-40% of sales registered in the same period a year ago. Our mall in Dehradun is running a campaign of never seen before offers with the help of various brands. It is time for collaboration, and retailers and mall authorities have to work together to drive customers. Organized retail offers more safety to shop and dine in these towns, we must capitalize on it. Facilities like Block & Shop, Video calling Shopping are adding value to our retail outlets. The key is to streamline your communication in a targeted way especially in Tier II and Tier III cities for motivating customers to visit the malls and experience the safety measures introduced personally,” says Abhishek Bansal, Executive Director, Pacific Group, who heads the operations of Pacific Malls in Delhi NCR & Dehradun. Explaining the market sentiment, Mohit Goel, CEO, Omaxe Ltd, says, “Being an end-user driven market, the demand has picked up faster in 2/3 cities due to a host of reasons like the government’s industry and infrastructure push, corporates looking for cheap real estate and skilled workforce that are staying back or returning and higher capital appreciation. Demand in cities like Indore, Lucknow, New Chandigarh, Ludhiana, Faridabad etc. is gravitating towards reputed developers – those with a strong balance sheet and good delivery record.” Retail and entertainment avenues in Tier II and III markets are scattered, and malls bring the luxury and convenience for customers to check out everything under one roof. Uddhav Poddar, MD, Bhumika Group, who is spearheading the development for one of the largest malls in Udaipur- Urban Square, says, “The residential and commercial real estate avenues in Tier II-III markets are scattered. On the other hand, commercial complexes and modern housing societies combine the values of urban lifestyle and convenience into one. Even for mall developers, the advantage remains, customers have the freedom to discover anything and everything under one roof. Mall authorities and developers presently are working relentlessly to ensure stern safety and hygiene measures even while they are in the construction phase. This trend will continue, efforts will be directed to create a haven for attracting customers and assuring them of their well-being all time in these newly-developed structures.” Raman Gupta, Director – Branding & Construction, GBP Group, says, “Reverse migration among the working professionals from metros and NRIs will lead to an increase in demand of property in Tier II and tier III cities. Talking especially about the northern region, Tricity and its peripheries are witnessing an upsurge laying the foundation for a market that is going to grow exponentially from here. Also, India is on its path of becoming the manufacturing hub, it will create significant demand for office spaces, business parks, and other commercial complexes in the coming years.” Realtors say that consumers these days prefer to shop online and have compelled brick and mortar retailers to focus on a concrete strategy for Omnichannel Retail. It is imperative for retailers to evaluate the situation prudently in order to tackle the cash flow situation. The Indian retail sector is going through an adverse time and the need of the hour is that the government takes certain strong measures to ensure that the retail sector in the country does not go in a state of dormancy. The retail sector is not just one of the biggest sunrise sectors of the country, but also creates volumes of jobs. Ajay Rakheja, Sr. VP-Commercial Real Estate, 360 Realtors, says “The sector is already witnessing lower revenue and has not seen any benefits coming from the fiscal stimulus packages and now if banks do not extend the moratorium on loans announced in March beyond August 31, then the retail sector will find itself in the doldrums. And the recovery for the sector will take longer than what is predicted. The retail sector might see some recovery from the Q4 2020, but consumer sentiments in post-pandemic times will remain largely muted and some categories like luxury, travel, hospitality, movies, fine dine, white goods, expensive gadgets, might see a drop. So, mall owners need to re-evaluate their future strategies.” Source: Financial Express Chandigarh

Property sales rise by 112% in Mumbai, rental market also shows upward trend

10/6/2020 12:30:00 PM

The number of properties sold in Mumbai, India’s real estate capital, rose by 112 per cent in September from the previous month, according to figures released by the Maharashtra government. According to official figures, 5,597 sale or conveyance deeds got registered with the state’s inspector general of registrations (IGR) in September as against 2,642 documents registered in August. In another sign of green shoots of recovery appearing in the property market – among the worst hit by the prolonged lockdown – the figures also showed that the volume of registered sale transactions this September was 39 per cent higher than last September, which had seen registration of 4,032 documents. Across the state, 1,19,834 properties were sold in September, which was also 46 per cent high than in August (82,100) and 49 per cent over last September (80,349). Earlier, in a bid to revive the real estate economy, the Maharashtra government had cut the stamp duty payable on all sale transactions executed and registered between September 1, 2020 and December 31, 2020 by 3 per cent and by 2 per cent for transactions registered between January 1, 2021 and March 31, 2021. Revenue Minister Balasaheb Thorat said that the stamp duty cut has had the desired impact. “The benefit has been passed on to the buyer. We have seen an uptick in sales since August 25. We are hopeful of the trend to continue,” he added. In Mumbai, also seen as the country’s costliest real estate, the relief has brought down the stamp duty payable on a sale transaction from six per cent to three per cent for now while in some other parts of the state, it has dropped from seven per cent to four per cent. A month later, it is evident that the government’s concession, which is estimated to set the state exchequer back by Rs 1,000 crore in estimated revenue, has given first sale transactions a much-needed boost. This September, statistics show that the state netted a total revenue of Rs 181 crore through stamp and registration levies from sale transactions. Last September, corresponding collections were to the tune to Rs 348 crore. After a complete shutdown in the first couple of months of the lockdown, construction activity has been gradually resuming operation in Maharashtra since June. But it was only after mid-July that the residential buying segment started witnessing some movement, officials said. The upward trend in the property sales has also positively impacted the home loan market. According to government numbers, September saw 3,398 and 29,250 registrations of agreement or memorandums for the deposit of title deeds in Mumbai and Maharashtra, respectively. It is mandatory for all home loan borrowers to enter into such agreements with the lending institution. In August, the corresponding number of documents was 2,359 and 23,353, respectively. Incidentally, the rental property market also depicted an upward trend. According to figures, Mumbai saw 3,515 more properties rented on leave and license basis in September as compared to the month earlier. The IGR registered 19,216 leave and license documents in September, which included 17,216 e-registration and 2,394 registration done at various registrar offices. In August, the total registrations done in this category were 16,095. “As a matter of precaution several housing societies had disallowed their members from renting out flats in the first few months of the lockdown. It is only now that the market has opened up,” said Vinod Gupta, owner of Sai Siddhi Realty, a real estate brokering agency that deals in residential and commercial properties in south and central Mumbai. With the rental housing market in almost a total shutdown mode previously, Gupta added that a price correction of up to Rs 4,000 to Rs 5,000 a month in rents for residential properties have been witnessed. “As economic and commercial activity in south and central Mumbai picks pace, we expect the rental market to gain further momentum,” he said. Stamp duty and property valuer Sunit Gupta, however, cautioned that the upward movement might be a temporary phase. “The lockdown has clobbered the economy and adversely hit per capita income. The additional sales witnessed in September can be attributed mostly to a pent-up demand from buyers. The concession in stamp duty has helped the trend as well. But it may not sustain over a longer period,” he said. He added that “buying sentiment” is expected to remain muted in the near term with many suffering from pay cuts and job losses. While the state government has indicated plans to halve construction premiums to help the property market further, Sunit said the government ought to have reduced property ready reckoner rates significantly to benefit first time buyers. “They (the government) missed a chance there,” he added. Meanwhile, government sources said that the state Cabinet is expected to soon green light a proposal to reduce construction premiums, which has been recommended by the high-level committee headed by Housing Development Finance Corporation Chairman Deepak Parekh. Source: Indian Express Chandigarh

Recovery signs in housing market

10/5/2020 12:32:00 PM

Sale of residential properties witnessed a sequential uptick during the July-September quarter as India began to slowly come out of one of the strictest lockdowns imposed anywhere in the world, allowing buyers to visit sites, finalise mortgage and act on pending purchase decisions. Real estate brokerage and consultancy JLL said residential sales were up 34 per cent during July-September over the April-June period across the seven metro cities in India, tabulating figures from established developers only, prompting the head of the institution to be “cautiously optimistic” about the residential market. Even though a more granular report is expected later this month about the health of the real estate market in each city, including Calcutta, the cumulative sales number pales in shadow when compared with 2019 and points to the extent of contraction in sales. These seven cities recorded sales of 14,415 units during July-September compared with only 10,753 units in April-June, when much of the country was completely shut. However, the sale was less than half of the 36,826 units sold in the July-September period of 2019. “We are feeling cautiously optimistic about the residential market, driven by sales volumes in Mumbai and Delhi. A combination of factors such as low mortgage rates, attractive prices combined with developers’ lucrative payment plans reinforce the longer-term potential of the sector,” Ramesh Nair, CEO and country head of JLL, said. Samantak Das, chief economist and head of research at the brokerage, said it did not make much sense to compare with last year. It was more important to see if there is an incremental gain month-on-month. “The festive season may bring back more buyers to the market even though the residential space is unpredictable.” Bangalore was the only city other than Calcutta which witnessed a decline in sales over the last quarter. Only 390 units were sold in July-September against 481 in the year-ago period, a 19 per cent drop. Bangalore saw a 12 per cent dip. Das declined to read much into the numbers. “There was hardly any launch in Calcutta in the last quarter. In a small market like this, launches can move sales dramatically,” he explained. Meanwhile, Bengal Peerless signed on former India cricket captain Sourav Ganguly to promote the second phase of Avidipta, billed as the tallest building on EM Bypass. “Somebody has to take the lead to shake up the market. We are trying to convey that it would be the best time to buy a property,” Ketan Sengupta, managing director of the company, said. Prices have not moved up in the last one year and the home loan rate has come down to 7 per cent, the lowest ever, making it compelling to buy if there is possibility of income impairment. Source: Telegraph India Chandigarh

From virtual real(i)ty to township living – how six months of COVID changed real estate industry

10/1/2020 2:21:00 PM

At the onset of the year, the real estate sector that was already going through a prolonged period of a slowdown was pinning great hope on 2020. The industry was expecting a revival. The markets showed signs of incremental growth in the first quarter and it seemed that the ascent would keep up the momentum. However, as the nationwide lockdown was imposed in March, the adverse impact was visible in the $180 billion housing market as well. COVID-19 has been a destabilising factor since. In most major markets, sales have plummeted by around 60 percent in the last six months. As business activities slow down across the country, the sector will continue to suffer from muted demand for some more time and it may take at least two quarters to normalise. Here’s a look at some trends that are here to stay. Increased digitisation The crisis has resulted in digitisation and wider technological adoption in the sector. From sales and marketing to collections and CRM support, technology is playing an important role. At a time, when physical interactions are restricted, online media will play an important role in driving marketing activities. Besides digital marketing, there is a spurt in online content and social media. Similarly in CRM, we are seeing API integration, which is bringing the entire operational process online. Going forward, virtual reality will be used to showcase properties digitally without the need for repeated physical site visits The millennial population will drive the change. The recent success of virtual property shows and the growing popularity of webinars points to this trend. The Online-to-Offline (O2O) model will be inclined towards the online medium with actual site visits now getting pushed back to the final stage of decision making. Demand patterns will evolve The crisis has challenged the popular notion to own a home in the central part of town. With the rising work-from-home culture, people will now opt for larger homes in the outskirts. Going forward, new launches may take place in the periphery. Interest in township living is also on the rise. In the new normal, buyers are looking at second homes, independent farmhouse living, and holiday homes. Should buyers expect price cuts? Property prices have already corrected over the years and a further decline may not be feasible. Price of land, too, is unlikely to come down. Large scale disruptions, increasing labour and construction material charges are all going to add up to costs. Attractive schemes are here to stay To push demand, developers will continue to provide attractive schemes. Some freebies such as registration charges, club membership fees and other facilities may be offered. There may also be some innovative payment plans. Government intervention is the need of the hour Real estate constitutes around 8 percent of India’s GDP. Governments, both at the central and state level, must provide a policy impetus to drive demand. Recently, the Maharashtra government decided to reduce stamp duty rates until March 2021. Madhya Pradesh has also taken a similar initiative. This has helped revive market sentiments to some extent. Other states should also follow suit. More initiatives in the form of a reduction in GST rates, income tax benefits should also be considered. Source: Money Control Chandigarh

Real estate may witness a surge in investment amid signs of normalcy

9/30/2020 12:02:00 PM

Developers from various parts of the country have now become bullish about the growth prospect of the sector in the near term and many of them are even planning huge investments. The Covid-19 pandemic and the resultant lockdown have impacted almost all industries, including real estate. However, with the gradual relaxation in lockdown norms, construction work has resumed in most places across the nation, and buyers have also become active. In fact, many of them are even planning to buy a piece of property in the near future. A recent report by and National Real Estate Development Council (NAREDCO), for instance, has revealed that a major chunk of the people (around 35%) still view real estate as the preferred mode of investment. Keeping in view such reports as well as increased investor confidence, developers from various parts of the country have now become bullish about the growth prospect of the sector in the near term and many of them are even planning huge investments. Taking the lead in this direction, Delhi-NCR based commercial real estate developer Bhutani Infra has announced its plans for investments to the tune of Rs 5,000 crore over the next three years towards developing three commercial real estate projects in Noida and Greater Noida. The company hopes to deliver close to 16 mn sq ft of commercial space in the next three years. “The Covid-19 pandemic has affected every industry, including real estate. However, there has been no impact on the Grade-A office market in Noida and Greater Noida. As these two cities enjoy cost advantage compared to Gurugram, there is a pick-up in demand in the Noida & Greater Noida region,” said Ashish Bhutani, CEO, Bhutani Infra. Bhutani Infra is currently developing three commercial projects – Bhutani Alphathum, Bhutani Grandthum and Bhutani Cyberthum. Located at Sector 90, Noida, Bhutani Alphathum is a landmark commercial project, which offers around 35 lakh sq ft of office spaces and a shopping mall spread across 7 lakh sq ft. The project also offers 500 studio apartments. The group is also developing Bhutani Grandthum, which is primarily a high street retail destination. Spread scross an area of 23 acres, it offers close to 6,00,000 sq ft for high street retail. The project – designed with unique concepts like Mirage Dubai, Ice Lounge, Gandola Ride, Yatch Club, is coming up at Greater Noida West. Bhutani Cyberthum is another project which is being developed at a rapid pace. It is spread across 27 acres and is located in Sector 140, Noida, thus enjoying excellent connectivity via Noida like Noida-Greater Noida Expressway, Dadri Road. It offers retail shop and office space in varied sizes. Another Delhi NCR-based developer – Signature Global – is also planning to launch 10,000 housing units before March 2021. Already, in the month of August, the group had launched a new affordable housing project in Gurugram, which will have around 832 units. The newly launched project is being developed under Deen Dayal Jan Awas Yojna at an estimated cost of Rs 400 crore. And it is not that only the developers based in Delhi NCR are bullish about the growth prospects of real estate. Tricity (Chandigarh)-based developer GBP Group has recently launched a new township project – Central Town – in Zirakpur. Spread across 32 acres, the project will entail an investment of Rs 600 crore, funded partially through internal accruals and partially through bank funding and sales proceeds. The upcoming township will have a mix of residential units, plots and commercial offerings. Interestingly, the project is one of the first township projects in the Zirakpur region, which traditionally offers affordable options as compared to the neighbouring areas. “In the surrounding areas of Chandigarh, prices are three times as compared to the prices in Zirakpur. The population growth of Zirakpur is 3.5% annually as compared to the nearby regions’ population growth of 2.5%. So there is a huge requirement of real estate in this area. Central Town is in the heart of the city and is well connected with Ambala Highway,” said Raman Gupta, Director-Branding & Construction, GBP Group. Source: Financial Express Chandigarh

Real estate can give the much-required push to Indian economy

9/29/2020 5:02:00 PM

The realty sector is the second largest employer in India after agriculture and its contribution to employment is expected to rise further owing to the shift in consumers’ preference towards owning houses over rental spaces. Real estate is expected to contribute 13 per cent to India’s GDP by 2025. The growth of real estate will have a cascading effect on ancillary industries such as infrastructure and cement, leading to the creation of direct and indirect employment. The realty sector is the second largest employer in India after agriculture and its contribution to employment is expected to rise further owing to the shift in consumers’ preference towards owning houses over rental spaces. Young working professionals had earlier contributed to rental yields for most realty players in Gurugram. The COVID-19 has pivoted the focus on financial security and sound investment backup. Now the same young lot is considering buying houses for both personal use as well as for investment purposes. Another trend is the proliferation of technology that has automated certain tasks and somewhat reduced the dependence on labour. Technology service providers stand to gain immensely as all realty players are leveraging emerging technologies. Smart construction techniques such as steel framing, prefabricated steel floor decks have expedited the pace of construction, leading to the delivery of projects in record time. With sustainability gaining new currency in real estate, eco-friendly projects and energy-efficient buildings have found favour with consumers. The value of real estate assets hinges on a robust infrastructure. The presence of schools, hospitals, connectivity to railway and airport boost the value of real estate properties. Additionally, consumers are looking for curated customer experiences and are ready to go the extra mile to afford it. Well- travelled, business-savvy millennials are now eyeing premium housing that offers the best customer experiences such as futuristic approach in terms of automation; green practices, the efficiency of space so that it can be customized and so on. Moreover, the Walk-to-Work concept has gained momentum with the increase in well-planned mixed use developments. Real estate, whether commercial or residential, has been considered as a relatively safe asset class for investors. India’s growing economy and wide consumer base are conducive to investment in real estate. Renowned international architects are now eyeing the Indian market and are collaborating with leading real estate players to design remarkable projects. The clarion call towards ‘Local for Vocal’ by Hon’ble Prime Minister Shri Narendra Modi has boosted the consumer sentiment towards Indian companies with sound credentials. The backdrop of depreciating rupee and falling crude oil prices further accentuate the prospects of investment in India. Multiple job opportunities in Corporate Inc in India, job losses in the international market, and job insecurity induced by the pandemic will lead to NRIs wanting to come back to their homeland. This is an opportune time for them to invest and plan a comeback to the home turf. Source: Financial Express Chandigarh

