Small Businesses Like Residential Property

Over 50 per cent of owner-managed businesses consider residential property to be the most attractive investment option, according to research from the Bank of Cyprus UK.

Despite the recent implementation of stamp duty changes for landlords in Engand and Wales, the figure (53 per cent) marks a rise from the Bank’s previous research in early November 2015.

It was found that residential property was the overwhelming investment choice for owner-managed businesses, as a mere 8 per cent see commercial property as an attractive investment. Cash investments were preferred by 16 per cent of respondents, whilst stocks and shares came in at 13 per cent.

Lakis Kasapis of Bank of Cyprus UK said: ‘Despite the new measures making life harder for buy-to-let landlords, demand for residential property as an investment is still strong, and surprisingly people are even slightly more bullish about buy-to-let investments than six months ago. We saw a rush to buy in the first quarter of this year as investors capitalised on buy-to-let property purchases before the stamp duty increase took effect in April.

‘It remains to be seen, however, if this appetite for investing in the residential market will now come to a hard stop following the stamp duty increase, or whether it will continue given the scheduled personal tax relief changes and the continued uncertainty surrounding a potential Brexit.’


Resource: http://www.residentiallandlord.co.uk/

Sharjah’s residential property rents set to drop further

Rents in Sharjah’s residential property market are set to continue to decline throughout 2016, following an average fall of 5.7 per cent during Q1 which has dragged the annualised rate of change in rents down to -8.3 per cent, according to international real estate consultancy Cluttons.

Cluttons’ Sharjah Spring 2016 Property Market Outlook report shows that unlike last year, the fall in villa rents has accelerated, with average rates declining by 13.2 per cent in Q1 2016 alone, whereas average apartment rents fell by 1.5 per cent in the first quarter, leaving them 7.7 per cent down compared to Q1 2015 figures.

The report also highlights the growing awareness amongst tenants to seek out well managed properties, with good quality facilities and rents that are perceived to be ‘fair’.

Suzanne Eveleigh, the Cluttons' head of Sharjah, said: "This sentiment among tenants creates an opportunity for landlords to differentiate themselves by undertaking refurbishment and modernisation of properties while the market works its way through the current slowdown."

"We have already seen numerous instances of this being done during the last downturn in the market and it is these properties that are now fully let and in high demand. That said, even in our portfolio of managed properties, voids have crept up to around three per cent, up from the usual average of 0.5 per cent to one per cent, reflecting the softening conditions. The situation is far more challenging in buildings where landlords haven't been proactive," she noted.

Cluttons research shows that demand for suburban-style living continues to rise in Sharjah, predominantly because of the relative affordability when compared to Dubai.

Developers are conscious of the demand for more luxurious gated accommodation and are continuing to rush new schemes to the market.

"These emergent high-end communities will help cater to the strong demand from both residential investors and tenants who are seeking out this type of housing in Sharjah," remarked Eveleigh.

"Al Zahia and the Dh2.4-billion ($653 million) Tilal City are examples of such communities that are progressing quickly. We expect to continue seeing larger and more elaborate residential communities built on the outskirts of the city, with a specific focus on the Airport Road corridor," she stated.

According to the report, the weaker conditions in the market are expected to persist as the year wears on, with rental falls of between three per cent and five per cent likely, on average.

Faisal Durrani, the head of research at Cluttons, pointed out that the rents across Sharjah’s more affordable areas remained linked to the performance of Dubai’s rental market.

"With a weak short-term outlook for Dubai, we do not expect to see any turn around in rental value growth until jobs linked to the World Expo in 2020 start to materialise, which we should start to see in the next 12 to 18 months. Until then, the rental market in Sharjah is expected to remain subdued," noted Durrani.

On the office market, Cluttons said rents across Sharjah’s main submarkets have stayed flat over the past six months, with all three of the city’s main areas (Al Soor, Al Majaz fringe areas, and Al Majaz prime areas) experiencing no change.

The only market to have showcased any change in the past 12 months is the fringe areas of Al Majaz, where office rents increased by 7.7 per cent between Q1 2015 and Q1 2016 and currently stand at Dh70 per sq ft, up from Dh65 per sq ft in 2015.

“While the silver lining for Sharjah’s office market is the relative stability in the level of prime office supply, the level of requirements has continued to dwindle. The vast majority of requirements that we have been recording are from the emirate’s important SME (small and medium enterprises) sector; which is usually for space in the region of 1,000 sq ft.” said Durrani.

