Real estate demand to improve

The Indian real estate sector has been experiencing robust growth since the election a new Government. The demand for residential housing and office space is likely to improve in the coming days. A report released from Knight Frank suggests that realty demand will improve in the major cities of the country. Let us see the outlook for the major cities in the next six months.

Real estate market of Bangalore

The report suggests that there will be an improvement of 17% in new completions in the H1 quarter of 2015 as compared to H1 2014. A large number of lease deals from the e-commerce sector are in the pipeline. This will push the real estate market of the silicon valley of India. With builders in Bangalore coming up with new projects, buyers can expect more in the coming days.

Real Estate market of Mumbai

Though new launches will be lower in the commercial capital of India, yet there will be an improvement in demand. However, the report says that though the demand will improve the magnitude of growth in price will be low. Like Bangalore, real estate developers in Mumbai are also launching several new projects.

Real Estate market of Chennai

Though new launches will be lower in the commercial capital of India, yet there will be an improvement in demand. However, the report says that though the demand will improve the magnitude of growth in price will be low.

In the coming days, the Indian real estate sector is expected to touch new heights.

Budget 2015: Mixed bag for the realty sector

Realty players expected a lot from the Union Budget 2015. In the end, the Budget can be summed up as a mixed bag for the sector. Though there are no direct benefits, a thrust on sustainable growth and infrastructure will benefit the sector in the future. Let us see the announcements that will aid the sector.

End of speculation to GST

In his Budget, Finance Minister Arun Jaitley announced that GST would be implemented from the next financial year. GST will benefit real estate developers as well as buyers. By announcing implementation of GST, the Finance Minister has put to rest all speculations regarding it.

Faster approvals

In his Budget, the Finance Minister announced setting up of an expert committee that will aid in the making of a pre-existing regulatory mechanism to quicken approvals. This is a welcome move since real estate companies have suffered because of delayed approvals that pushed up project costs.

Relief to the Indian middle-class

By abolishing wealth tax, the Government has provided a big relief to the Indian middle class. Instead, the Government has introduced a surcharge of 2% on people earning Rs 1 crore or above. Abolition of wealth tax means that a majority of Indians will not have to pay any tax on property ownership and only super luxury apartments will be taxed.

Tax soaps to Real Estate Investment Trusts (REITs)

Tax soaps announced for real estate investment trusts will attract massive funds. Rationalization of capital gain tax regime for REITs is a big boost to the sector.

However, the increase of service tax from 12% to 14% has not gone down well with real estate builders, as it will aid inflation. It will also increase the cost of construction. However, the results of the announcements are still to be seen and one hopes that the sector will gain strength in the coming days.

GST Regime: A positive development for the real estate sector

The Indian real estate industry has witnessed a robust growth in tier I, II and III cities. Development in Goods and Services Tax (GST) is a positive development for the realty industry that can have a significant impact. At present, though construction services have been taxable under service tax and VAT, a few basic issues need to be solved. The proposed shift to GST will strengthen the realty sector and solve many of its problems.

As of now with service tax and VAT being the primary levies, there is a constant dispute on the rate of tax since there are several options for discharging taxes across the states. Because of this, real estate developers have been following diverse practices. However, with GST being implemented the practices would be common across geographies. This will benefit real estate companies in bangalore as well as buyers.

Benefit to buyers

Presently, homebuyers need to pay VAT and service tax while booking an apartment before its completion. The developer on the other hand needs to pay CST, excise duty, customs duty, etc. all of which is added during pricing. All these taxes push up the cost of the residential unit to a great extent. GST aims to remove all these taxation system with a single system. Thus, it will bring down the cost of construction and aid buyers.

Benefit to commercial developers

Commercial developers will benefit immensely from the regime as most of them are burdened with high costs since there is no credit is available for construction services on a commercial property. Hence, most of them are rented out. GST will ensure a smooth flow of credit, thereby aiding developers.

Overall GST augurs well for the real estate industry. Smooth flow of credit will increase investment opportunities in india property bangalore and real estate builders can expect more transparency in the sector.

Rise in PE Investments in the Indian Realty Sector

Private equity (PE) investment in the Indian real estate sector rose more than double in 2014 as compared to 2013, according to a report from real estate consultancy Cushman & Wakefield. According to the report, PE investments rose to Rs 15,410 crores in 2014 as compared to Rs 7,360 crores in 2013. The massive rise is a clear indication of the renewed interest among investors in the sector.

Reasons for the rise

With foreign investors acquiring IT parks and IT-SEZs, the same gave a big push to PE funds. Rapid growth of the residential segment owing to attractive capital appreciation and leased commercial office assets has also boosted PE funds in the sector.