Residential Plots Seeing Good Demand Among Tricity Buyers

9/28/2020 11:55:00 AM

Home buying is still considered to be one of the most crucial decisions in a person's life. With umpteen options available in the real estate market of Tricity, the end-users have to carefully analyse their home choices, which aligns with their budget and living standards. The trend of high-rise gated societies, townships, and residential plots has managed to co-exist in the Tricity realty market due to the diversity of population residing here. Some of the primary reasons for choosing residential plots over gated societies can be the future returns and flexibility which plotted developments offer when compared to the gated societies. An end-user looking to invest in plots must be prepared to get these future returns only after a horizon of 5-6 years. The plots come with the freedom of construction and designing of homes as per their taste and preferences. While for the developers too, residential plots take lesser time to fully develop as compared to the hundreds of units in a gated society. Due to the major lifestyle changes happening in Corona times, residential plots are also preferred choices by many due to the privacy and exclusivity they offer in terms of areas like parking, entrance, pool, garden etc. The influx of end-users in the market is due to the lower home loan interest rates offered by the banks. The majority of the population migrating to Tricity region from Punjab, Haryana, J&K, and Himachal Pradesh has to adjust with the rental accommodations, but a part of them still desire to own a home in the vicinity of the City Beautiful. Regions like New Chandigarh, Dera Bassi, and Kharar are the ideal locations for owning such residential plots. Key road projects like connecting Kharar with New Chandigarh have begun. Recent announcement related to GMADA starting the land acquisition process to build a 6km, 200-feet wide link between Airport road to Kharar -Landran road will further improve the connectivity and value of the property in these regions. The road is a part of the Mohali master plan. In present times, as industries are beginning to recuperate developers are still open to offering deferment payment plans, some are even offering comparatively lower booking amounts to cease the deal. This will be a pattern for only a limited time, until the market comes back to its pre-COVID level. Investment in residential plots can be strenuous on homebuyer's financial and emotional health. Therefore, it is very important to purchase plots from reputed developers who have a track record of timely delivery and experience in the business. Scrutinizing and verifying the documents required for a property purchase must always be on priority. Residential plots are a great option for people who are open to taking responsibilities and appoint staff for the extra care and maintenance, it demands. It is an extremely beneficial purchase in present times looking at the market condition. Property prices will appreciate significantly in the coming 5- 6years, as these newly developing regions transform into the next urban hotspots near Tricity. Source: News Chandigarh

Will Film City project near Jewar boost real estate markets in Noida, Greater Noida and Yamuna Expressway?

9/24/2020 2:45:00 PM

After Jewar airport, there will be another feather on Yamuna Expressway Industrial Development Authority’s cap. Chief Minister Yogi Adityanath has announced that a 1,000-acre plot located just about 6 km from the proposed Jewar International Airport, has been identified for a film city project. While this is expected to revive the fortunes of Noida, Greater Noida and Yamuna Expressway real estate market that has taken a beating especially after the COVID-19 pandemic, the real benefits in terms of price appreciation and increased infrastructure activity will only be witnessed once construction gets underway, say real estate experts. Besides the commercial segment which is expected to see a spurt in demand, the residential category which may benefit from this project would be the luxury segment, say experts. “Similar to any mega infrastructure project, proposed film city too will help in reviving the property market in nearby areas like Noida, Greater Noida and Yamuna Expressway. However, the ‘real’ benefits - in terms of price appreciation and heightened real estate activity in residential, commercial and retail will be seen only once the project sees visible signs of construction activity or nears completion,” Santosh Kumar, vice chairman, Anarock Property Consultants told Moneycontrol. For instance, property prices in Ayodhya shot up 25-30 percent back in 2019 when the SC verdict was announced and then almost doubled when the temple ‘poojan’ was done back in August. In this case there was some activity or progress that happened. “Likewise, even while the film city project has been announced and the area for it has also been identified, we need to see some ground activity for property prices to scale up significantly. Those having land parcels nearby or even the investors will be in a wait and watch mode,” he explained. The site is located in Sector 21 along the Yamuna Expressway in Gautam Budh Nagar which is barely an hour’s drive from Delhi. According to the presentation, of the 1000 acres, 220 acres would be kept aside for commercial activity. “The site is also located close to the proposed logistic hub in Noida, the proposed dry port and freight corridor, thus providing all facilities of transport and movement,” chief minister Yogi Adityanath had said on September 22. The region would also boast of an international electronics city and a global financial hub in the coming years. The Jewar international airport is expected to be functional by 2023. While there is no official date with regard to the completion of the film city project, sources said that it could be ready by 2023. The land identified for the project was among three proposals submitted by the Noida, Greater Noida and Yamuna Expressway Industrial Development Authorities. Will the announcement help mitigate the impact of COVID-19? Even before this announcement, real estate activity was already beginning to pick momentum in the NCR region. Housing enquiries in Gurgaon have reached almost the same as the pre-COVID-19 levels while in Noida and Greater Noida enquiries are back at more than 80 percent. “It will be the progress of the project that will determine its impact on the property market and the trends therein,” Kumar said. The proposed Film City is likely to boost investment sentiments across Uttar Pradesh, particularly in areas adjoining Noida, Greater Noida and Yamuna Expressway. “This bodes well for the real estate sector and it is likely to have a positive impact on demand for both residential as well as commercial properties. Along with upcoming Jewar Airport, the proposed Film City is expected to provide a new lease of life to existing projects and will boost new project offerings immensely,” said Dhruv Agarwala, Group CEO, The proposed Film City is located close to Gaurs Group’s integrated township, Gaur Yamuna City on Yamuna Expressway. “Such developments will bring positive momentum in developments and investments. This announcement would be a boon for the region both in terms of residential and commercial development. Post Jewar Airport, this is the biggest announcement for the region and we hope that the work starts soon,” said Manoj Gaur, MD, Gaurs Group. Some experts say that the initiative is bound to improve economic activity in the region and have a major “economic multiplier effect on the local economy,” said Amit Modi, Director ABA Corp & President (elect), CREDAI Western UP. “It will not only attract the best talent involved in the filmmaking process, but also millions of support staff and workers, who will be looking for accommodation in the region. We feel it will have a huge impact in both owned, rental, office and commercial real estate in the regions where national production houses will also be opening their satellite offices to support the filmmaking process. It is indeed a welcome step and will open gates of opportunities for the regional real estate market,” said Modi. There may also be a possibility that once the Noida Film City is running in full force, a lot of celebrities would want to invest in and around the region for the want of easy access and reach, he said. According to Deepak Kapoor, director, Gulshan Homz, Noida will emerge as the most robust luxury real estate destination after the film city comes about. The demand for customized penthouses, villas, and farmhouses in the region is likely to go up in the region. The wellness home concept will also witness demand, he said. The recently proposed plan by UP Govt. development of Film City in Sector-21 of Yamuna Expressway is going to be a monumental step in making the region of Noida the biggest entertainment and business hub of North India. It will go a long way in creating job opportunities and also transform the face and scale of real estate developments planned in the area, said Ashish Bhutani, CEO - Bhutani Infra. Will the announcement enable Noida to finally overtake Gurgaon? Both property markets are actually independent and it is not as if Noida will overtake Gurgaon, or vice versa, say real estate experts. Having said this, Noida and Greater Noida still have scope for growth as property prices here are far more affordable in comparison to its counterpart in Haryana. As per ANAROCK research, the average property prices in Noida are around Rs 4,795 per sq. ft. while in Greater Noida it is Rs 3,350 per sq. ft. As for Gurgaon, the average prices hover at Rs 6,100 per sq. ft, says Kumar from Anarock. According to an earlier report released by Knight Frank, the impact of the pandemic has been so drastic that Gurugram was pushed to second place for the first time in seven years in office leasing activity in the first half of this year. According to the report, more office space was leased in Noida in January-June as supply was available at much lower rentals in the satellite city. According to the report, 0.92 million sq ft office space was leased in Gurugram in the first six months of 2020 compared with 1.08 million sq ft in Noida. Noida outperformed Gurugram in terms of overall transactions and became the highest contributor to gross leasing in the National Capital Region market, posting a year-on-year increase of 86 percent. This came on the heels of a 45 percent decline in gross leasing by area in the NCR in the first six months of 2020. “Demand for office spaces has been growing in Noida mainly due to relatively high rentals in Gurugram’s established office space locations such as DLF Cyber City, Golf Course Road, MG Road and Udyog Vihar,” the Knight Frank report had said. Better infrastructure, including roads, improved metro rail connectivity and competitive rentals helped Noida pip Gurugram, it said. Source: Money Control Chandigarh

Real estate body to revive stalled projects in NCR

9/23/2020 2:31:00 PM

After its intervention to restart a stalled housing project in Noida, the Uttar Pradesh Real Estate Regulatory Authority (UPRERA) is now contemplating to help resume operations of other stalled projects in the state. The UPRERA decided to step in after successful restart of the Jaypee Kalypso Court (Phase-II) project which restarted construction work at the site after a wait of nine years, on September 19 as UPRERA facilitated conciliation between the promoter and the allottees. As per the UPRERA sources, NCR region has witnessed many projects slipping into a limbo making it miserable for the buyers who end up making a huge investment for a house of their own but the projects get delayed as the builders often fail to fulfil commitments made to homebuyers. According to Rajive Kumar, chairman, UPRERA has been successful in resolving the dispute and restart a stalled project. “Jaypee Kalypso Court project of Jaiprakash Associates Limited has been the first such project that UPRERA had taken up for revival and now the promoter has commenced construction work on the project” added Kumar. Not only NCR, but the regulatory authority is planning to extend this approach to various other districts also in the state where projects are stalled either due to an impasse between the promoter and the homebuyers or the completion date, as declared by the promoter, has lapsed, including the one-year extension permissible under Section 6 of the RERA Act. In Lucknow, several housing projects of private developers are stuck for several years. Allottees in the state capital want RERA to intervene to restart these pending projects. According to RERA officials, based on the audit done by consultant Currie & Brown, it has come to light that around 40 stalled projects in Gautam Buddha Nagar district could restart with the intervention and following conciliatory tactic between the promoter and the buyer. This approach is ideally suited to such projects where the promoter is keen to complete the project but unable to do so either due to expiry of registration of the project with UPRERA or due to differences with allottees. Source: New Indian Express Chandigarh

Ayodhya land prices double month after Ram temple bhoomi pujan

9/22/2020 1:05:00 PM

In what could only be described as miraculous or divine intervention, land prices in Uttar Pradesh’s Ayodhya have doubled in just a month since the Ram temple ‘bhoomi pujan’ in August. This surge was observed above 30-40% growth witnessed between the Supreme Court’s verdict in the Ram Janmabhoomi-Babri Masjid title suit nine months earlier and temple ceremony in August. Even in surrounding areas near the town, land prices have shot up to Rs 1,000-1,500 per square feet, whereas at prime locations these rates stand as high as at Rs 2,000- 3,000, as per TOI. Before the verdict, the land was easily available at Rs 900 per square feet. The report said that the demand for land shot up in the area after the announcement of three large infrastructure projects, three-star hotels and an international airport by UP Chief Minister Yogi Adityanath who promised to turn the city into India’s Vatican. The city’s realty prices remained depressed for decades owing to an ongoing highly-volatile political controversy which ran for decades. The nearest hotel to the city was on Faizabad. Lack of amenities in the outskirts kept prices around Rs 300-450 per square feet. More than private demand, the prices are surging in anticipation of state government buying vast tracts of land for infrastructure projects. Private buyers, however, remain wary of their investment getting jeopardised in case they buy at premiums and later their land gets acquired by the state. Local property agents quoted in the report say the local authorities have already put land registry strictures in place. Many properties are disputed and a majority of land parcels up for sale lie on the wetlands of Saryu river and are being watched by the National Green Tribunal. While most buyers want the land for religious purposes such as setting up dharamsala and community kitchens, there are some who see it as a solid investment for the future. Source: Timesnownews Chandigarh

Private equity inflows into Indian real estate plunge 85% to Rs 65 billion, says Colliers International

9/21/2020 12:00:00 PM

With investors, both foreign and domestic, are adopting a cautious approach to Indian real estate against the backdrop of the ongoing pandemic, the overall private equity inflows into the sector stood at Rs 65 billion through August 2020, which is just 15 percent of the corresponding period in 2019, a report by Colliers International has said. The report by Colliers International titled Future India: Captivating Strategic and Private Equity Investments was launched on September 17 at the FICCI 14th Annual Summit. Newer asset classes such as data centres and rental housing gained prominence among investors. During 2020 through August, the leading segments have been data centres, driven by demand for cloud infrastructure, as well as offices as they tend to offer steady rental income. Robust domestic consumption also maintained investors’ con­fidence in industrial and logistics assets. The growing demand for data centres provides an attractive opportunity for investors to capitalise on the interplay of real estate (location), infrastructure (power and fi­bre network) and technology (cloud services). According to Colliers International, through August 2020, data centres attracted investment of Rs 29 billion spread across two deals in Delhi and Mumbai. The segment garnered the highest (46 percent) share in the total private equity investments in real estate in India, replacing commercial office segment from its usual top position. “Commercial office continues to drive investor demand for quality Grade-A assets and with successful REITs established depth across institutional and retail investors. There is likely to be an enhanced demand for operating assets which may extend to warehousing/ industrial, consumption and technology-driven assets demand, such as data centers. "Further, market situation is giving opportunities for investors to look at specific situations and residential is providing an excellent opportunity where inherent and pent-up demand remains strong,” says Piyush Gupta, Managing Director, Capital Markets and Investment Services, at Colliers International India. Continued investor confi­dence in office segment The commercial office segment in India continues to attract significant interest from investors even in the current times of uncertainty around the remote working culture that is likely to continue until the end of 2020. The segment attracted investment inflows of Rs 5 billion during 2020 through August, accounting for a 24 percent share in the total investment pie. Investors see upside in industrial and logistics assets As per Colliers International, in 2020 through August, the segment attracted interest from multiple large institutional investors, with investment inflows of Rs 7.8 billion. While investment over the coming year may be muted due to pandemic-inspired slower decision-making by investors, the segment is expected to grow over the next two-three years as existing participants expand their portfolio and new players enter the market. The segment will attract inflows from both foreign and domestic funds to the tune of Rs 297 billion during 2020-2023, translating into a CAGR of 5 percent. Against the backdrop of robust demand from e-commerce and other consumer-led occupiers, investors are recommended to stay focussed on the segment to reap the benefi­ts. Green shoots in the residential segment Due to the ongoing pandemic, the residential segment has experienced lower sales velocity, leading to near-stagnation. Certain developers are looking to offload bulk inventory to investors by offering steep discounts, owing to tough market conditions. Investors may consider equity investment in completed units of affordable and mid-segment residential projects that may offer desirable returns beyond a holding-period of 3-4 years. Investors should benefi­t from low entry price and gradual recovery in the economy due to increasing impetus of the government to revive demand in the residential sector. Investors should consider partnering with top-tier developers and invest in greenfield residential projects to capitalise on inherent end-user demand. Investors may consider opportunistic assets in hospitality and retail real estate segments that offer attractive valuations. Investors may also explore opportunities presented by over-leveraged developers who are keen to monetise their assets in order to reduce debt burden. Chandigarh

Indian residential real estate: The new hotspot for NRI investments amid Covid-19