Aside from this core demand driver, Cluttons has noted a handful of requirements from oil and gas linked occupiers, who, alongside the public sector and quasi government sector, continue to drive larger space requirements.

"Despite the relative stability in the emirate’s office market, we are expecting to see rents decline this year between Dh5 per sq ft and Dh10 per sq ft across the board," stated Durrani.

"With entry level rents in comparable, desirable and sought-after office submarkets in Dubai such as Deira, Bur Dubai, Garhoud, Jumeirah Lake Towers and Business Bay currently standing at between Dh60 per sq ft and Dh75 per sq ft, it is likely that Sharjah’s office landlords will be left with little option but to drop rents to below those in Dubai in order to entice demand," he added.-TradeArabia News Service.

Resource: http://www.tradearabia.com

Dramatic shifts herald a new era in residential property

There have been two sudden and dramatic shifts in the Sydney apartment market, which are set to spread to Melbourne, Brisbane and other markets.

It may herald a new era in Australian residential property.

The first shift is that the level of Chinese buying of Sydney apartments has fallen dramatically. The largest Sydney developer, Meriton’s Harry Triguboff, estimates that in the last month or so Chinese buying has halved.

The Chinese and other Asian buyers have been buying over 80 per cent of Sydney apartments in recent years so this is a huge and dangerous development.

But just as everyone began to prepare for the resulting calamity, a second dramatic shift has taken place in the last few weeks: There has been a surge in Australian buying of both existing and ‘off the plan’ apartments.

The increased buying has been so sudden that there has not been time to fully analyse the trend, but it seems that two forces are driving it.

First, the Coalition’s retrospective (see footnote) decimation of superannuation as a savings mechanism for up-and-coming executives and salary earners has turned Australians towards negative gearing as a savings mode.

And, secondly, this trend was accelerated by the fall in interest rates as well as the signal by the Reserve Bank that if inflation remains at current levels or moves lower, further interest rate cuts would be in the pipeline.

The latest surge in local buying includes first home buyers but increasingly young Australians are negatively gearing investment properties and either living at home or renting. Indeed, it has become the modern fashion for young people to be investors rather than first home buyers.

As we know, the ALP plans to confine negative gearing to new developments and reduce the capital gains tax. Australians who are suddenly buying apartments either don’t expect Bill Shorten to win the election and/or are setting up their negative gearing prior to a change in the legislation should Shorten win. An ALP win is now a real possibility. (Business should prepare for a Shorten win, May 11.)

Why have the Chinese stopped buying in Sydney? We don’t know the full answer but almost certainly it will be a combination of the fact that it is becoming increasingly difficult to transfer money out of China and Australian banks have withdrawn the welcome mat for overseas buyers.

Those who bought apartments ‘off the plan’ 18 months to two years ago are settling well because the higher values enable them to gain bank finance, but there is a fear that when more recent ‘off the plan’ purchases come up for settlement in 18 months to two years the funding to complete the purchase may not be available.

We are therefore set for a fall in apartment development and/or prices unless the local buying surge gathers momentum.

While Brisbane shows similar trends to Sydney, Chinese apartment buying in Brisbane has not been nearly as dominant as Sydney. In Melbourne, Asian buying has been at least equal to Sydney and may have been greater.

Whereas Meriton dominates Sydney, Melbourne is a far more complex market and on July 1 the state government is set to raise the levy on foreign purchases of apartments from 3 per cent to 7 per cent. That is causing a surge of apartment developments to be brought forward so there is intense marketing to foreign buyers suggesting they buy before the July 1 tax increase.

Melbourne’s foreign apartment buying is closely aligned with education and, unlike Sydney, there are far more properties that have been bought by the Chinese and left empty. (In Sydney, Meriton exerts great pressure on foreign buyers to rent and there are few empty apartments.)

Once the July 1 rush is out of the way Melbourne will almost certainly follow Sydney and see a decline in Chinese buying. Already in Melbourne older apartments are selling for lower prices than new apartments. This two-tier market is very dangerous and lowers the level of bank financing for new apartments.

The sudden fall in Chinese buying in Sydney is of great long-term significance to the nation. The Chinese buyers not only underpin the market values but have also enabled the nation to adjust to the fall in mining investment. They have been a key element in our prosperity. If it continues to be difficult for the Chinese to buy apartments it may also affect our tourism and education, which have been key export markets for Australia.

Meanwhile, Meriton reports that the rental market is strong in Sydney and the Gold Coast but Brisbane has dropped by 5 per cent because of a very big increase in units.