PE funds are an important source of funding for real estate developers and many real estate companies bank on these funds to complete their projects. PE funds have been a major catalyst for growth of the sector. Total number of deals also rose from 40 in 2013 to 73 in 2014.

With the economy slowly reviving, the Indian realty sector needs funds. Setting up of real estate investment trusts (REITs) has boosted confidence of real estate developers in bangalore and in the coming days, the number of PE investments is expected to go even higher.

Real estate developers in Bangalore and other metro cities offering freebies to attract homebuyers

The time could not have been better for buyers to purchase apartments in the major metros of India. Real estate developers in Bangalore and other metro cities of the country are offering major discounts along with freebies to lure buyers.

 

Great discounts

Prominent real estate developers in Bangalore, Mumbai, Kolkata and NCR are offering nearly 25% discount. Not only this, they are also offering buyers free studio apartments along with modular kitchens. Studio apartments are being offered to buyers purchasing top floors of luxury residential apartments.

Data from various sources reveal high inventory levels. This has left real estate companies concerned. For raising capital, it is important to show bookings. However, the result of these steps is still to be seen. The housing market of the country is delicately poised at this moment. With NRIs eyeing to buy apartments in the country, it is the right time to offer discounts and freebies.

 

The upcoming Budget holds the key to the growth of the real estate sector. Developers are expecting a further reduction in interest rates that would make home loans cheaper. This will enable buyers to buy the apartments of their choice. Developers are also expecting the market to revive in the coming months that will help them sell unsold inventories.

Branded Luxury Homes in India: An evolving concept

Though the concept of branded luxury homes is new in the Indian real estate market, yet it is generating a considerable amount of interest among buyers. These homes cater to a niche audience and the basic idea behind these homes is to promote brands. To boost the value of these apartments, real estate developers are tying up with international brands to bring top-notch facilities to customers.

Focus on comfort and luxury & target audience

Superior comfort and luxury are the focus of these homes. Unique lifestyle is the objective of these households. The target audience is the super high-net-worth individuals of the society. These units offer personal customization. However, such customizations do not affect the overall specifications of the project.

Exotic locations, breath-taking interiors and high-class amenities are some of the features of these apartments. Since they are targeted for the elite and people living abroad, hence it is important to equip them with facilities matching international standards.

Hurdles

However, there are many hurdles before real estate companies before undertaking such projects. Some of the major problems are:

Selective location

Location plays a key role in these types of apartments. Hence, developers have to be spot on in their selection. In the main cities, there can be a problem of posh locations and getting approvals is a major concern.

Restricted number of buyers

Another major problem for developers is the restricted number of buyers. Majority of the population belongs to the mid-income group.

Apart from the above factors, sales and marketing of these properties present a stiff challenge. Developers have to tie up with reputed marketing and public relations firms to ensure that their message reach the target audience.

The success of these high-end apartments depends on the strengthening of the economy. Since a majority of the population falls under the mid-income group, it is vital to produce individuals who can buy these ultra-luxury homes.

More tax incentives sought by realty developers for REITs in upcoming Budget

Setting up of real estate investment trusts (REITs) have received thumbs up from the realty players. REITs have been in the wish list of developers for long and with SEBI notifying norms for the trusts in September 2014, the roadblock for setting up of the trusts had been cleared. REITs would not only solve the problem of liquidity, but also bring more transparency in the sector.

Tax incentives in upcoming Budget

However, to ensure success of these trusts, real estate companies and developers have asked for more tax incentives for investments through REITs in the upcoming Budget. Real estate developers feel that unless changes are ensured to overcome tax hurdles, REITs cannot achieve their real objective. Therefore, it is time that the Finance Minister addresses this issue in the Union Budget.

Tax incentives to attract domestic investors

The Indian real estate sector is one of the most dynamic sectors of the economy. Domestic players have an integral role to play here. However, the present tax structure for Indian REITs could lead to multiple tax levels for domestic real estate investors. Several other issues need to be addressed. Questions on the initial value of properties along with approvals of large bank loans need to be answered.

Strong support from Government

For the trusts to be successful, it needs a strong support from the Government. REITs will play a vital role in strengthening of the sector. For the Indian realty sector to touch new heights and competitive, REITs will play a crucial role. Once clarifications are achieved, it will be easy to execute investment plans.

The real estate business is at a critical stage. After a slump in the past year, there has been a positive sentiment among investors after the election of a new Government. REITs are important for several big projects and hence, it is the right time to consolidate these trusts.