9/18/2020 2:33:00 PM

The significant drop in property rates, stricter regulatory measures, increased transparency and greater consolidation in the sector have together created a lucrative avenue for NRIs to invest in the Indian real estate market. With uncertainty looming almost everywhere, individuals living overseas are looking forward to have a property in India as well, driven either with a hope to return to India or at the very least own property in their homeland. According to property consultant Anarock, the rupee’s depreciation had been a factor of considerable interest for NRIs considering Indian real estate as a sensible investment option during these volatile times. This calls for developers to address this demand and help revive and grow the residential real estate market in India. Generally, the Indian real estate market has been irrepressible, and in spite of the slowdown that the industry witnessed in these past few months, buyers have become more active and interestingly the demand continues to grow from the NRI clientele. Now with various international brands also considering India over China as their preferred hub for production, manufacturing plants and business going forward, India is gearing up for some major inflow of global investments, that will have an impact across various industries. The NRI investors have always been the first to forecast such trends and enjoy the first mover advantage, disregarding the general sentiment. As per various reports, the current NRI investments in India will hit an all-time high of $13.1 billion in FY 21. Especially since the formation of RERA, NRI buyers have extended confidence to invest in India, more than ever, through a more simplified format of engagement along with trustworthy developers and properties that are registered under RERA. This helps the investors take interest and enter the Indian market even during the pandemic. UAE, USA, UK, and Canada are the biggest source of NRI residents who invest in India, with 42% of the total inflow coming from GCC alone. Even after having spent a significant part of their work life in these countries, citizenship is not an option available to Indians based in the Gulf region, which brings them back to India when it comes to investing in assets like a house. Especially due to COVID 19 Indians living abroad are looking at their home country as an option to settle in the future by investing in residential real estate. In the past the investment decision has been across residential, commercial, and retail real estate, largely to benefit from returns in form of rentals, but today most enquiries have come around residential properties and primarily for end-usage. Today the demand is not limited to luxury properties only, buts cuts across segments starting from affordable and mid-segment housing to premium, luxury and super-luxury properties, especially for cities in Southern states of India – Bangalore, Chennai and Hyderabad, followed by New Delhi and Mumbai. There has been a steep rise in demand for ready-to-move-in inventory in projects that offer safety and protection in addition to ensuring availability of lifestyle essentials. Rise in demand for ready to move in houses or near-completion projects has largely surfaced from the deferred deliveries related to under-construction units. Also, with no Goods and Services Tax (GST) payable on resale flats, the demand for ready-to-move-in houses has soared. Credible developers with a proven legacy to deliver on commitments will have an advantage in today’s marketplace. The recent depreciation in the Indian rupee has sweetened the deal as NRIs now have to shell out lesser to buy a home. The significant drop in property rates, stricter regulatory measures, increased transparency and greater consolidation in the sector have together created a lucrative avenue for the NRIs to invest in the south Indian real estate market. COVID-19 had a drastic impact on pricings and demand in regions like Hyderabad, Bengaluru and Chennai. Consumer demand has spiked in these markets as more home buyers from across India and abroad are quickly taking advantage of the prevailing conditions to buy their dream homes. This lockdown has helped people realize the importance of living at home & a community that can be called their own. This psyche will be one of the driving forces in the future as buyers begin to accept and adapt to the new normal where they will continue to consider buying residential properties as the safest investment option. Real estate has always been an important aspect of the Indian economy. Early this year, the industry had been predicted to reach $1 trillion by 2030, contributing 13% to India’s GDP by 2025. Despite the ongoing global pandemic, the real estate market has seen a surge in demand from investors. This can be attributed to the fact that real estate is a safe and secure investment that yields high appreciation. Source: Financial Express Chandigarh

Delivery of nearly 5,000 housing units offered since lockdown in Noida, Gr Noida: NAREDCO-UP

9/16/2020 2:06:00 PM

The Uttar Pradesh chapter of realtors'' body NAREDCO on Monday said its member developers have offered delivery of nearly 5,000 housing units in Noida and Greater Noida since the imposition of COVID-19 lockdown. These units are from five major real estate groups -- Supertech, Migsun, Panchsheel, Sikka and Trident. Details from other members regarding their deliveries in Gautam Buddh Nagar district have been sought, NAREDCO-UP said in a statement. NAREDCO-UP President R K Arora expressed optimism on the real estate sector, which had come to a grinding halt since the lockdown in March, returning to tracks soon. "Based on the available data, NAREDCO member developers like Panchsheel Group offered delivery of approximately 1,100 units, Migsun Group 1,225 units, Supertech Group 1,976 units, Sikka Group 250 flats and Trident Group 350 units after the implementation of the lockdown," Arora was quoted as saying in the statement. Details of flats offered by other member developers are also being collected, Arora, who is also the chairman of Supertech Group, said. He said the UP chapter of the National Real Estate Developers Council (NAREDCO) has made efforts to bring back the migrant workers who had left construction sites amidst the lockdown. The developers'' body had signed a Memorandum of Understanding with the UP government for rehabilitation of migrant workers, on the basis of which many of them have been brought back from different parts of the state and provided job, accommodation, food and necessary facilities so as to resume construction, he said. "With the joint efforts of all developers, the workers could be brought back and construction resumed at sites. In spite of all odds, the developers have been able to give possession of an impressive number of units to buyers since the implementation of lock down," he claimed. PTI KIS RVK Source: outlookindia Chandigarh

RBI resolution plan guidelines favourable for residential real estate, says ICRA

9/15/2020 2:43:00 PM

The Reserve Bank of India (RBI) has recently released sector-specific leverage and debt-coverage guidelines for determining eligibility for restructuring of stressed loans, including those in the residential real estate sector. Real estate has been identified as one of the more deeply impacted sectors, and consequently, relatively high leverage levels have been permitted for the sector. The required debt coverage levels are, however, similar to those expected across most identified sectors. ICRA has, in its earlier commentaries, maintained that Covid-19 has served a double whammy to the already reeling residential real estate sector in India. With inflows from both new and already booked sales having been adversely impacted, stress levels on developer’s operating cash flows have increased significantly. The ability of developers to meet scheduled repayment obligations in a timely manner would therefore remain closely linked to refinancing or carrying out of one-time restructuring of debt obligations under the recently-announced government relief measure. Commenting on the same, Mahi Agarwal, Assistant Vice President and Associate Head at ICRA, said, “Developers were already suffering from reduced credit availability post the onset of NBFC liquidity crisis and with Covid-19, the overall liquidity available to the residential real estate sector has reduced further, amidst lender’s concerns on deteriorating asset quality and increasing loan-to-value ratios. In addition, collections and construction-linked disbursements have also witnessed a slowdown due to the weakness in demand and disruption in execution.” “However, with these guidelines providing for financial headroom, stressed developers are now likely to receive much-needed liquidity support which will aid management of cash flows and allow for completion of slow-moving/stalled projects. The efficacy of the assumptions made by the lender though, particularly with regards to demand risks, will remain a critical determinant of the ultimate success of the restructuring plan,” she said. As per the resolution plan guidelines, residential developers will need to maintain the following parameters at a project-level in order to be eligible for loan-restructuring: If the above parameters are met, the residual tenor of the concerned loan may be extended by up to two years, with or without a payment moratorium, with the asset classification remaining as “standard”. Sanction of additional facilities, and/or conversion of debt to equity or non- convertible debt securities may also be considered. As per ICRA estimates, the operating cash flows of real estate developers are expected to reduce by around 30-50% in the current fiscal, resulting in higher reliance on refinancing and incremental debt to meet project costs and debt obligations. While many companies have availed moratorium to bring down debt repayments, which, coupled with automatic reduction in collection-linked prepayments, has provided some support in terms of debt coverage levels, developers with a high proportion of slow-moving or stalled projects with significant impending debt repayments are likely to continue facing cash gap issues. A one-time restructuring of debt obligations can provide considerable support for such stressed projects, as deferment of obligations/additional funding to meet the cash gap, with a favourable repayment structure spread over two years, would provide the required liquidity to enable project completion. In fact, the scheme, if successfully implemented, would achieve objectives similar to that of the SWAMIH fund, which has a target corpus of Rs 25,000 crore to provide debt financing for the completion of stalled projects. The fund has, since its inception in November, 2019, already cleared investments of over Rs 10,000 crore in 101 projects, and the high volume of proposals that it continues to receive reflects the high requirement for liquidity in the realty sector. In terms of implementation of the restructuring scheme, lender assumptions on future cash flows, structuring of debt obligations, and accounting policies being followed would be the key look-out areas. Appropriate structuring of repayments, based on expected future cash flows, would be important, as the same would allow for the suggested debt coverage levels to be met and would ultimately enable project completion on the back of the external funds thus provided. Post completion of the project, outside liabilities would reduce, as customer advances would be converted to sales and project creditors would be paid off, leaving external debt as the major outside liability. This, combined with the requirement of most lenders for a 35-40% equity margin on construction funding, would allow for the specified TOL/TNW parameter to also be met within FY2023, provided that the equity has been brought in in the form of promoter funds and not project accruals. Given buyer preference for completed inventory, sales would also be likely to receive a boost post project completion, which, combined with the reduction in construction out-flows post project completion, would support EBITDA generation to service the increased debt. Lenders would, however, need to ensure that the assumptions made while drawing up future cash flows, particularly with regards to sales, collections, and project progress, are realistic and achievable, in order to avoid a subsequent breach of the defined parameters. Source: Financial Express Chandigarh

Pandemic Boosts A New Real Estate Asset Class

9/14/2020 3:58:00 PM

When both commercial and housing property markets suffered during the pandemic, work from home increased interest in one category of real estate: data centres. Immediately after India went into a lockdown mode due to Covid-19, there was a 25-35% increase in data centre capacity usage as companies began to overhaul their digital infrastructure to deal with the new work environment, according to Anarock Research. It expects that to boost growth of data centres as a real estate asset. Data centres were classified as an essential service and there has been a huge surge in cloud usage because of schools, e-commerce or streaming applications such as Netflix and Amazon Prime Video, said Shard Sanghi, chief executive officer-global data centres and cloud infrastructure (India) at NTT Ltd., a provider of hosting and cloud services. “You need to have more physical servers to be able to support demand from these places. So absolutely it is a factor in the growth in data centres.” To be sure, developers were warming up to the idea of building their own data centres—dedicated space to house internet servers and other data applications. The pandemic will only aid this newly emerging asset class when owners of commercial real estate, so far immune to slowdowns, are also feeling the pain. Apart from the Data Protection and Privacy Bill that calls for localisation, multinational companies coming to India are also driving demand, according to Sanghi. “If they have sensitive and critical data, it has to be hosted and processed in India itself.” Anarock estimates that additional 10 million square feet of data centre space is likely to be added over the next two to three years. Currently, data centres in top eight cities occupy 7.5 million sq. ft. space, with Mumbai, Chennai, Bengaluru and Hyderabad seeing maximum demand. “Work-from-home compulsions, online education, video-based medical consultations, a huge increase in e-commerce and business-related video conferencing and webinars are increasing the demand for data centres,” said Shobhit Agarwal, managing director and chief executive officer Anarock Capital. “The government’s move to make data localisation mandatory ensures a promising future for data centres in the country. ” Adani Group, Hiranandani Group and Salarpuria Sattva have already rolled out investment plans for building data centres. Source: Chandigarh

Demand for ready-to-move-in homes accelerates in Covid times

9/9/2020 2:10:00 PM

Demand for ready-to-move-in (RTM) property has increased in recent years due to a variety of reasons, including project delays by multiple builders. However, in times of the current pandemic, people are showing an inclination towards RTM homes more than ever. Last year, it was estimated that around 3 lakh RTM homes will hit the market by the end of 2020, but as of now, there might be a slight change in the figures. However, the demand for these homes has transformed with people ready to pay extra just to ensure that they immediately own a real estate asset. According to 360 Realtors, one of the leading institutional channel partners, RTM sales in Delhi NCR (Gurugram and Noida markets combined) were 3,870 units in the previous quarter (April- June), and the sales of RTM homes in the present quarter (July- Sept) are expected to rise by 18% based on early numbers. “During the lockdown, many households realized the importance to own a home. Hence there was a healthy demand for RTM homes. Moreover, in RTM properties one can save GST as well. However, due to attractive payment plans, under-construction projects were also able to garner buyer’s and investor’s interest,” says Ankit Kansal, founder & MD, 360 Realtors. With home loan interest rates at an all-time low, the situation of homebuyers has improved and they are not in a mood to wait for property. The demand has increased due to the situation thrown at the door of the people after the global pandemic. “People who were living in rented accommodation faced many difficulties and they realized the importance of having their own home. Then we have the NRIs, who after witnessing the tough times abroad, are coming forward to buy a piece of property in India that can help them have security in case of exigencies. Post-COVID, people are more concerned about the real estate asset and are ready to pay extra if the property fulfills their set of requirements,” says Amit Modi, Preident (Elect) CREDAI Western UP & Director, ABA CORP. In fact, in their last report ‘Concerned yet positive – The Indian Real Estate Consumer (April – May 2020)’, which was jointly released by and National Real Estate Development Council (NAREDCO), the majority of the consumers showed an inclination towards RTMs or the projects that are near completion. A majority of respondents surveyed (73%) comprise ‘first-time homebuyers’, who are looking to buy a ‘ready-to-move-in-house’ for end-use and are from the age group of 25-45 years. While 60% of respondents opined that for the next six months, they would prefer a ready-to-move-in home, 21% said they were okay with a piece of property with a delivery timeline of a maximum one year. Dhruv Agarwala, Group CEO,, &, said, “Our survey showed that potential homebuyers who were searching for flats have pressed a pause button for the time being because of liquidity concerns and uncertainty over the COVID pandemic. But, a majority of them will gradually start returning to the market in the coming months. This survey has established again that credible developers and ready-to-move-in or nearing completion properties are preferred by prospective customers, who are largely end-users.” Realtors say that the demand for RTMs is mostly from the millennial who are most concerned about their health & safety as against the prices of the right property. Vijay Verma, CE0, Sunworld Group, says, “The New Age generation is very specific about the needs and this pandemic has made them realize the importance of having a real estate asset. For their own use, they are looking for RTM properties where they can have control over their health. Even for investment purposes, they prefer RTM property as it will be an immediate source of extra income for them. The demand has increased as the need is immediate and people want an immediate solution, which is provided by the RTM properties.” Source: Financial Express Chandigarh

Digitization enabling real estate sales during lockdown

9/5/2020 12:50:00 PM

The real estate industry which was already poised for digitizing its processes, practically overnight, with the ongoing COVID-19 pandemic and the announcement of the lockdown has magnified its importance on technology. Within the residential real estate, developers have taken the digital leap. They have become more inclined towards investing in online sales processes to ensure a convenient home buying process during the pandemic. We have been seeing good traction in the demand for residential homes and we are seeing demand coming back to the sector. We have seen a considerable increase in enquiries over the past 4 months with most customers using digital mediums for house hunting and project shortlisting amid the lockdown. The emergence of this unprecedented crisis has undoubtedly accelerated the pace of digitization within the industry, redefining parameters and forming a path for fundamental home buying and selling strategies to ensure the sector stays afloat. Several real estate developers have been working towards digitizing the complete sales process with the help of cutting-edge technology while duly abiding by their social distancing protocol. The following are some methods that have helped developers like Godrej Properties to adapt to the changing times and that will be essential during the ‘new normal’: Enhanced networking and lead generation through social media: Realtors can develop strong networks with customers and prospects along with their industry peers through various social networking sites. According to a report by the National Association of Realtors, 47% of real estate businesses note that social media results in the highest quality lead compared to other sources. While social media does provide a platform for mass e Personalized experience with Conversational AI: Chatbots, which are the most common form of Conversational AI, can engage sales prospects online. Customers today favor a conversational tone in marketing messages which makes it imperative to have a more personalized approach. Chatbots can identify a user’s intent and extract important details enclosed within their request to provide appropriate responses and solutions. Site visitors are nurtured with insightful information about the properties that they are looking for and are provided with recommendations to help them make informed decisions. Closing deals through video conference: Video conferencing has emerged as a convincing digital tool that has been adopted lately by realty players. While staying true to the social distancing norms, developers have made sure that they are in constant touch with their internal stakeholders, channel partners and customers by using tools such as MS Teams & Webex to host CPs and customers, taking them through the product offering and make live bookings, without the need of any paper intervention. Seeing the bright side of adversity, developers, along with their channel partners, are counting on webinars and online seminars to tap potential buyers and investors. Prospective homebuyers can also view the properties from wherever they are, allowing them to scrutinize the property and ask detailed questions carefully. Market listings with remote viewing and virtual walk-throughs: Social distancing has changed the way people interact and inhabit physical spaces. However, the combined power of advanced 3D modelling and virtual tours are spearheading the online property market. Developers are striving hard to bring this technology to a broader audience and provide a unique virtual tour experience for home buyers. These contactless walk-throughs save time, avoid multiple people from visiting properties and are ideal for the initial stages of seeing homes online. The following few months are going to see a massive adoption of technology as an outcome of the Covid-19 pandemic. Customers are going to be more active on digital platforms, and developers will come up with new strategies to sell their homes online. The crisis has undoubtedly given the sector a major push towards widespread technology integration and equipped them to face crisis situations with ease. Digital platforms that are aiding the industry today will form a strong foundation for businesses tomorrow, and these new upcoming technologies will create a seamless buying experience for homebuyers. Source: Financial Express Chandigarh