What about Harry Triguboff as Australia’s largest apartment owner? What is he doing?

“We in Meriton are well placed whatever takes place. We have pending sales for $1.5 billion, which will probably be mostly honoured by the banks. We sold a lot of our old stock, so we are debt free,” he says.

Footnote: There has been considerable debate about whether Scott Morrison’s budget changes to superannuation represent retrospective legislation. The first change, the $1.6 million asset level that triggers pension taxes, is debatable but if you declare it ‘retrospective legislation’ you must also declare the ALP’s superannuation changes retrospective. But there is no doubt whatsoever that the lifetime cap of $500,000 on non-concessional contributions which goes back to 2007 is retrospective legislation of the worst kind.

Resource: http://www.theaustralian.com.au

Mumbai, suburbs' residential property prices rose only 3.3% in 2015: JLL India

MUMBAI: Mumbai, the country's most expensive property market, is maturing and sharp appreciation in real estate prices may not be a scenario likely to be witnessed soon. The average residential property prices in Mumbai and suburbs witnessed an appreciation of 3.3% in 2015 as against average 7% in 2014.

Unlike the pre-global financial crisis (GFC) times - when prices saw double-digit growth (y-o-y) across the city and suburbs - the market has seen a rather subdued growth in prices ov er the last couple of years, showed a JLL India study. The subdued rise indicates the maturing residential market, which should be a good news for end users who wish to buy home.

"A sign of any residential market's increasing maturity is evidenced by gentler price appreciation - a process which has been very much in evidence in the country's financial capital...The forecasted increase in residential property prices in 2016 is expected to be 6%. While a price rise of 6-7% (y-o-y) was predicted for 2015, the actual increase should come as a pleasant surprise to home buyers," said Ramesh Nair - COO - Business & International Director, JLL India.

At the sub-market level, south-central Mumbai and the eastern suburbs saw the maximum appreciation at 4.3% and 4% respectively, followed by north Mumbai and western suburbs at 3.9% and 3.5% respectively. Outside the city and suburbs, Thane saw a 3% appreciation in capital values, while the figure for Navi Mumbai stood at 6% However, Navi Mumbai also has a lot of unsold inventory in many of its pockets and only few precincts are witnessing good demand.

According to JLL India, smaller units are in demand lately due to their relatively affordable ticket sizes, and several builders are now offering them even in premium locations.

A JLL study in 2Q15 had showed that 69% of the apartments in the city and suburbs were priced above Rs 1 crore. The number came down to 65% in 4Q15, showing how developers are trying to bring in affordability.

The 2015 figure also reflects how developers have shown unprecedented flexibility and kept costs stable by absorbing some of the increased holding costs. Some home buyers reciprocated by jumping the fence and buying houses at attractive prices. Moreover, developers started to gauge market dynamics with greater precision and adapted their product offerings as per changing demand.

Resource: http://economictimes.indiatimes.com

Real Estate Bill is an act now, may protect home buyers

NEW DELHI: The Real Estate (Regulation and Development) Bill, 2016, became an act on May 1, kick-starting the process of making rules as well as putting in place institutional infrastructure to protect the interests of home buyers in India.

While acknowledging that the act is a positive development, property experts said the new rules should address problems faced by builders in getting sanctions and approvals in a timely manner. "Government authorities should also be made accountable for timebound approvals through the rules that will be made," said Anshuman Magazine, managing director of property advisory firm CBRE South Asia.

He said that if this happens, it will be one of the major steps towards the recovery of the Indian real estate market and will improve the confidence of both consumers and institutional investors - domestic or foreign. "Of course, it should not become another hurdle for development, which will then raise property prices in the long term," said Magazine.

The Ministry of Housing & Urban Poverty Alleviation notified 69 of the act's 92 sections that come into force from May 1. Rules for implementing the provisions of the act have to be formulated by the central and state governments within six months - by October 31 - the maximum period stipulated in Section 84 of the act.

The housing ministry will make the rules for Union Territories while the Ministry of Urban Development will do so for Delhi.

The key to providing succour to home buyers will be the setting up of Real Estate Regulatory Authorities, which will require all projects to be registered, and the formation of Appellate Tribunals to adjudicate disputes.

According to Section 20 of the act, state governments have to establish the regulatory authorities within one year of the law coming into force. These authorities will decide on the complaints of buyers and developers in 60 days.

The act seeks to protect the rights of home buyers, mandates registration of projects, including those that have not got completion or occupancy certificates.

