October 2017 Vol 02


Reforms, New Legislations drive consolidation in Real Estate

A raft of reforms and legislations in the real estate sector is driving consolidation with several smaller realty developers either monetising their land parcels on outright basis or entering into joint development or development management agreements Last November’s surprise demonetisation of high-value notes has induced an unforeseen liquidity crunch worsened by banks that have been reluctant lenders following a crackdown on NPAs by RBI. This affected quick transformation in the sector known to benefit from unaccounted cash transactions.

“Small and mid-sized developers are finding it tough now because of strict RERA guidelines and their lack of strong credibility to generate sales given homebuyers’ current preference for solid execution track record. Apart from this, the absence of financial strength is also pushing them towards forming alliances with big developers,“ said Ankur Srivastava, chairman of GenReal Property Advisors.

Source: The Economic Times, Monday 16 October 2017

Hopes of recovery in Residential new sales ignite a Realty rally

Just after the Festival of Lights, shares of property companies lit up Dalal Street on Monday on expectations that a raft of festive season offers and increasing confidence among home-buyers would induce them to reach for their cheque book. Realty stocks climbed as much as 18% on a day the broader gauges were flattish on resumption of trading in Mumbai after the Diwali weekend. Kolte-Patil Developers, Sunteck Realty , Puravankara, and Sobha registered fresh 52-week highs, with buyers expected to re ward developers that have good completion and delivery records.Shares of Arihant Superstructures, Ansal Buildwell, DLF, Anant Raj, Godrej Properties and Peninsula Land also rose between 3% and 8%.

With the uncertainty around the implementation of Real Estate (Regulation & Development) Act now over, the formation of regulatory authorities in key property markets has helped build confidence among home-buyers, analysts said.These factors, combined with low home-loan interest rates and rising affordability of residential units, could stoke a revival in demand in the second half of the year.

Source: The Economic Times, Tuesday 24 October 2017

Indians again top foreign property investors in Dubai

Indians purchased property worth Rs 42,000 crore in Dubai between January 2016 and June 2017, continuing to be the most prolific among foreign realty investors in the Emirates. According to the Dubai land department, Indians had invested Rs 30,000 crore in Dubai’s real estate in 2014.

A study by Dubai Property Show has revealed that apartments are the most popular choice for desis, comprising 33% of the purchases. Villas (17%) came next, with commercial property (9%) and land (6%) being the other preferred investments. According to the study, most (88%) Indians look to invest between Rs 3.24 crore and Rs 6.5 crore.

Source: The Times of India, Friday 27 October 2017

75% of world’s new billionaires from China and India

The number of billionaires in Asia surpassed the US for the first time though the US still has the greatest amount of billionaire wealth. One billionaire is created every three weeks in China, which leads the region when it comes to the number of billionaires. At the current pace, in four years Asia is tipped to overtake US in terms of the world’s largest concentration of wealth, according to an analysis of data from roughly 1,550 billionaires by UBS and PriceWaterhouseCoopers.

Source: The Times of India, Friday 27 October 2017

Getting realistic about realty decisions

High festive spirit and attractive offers could be a big lure when it comes to buying a property. After all, it’s every individuals dream to see his name plate on the property brought with his hard-earned money. But for all your positivity, there could be external negatives at work. You may encounter frauds and take you for a ride if caution is not exercised at your end. There are several ways in which you can be cheated. It is therefore imperative that you get all your papers and information in order before going for the big buy and thus avoid a lot of heartache later. We provide you with a check list that needs to be adhered to at all cost before signing on the dotted line:

  • Always ask for original property papers. Non-availability of these is a clear signal to stop any kind of dealing right away as there are chances that the title of the seller is unclear or there is a mortgage issue over the property. A title certificate will ensure a clear and marketable title for the property. 2) A legal opinion of an advocate is advisable in which case you will have to hand over to him the copies of documents of title deed related to the house under sale.
  • Check for any pending loans on the said property. 4) Check for approved layout and building plans with the number of floors available. Also check the building bye-laws in the area of purchase. 5) Make enquiries if the asking price is justified. Also check the transfer fees, stamp duty and registration charges.
  • It is advisable to check for recurrent charges like property and water taxes. Society maintenance charges differ in different co-operative societies and may or may not be suitable for you. 7) If you are intending to buy your home in a co-operative society, you must verify the original share certificate. This is issued by the society and will ensure that the property you are about to buy is indeed owned by the person selling it, as it would have the latest owner’s name mentioned.
  • You would have to complete the transaction of the purchase by registering the deed. You must always remember that the unregistered agreement would not have any validity in law. 9) You must also watch out for the income tax clearance certificate to ensure that the owner has discharged all the income tax liabilities.
  • Make sure to acquire the completion certificate from the builder. It is authorized by the Municipal Corporation after the builder complies with the rules laid out by it. 11) Make sure to acquire the occupation certificate. This is issued once the building is ready for occupation with permanent water, sewage facilities and electrical connections. 12) Acquire all the NOCs of all the concerned departments from your builder or seller. For example a no-objection certificate if it is part of a registered society. Also acquire documented approvals from the society regarding the amenities offered to you like parking space, usage of club house, etc.

The ‘RERA’ factor: If you plan to go for an under-construction flat, then check if it has been registered under RERA. You can check on the official website of RERA to check if the property has been registered. The new act which has come into force recently is in the interest of the buyer. It safeguards his interests and in case of any fraud, the buyer can be pulled up by the government and made to compensate accordingly.

Source: Mid-Day, Friday 27 October 2017

Realty investments grow 100% in top 6 cities: Study

With favourable changes in the legislative environment, India’s six major cities – Mumbai, Bengaluru, Pune, New Delhi, Chennai and Hyderabad have recorded 100% increase in investments in real estate sector at $2.87 billion during July 2016-June 2017, according to a survey by Cushman and Wakefield.

Mumbai, with an investment of $1.75 billion from foreign as well as domestic private equity investors, has moved up to 81st position in the global survey on rankings of cities for attracting capital from 149th slot in 2016. Also, the financial capital has witnessed highest growth among the gateway cities of the world with 194% increase in investment from $594 million in the same period last year.  

Source: The Times of India, Tuesday 31 October 2017

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