Real Estate: Tier II And Tier III Cities On Integrated Township Radar

9/3/2020 12:00:00 PM

Tier II and Tier III cities are rapidly developing and reforming boundaries to closely located towns, with improved road connectivity and frantic economic activity, the stage is all set for these cities to witness the concept of Integrated Townships. What this essentially means is that instead of the regular run-of-the-mill colonies developed by Government bodies or local developers, people will now want to enjoy the luxuries of modern living: plush markets, schools, hospitals, entertainment facilities- all in the same compound especially in the aftermath of COVID-19. So what can people expect from such forays? Township is the largest format of real estate at least 100 acres of development. The bulk of the construction in an integrated township is residential (30-40 per cent), roads and parks are 15-20 per cent, houses for economically weaker section comprises 5-20 per cent, and rest is commercial. A township is a place that is self-sufficient with physical infrastructure (roads, power, sewer, etc) and social infrastructure (schools, hospitals, retail, entertainment areas, mass transit system, etc). Townships in India have varied in size. They range from (1) 100 acres to 500 acres (2) 500 acres to 3000 acres (3) Above 3000 acres. These townships are not just comprehensive residential hubs but are meant to provide a new way of life. It is life amidst the very best of nature coupled with strategic location and ultra-modern facilities. Major developers from around the country are already eyeing these 'prime' cities. The latest trend observed among millennials is to look for projects that provide environmental sustainability. The young generation is conscious about the world around them and wants their place to be in sync with the environmental concerns. "We have noticed that this generation is inclined towards buying homes in integrated townships. It is the 'in thing' for them to stay at a place that takes care of all the needs such as schools, shopping / entertainment, and healthcare. Many millennial are inclined towards these townships as the place has office spaces which provide them the option of walk-to-work or cycle-to-work. With many corporate likely to move towards tier II and III cities, demand for townships is going to increase. It is very clear that this generation wants to own a home as early as possible and that is why they want a place which is completely livable even if it is in the outskirts of a city," says Prateek Mittal, Executive Director, Sushma Group. "The rise in demand for homes in the post-covid scenario will veer towards facilities in a home that address health and safety concerns. This is addressed in integrated townships due to the controlled living environment they offer to its residents. Reasonable land prices, scarcity of organized living options and migration of working professionals, etc are some of the reasons that could reignite demand in cities like Lucknow, Chandigarh, Ludhiana, etc. With home loan interest rates at their historic low and government subsidy to home buyers, the acceleration in demand seems certain," says Mohit Goel, CEO, Omaxe Ltd. Omaxe is currently developing 9 townships at various locations and has delivered several townships in the past. The reason Integrated Townships will succeed in these cities is that most of the colonies here are either badly planned or unauthorized, which means hardship such as poor sewerage, inadequate electricity, and security issues. Kushagr Ansal, Director, Ansal Housing says, "The continuing cost pressures characterising India's Tier I cities are encouraging more companies to actively look at Tier III cities to satisfy their future requirements for the offshoring of business processes. These cities provide cost advantages of 15 per cent-30 per cent over Tier I and II cities through lower labour and real estate costs and reduced staff attrition rates and this gap is expected to widen further. Thus, more jobs mean people in these cities need upgraded lifestyle and townships are the formats that they are looking at." Residential markets across various tier-II or tier-III cities have witnessed heightened activity which is expected to grow more after the Corona scare, leading to a push in commercial realty as well. "Lower price points for properties is one of the most formidable reasons for the changing outlook of real estate here, which includes inclination towards living in integrated townships. Industries are open on moving to smaller towns, as an exercise for a cost- effective expansion and also due to the land congestion and high rental & property rates in metros", says Raman Gupta, Director - Branding & Construction, GBP Group. Chandigarh

McKinsey’s survey sees India’s growth despite pandemic woes

8/31/2020 1:43:00 PM

In the context of both structural growth slowdown and the economic shock of the pandemic, recovering to a high-growth path will not be business as usual for India, according to a survey titled India’s Turning Point by McKinsey Global Institute. Excerpts from the survey reveal that two sectors - manufacturing and construction - have the potential to give India the biggest lift to productivity and job growth, respectively. In other emerging economies, sectors such as construction and trade typically absorb the greatest numbers of workers moving out of agriculture and increase average labour productivity at the same time. Indian businesses can create economic value of about $635 billion by 2030 if they tap into the shifting preferences of Indians aspiring to a higher standard of living. India has the opportunity to put in place a robust planning approach for its top cities, which have low capital investment per capita and are less productive than they should be. India would need 25 million affordable housing units by 2030, at a low cost of at most 2,000 rupees per square foot, depending on income segment. For example, mass affordable housing that uses modern construction practices, including prefabricated and modular construction and lightweight aluminium formwork is five to six times more productive than the sector average and would reduce cost to home buyers. Other opportunities include a planning approach that increases the floor space index (FSI) systematically to make the right parts of cities more dense and productive. India’s maximum FSI ranges from 1.8 to 5 across most cities, while averages are lower as the minimum FSI across cities ranges from 1.2 to 3.5. For a country of India’s urban scale, McKinsey estimates that these ideas could generate $195 billion in economic value in 2030 and support about 30 million jobs, for average yearly investments of $75 billion. The construction sector has the potential to more than double its GDP to $550 billion, from $250 billion in 2020. Productive and resilient cities, will require significant changes in the real estate sector. The ratio of home price to income is on average 4.3 in the eight largest cities in India, compared to less than 1.5 in a set of OECD countries. The higher price of land in India is a large contributing factor and land market reforms would have a substantial impact other sector-specific measures could also help boost the real estate sector. Homeownership could be incentivised by rationalising stamp duties and registration fees to reduce costs to buyers and offering greater tax incentives. The high cost of land is a key reason. By enacting several key reforms, India has the potential to reduce land costs by 20 to 25 percent and increase the supply of land available for construction. Finally, the process of land acquisition for industrial use could be significantly eased. Some states have implemented measures like land pooling, enhancing the state land bank for industrial use, and introducing legislative amendments to ease the acquisition of land by the private sector, subject to high level clearance. To ease conversion of land from agricultural to industrial use, Karnataka has implemented a simplified online, single-window system that requires fewer document submissions for land use conversion for industrial purposes. Approval is automatic after 30 days if no response has been received. Source: Chandigarh

Booster dose for realty: Maharashtra reduces stamp duty on sale deeds

8/29/2020 1:02:00 PM

The Maharashtra Cabinet approved a proposal on Wednesday to reduce stamp duty by 3 per cent on all land or home sale transactions executed and registered between September 1 and December 31, this year. There will be a 2 per cent reduction on stamp duty from January 1 to March 31, 2021. Batting for an early resumption of real estate works, a government-appointed committee for economic revival had earlier recommended concession in stamp duty for first sale transactions. Another committee headed by HDFC Chairman Deepak Parekh, which studied the impact of the lockdown on the sector, too, had batted for the cut, while also pushing for reduction in construction premiums. A plan to lower construction premiums is also in the works, said officials. The government is hoping that the concession will kickstart home buying in Maharashtra. Tax income from property transactions is the second highest revenue grosser in the state after Goods and Service Tax. In Mumbai, the stamp duty rate is 6 per cent of the agreement value or the ready reckoner value, whichever is more. The concession will mean that this will to 3 per cent of these values from September 1. “This will certainly stimulate the housing demand and help in converting inquiries into sales closures. The fiscal advantage should nudge fence sitters to convert into actual home buyers with rippling effect on economic growth. With many other favorable market conditions, this announcement shall rekindle the ailing real estate sector and see volume in transactions,” said National Real Estate Development Council (NAREDCO) national president Niranjan Hiranandani. He further emphasised that if the central government can slash GST rates, it would act as a shot in the arm to the real estate sector. In another move to push construction and redevelopment activity in the Mumbai Metropolitan Region, the state Cabinet on Wednesday approved a proposal to extend Mumbai’s Slum Redevelopment Authority (SRA) model to all urban local body limits in the region. Ironically, the Mumbai model, which promised heightened area incentives and perks to slum redevelopers, has fared miserably with just 20 per cent projects completed in over two decades. The SRA will have a separate set up for clearance of projects in the rest of MMR. The Cabinet also appointed a study group to check if more than one authority would be needed for these areas and the feasibility of extending the same slum redevelopment model to urban agglomerates outside MMR. Source: The Indian Express Chandigarh

Real Estate Sector Witnesses Improved Market Sentiments In Unlock Phase

8/28/2020 1:50:00 PM

The pervasive impact of the COVID-19 pandemic is evident on real estate through stalled deals, halt in sales, and delay in launches. As India enters Unlock 4.0, the restarting of economic activity and push by the government through various initiatives have set the pace for boosting demand and sales in the real estate sector. "The real estate sector was already hit by the market slowdown. It was expected that it would take longer to return to normalcy, but with the revision in interest rates and a few favourable government policies, the market has already started reviving and the demand graph is trending upwards. The construction works have also resumed in order to deliver the projects as per the given timelines. Homebuyers are more conscious now to invest in a property with assured safety, to live a sustainable life. The rise in the housing demand for Tier-II cities can be seen because of affordability and better growth prospects." says Ashish Sarin, CEO, AlphaCorp. It is expected that the pent-up demand in the residential sector will give a fillip to sales especially of ready-to-move-in and near-completion properties in the post-COVID-19 scenario. In the commercial segment, co-living and office spaces are likely to lead to recovery. In the logistics and warehousing sectors, supply contraction in the sector will lead to a dip in vacancies and better pricing. Mohit Goel, CEO, Omaxe Ltd. says "The enquiries and sales in the real estate sector are picking up post-lockdown albeit some shift in demand and preference of homebuyers. The developers' agility to adapt to this new demand is the key to the quick recovery of the sector. The RBI's liquidity support has been helpful but it is pertinent that measures to shore up demand must be taken. Being an end-user driven market, the demand has picked up faster in 2/3 cities due to a host of reasons like government's industry and infrastructure push, corporates looking for cheap real estate and skilled workforce that are staying back or returning and higher capital appreciation. In the commercial segment, organised retail with 2-3 years delivery timeline is showing a lot of demand from investors and retailers." Expressing views on traction picked up by the office space market, Ashish Arora, Director-Distribution, Viridian RED, says, "Real estate market sentiments have gradually improved during the unlock period. Decision-making processes and deals which were put on hold due to the lockdown have been resumed now. In the last couple of months, India's office space market has witnessed few of the key transactions led by global firms which have brought much-needed breather to the sector. Despite the hurdles created by the COVID-19 pandemic, the commercial realty segment has an optimistic future. Backed with affordable rentals, the abundance of skilled and low-cost talent, increased interest of investors towards REIT would augment the growth of the commercial realty sector." The COVID-19 crisis is also expected to redefine certain trends in real estate. The lockdown witnessed players leveraging technologies such as Artificial Intelligence, Virtual Reality to enhance the consumer experience. Amarjit Bakshi, CMD, Central Park explains, "There has been a revival in demand through increasing footfalls and sales. We have also seen an increase in unique visitors on our website and have been witnessing an increase in queries for various assets within our township. There is so much latent demand for real estate, that we have started reviving the sales impetus. There has been a comparative upsurge in sales in the third quarter of 2020 largely influenced by the investor segment. As more and more investors are finding the equity market volatile, they are skewing towards prime real estate investments from reputed builders. COVID-19 has invariably renewed focus on developers with a strong track record and penchant for style and design. There is still caution against launching new projects but hopefully, we will see new zest in the coming festive season." Going forward, we foresee an extensive use of technology to offer curated experiences. The overall concern towards hygiene, health, and wellness measures will inevitably benefit real estate players with sound credentials and an enviable track record. Source: Chandigarh

Model tenancy law to be approved in next one month: Housing Secy

8/27/2020 11:25:00 AM

The government will approve the model tenancy law in the next one month and then send it to states/UTs for adoption, a reform aimed at boosting rental housing, Housing and Urban Affairs Secretary Durga Shanker Mishra said on Wednesday. Addressing a Assocham webinar on the housing sector, he said the Centre would encourage states/Union Territories to adopt this model law. He hoped that they would pass necessary legislations over the next one year. "We are bringing a very big reform. We are changing the tenancy law," Mishra said. The secretary pointed that the present tenancy laws in various states were skewed towards safeguarding the interest of tenants. As per the 2011 census, Mishra said, 1.1 crore homes were vacant as people fear giving them on rent. The secretary said the model tenancy law will be approved in a month by the competent authority. Mishra said his ministry would ensure that within one year every state passes legislation to implement this model law. The secretary said the model law provides for rent transactions on agreements and dispute resolution system. "We hope that 60-80 per cent of the vacant flats will come into rental market once this law is implemented," he said, adding that the real estate developers could also convert their unsold inventories into rental housing. The ministry had in July 2019 floated the draft model tenancy law, which proposes that landowners will have to give a notice in writing three months before revising rent. It advocated appointing a district collector as rent authority and heavy penalty on tenants for overstaying. Talking about the newly launched Affordable Rental Housing Complexes (ARHC) scheme, Mishra said the programme aims to convert lakhs of vacant flats owned by the Centre and states into rental housing for migrant workers at a very cheap rent. Finance Minister Nirmala Sitharaman had announced the ARHC scheme as part of the over Rs 20-lakh crore economic package to deal with the COVID-19 crisis. Last month, the housing ministry issued guidelines to implement ARHC in the country. "We want to bring vacant homes owned by the central, state and urban local bodies into this scheme and provide affordable rental housing to migrants/urban poor," he said. Mishra highlighted that ARHC also encourages private players to participate in this scheme by giving extra developable area (floor area ratio) to them. Subsidy wll be given for adoption of innovative construction technology. Interest rate will also be lower. The secretary said the scheme would generate a return of 13 per cent to make it financially viable. Mishra assured the industry that he would look into their suggestions to make this scheme more attractive. To make ARHC scheme tax efficient and boost investment in rental housing, NAREDCO President Niranjan Hiranandani demanded accelerated depreciation and increase in rate of standard deduction and enable private players as well as financial institutions to earn decent return. Property consultant Anarock Chairman Anuj Puri said rental housing offers great opportunity, but to encash that tenancy laws need to be reformed. He said many large corporates and companies like Signature Global have entered into affordable housing segment and the same could be replicated in rental housing. Last month, the Union Cabinet approved the ARHC scheme, under which existing vacant government-funded housing complexes will be converted into affordable rental housing complexes through "concession agreements" for 25 years. ARHC is a sub-scheme under the Pradhan Mantri Awas Yojana- Urban. The concessionaire will make the complexes livable by repair or retrofit and maintenance of rooms and filling up infrastructure gaps such as water, sewer, sanitation, road and related work. Source: Chandigarh

Why now is opportune time to buy house ‘Work from Home’ influences home buying preference

8/25/2020 12:20:00 PM

The pandemic inducing virus COVID-19 came into the lives of individuals out of nowhere and spread like a sheer wildfire, altering almost everything that came in its way. People across the globe found themselves confined within the four walls of their homes and the brick and mortar operations of offices, stores, and businesses came to a halt. These changes paved the way for a new professional culture called work from home, wherein employees had to carry out all their functions remotely from the safety of their homes. However, keeping in the mind the myriad benefits and the ease of work that this concept offers it will be safe to say that this is bound to become an integral part of one’s daily life. As per a study conducted by the research firm Gartner, over 75% of business employers plan to increase the number of permanent remote employees. This new development has not only infused high degrees of trust in professional relationships but has also transformed the face of the real estate sector. The buying patterns of those willing to purchase property have noted significant influence arising from the modern changes in their work cycle. Here are some factors that have fuelled this transition- Emerging popularity of Peripheral areas Before the virus outbreak, office goers looked for houses that were situated closer to their work-place. It meant that convenience and lesser travel time were the two primary drivers of a homebuyer’s choice. However, as remote working gains popularity with each passing day and seems to become a permanent aspect of one’s life the very parameters that governed one’s decisions have witnessed an absolute change. Individuals are now looking for offerings that provide them with extra space, modern amenities, and enhanced ambiance. For the buyers in the post corona era, the location will not play a major role, as they do not mind residing in a house that is bigger and cheaper as well as situated in the periphery of the city. Affordability Coronavirus has adversely affected the economy and caused severe consequences, the brunt of which is being faced by employees across the board. With a reduction in earnings, organisations are finding it difficult to stay afloat and are resorting to all possible methods to ensure cost-cutting. One of the paths adopted by the corporates entails cutting the overall pay of employees, simultaneously resulting in low income in hand. During such persistent scenarios, the affordability aspect of properties emerges as a prime point of consideration. However, the government measures such as lowering of home loan interest rates are playing a significant role in protecting the interest of home buyers and making it an opportune time to own a house. Home Ownership Covid-19 has brought with itself a sense of deep-rooted uncertainty and ambiguity, leaving mankind grappling for something that provides them with a feeling of safety as well as security. A rented house can never be that peaceful abode, rather it will continue to have the hassles of monthly payments and undue restrictions, leaving one at the whims of their landlord. Additionally, with property rates adopting a downward trend and the varied measures introduced by the government, the option of owning a house amidst a pandemic seems to be increasingly lucrative. However, with the world adopting the new normal of working remotely, the charm of the above-mentioned trend stands tarnished, consequently rendering the distance factor immaterial. Further, the idea of work from home provides employers with access to a greater talent pool, making them more convinced about the permanency of this method of operating. Hence homebuyers are now looking for quality homes irrespective of the closeness to one’s place of work. Source: Financial Express Chandigarh