Registration will require builders to set aside 70% of the funds collected from buyers and pay interest in case of delays. Any officer, preferably the secretary of the department dealing with housing, can be appointed as the interim regulatory authority.

Once the regulators are set up, they will get three months to formulate regulations concerning their functioning. Real Estate Appellate Tribunals need to be formed within a year - by April 30, 2017. These fast-track tribunals will decide on disputes over orders of the regulators within 60 days.

A committee chaired by the secretary of the housing ministry has started work on formulation of model rules so that states and UTs can frame their rules quickly, besides ensuring uniformity across the country. The ministry will also will come out with model regulations for the regulatory authorities.

The remaining sections of the act that have to be notified relate to aspects such as the functions and duties of promoters, rights and duties of allottees, prior registration of real estate projects with the regulatory authorities, recovery of interest on penalties, enforcement of orders, offences, penalties and adjudication.

Considering that there 12 months left for the regulatory authorities to be set up by the states, builders are expected to speed up work to avoid the stringent provisions of the new real estate regulatory act.

Resource: http://economictimes.indiatimes.com

Will the new Real Estate Act be a game changer?

The new Real Estate Regulation and Development Act has just come into force. It is being hailed as a positive step. The Act envisages that the states and Centre will formulate specific rules for real estate regulation.

Broadly, every state will set up regulatory authorities for oversight of real estate projects, all of which will be registered. Guidelines and timelines will be laid down for projects and penalties imposed if those are not adhered to. Instead of legal disputes being processed slowly through normal courts, Appellate Tribunals will adjudicate disputes with time limits of 60 days.

There are time limits for states to pass new laws and set up the boards, etc. The process will, if timelines are adhered to, take about a year or so. Most likely, since state-level governance is very uneven, this will work patchily. Some states will set up efficient Tribunals and Regulatory Boards; others will not.

Many politicians have interests in real estate. That could work both for, and against the concepts of the new Act. Some smart and not-so-crooked politicians will back the new act and use it to accelerate activity. Others will try to hold up the new legislation or subvert it.

The real estate sector has endemic issues. Recessive conditions in the past three years have made things worse. For one thing, actual prices and “official” prices are often wildly at variance, with huge amounts of black money kept off the books. Builders are perpetually cash-strapped. Banks have been cautious about lending to builders because the Reserve Bank of India demands very high-risk weightage since there are high chances that such loans will go sticky.

Rentals are generally low as a percentage of price, while prevailing interests rates are high. A property owner could sell it, park the proceeds in a fixed deposit and rent the property back with a comfortable margin of profit. This makes the landlord model less than attractive.

Many builders used to rely on the booking amount to fund projects. But, over-supply means that builders have not been able to raise sufficient booking amounts. That in turn, has meant incomplete projects. Distress caused by two drought years has also cut demand in the rural and semi-urban segment.

Builders also notoriously divert funds. The new Act envisages forcing builders to use at least 70 per cent of booking amount for the specific project where the booking has been done.

Finally, real estate is too expensive. This is true in absolute terms. Indian property prices match and often exceeds that of real estate in most First World countries. It is even more true in relative terms, considering low median incomes prevalent across India.

Nevertheless, this Act along with the development of financial vehicles such as Real Estate Investment Trusts (REIT) will encourage investments into real estate. The new Act should force more transparency and disclosure from builders. It may trigger a shakeout and consolidation where only builders with deep pockets will survive.

It will take a few quarters before the enabling legislation is written and implemented and there will be a sequence of messy defaults and mergers and acquisitions. Also, in all probability, prices will have to drop to realistic levels, or interest rates will have to sharply reduce, before the inventory starts to clear. But, this could, hopefully signal the bottom of the real estate market.

There is one last caveat. Good legislation doesn't necessarily lead to good outcomes. The Electricity Act 2003 was excellent, for example. But, it was never properly implemented for a variety of reasons including political reluctance. One hopes that this new Act does not go the same way.

Resource: http://www.business-standard.com

Top 10 biggest real estate projects coming to NYC

Manhattan developers struck back in April after a handful of slow months, dominating the list of the month’s largest development permit filings. Big-name players including L+M Development and Joseph Chetrit’s Chetrit Group made waves with major projects in the borough, as did smaller firms such as Sumaida + Khurana and Kenneth Horn’s Alchemy Properties.

On the whole though, developers in April continued their several-months-old pattern of slower, less intense filing activity. As in March, only half the projects on the list crossed 100,000 square feet, though two more just missed the mark, according to data from PropertyShark.