Good Investment Prospects in North Bangalore

Over the last few years, real estate developments have gained tremendous pace in Bangalore. Being the IT hub of India, Bangalore has attracted workforce from all over the world. In the last few years, North Bangalore has evolved as a lucrative investment destination for residential real estate. Several factors have contributed to its growth.

Factors contributing growth

Large access to lands at an affordable price coupled with continued expansion of the city has made North Bangalore a lucrative destination for real estate developers and end users. Many areas in this part of the city offer high returns on investment. Areas like Devanahalli, Hennur, Doddabalapur Road, Thanisandra, Nagarbhavi, etc. are offering high returns on investment.

Growth in infrastructure

Growth in infrastructure has made North Bangalore a favorable investment area for real estate companies. Bangalore International Airport along with proximity to several IT parks and multinational companies has transformed the landscape of North Bangalore. In the coming years, prices of properties in North Bangalore are expected to go up.

North Bangalore catering to every requirement

North Bangalore caters to the needs of every individual. While there are high-end villas and premium apartments, there is no dearth of affordable houses in the area. Builders in Bangalore are offering every kind of apartment with top-notch facilities to grab attention of homebuyers.

Good connectivity

Connectivity is an essential aspect of any successful investment. Monorail, high-speed railway links and express highways have played an essential role in connecting this part of the city to other parts of Bangalore. Connectivity will further improve with the launch of the IT investment region.

Overall, North Bangalore has a positive investment prospect for both commercial and residential investors. With NRIs taking an active interest in the Bangalore property market, things look quite positive for the realty segment of the city. So, if you are planning to invest in the bludgeoning realty market of Bangalore, explore your option in North Bangalore.

Reasons to invest in eco-friendly properties

With time, there has been a growing buzz for eco-friendly homes. Real estate developers, as well as buyers, are focusing on green aspects during construction. Given below are the reasons as to why you should invest in green homes.

Increases your home’s value

Green homes use sustainable construction materials that boost the overall value of the house. These materials have lower utility bills and are better for the environment. Prices of such apartments are on a rise and will fetch good returns in the coming days.

Lowers utility bills

Green apartments help save a lot of money. You can save on your electricity and other bills. Since these homes have strong insulation, there is no need for artificial heating and cooling system. This reduces the load on your finances.

More durable

Eco-friendly homes wear out soon as they are constructed from recycled products is a common misconception. However, it is not the case. Recycled plastic and wood fibers are more durable than traditional materials. You will spend less time and money in maintaining your home.

Healthy living

Eco-friendly houses improve bio-diversity and the quality of indoor air. This helps you lead a healthy life. Because of cross-ventilation in green apartments, there is free movement of the air that helps residents lead a healthy life.

Preserve the surrounding

Eco-friendly homes preserve the surroundings and cut down carbon emissions. Since they use natural resources, the impact on the environment is extremely less. Real Estate Builders companies engaged in building green apartments can also avail various tax benefits.

Less expensive

It is a common belief that these homes are expensive. Nevertheless, it is not. Since these apartments help you save so much that your cost is recovered soon.

With the degradation of the environment, green homes are the need of the hour. Property investors are increasingly investing in such properties. In the coming days, the demand for these homes will further rise.

Home Building Basics — Finding the right developer

With several real estate developers foraying into the realty segment, choosing the right one is a difficult task. The success of home building depends a lot on the developer and hence it is important to choose a credible builder. Given below are some effective tips that will help you in your choice.

Carry out an extensive research

It is vital to conduct a full-fledged research. While there are several established and prominent brands, there are many smaller players too. Before the final selection, you must study every aspect of the developer minutely. Never blindly believe the claims made by the developer. Carry out a thorough research before finalizing.

Check out the project’s feasibility

Always check out the project’s feasibility in the location undertaken by the developer. There have been several instances in the past when builders have failed to complete their projects because of some hurdle or another. Study the location carefully before making any commitment.

Go for established developers

Always choose real estate builders with a good reputation in the market. Talk to their previous clients to know their experience. Find out whether the developer has been able to deliver his promises or not. It is crucial to find out about his previous projects.

Check out the financial stability

Before finalizing a developer, it is important to check out the company’s financial stability. Find out the financial statements of the companies before the deal. Real estate projects are often delayed due to lack of funds. Investing in delayed projects is a waste of time and money. Hence, it is vital to check out the financial stability of a firm.

See all the relevant documents

Make sure that the developer provides all the relevant and legal documents of the project. Get a copy of the project plan, title-deed and the necessary approvals from the concerned authorities. Hire a lawyer to take care of the legal formalities.

Building a home is a mammoth task. You need to be extremely cautious and ask all the relevant questions about the property before signing.