How covid has changed the way we live

8/24/2020 1:53:00 PM

Home-buying activity came to a grinding halt after the lockdown induced by covid-19. According to a report by PropTiger, an online real estate platform, real estate sales ped over 70% in the April-June quarter compared with the previous year. Things are changing now, however. With the government gradually easing the restrictions, online portals are seeing a surge in traffic. The number of enquiries are at pre-covid-19 levels, but the nature of enquiries have changed. With many companies allowing work from home (WFH) to a large number of employees, people are now looking for spacious houses. A joint survey on consumer sentiment by real estate portal and self- regulatory body National Real Estate Development Council (NAREDCO) indicated that over 40% of buyers are looking to upgrade their homes and there is a in the demand for one-bedroom houses. In fact, to be able to afford bigger houses, homebuyers are also opening up to the idea of moving to peripheral locations. We tell you how the pandemic is changing the way we live. Looking for space Many companies allowed WFH due to the lockdown but are now planning to continue with it. As a result, people are now looking to carve out an office space into their homes. “For around five months, most people have been working from home. This has resulted in a yearning for private space where one can focus on work. Clearly, for those who are looking for an upgrade in the next year, the ‘extra space or study room or multi-functional area’ in the apartment design will be a factor to consider," said Subhankar Mitra, managing director, advisory services, Colliers International India. In keeping with the trend, the demand for one-bedroom houses has already witnessed a . “We have seen a decline in the demand for single-bedroom homes of around 10% as a proportion of total demand for new homes, resale and rental homes. Market anecdotes also point to the requirement for larger homes," said Mani Rangarajan, group chief operating officer,, and Apart from that, the demand for new house compared with those on resale has surged due to availability of amenities and open spaces around new homes. “Online search for new houses has gone up as compared to homes available in the resale segment," said Rangarajan. Significant inventory build-up has reduced the premium new houses had over resale properties, which is why the demand has gone up, he added. The problem of rising inventory has intensified post covid-19. As per industry estimates, the premium that new houses commanded over resale properties may have come down from 15-20% to 10-15% depending on the location. Distance doesn’t count Commuting is no longer an issue for those working from home, which has reduced the need to take a house close to the workplace. As a result, people are more open to moving to peripheral locations for better affordability. “Demand for homes located in peripheral areas of cities may go up given that homes are more affordable in these areas and buyers can purchase larger homes," said Rangarajan. Demand from peripheral areas has already increased, said Sudhir Pai, CEO, Magicbricks, a real estate portal. “This is primarily due to affordability and a fresh supply of ready-to-move-in properties. This demand is prominent in major markets of Bengaluru, Hyderabad, Chennai, Mumbai, Pune, Gurugram and Noida," Pai added. There is a surge in demand in tier II and tier III cities as well. “With some people moving to their home towns due to WFH, the demand in these cities has gone up," said Rangarajan. Magicbricks is witnessing a 50% increase in searches in small towns. “More working professionals are thinking of having a house in their home towns," said Pai. Credibility is key Covid-19 has heightened the risk of delay in projects. While work was halted across the country due to the lockdown, most developers saw poor sales during the period, adding to the financial stress in the sector. According to a report from Liaises Foras, a Mumbai-based real estate research firm, around 50% of unsold inventory faces high execution risk post covid-19. In this scenario, people are preferring developers that come with a credible track record. “Post RERA and GST there is a certain shift of homebuyers towards reputed developers. Developers with a good track record registered notable sales even during the lockdown. Going forward, this momentum will continue," said Mitra. In any case, there has been a surge in demand for ready-to-move-in houses over the past few years as people are becoming wary of project delays. A house is one of the biggest purchases of one’s lifetime, so it’s important to be careful. Be mindful of the practices adopted by the employers in your industry to assess if WFH will be long term for you and decide accordingly. If you think WFH may not last, buying that big house in the suburbs at the price you can afford may not really make sense. Source: Live Mint Chandigarh

Rental housing in India may boom in next two years: Report

8/22/2020 4:56:00 PM

Driven by rapid urbanization, migration to cities and the rising cost of home ownership, rental housing in India is likely to see a boom in the next two years, according to a report by Savills India. As per the 2011 census, urban households on rent stood at over 21 million, which is around 20% of the total number of houses in urban India. Almost 80% of the rental housing market in the country is concentrated in urban centres. While India’s urban population share has grown more than threefold in over a century at around 10% in the 1900s to the current levels of more than 34%, annual inter-state migration is estimated to be growing at around 9-10 million annually. Meanwhile, the cost of house ownership across India has shown a CAGR of around 5% in the past few years, as per the report. The events and policy initiatives over the last few years &ndash including the establishment of RERA, PMAY, Model Tenancy Law, and others &ndash have laid the foundation for development of rental housing. The missing piece of the puzzle was about making it viable and sustainable for the development and distribution process. This is because the returns from residential real estate have remained very low. It fails to attract capital, or, long- term operations-interest. This missing-part received a significant boost through the Central government’s announcement of creation of rental housing for poor urban migrants during the COVID-19 induced lockdown. During lockdown, the migrant workers and economically-weaker sections frequently symbolised the plight, mainly because impermanent housing and the attendant economic woes forced them into reverse-migration. This class of society has, for long, been the biggest latent demand-segment for such housing. However, high land costs in cities (coupled with overall project costs) have historically rendered any solution ineffective, as rent-paying capacities of the subject demand segment did not provide any buoyancy to project cashflows. Moreover, lack of suitable operational mechanisms for long-term, made it impossible to address this issue in the past. The Affordable Rental Housing Complexes (ARHCs), Operational Guidelines July 2020 released by Ministry of Housing and Urban Affairs, has now laid a roadmap. “This is a remarkable attempt in this direction. We may say that this could prove to be a possible watershed development in the direction of sorting housing woes of urban poor,” states the report. Operational Guidelines for ARHCs have laid down two models &ndash while the first model (M-1) envisages the operation of vacant government funded houses as ARHCs by a concessionaire for 25 years, the second model (M-2) provides for public & private entities to create ARHCs on their own vacant lands. ARHCs can, arguably, be called the most important of all the policy measures since 2005, since it can enhance liveability in the quickest time &ndash compared to other measures which require longer implementation-timeframes. If implemented via one of the two models, the rental housing availability can begin in less than 2 years. As per the report, the guidelines have laid a clear roadmap for investors looking at stable long-term returns. ARHCs can match the risk-return profiles of offshore wealth, insurance and sovereign funds, and give them a strong foothold in the large residential market of the country. ARHCs also open the prospects of having a residential REIT in the country. “Rental housing is another market that is yet to be tapped, especially in the urban areas which have seen prices of homes go beyond the cusp of most of the city dwellers. The recently released operational guidelines on Affordable Rental Housing Complexes (ARHC) are a long-awaited giant leap in the right direction,” says Anurag Mathur, Chief Executive Officer, Savills India. Rental housing in India, in fact, is in its infancy. However, there is a tremendous upside potential for the market participants to explore. Much like REITs, India can take a leaf out of the immense learning experience worldwide. Singapore, Hongkong, Germany, UK, etc., have significantly mature rental housing markets. In due course, the Indian market should explore some of the concepts in play in these countries, such as 99-year lease models Greater private and community ownership of assets Negative Gearing, a concept in use in Australia Utilisation of centrally sponsored savings schemes to fund buying or leasing of rental houses, among others. Interestingly, senior living and co-living segments have also commoditised the monthly rentals derived from households. Only, their target segments are obviously different, since they focus on elderly population and the millennial age bracket, instead of the low-income group focus of affordable rental housing schemes. These classes of rental houses are clearly complimentary in nature, and can well be stepping-stones for investors to achieve higher returns and diversification of residential portfolio. Chandigarh

Rental housing in India may boom in next two years: Report

8/20/2020 3:09:00 PM

Driven by rapid urbanization, migration to cities and the rising cost of home ownership, rental housing in India is likely to see a boom in the next two years, according to a report by Savills India. As per the 2011 census, urban households on rent stood at over 21 million, which is around 20% of the total number of houses in urban India. Almost 80% of the rental housing market in the country is concentrated in urban centres. While India’s urban population share has grown more than threefold in over a century at around 10% in the 1900s to the current levels of more than 34%, annual inter-state migration is estimated to be growing at around 9-10 million annually. Meanwhile, the cost of house ownership across India has shown a CAGR of around 5% in the past few years, as per the report. The events and policy initiatives over the last few years &ndash including the establishment of RERA, PMAY, Model Tenancy Law, and others &ndash have laid the foundation for development of rental housing. The missing piece of the puzzle was about making it viable and sustainable for the development and distribution process. This is because the returns from residential real estate have remained very low. It fails to attract capital, or, long- term operations-interest. This missing-part received a significant boost through the Central government’s announcement of creation of rental housing for poor urban migrants during the COVID-19 induced lockdown. During lockdown, the migrant workers and economically-weaker sections frequently symbolised the plight, mainly because impermanent housing and the attendant economic woes forced them into reverse-migration. This class of society has, for long, been the biggest latent demand-segment for such housing. However, high land costs in cities (coupled with overall project costs) have historically rendered any solution ineffective, as rent-paying capacities of the subject demand segment did not provide any buoyancy to project cashflows. Moreover, lack of suitable operational mechanisms for long-term, made it impossible to address this issue in the past. The Affordable Rental Housing Complexes (ARHCs), Operational Guidelines July 2020 released by Ministry of Housing and Urban Affairs, has now laid a roadmap. “This is a remarkable attempt in this direction. We may say that this could prove to be a possible watershed development in the direction of sorting housing woes of urban poor,” states the report. Operational Guidelines for ARHCs have laid down two models &ndash while the first model (M-1) envisages the operation of vacant government funded houses as ARHCs by a concessionaire for 25 years, the second model (M-2) provides for public & private entities to create ARHCs on their own vacant lands. ARHCs can, arguably, be called the most important of all the policy measures since 2005, since it can enhance liveability in the quickest time &ndash compared to other measures which require longer implementation-timeframes. If implemented via one of the two models, the rental housing availability can begin in less than 2 years. As per the report, the guidelines have laid a clear roadmap for investors looking at stable long-term returns. ARHCs can match the risk-return profiles of offshore wealth, insurance and sovereign funds, and give them a strong foothold in the large residential market of the country. ARHCs also open the prospects of having a residential REIT in the country. “Rental housing is another market that is yet to be tapped, especially in the urban areas which have seen prices of homes go beyond the cusp of most of the city dwellers. The recently released operational guidelines on Affordable Rental Housing Complexes (ARHC) are a long-awaited giant leap in the right direction,” says Anurag Mathur, Chief Executive Officer, Savills India. Rental housing in India, in fact, is in its infancy. However, there is a tremendous upside potential for the market participants to explore. Much like REITs, India can take a leaf out of the immense learning experience worldwide. Singapore, Hongkong, Germany, UK, etc., have significantly mature rental housing markets. In due course, the Indian market should explore some of the concepts in play in these countries, such as 99-year lease models Greater private and community ownership of assets Negative Gearing, a concept in use in Australia Utilisation of centrally sponsored savings schemes to fund buying or leasing of rental houses, among others. Interestingly, senior living and co-living segments have also commoditised the monthly rentals derived from households. Only, their target segments are obviously different, since they focus on elderly population and the millennial age bracket, instead of the low-income group focus of affordable rental housing schemes. These classes of rental houses are clearly complimentary in nature, and can well be stepping-stones for investors to achieve higher returns and diversification of residential portfolio. Source: Financial Express Chandigarh

Realty developers go digital to woo customers

8/18/2020 5:00:00 PM

From online customer interaction to virtual site visit, the realty developers in the region are leaving no stone unturned to attract buyers and mitigate the impact of the Covid. The real estate players have started adopting digital technologies to target potential outstation and NRI customers. “We are organising virtual tours to ease home viewing experience for our customers. In the coming months, more such innovative tools will be used. Homebuyers in tier 2/3 cities are very enthused with this new normal,” said Mohit Goel, CEO, Omaxe Ltd. The company has also started online bookings wherein homebuyers can the property, make payment and submit documents. According to buyers, virtual tours bring the ease of visiting projects within the comfort of your home by scrolling through screens via latest technology integration. “Due to travel restrictions, many of the potential customers are unable to make a site visit. So we are facilitating virtual tours through WhatsApp and other platforms besides live interaction so that they can see the actual construction site. In addition to this, we also send video bytes to customers to keep them updated about the project,” said Iqbal Singh, marketing head, The Mentor Group. According to housing portals, online search for property has increased significantly amid the pandemic. “To assist buyers, we offer several technology-focused products such as online booking, real-time video connect, virtual tours, webinars to help our users, developers and brokers connect with customers,” said Mani Rangarajan (Group COO &ndash, & There have also been instances where the developers have seen a surge in demand without going digital. “As compared to February, the physical site visits to our projects have increased by 30% in July and sales have gone up by 10%,” said Prateek Mittal, Executive Director, Sushma Group. Source: The Tribune Chandigarh

NRIs, Invest Now in Property

8/17/2020 4:12:00 PM

The Indian housing market today is in a state of accelerated consolidation, where organised corporate players are emerging as the top real estate developers. This is good for the market's credibility, transparency, and overall health. The INR is currently quoting at Dh20.41, which translates into more purchasing power for Non-Resident Indian (NRIs), historically low repo rates and property circle rate revisions have also enabled housing prices to fall significantly in major investment destinations across the country. Anupam Rastogi, co-founder and Head - GCC, Square Yards, said: "NRIs today, more than ever before have their eyes firmly set on a permanent address in India, given the shifting global equations and the importance of a home that doubles up as an office in a rapidly growing work from home trend." NRIs have also realised that rent is a pure expense while a housing loan EMI is about net worth creation, asset building, a secondary income source if need be. According to the Reserve Bank of India's (RBI) Foreign Exchange Management Act (FEMA), NRIs holding a valid Indian passport have a blanket permission to invest in multiple number of immovable (residential and commercial) properties in India. As far as tax benefits are concerned, NRIs are eligible to a tax deduction on interest paid and loan repayment on their home loans if they are NRIs as per the income tax definition and file their income tax returns in India. Some tax benefits also extend to selling of property also where they can exercise the option of cutting down on long-term capital gains tax payable by them by buying another property. Dr Niranjan Hiranandani, National President, NAREDCO, said: "There are several factors that work out in the favour of property investors at the moment. Since the last couple of months due to the Covid-19 lockdown situation there has been a huge in the demand in real estate properties. Almost all the developers are facing liquidity crises and would be keen on clearing their unsold inventory. Many developers are offering properties at very reasonable rates or offering incentives to convert a quick sale. The funds would then be used to complete their stalled projects or start a new project which they had kept on hold." NRI's form a sizeable chunk of our investor base in the Indian real estate sector due to its emotional and commercial reasons. So developers do anticipate demand rising for real estate by NRIs in the coming quarters. India continues to be one of the most preferred investment destinations for expats. Last year, India was one of the top countries receiving foreign remittances to the tune of $83 billion. The real estate sector is one of the largest employment generators after agriculture in India. The developers have ensured that its workforce is well taken care of and paid salaries on time. However, most of them are also facing working capital issues and struggling with paucity of funds at the moment. The Government of India and the Reserve Bank of India have taken many steps, which include fiscal stimulus packages and structural reforms to revive the economy and arrest job losses. The impact of the same would be surely seen in the coming years. The Indian real estate market has been significantly impacted by the pandemic and the subsequent lockdowns. The real estate sector is highly over- leveraged and reduced business over the past several months is bound to make it desperate for sales. Khetsi Barot, Executive Director, The Guardians Real Estate Advisory, said: "The developers have realised that ready-to-move-in and completed projects tend to attract a large number of buyers. Such projects also realise payments immediately as the buyers intend to immediately take possession of their asset." Most developers are currently focusing on completing their projects that are under construction and then depend on inventories at completed projects for their revenues. "In order to make it lucrative for potential buyers and primarily to gain sales volumes developers have begun offering bank subvention and flexi payment schemes as well. These schemes have been introduced to comfort the buyers at a time when they are tilted towards postponing the purchase," added Barot. Today NRI's are not eyeing Indian real estate only as an investment option but are also looking to build something they can use in near future for themselves. Therefore, in current scenario where ready properties are available at good price with option to move in and pay later they can consolidate their investment into a large, spacious, well designed homes that suits their family requirement in an established location with latest facilities and amenities in the complex and if it comes with good location it's an added advantage as an investment. "NRIs can take the benefit of current foreign exchange while transferring lump sum savings they have and the balance can be funded over time through home loan which is all time low at about 6.8 per cent," said Bhasker Jain, Head - Sales, Marketing & CRM, The Wadhwa Group. "More than anything else developers are trying to complete existing projects in hand rather than launching new ones as today buyers don't have appetite to take risk of delay in completion of projects. Also due to Covid-19, end users who have realised the importance of a well planned home want to move in as soon as possible for safety & health of their family. NRI investors too can get a healthy rental yield immediately if they put money in ready projects." Source: Khaleej Times Chandigarh

Haryana resumes process to register properties with agricultural land

8/12/2020 2:35:00 PM

The Haryana government, which had since July 22 temporarily halted registration of transfer deeds related to transfer of land/ properties in the state, will restart the process in a phased manner. The process for taking e-appointments for registration of agricultural land in rural areas of the state will start from Tuesday. However, the registration of agricultural land deeds will start from August 17. Similarly, e-appointments for the registration of land deeds in urban areas will start from August 17 and the date for re-starting registration of deeds will be shared soon. The decision on resuming registration process was taken by a meeting led by chief minister Manohar Lal Khattar and deputy CM Dushyant Chautala on Monday. The meeting also reviewed linkages of various departments with e-Registration system of revenue department. The CM was informed that the testing of the module for e-registration of agricultural land deeds, in rural areas, prepared by the revenue department, has been completed. Haryana has already made sweeping changes in the process of registration of property/land sale deeds after the alleged registries scam, which occurred during the lockdown and covers over 30,000 sale deeds executed without the mandatory no-objection certificates (NoCs). These land sale deeds were executed without taking NoCs from the town and country planning and urban local bodies departments in Gurgaon, Sonipat, Faridabad and Jhajjar districts. Khattar specifically directed that the decision regarding no registration of transfer of deeds of land for land in urban areas, as declared/notified under Section 7-A of the Haryana Development and Regulation of Urban Areas Act, 1975 (as amended from time to time) and villages where the jamabandis are currently offline and not available on web-HALRIS will remain unchanged. Besides, this no registration of transfer of deeds of land will be done in controlled areas for the time being. The Haryana government is also using technology-based checks to prevent registrations in violation of the law by interfacing the web HALRIS application with TCP, ULBs, HSVP, HSIIDC, urban estates, police, forests, litigation matters on priority basis. There are a total of 32 lakh properties in urban areas across the state, of which 18 lakh properties are integrated with the department portal. The rest will also be brought on a single digital platform by October 31. Source: The Times of India Chandigarh

Uttar Pradesh to soon have single window clearance system for developers

8/10/2020 6:01:00 PM

The Uttar Pradesh state government has kickstarted the process of creating a single window clearance system for developers, a move that will significantly reduce real estate project costs in Uttar Pradesh. A builder currently has to take 70-80 permissions through the entire project life cycle— from land acquisition to the completion of the project — from different authorities and getting permissions takes one to two years resulting in cost overruns, according to the developers. “This will ultimately help the homebuyers as the benefit of cost cuts will be passed on to them and it will ensure timely delivery. The authority should also be held accountable if there is a delay from their side. There should be a system where a builder is required to submit documents at one place only,” said Manoj Gaur, chairman of Gaurs Group. Apart from NCR towns of UP- Noida and Ghaziabad, the move will benefit real estate projects in tier 2 cities like Lucknow, Meerut, Varanasi, Bareilly and Jhansi, where developers have shown willingness to invest. Last week, the Uttar Pradesh Real Estate Regulatory Authority (UP RERA) invited bids for ion of consultants for benchmarking existing policies and procedures to create a single window system of state developmental authorities. “The idea is to bring all the development authorities under one roof and ensure clearance in a time bound manner. It will provide a one stop integrated services to real estate promoters. This will also check delays in approval and clearance processes by putting and tracking Service Level Agreements (SLAs) on each activity involved,” said Rajive Kumar, chairperson, UP RERA. As of July 2020, 53,364 real estate projects have been registered under RERA across the country while in UP the number of registered projects stood at 2818 as of July 2020. Developers say the need for a single window system was a long standing demand and is a step in the right direction. “Sometimes after completing the construction, a builder has to wait upto a year for the completion certificate. There is no timeline for the builder who has to pay interest, which earlier used to get passed on to the homebuyers. Once the approvals start coming in time bound manner, developers can reduce unnecessary cost,” said RK Arora, president of Uttar Pradesh chapter of apex real estate body National Real Estate Development Council (NAREDCO). In Noida alone, there are three different authorities that developers have to deal with along with a host of departments such as environment and fire department. Since they can’t advertise before registering the project with RERA, a lot of time is lost between land acquisition and getting required NOCs for the registration of the project. “The single window clearance system is a prudent move by the UP government towards the real estate sector. This will not only help us in fast tracking the projects, but let us work on a project with comparatively lesser interest amount,” said Amit Modi, Director ABA Corp. “The benefit from reduced interest rates would be translated to the price points offered to the end-users. The immense amount of time saved from permissions and clearances can be utilised in developing better stakeholder relationships, and driving more investment towards the sector,” he added. According to a study by property consultant JLL, about 3 lakh houses in NCR are currently under construction of 1.24 lakh are in mid-segment. And maximum proportion (66%) of these 1.24 Lakh mid-segment under construction residential units are concentrated in Noida and Greater Noida area of Uttar Pradesh. Source: The Economic Times Chandigarh

Punjab notifies housing policy, to include areas off MC limits

8/8/2020 10:17:00 AM

To give a fillip to construction of affordable houses, the state government has notified yet another ‘Punjab Affordable Housing Policy 2020’ on July 24 in supersession of earlier policies announced in March 2018, May 2020, and another one on 15th July this year. The new policy would be applicable in all areas developed by the Department of Housing and Urban Development, residential and mixed land use zones of master plans and in 3-km belt around municipal limits even if it is outside the master plan or regional plan. Minimum site area for plotted or plotted and group housing mixed colonies would be five acres and for exclusive group housing colonies it would be two acres. Minimum right of way (ROW) for approach road to colony for plotted development would be 22 to 40 feet wide or as per master plan whichever is more while for group housing or mixed development colonies the ROW would be 40 feet. The apportionment of plotted area has been fixed at maximum 60 percent of effective site area as saleable, 10 percent for EWS (from out of total 60 percent), eight percent under parks, five percent for commercial (excluding parking) and four per cent for community centre. The policy further lays down that maximum plot size for affordable houses would be 150 sq yds and for EWS houses it would be 100 sq yds. Maximum ground coverage of 70 per cent would be permissible with FAR 1:2.1, maximum height 11 metres (excluding mumty and parapet wall), ground plus two floors with both front and rear set back of 7.5 feet. For the group housing colonies, minimum of 25 percent area has to be under parks, maximum permissible ground coverage would be 35 percent with FAR 1:3. Under the provisions of the policy, the Chief Town Planner (CTP) would be the competent authority for the approval of CLU (change of land use) and layout plan/zoning plan of colonies with total area of more than 10 acre while for colonies with area of less than 10 acre STP (senior town planner) would approve CLU. Source: The Tribune Chandigarh

Smart homes for Smart Homebuyers: The future of Indian Real Estate Horizons Cottages

8/6/2020 2:20:00 PM

We’ve all seen the movie Smart House and wondered if we can really embed the fancy features of house automation in our personal spaces. The possibility of it was quite distant back then, but now with technology advancing manifolds, making your abode a smart home can be a doddle. Making your space more secure, convenient, customized, and comfortable, home automation or demotics has quite recently come in the main frame. With customers becoming increasingly aware and dependent on technology, their aspirations for better living is increasing. With smart homes, we will not have to worry about the tedious everyday tasks that take our time, and efforts. Dabbing into our personal spaces, home automation is here to transform dreams into reality. Ranging from remote controlled shutters or doors, to smart home hubs and security, smart home technology is here to make your life easier. With the never-seen-before technology, artificial intelligence and IoT are offering unique experiences to both homeowners, and prospective homebuyers. Industry experts believe that the bespoke technology will soon dominate the real estate market. Still being at a nascent stage in India, the country will see a massive rise in the number of tech-equipped homes where everything can be controlled with the click of a button. Also the concept of “intelligent sensing” comes into mainframe with home automation. The radar or built-in sensors will not only control appliances, but will also be moving beyond passive communication, and will rather engage proactively (we can get a hint with Google’s Alexa). Also, they will be a lot more energy-efficient and cost-effective, with automatic off/on, standby modes reacting to the presence or absence of a person. Redefining the term “modern housing”, we aren’t just limited to opulent homes but these spaces also being technology-savvy. Complementing your fast-paced lives, allow your smart home to make your living stress-free. Embedded with high-end technology, these houses can have new-age solar powered sensor motions or app-controlled systems where you can do things even from a distance. Customers also have the option to the aspects of home automation that they feel are right for them. With the changing needs and preferences, the demand for better housing is scaled up, with homeowners really excited by the possibility of building an intuitive home. Automation has really made it possible for you to speak to your home, and it is not just restricted to a few, but extends to the reach of every customer. Undoubtedly, home automation is the future of living in India. Source: Chandigarh

Use of technology to propel housing demand amid Covid crisis

8/5/2020 2:25:00 PM

Owing to the on-going pandemic and the resulting lockdown, prospective buyers are stranded at home and are reluctant to move outside, which has severely affected the buyer-seller relationship across sectors. However, the changing scenario has required both the supply and demand side to adapt to newer ways to look at the real estate sector. The lockdown has compelled stakeholders to increase the use of digital platforms and technology in this sector, according to Proptiger Research. It says real estate developers are working around the challenges to come up with new ways to attract buyers, especially with the use of tech-based solutions. As the lockdown has hampered physical visits to the site and communication, developers are investing in online platforms including the ability to book homes online and innovative ways to simulate the physical experience of the property for the home-bound buyers. Drone shoots, virtual tours, and online booking platforms are gaining more prominence, as the number of online buyers increase. While the ‘Digital India’ campaign by the Government of India was started in 2015, with the vision ‘to transform India into a digitally empowered society’, the lockdown has given a greater impetus for home-bound citizens to use digital platforms. Though the use of such platforms for financial transactions and e-commerce has been fairly common, online business transactions have gained more importance during the lockdown. Internet users in India are expected to increase to more than 700 million by the end of 2020 this will provide a further boost to the ‘Digital India’ campaign. The economic slowdown has resulted in fewer new launches as well as sales, yet on the buyer’s side, use of online platforms to search and discover property has quickly bounced back. According to Housing Research, Q1 2020 saw an YoY increase of 30 percent in online search traffic over Q1 2019. While online searches initially declined in April due to the initial shock of the lockdown, this quickly recovered and registered a YoY increase of 25 percent over Q2 2019. Even though sales have decreased, owing to the economic downturn, the number of interested buyers is increasing online, as sellers come up with innovative ways to attract them, all from the comfort of their homes. RELINKING BUYERS USING TECH-BASED SOLUTIONS Drones Since 2018, drones have been used in real estate during the construction phases. The current situation has given rise to the use of drones as a tool for providing a site visit experience to buyers, where one can see the exact view of the surrounding areas. Virtual Tours In case of virtual tours, 3D models and walk-throughs are being developed to provide a near-reality experience of the property. Virtual reality (VR) is also gaining traction. VR uses technology to create a simulated environment and has its applications mainly in entertainment, and now in healthcare, as well as retail. In India, many residential real estate developers have already experimented with tools such as virtual tours and VR to attract buyers, and this is likely to grow further. Webinars & Video Conferencing Webinars have evolved as a great tool to connect with multiple buyers at the same time. The process of a site visit required the sales person to organise site visits for each buyer, which resulted in the sales person being able to conduct only one or two site visits. The use of webinars has made the process hassle-free and more productive, as now multiple buyers can be accommodated at the same time. To establish a connection and to provide one-on-one assistance for further process requirements, the buyers are being connected to the sales person through video conferencing. Online Platforms As per the report, owing to the increasing online buyer traffic, many developers are now advertising their properties through online platforms. Such platforms provide end-to-end assistance for online to offline (O2O) conversions. Even though the connect is being established with buyers using such solutions, economic slowdown has increased the financial woes of buyers, which has made them postpone their decision to buy by 6&ndash12 months. Hence, developers are also coming up with schemes to make the purchase options more viable, which include a waiver of registration charges and stamp duty, innovative payment schemes, cashback schemes, freebies, refundable bookings and price protection plans. The use of technology in construction, as well as marketing and sales, is at a very nascent stage in India, yet, the on-going pandemic has propelled various stakeholders to upgrade and explore more in this field. Source: Financial Express Chandigarh

Minister supports 100% FDI in affordable rental housing

8/4/2020 2:05:00 PM

Housing and Urban Affairs Minister Hardeep Puri on Friday came out in support of allowing 100% foreign direct investment (FDI) in affordable rental housing while speaking to leaders of the industry at the launch of a portal and app for prospective home-buyers. Responding to the demand raised by the industry during the virtual launch of a mobile app of the Confederation of Real Estate Developers’ Associations of India (CREDAI) and an e-commerce portal of the National Real Estate Development Council (NAREDCO), Mr. Puri said: “I’m all for it, 100% FDI in affordable rental housing”. India will continue to attract FDI, says UN trade body Along with the e-commerce portal and app, the Minister also released a series of documents, including guidelines and memorandum of agreement to be signed with States and Union Territoriess, related to the Affordable Rental Housing Complexes (ARHCs) scheme that was announced as a part of the coronavirus (COVID-19) economic response plan of the government, the Atmanirbhar Bharat package. Under the scheme, existing government housing projects that have been completed but are yet to be allotted to beneficiaries will be converted into ARHCs through public private partnership. The scheme also includes construction of new ARHCs. Mr. Puri said at the webinar: “Owning a home should not be considered the be all and end all of life.” He added that rental housing was necessary for younger people starting their careers. In a statement, NAREDCO said real estate developers would be offering over 2.7 lakh “ready-to-move-in” houses for online sales. Affordable housing to cement a place in realty sector Housing and Urban Affairs secretary Durga Shanker Mishra said home-buyers would be able to homes in any city and set up appointments to visit them as per their convenience. After taking a decision, the payments would be made online as well, he said. Source: The Hindu Chandigarh

Housing sales improve in July looking for land parcels for future developments: Mahindra Lifespace

7/31/2020 1:16:00 PM

Housing sales as well as enquiries from prospective homebuyers, which were badly hit during April-June due to the COVID-19 pandemic, have started to revive gradually and end-user demand is likely to strengthen in coming months, a top official of Mahindra Lifespace said on Thursday. In an interview with PTI, Mahindra Lifespace Developers MD & CEO Arvind Subramanian said the company did not witness much cancellation of apartments booked by customers as widely feared after the outbreak of COVID-19 and subsequent lockdown. "Just like the economy, businesses were severely challenged in the first quarter of this fiscal year. There was almost a standstill in housing sales and construction activities," he said. However, Subramanian said, "The good news is that our existing customers are committed to their bookings. We are not seeing a large cancellation which could have been one of the outcomes." He said the sales bookings and enquiries from customers in July increased as compared to the past three months, and this could be because of pent- up demand or new buyers looking for security of home ownership amid the pandemic. Subramanian expects demand to strengthen gradually in the coming months and ruled out any V-shaped recovery because of a lot of uncertainty. He said interest from non-resident Indians (NRIs) has increased, driven by favourable exchange rate and the need for safe environment in a gated housing society for their elderly parent. Mahindra Lifespace Developers, which is a real estate arm of business conglomerate Mahindra group, plans to launch one housing project in the Mumbai Metropolitan Region (MMR) in September, he said. Subramanian added that the company was in advance negotiation with landowners for either outright purchase of land or formation of joint venture to develop housing projects. The expectations of land owners have softened after the outbreak of COVID-19, he said. Subramanian said the company was also looking to set up an investment platform for the development of mid-income housing projects. It already has one platform with HDFC Capital for affordable housing projects. The construction work has started in all projects but the number of workers available at its sites is just around 20 per cent compared to the pre-COVID- 19 level. Subramanian said the company has a strong balance sheet with low debt and healthy cash position. "This is the time for stronger players to be patient and conserve resources." Asked about the industrial parks vertical, he said the growth prospects look encouraging with India being considered as manufacturing base amid geo- political tensions between the US and China. Subramanian said the enquiries for the industrial space have also increased and hoped to convert them in the next 6-12 months. To encash this opportunity, he said the company would explore setting up more industrial and warehousing parks. Mahindra Lifespace Developers on Wednesday reported a consolidated net loss of Rs 20.5 crore for the quarter ended June on lower revenue amid the coronavirus pandemic. Its net profit stood at Rs 13.11 crore in the year-ago period. Total income fell drastically to Rs 22.09 crore in the first quarter of 2020-21, compared with Rs 120.30 crore in the corresponding period of the previous year, according to a regulatory filing. The company achieved sales of Rs 39 crore (0.08 million sq ft) in residential business and attained collections of Rs 72 crore. It delivered 28 units to customers across various projects. Mahindra Lifespaces leased 2.5 acres for Rs 8 crore in the integrated cities and industrial clusters business. Subramanian did not give any guidance regarding sales bookings, collections and deliveries for the current financial year. Chandigarh

Over 50% consumers want to buy a new home in next six months: JLL

7/30/2020 3:05:00 PM

Over 50% of consumers are considering buying a new home in the next six months, according to a survey by JLL, India’s largest real estate consultancy firm. JLL’s Homebuyer Preference Survey, which saw participation from 2,500 professionals across Mumbai, Delhi-NCR, Bengaluru, Pune, Chennai and Hyderabad, was conducted during June-July. When asked to choose between buying and renting, 91% respondents wanted to buy a home. Additionally, 67% believed that buying a home is a necessity, not a luxury. The evolving covid-19 pandemic will also influence short-term decision making with job security cited as the biggest concern when contemplating the purchase of a home. However, a greater proportion of people in the age group of 20-35 years were likely to defer their home purchase plans by more than six months. Consumers above 35 years indicated that they are more inclined towards buying a property in the next six months. Also, more than 50% of the prospective homebuyers indicated a preference to buy a 2 BHK apartment with size ranging from 800 to 1,000 sq ft. “Real estate has emerged as the most resilient asset class today and we see potential for more consumers to pivot towards home ownership in the longer-term. In tandem, ongoing work from home arrangements are pushing developers to become more flexible and give homebuyers the option of creating a study room if need be," said Ramesh Nair, CEO & Country Head (India), JLL. Affordable and mid segments, however, will continue to drive the market. Most respondents indicated a preference for properties in the sub Rs 50 lakh and Rs 50-75 lakh category. On the supply side, developers have also realigned their products, with 60% of the new launches in the past two years falling in the Rs 50 lakh and Rs 50-75 lakh price segments, said JLL. The alignment of demand and supply will support the recovery process and it is expected that the affordable and mid-price segments will continue to witness maximum traction in the post-covid era as well, according to the consultancy firm. The pandemic has, however, also accelerated the pace of digital transformation amongst developers and intermediaries. "In the past, we’ve seen project discovery happen online, this moved to virtual tours and interactions, and now one-fifth of the respondents in this survey said they’re digital- ready to affect their transaction online end-to-end," he added. While the requirement of study rooms as work from home practices are adopted is a key highlight of the study, the importance of healthy living is gaining currency as societies with wellness amenities are being favored. Homebuyers want to mitigate the risk and are willing to pay a premium for properties from reputed developers, showing an affinity towards ready-to- move-in properties in gated societies and township projects. “It is encouraging that more than 50% of the prospective homebuyers surveyed have expressed their readiness to potentially buy homes within the next six months. At the same time, developers are relatively flexible to allay buyers’ concerns in this fragile business environment with respect to immediate cash outgo and long-term financial obligation by offering attractive flexible payment options with minimum upfront payment," said Samantak Das, Chief Economist and Head Research & REIS, JLL. The markets of Hyderabad, Pune and Chennai provide indications of relatively healthy inventory management in terms of average construction period and years-to-sell or YTS. Further analysis reveals longer-term resilience might appear first in the southern markets of Bengaluru and Chennai. The larger markets of Delhi-NCR and Mumbai have high levels of unsold inventory in various stages of construction as well as greater YTS due to a prolonged slowdown in sales. The proportion of prospective homebuyers who deferred their home purchase decisions by more than six months is also higher in these larger markets, the study highlighted. Source: Live Mint Chandigarh

Panchkula: An emerging real estate destination

7/28/2020 3:06:00 PM

With a healthy environment, availability of social as well as core infrastructure and a burgeoning business ecosystem, Panchkula has all the necessary components to give a fillip to the development of real estate projects. A serenely beautiful place away from the bedlam of daily life is what the people want to have for their dwellings. As pollution is increasing by the day in metros, the places unaffected by such factors have become the most sought-after destinations for living. Panchkula, a part of Tricity also comprising Chandigarh and Mohali, has become a cynosure owing to its natural beauty and promising business ecosystem. Situated in the hills of the Shivalik range, the city has gone through a rapid change, industrial as well as commercial, without affecting its natural surroundings. The transformation includes all the modern amenities of life, besides infrastructure development. All these factors create a conducive environment for investment in residential as well as commercial properties in the city. Smooth accessibility is a prerequisite for the development of real estate projects. Besides the locational advantage, Panchkula is well-connected with highways ensuring ease in connectivity to residents with other cities. Positioned at a distance of 10 minutes from Chandigarh and 3 hours from Shimla, the city is linked to Ambala-Shimla NH- 22 and NH-21, apart from direct access to NH 73. Residential and commercial, both kinds of projects, are necessary to augment business activities in a city. Panchkula has emerged as a preferred destination for business houses and IT firms are prominent among them. Many companies have commenced their business operations in the city, creating huge employment opportunities. Spread over an area of 79 acres, the Panchkula IT Park has 28 plots for IT majors. This area has land for commercial establishments, institutions, and shops too. The proximity to Chandigarh has proved a major growth stimulator for Panchkula. Whenever companies running business operations in Chandigarh looking for expansion, they find Panchkula a better alternative. Many existing brands and retail chains in the region have marked their presence in Panchkula, providing it luxuries at par with metro cities. The growth of retail markets, shopping malls and multiplexes has pushed the demand for commercial spaces. These factors have made the city the hotspot for investment in properties. As the commercial operations are increasing, so are the employment opportunities. The increasing demand for residences amongst the new age working population has encouraged the development of projects in the city. Even the young tech employees working in Chandigarh IT Park find abode in Panchkula. These factors are making the city a flourishing real estate market, gaining pace by the day. The residential and commercial properties developed along the Chandigarh-Panchkula highway are representing the opportunities of this thriving realty destination. Rapid urbanization has changed people’s choices; they are inclined towards a modern lifestyle. This is a major trend affecting the life of the city. A luxurious residence has become a desire for everyone. The realty sector is expected to develop townships equipped with ultra-modern features to enhance the convenience of residents. At the same time, many policy reforms introduced by the government have provided the much-needed impetus to the sector, encouraging developers to come up with world-class projects. With a healthy environment, availability of social as well as core infrastructure and a burgeoning business ecosystem, Panchkula has all the necessary components to give a fillip to the development of real estate projects. Growth of nearby areas and connectivity with neighboring states are other features of the city, exhibiting immense possibilities. In short, Panchkula is a promising place for the development of residential and commercial properties. Source: Financial Express Chandigarh

Finance Minister Holds Review Meeting For Stressed Residential Projects To Boost Investment In Real Estate Sector

7/27/2020 1:41:00 PM

Union Minister for Finance and Corporate Affairs Nirmala Sitharaman on Thursday held a meeting to review the performance of the special window for affordable and mid-income housing (SWAMIH). The meeting was conducted with the secretaries of the ministries of Finance and senior management team of the State Bank of India, SBI capital markets limited and SBICAPS ventures limited (SVL). The fund has so far approved 81 projects with an investment of Rs 8767 crore, said the release. The SWAMIH Investment Fund has progressed from a policy announcement to an operational initiative on the ground. It has approved 81 projects that will enable the completion of almost 60,000 homes across India. The projects are spread across large cities such as the National Capital Region, Mumbai Metropilotan Region, Bengaluru, Chennai ad Pune. It also includes tier 2 cities including Karnal, Panipat, Lucknow, Surat, Dehradun, Kota and Nagpur, to name a few. Among these projects, investments in 18 projects have been given the go-ahead and disbursement of funds has started in at least 7 of these projects. It was also highlighted that activation of these construction sites by the Special Window would provide employment opportunities for various skilled and semi-skilled labourers. Additionally, the fund is actively evaluating options to provide relief to 15,000 homebuyers in certain long-stalled projects which are pending before the Supreme Court for resolution. The Finance Minister also lauded the efforts of the Special Window and said that both private and public Banks, Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) should see the special window as a stakeholder and lend their support to facilitate the early completion of stressed projects. During the meeting, the Finance Minister asked the Department of Economic Affairs to closely follow the performance of the SWAMIH Investment Fund in order to ensure that the capital raised gets rapidly committed towards resolving stressed projects and remove any encumbrances that could arise in this process. The Narendra Modi Cabinet in early November last year had approved the establishment of the Special Window fund. It was to provide debt financing on a priority basis for the completion of stalled housing projects that are in the Affordable and Middle-Income Housing sector. Source: Chandigarh

About 35 lakh houses handed over to beneficiaries under PMAY-U: Housing Minister

7/24/2020 4:17:00 PM

Thirty-five lakh houses have so far been delivered to beneficiaries under the Pradhan Mantri Awas Yojana (PMAY-Urban) while 65 lakh houses are currently under construction, Union Minister Hardeep Singh Puri said on Thursday. Puri said an estimated 3.65 crore jobs would be generated in the construction of all sanctioned houses under the mission and of these, about 1.65 crore jobs would have already been generated. The government has set a target of 1.12 crore houses in urban areas by 2022 under PMAY - ''Housing for All'', one of the flagship programmes of the Narendra Modi government. The Union Housing and Urban Affairs minister was addressing a webinar to mark the 5th anniversary of PMAY (U), Smart Cities Mission (SCM) and Atal Mission for Rejuvenation and Urban Transformation (AMRUT). He said India has undertaken one of the most comprehensive planned urbanisation programmes in the history of the world. According to the ministry, the houses built under PMAY(U) and earlier schemes of the Ministry of Housing and Urban Affairs (MoHUA) have served as a boon in the fight against COVID-19. Presently more than 22,000 houses are being dedicatedly used as COVID-19 facility units in various states and Union Territories, Puri said. Talking about another Mission - AMRUT, the minister said the ministry has so far provided 79 lakh household water tap connections and 45 lakh sewer connections in the country. "Seventy-six lakh conventional streetlights have been replaced with energy-efficient LED lights which have led to energy savings of 167 crore units per annum, resulting in a reduction in CO2 emission by 13 lakh tonnes per annum," he also said. About the Smart Cities Mission, he said the Integrated Command and Control Centres (ICCC) developed under the mission have helped cities in their fight against COVID-19. Forty-seven operational ICCCs became war-rooms and have played an effective role in COVID response, the minister said. He added that 5,151 projects worth over Rs 2 lakh crore were identified in 100 smart cities. "So far, the mission has tendered around 4,700 projects worth Rs 1,66,000 crore which is about 81 per cent of the total projects proposed," Puri said. Source: ET Realty Chandigarh

COVID-19 impact: Millennials now considering property ownership seriously

7/23/2020 12:01:00 PM

A liquidity crisis may well be cited as the single-biggest problem India’s residential real estate sector currently faces. However, it would be a big mistake to look at the worrisome state of affairs as a financial issue alone. Overlooking certain psychological factors that have contributed significantly to the current crisis would be trying to wish away the elephant in the room. Fear factor and India’s residential real estate Humans are biologically programmed to go into a fight-or-flight mode as soon as they sense fear. The choice between staying and taking on an adversary or to run for our lives is oftentimes made in a split second, as we reflexively gauge our ability to counter the looming danger. It is this sentiment that has primarily been responsible for the slowdown in India’s residential real estate sector. The global coronavirus crisis and the subsequent lockdowns came only much later to make matters worse. As project delays became commonplace, starting in 2014 amid rising cases of builders facing financial difficulties, buyers, especially those belonging to the middle class, decided it was better to flee from the market than fight the uncertainties around project deliveries. The fight was just not worth it given many of the buyers were investing their life’s savings into these homes. It must be pointed out here that it is the middle-class buyer that fuels the overall demand for homes in India, by committing to huge debt for his or her entire working life to afford a house. The mistrust and negative sentiment that arose in the minds of this crucial buyer segment cost the residential real estate sector dearly and most short-term efforts made to bring them back to the market have failed to make much impact. This is evident from the fact that home sales during the October-December period of 2019 the festive season which is the busiest time of the year for residential real estate declined 30 percent compared to the same period the previous year. Data available with Proptiger show only 64,034 units were sold during the festive season last year in the nine prime residential markets of the country, despite the fact that interest rates were at record low levels and the government had launched several tax-saving measures to promote sales. Coronavirus and the turn of sentiments Even as developers worked overtime to think of ways to increase sales, the sudden emergence of the coronavirus crisis threw cold water on those plans. That would, however, be just one way to look at the pandemic and its various effects. Since spending increasing amounts of time at home has become integral to human safety, home-ownership is already being viewed differently in a world crippled by the deadly virus. The virus-induced fears in the human mind have forced us to acknowledge the fact that our homes are our ultimate safe havens. The changing buyer sentiment In a survey conducted by in collaboration with NAREDCO, 53 percent respondents said they have put their plans to buy a property on hold for six months and plan to return to the market after that. Nearly 33 percent respondents in the survey also said they would have to upgrade their homes in order to work from home. Despite the time of doldrums, the residential sector might have been through over the past few years, its sentimental value has bounced back in the wake of COVID-19, with 35 percent respondents in the survey saying this was their preferred investment class. The virus spread has made Generation Rent, which primarily has a no-strings-attached approach towards asset ownership, rethink its strategy as well. Currently, nearly 40 percent of India’s millennial workforce comprises migrants are looking for affordable yet modern living spaces that provide them with an optimal mix of privacy with an opportunity to engage in social exchange. Since most of the respondents fall in the age cohort of 25&ndash35 years, they preferred renting a house for self currently, primarily because of the job profile that does not make it viable to invest in a stationary asset. In fact, 47 percent respondents in our survey said they would like to invest in property if it was rightly priced. Those renters who are not in a position to buy a house currently because of price issues or the nature of their jobs have also said they would buy a property within two years. Opportunity to bounce back The coronavirus tragedy has challenged humanity in multiple ways, but it has also created new opportunities for many businesses. The residential real sector has a real opportunity to spring back towards normalcy, something it has been trying to do unsuccessfully for several years, because of the way people are likely to perceive home-ownership going forward because of the virus. It is entirely up to us now as to how efficiently we are able to deal with the short term challenges and emerge successfully out of this complex global crisis. Chandigarh

Realty players may find big opportunity in student housing sector here’s how Covid is likely to help

7/22/2020 2:30:00 PM

India has been fast warming up to the concept of student housing in the last couple of years with several developers and investors keeping a close eye on the segment. However, the ongoing pandemic has raised some existential questions for this new, up and coming asset class in the near to medium term. With social distancing here to stay, the COVID-19 situation certainly challenges the very idea of student housing which is built on the concept of shared accommodations and optimising the use of spaces thereby saving expenditure. Schools and colleges have remained shut as the entire country copes with the deadly virus that has continued to spread across the nation. As health and safety take topmost priority for both individuals and businesses, India’s student housing segment is clearly feeling the impact of the pandemic like any other sector. Occupancy levels have significantly declined in the last few months while all expansion plans are currently on hold with most student housing providers on a wait and watch mode. But all is not lost for this segment. In fact, the chances of the segment bouncing back strongly clearly outweigh the downsides of the current situation. While a successful medical intervention to the crisis will play a big role in the sector’s recovery, let’s not forget India’s growing youth population that comprises students in the age group of 15-24 years. The current dip in demand is a temporary blip and does not indicate any long term trend. Thanks to the COVID-19 situation, student housing will only evolve, come back with positive alterations and be more relevant than ever. Physical form of education is here to stay Virtual classrooms have taken over physical form of education in the aftermath of the pandemic and resultant lockdown. Schools and colleges are currently relying heavily on online classes in response to the present situation where physical movement is strictly restricted. However, we believe that these are short term and temporary solutions adopted in tune with the current circumstances. Despite the popularity and benefits of online classes to many segments of the society, it appears impossible to replace physical education at a certain level of formal education or even higher professional courses. Physical interactions will remain a necessity for the most part of education in one’s lifetime. And for a vast country like India where quality educational institutions are concentrated in large cities and towns, it is only a matter of time when students, who had left for their hometowns, will be back to their campuses. Institutions and students are already yearning towards going back to the regular model as there are several feasibility issues and technical challenges in continuing with virtual classes on a long term basis. Quality services to create distinction While the concept of student housing has remained in India for decades largely in the form of paying guest (PGs), there are only a handful of organised players in the market. In that sense, the organised student housing is at the budding stage right now. On the back of the growing inherent demand for such shared student accommodations, several large investment firms and developers have already started the groundwork to enter this space. The COVID-19 situation could lead to some of the providers to relook into the plans with a lot of focus on health and hygiene. A clear distinction in the market between an organised player offering quality services and products and unorganised housing providers will be established in the post-COVID-19 world. Going forward, student housing firms may have to operate like hospitality operators providing higher quality services and experiences to cut themselves from the clutter. During this transition period, the operational cost may increase as these providers try to adopt the new norms of physical distancing and hygiene requirements. But in the long run, these facilities will be key to distinguishing themselves in the market. Future of student housing segment For instance, Greater Noida &ndash one of the thriving markets for student housing, a survey by Savills India has found that the city is expected to receive a steady demand for student housing developments. Greater Noida represents a significant market for student housing with more than 50 colleges and approximately 28,000 students enrolling each year for various courses. Approximately 65% of these students are from states other than Delhi NCR and form the potential segment of student housing. There is an availability of largely three types of housing segments. 55% students prefer housing provided by national and local operators who provide accommodation to the majority of the students. Some of them operate on a structured basis offering amenities. 27% prefer hostels provided by the educational institutes on campus and 18% prefer small-scale paying guest accommodation and apartments rented out in residential colonies. It was observed that the majority of the unorganised supply lacks quality and amenities. A new player that offers good quality student housing with grade A standards is expected to set the right benchmark and attract good demand from the market. It is expected that going forward off-campus student housing market will pick up demand. Further, the share of organised student housing operators is expected to increase from the previous levels, backed by better facilities and services offered by them. Source: Financial express Chandigarh

Commercial space at Chandigarh railway station: More time given for bidding

7/20/2020 12:09:00 PM

Chandigarh: People who want to bid for space in the 25-lakh-square-foot commercial area at the local railway station have another two months. Indian Railway Stations Development Corporation (IRSDC) has extended the deadline. Highly placed sources in IRSDC said now they will accept bids till August 24, while the earlier deadline was June 24. Prospective bidders had requested the corporation for more time to let the Covid-19 situation improve. The pandemic has caused a huge shortage of labour, which has stalled major projects. In this environment, companies do not want to start something fresh in absence of any basic requirement. On May 20, the corporation had a pre-bidding meeting with giants of the real-estate, industrial, and fund houses sectors. Participants included L&T, Eldeco, Adani Group, Kalpataru Power Transmission, JLL, JKB Infrastructure, and AECOM. Chief executive officer S K Lohia represented the IRSDC. A railway official said that the request for proposal (RFP) for mixed use development of the land parcel on the basis of leasehold rights was invited on January 3. The first due date for bidding was May 27. During the pre-bid meeting, companies requested for more time. The IRSDC plans to put in Rs 136 crore in this project to make the station world-class with the addition of an international airport by 2021. But the revamping has not started yet and the project winner is inactive. On June 26, the IRSDC opened the bids for four stations (Gwalior, Nagpur, Amritsar, and Sabarmati) and soon the work will commence on these sites. The four projects will be railways' first started by in-principle approval of the Centre's Public Private Partnership Appraisal Committee (PPPAC). These are also first to have provision for pre-determined user charges on passengers and visitors as a revenue stream for the concessionaire of the redeveloped stations. Source: The Times of India Chandigarh

65% home buyers back in real estate market: Survey

7/17/2020 3:58:00 PM

Two out of every third home buyer is now back in the real estate market, reveals consumer sentiment surveys conducted by Out of them, 33% have think that it is a good time to buy a new house while 32% others are in the finalization stage. Maneesh Upadhayaya, Chief Business Officer, 99acres, said 65% buyers are in the market now while only 38% were actively searching for houses post-lockdown 1.0. "In addition, buyers are still looking at real estate as the best asset to invest in. COVID-19 has further assisted in increasing the adoption of digital platforms with 55-60% buyers/tenants expressing preference for virtual visits and meets," he said. According to the report, 11% have completely ped the idea of buying a property due to job and market uncertainty. "On the tenants side, 38% of tenants are looking out for a new house for larger spaces. While looking for a new rental place, the need for safety and hygiene has taken a leap due to the spreading virus. 78% of the tenants said that they will add legal safeguards in the rental agreement regarding future uncertainties and further, 76% agreed that COVID-19 free property is an extremely important factor for them," the survey said. 77% of the home buyers agreed that they are looking for a house for end-use whereas only 23% are willing to purchase for investment purposes. Further, ready to move property continues to be favorite as 64% of the homebuyers preferring ready to move house. While the preference has shifted towards digital means to buy or rent homes, the need for physical visits still persists but only for finalizing the deal, confirms 55% of the homebuyers and 60% of the tenants. When it comes to prices, 67% of homebuyers expect rates to go down significantly and another 20% are foreseeing a slight reduction. With work from home becoming the new reality, proximity to the workplace, which was once a major concern, has ped down in the list. However, proximity to key areas like market, hospital, and school, as well as safety were a couple of aspects that have taken over the minds of buyers and tenants while shortlisting a property. Source: Live Mint Chandigarh

Commercial real estate to move northwards in Tier 2 markets post Covid-19

7/16/2020 11:59:00 AM

Factors like good location, easy accessibility, improvement in basic infrastructure, increased connectivity with suburbs and the availability of skilled manpower have turned smaller cities into an attractive business destination. Bigger cities are witnessing the trend of high property prices, land saturation and subdued demand, which has led the buyers to look for greener pastures that are cost-effective markets. This has brought the non-metro (Tier II) cities into focus. One of the most important factors that has made it all possible is the fast-growing infrastructure in these cities. Many government schemes like AMRUT, Smart Cities etc have also played a significant role in the growth of these cities. Earlier only the natives of these cities used to stay there, but now people are migrating to these cities also. People from metro cities are also migrating there and demand for real estate is increasing. Post-Covid, the scenario is likely to change further as many people have already migrated to smaller cities. People with businesses will definitely love to spend time with their near and dear ones living in smaller cities. The demand which was already on the rise before this pandemic is likely to go further northwards. NRIs and HNIs too would start investing more in commercial real estate after the pandemic is over. The primary reason being the interest rates are at the lowest, leading to real estate becoming a very attractive proposition. Before the pandemic scenario, many reports put out the figures of rising real estate investments in Tier II cities at around 20 per cent over last year, which is a clear sign of the movement of buyers and investors to these cities. Indeed, the development of physical and social infrastructure — airports, road infrastructure, better connectivity, companies foraying in these markets — has pushed the real estate demand in these cities. Now tier 2 cities also have local experienced developers having delivered remarkable commercial spaces in the peripheral areas. Their design and quality has evolved to match up to international standards, meeting all the demands of the new-age and traditional businesses alike. These are the main catalysts for the growing demand of commercial real estate. This has led to the movement of businesses and employment centres, townships with mixed developments, etc in these suburban and peripheral areas. As approval processes, land acquisitions etc have been halted in current times along with various restrictions imposed on the movement of staff, just like other sectors, it will impact the immediate launches and new supplies will be delayed. Thus, post-Covid, considering all these factors, there will be a lull in supply in the mid-term, but we are very much hopeful that the government will also take steps to bring positivity to business and might announce a slew of measures. Most likely the push will be given to startups and SMEs, and these two are going to move towards tier II cities, thereby increasing the demand of commercial there. Factors like good location, easy accessibility, improvement in basic infrastructure, increased connectivity with suburbs and the availability of skilled manpower have turned smaller cities into an attractive business destination. In the coming months, a lot of IT/ITeS companies will go for rationalization of manpower and will look to optimize their office real estate portfolios. These firms would consolidate offices across various locations and move to smaller cities. This will open up new avenues for investment in the commercial segment. For example, in Chandigarh, the primary reason for the soaring popularity is advent of IT/ITEs sector and world class education and medical facilities. Today Tricity boasts of having good infrastructure coupled with state-of-the-art office campuses that are pulling in a good chunk of the migrant population. A few prominent upcoming investment locations are Zirakpur, Airport Road, Panchkula, and Mohali. Now the focus should on lessening the burden on bigger towns. It also means that the government has to work on developing employment opportunities in these cities. This is good for the overall economy of the country. Real estate reports point out that nearly 12 per cent people in Delhi- NCR prefer to invest in nearby cities like Sonipat, Jaipur and Chandigarh. Many private equity investors are turning their focus on Tier 2 cities and Private Equity close to USD 1.37 bn was pumped into the real estate markets across various smaller cities, including Bhubaneshwar, Chandigarh, Ahmedabad, Mohali, Indore and Amritsar, between 2015 and 2018. Chandigarh

Wow! Chandigarh to Delhi in just 2 hours - Modi government's Rs 20k crore infra gift

7/15/2020 12:18:00 PM

It's a huge Rs 20k crore infrastructure gift from Modi government! Believe it or not but travel time from Chandigarh to Delhi Airport is all set to be reduced to half - from 4 hrs. to just 2 hrs. In a major development, Union Minister for Road Transport, Highways and MSMEs Nitin Gadkari inaugurated and laid the foundation stones of various Highway projects as part of a new economic corridor worth about Rs 20,000 crore in Haryana on Tuesday through webcast. Details of the projects The projects inaugurated include the 35.45 km 4-lane Rohna/Hasangarh to Jhajjar section of NH 334B costing Rs 1183 crore, the 70 km 4-laning of Punjab-Haryana Border to Jind section of NH 71 costing Rs 857 crore, and the 85.36 km 2-lane with paved shoulders Jind-Karnal Highway on NH 709 costing Rs 200 crore. Foundation stones were laid for projects including the 227 km 6-lane access controlled Greenfield expressway from Ismailpur to Narnaul on NH 152D in 8 packages costing Rs 8650 crore, the 46 km 4-lane Gurugram Pataudi-Rewari section of NH 352W costing Rs 1524 crore, the 14.4 km 4-lane Rewari Byepass costing Rs 928 crore, the 30.45 km 4-lane Rewari-Ateli Mandi section of NH 11 costing Rs 1057 crore, the 40.8 km 6-lane Narnaul Byepass on NH 148B, NH 11 and Narnaul to Ateli Mandi section of NH 11 costing Rs 1380 crore, the 40.6 km 4-lane Jind-Gohana (Pkg 1, Greenfield alignment) of NH 352A costing Rs 1207 crore, the 38.23 km 4-lane Gohana-Sonipat section of NH 352A costing Rs 1502 crore, and the 40.47 km 4- lane UP-Haryana Border to Roha on NH 334B costing Rs 1509 crore. Chandigarh to Delhi in just 2 hours Speaking on the occasion, Gadkari said, these projects will benefit people of Haryana in big way by providing smooth connectivity within the State, as well as to other States like Punjab, Rajasthan, Delhi and Uttar Pradesh. The Minister also said that these important projects will decongest big cities reducing travel time. It will take about 2 hrs to reach Delhi Airport from Chandigarh against 4 hrs now. The projects will also save on time, fuels and cost, as also boost development in backward areas of the State. He added, the Modi Government is committed to progress and prosperity of the country, and Rupees two lakh crore worth of works will be completed in the first two years of this government. He recalled that the Prime Minister has conceived Rs 100 lakh crore worth of infrastructure development towards achieving the five trillion economy. Source: Zee Business Chandigarh

As public sector banks slash home loan rates, borrowers with housing finance companies are keen to shift their accounts

7/14/2020 11:55:00 PM

Home loan borrowers with housing finance companies (HFCs) and non-banking lenders are a worried lot. With most public sector banks (PSBs) and a few private sector players reducing home loan interest rate to a 15-year low, their attempt to switch their loans to institutions offering lower interest rates is making little headway. While home loan transfer from one institution to another to take advantage of lower interest is nothing new, the clamour for a shift is getting louder in recent days as many borrowers are undergoing liquidity stress due to the Covid-19 pandemic. With home loan EMIs accounting for a substantial portion of monthly expenditure, any reduction in outgo is a welcome relief to the borrowers. According to Shreekant, CGM, Real Estate and Housing Business Unit (REHBU) of State Bank of India, the surge in demand to switch home loans is driven by the trust in public sector lenders and the low interest rates offered by them. Although interest rates of private and government lenders were similar in the past, private banks have not been that aggressive in reducing their lending rates barring few exceptions. “The problems in the portfolio and functioning of some of the HFCs in the previous years have worried the borrowers,” Shreekant said, adding, “Also, interest rates offered by PSBs are at all time low. So a loan at 6.95 per cent with us is any day better than a 9 or 14 per cent loan with HFCs.” Ratan Chaudhary, Head of home loans at, a digital lending marketplace, said whenever there is a change in interest rate regime there will always be a shift because people think the new benchmark is more transparent and cheaper. In October 2019, the RBI mandated that all new, retail floating rate loans have to be linked to external benchmark - repo linked lending rates (RLLR), to make interest rate transmission more transparent and faster. The new repo-linked pricing regime followed by banks has brought stark difference in interest rates. Consequently, multiple cut in repo rates by RBI over the last few quarters has also resulted in steep fall in lending rates of some banks, especially PSBs. However, interest rates of NBFCs / HFCs still benchmarked on their internal cost of funding, deprives their borrowers from immediate benefit of falling interest rates. For instance, floating rate of interest on a home loan up to Rs 30 lakh in Bank of Baroda or Bank of India starts from 6.85 per cent whereas the interest rate for the same loan amount and tenure in PNB Housing or Indiabulls could cost anything upwards of 8.5 per cent. “Normally the cost of funding of HFCs will always be higher than that of PSBs,” Pankaj Bansal, Head, Key Account Management of BankBazaar said, adding, “Secondly, the repo rate is at 4 per cent and even when margins are added, the interest rates offered by PSBs will still be attractive to consumers.” But borrowers are finding it difficult to make the transfer. Social media is flooded with complaints about these institutions not acting on the transfer requests. But the banks and NBFCs claim that they are working with limited staff and the process involves copious paper work and field visits to physically verify the properties. The transfer will inevitably happen. “If I have a home loan for Rs 50 lakh, which I can straight away transfer to a PSB then I can even wait for two months,” Bansal said adding, “because if you calculate 2-2.5 per cent savings on the residual balance of the loan for next 15-20 years, it is still a huge savings from an interest outlay.” Borrowers facing liquidity challenges due to business loss and salary cuts are not only using this opportunity to switch their loans to lower interest rates but also to extend the loan tenure to reduce their monthly EMI burden. “Post covid, if a customer’s loan is eligible to be taken over by a bank, then he can get his tenure extended if the bank permits,”’s Chaudhary said, adding, “so he will not only get lower interest rate but his EMI will also come down by getting the tenure of the new loan extended.” “In takeover loans, if the outstanding has come down, the value of the property has appreciated and if the borrower or bank is in possession of the title deed then we can also give a top up loan for improving their cash flow,” SBI’s Shreekant said, adding, “That is also one of the reason for the uptick in takeover from other banks.” Chandigarh

Four innovations that will define real estate in the new normal

7/11/2020 1:50:00 PM

Technology has been disrupting the real estate space globally. In recent years, India's real estate sector has seen significant advancement in technologies that can improve planning and governance, efficiency in development, operations and overall customer experience. From growing population and urbanisation, to increased regulatory and compliance measures, and more recently the spread of COVID-19, now reverse migration, have all impacted real estate investment, development and operations. At the same time, such macroeconomic developments, coupled with advancements in technologies, are providing a vibrant platform for innovative tech-oriented products and services in the real estate sector. Earlier this year, India's largest real estate services firm, JLL, launched a whitepaper titled 'Technology Led Innovations: Impact on Urban Development and Real Estate' at the PHD Chamber of Commerce and Industry’s Urban Technovation Summit, 2020. The whitepaper elaborates on the impact of technology led innovations on the real estate sector, and the factors that will help create an ecosystem of growth and investment. The cities of tomorrow will be built on technology the usage of data on a digital ecosystem is going to change cities and position them better in this competitive world. Technology and innovation during implementation of urban scale projects will drive investments and we at JLL are working towards establishing this to major cities and development projects we deal with. Technology led innovation or technovation in the realty sector can be structured under four pillars - Ecosystem Led Technovation, Services Led Technovation, Space Led Technovation and Product Led Technovation. At the macro level, Ecosystem Led Technovation will enable technology to build smarter cities that can help improve efficiency, sustainability and liveability, while also creating a transparent and competitive business environment. Technology solutions can help improve the ‘smart quotient’ of the city by involving stakeholders like the government, investors the citizens, and leave a lasting positive impact on the environment. Technology plays a key role in the planned as well as future projects of the envisaged smart cities. Cities such as Bhubaneswar, Indore and Pune have focused on smart projects such as the Command Control Centre (CCC). Pune has allocated Rs 154 crore for Integrated Command and Control Centre (ICCC) which oversees 200 Wi-Fi hotspots and over 80 environmental and flood sensors along with public address system and traffic surveillance system. These innovative uses of technology help make these cities smarter and safer. With adoption of tech tools for administrative processes, city congestion will reduce, make cities safer for all stakeholders and enhance quality of life, all of which will drive investments and increase resources for governments that can be utilised on other initiatives. Several cities in India have adopted projects of high impact such as Citizen Response Management Systems (CRMS), smart and integrated public transportation systems, city-wide surveillance systems, smart homes, digitisation of municipal operations, etc., JLL was involved in Smart City Proposals (SCP) for 8 of these cities, which include Bhubaneswar, Chennai, Puducherry, Tiruchirappalli, Aligarh, Moradabad, Amritsar and Vadodara. JLL is also presently working as Project Management Consultants for Trivandrum, Kanpur, Dehradun and Moradabad Smart Cities in successfully implementing the identified projects. Services Led Technovation elaborates on the impact of proptech across the real estate lifecycle in a more efficient and effective way.Digital brokerages have already become a starting point for property searches. More recently, developers are increasingly adopting new and advanced construction technology and methods to save time and improve employee safety, using AI and VR to create avenues for more accurate forecasting, and incorporating various technological tools in retail malls and commercial sector for better user experience. While the housing sector has been relatively slower in adopting technology, COVID-19 has seen rapid investment in technology and automation by leading real estate developers. Moving forward, newer prop-tech services spanning data management, real estate investments, and building operations are finding increased adoption with organised industry players. Space Led Innovations, on the other hand is about developing and operating smart buildings primarily through IoT. Wearable technologies help prevent potential issues during project construction and operations. 3D printing can help up-skill the workforce in the construction industry, whilst reducing construction costs. Finally, increasing focus on sustainability, well-being, has provided various sensors-based technologies that help building managers and occupiers strive for predictive maintenance. The office sector continues to be a pioneer in incorporating technology for a more efficient and sustainable workplace. For instance, as employees start to return to the office, workplace apps will continue to evolve to encompass new features focusing on emerging trends on health and safety. Product Led Technovation like drones will continue to see exponential growth, especially as a tool for data capturing, processing, monitoring and delivering better experience. From real estate agents using drones for site walkthroughs, to planners using the product for surveys and site managers using it to improve employee safety, Drones have found utilisation across the real estate lifecycle. Urban planning and real estate sector will observe the expansion of various disruptive technologies in India, including 3D printing, blockchain and drones, with a possibility to scale to smaller cities. Backed by new normal, post-COVID scenarios, emergence of the middle class and millennials, improved consumers’ technology sophistication, global black swan events, as well as government support, real estate technologies in India are poised to thrive. Source: Chandigarh