Half of April’s filings were for residential projects. A pair of hotels, a pair of school expansions and a single Brooklyn office project rounded out the list.

23 Park Row, Manhattan

L+M Development Partners, one of the city’s most prolific affordable developers, filed a permit application for a 59-story, 266,000-square-foot residential tower in the Financial District, which it’s building in partnership with Joe and Rachelle Friedman, the founders of J&R Music and Computer World. The building will hold 108 apartments, though it’s not yet clear whether the partners are planning condominiums or rental units. COOKFOX Architects is designing.

540 Fulton Street, Brooklyn

The Dushey family’s Jenel Management is planning a 19-story, 174,000-square-foot Downtown Brooklyn office building with three levels of retail space at the base. The retail-focused, Midtown-based developer, led by David Dushey, bought the property in 1981. It demolished the two-story, 26,000-square-foot retail building there last year. Marvel Architects is the project’s architect of record.

609 West 56th Street, Manhattan

Chelsea-based Sumaida + Khurana and LENY – based in Tel Aviv, Israel – are planning an 80-unit, 34-story, 123,000-square-foot condo tower in Hell’s Kitchen, with retail on the ground floor. The partners bought the site in Feb. 2015 for $55 million from developer and sometime-politician John Catsimatidis of Red Apple Group, along with the adjacent 823 11th Avenue.

249-263 West 34th Street, Manhattan

Joseph Chetrit’s Chetrit Group filed a permit application for a 300-key, 33-story, 122,000-square-foot hotel with retail at the base near Penn Station in Midtown. The developer, in partnership with Shifra Hager’s Cornell Realty Management, acquired a handful of retail properties on the block late last year in a swap with investor Charles D. Cohen. Chetrit and Cornell ultimately dissolved their partnership and split the assemblage.

2002 Surf Avenue, Brooklyn

Midtown-based developer and real estate finance firm iStar is planning a 135-unit, 107,000-square-foot supportive housing building just off the Coney Island boardwalk. iStar leased the site – adjacent to the 5,000-seat amphitheater and restaurant the company is building at the Childs Restaurant in Coney Island – from the city’s Economic Development Corporation last year. The developer plans to build a total of 1 million square feet of housing in the area, according to its website.

40-10 99th Street, Queens

The New York City School Construction Authority is planning a five-story, 96,000-square-foot expansion of P.S. 19 in North Corona, also known as the Marino P. Jeantet School. The new structure, which will sit just north of the school’s main academic building, will house administrative offices, cafeterias, a gymnasium and classrooms. Burnham & Buttrick Architects, based in Midtown, is the architect of record.

2251-2259 Broadway, Manhattan

The Carlyle Group and Kenneth Horn’s Alchemy Properties filed an application to build a 32-unit, 95,000-square-foot condominium building on the Upper West Side. The partners bought the site in February for $51 million. The new Goldstein, Hill & West-designed building will have retail at its base and a terrace on the roof.

1056 Manhattan Avenue, Brooklyn

Joseph Brunner and Abe Mandel’s Bruman Realty filed a permit application to build a seven-story, 74,000-square-foot residential building in Greenpoint. The property will contain 90 apartments, as well as a 12,300 square feet of retail space on the ground floor. Brunner bought the site in November for $18.5 million from J. Josephs & Sons. Karl Fischer is the architect of record on the project.

2760 Briggs Avenue, Bronx

The New York City School Construction Authority, in its second school renovation filing of the month, plans to add another five-story, 67,000-square-foot building at P.S. 46 Edgar Allen Poe branch in Fordham. The building will hold a 280-person auditorium, offices, and classrooms, as well as outdoor playground on the fourth floor. Mitchell Giurgola Architects of Hell’s Kitchen is designing the project.

38-15 9th Street, Queens

Crown Heights-based investment firm Brooklyn North Capital filed a permit application for a new 198-key Red Lion hotel in Long Island City, to open in 2019. The building is slated to stand 14 stories and span 61,000 square feet of space. Brooklyn North bought the four-parcel site in March for $4.7 million.

Resource: http://therealdeal.com

The massive spike in the number of apartments built in the US last year was almost entirely because of a single city

One city in the US that is responsible for most of the recent apartment boom.

According to Michelle Meyer and the Bank of America Merrill Lynch team, the US saw a startling spike in multi-family housing starts (basically apartments and condos) and New York City was the reason why.

Meyer and company edged down their projection for the number of multi-family starts in 2016 to 375,000, bringing total housing starts down to 1.175 million this year from 1.25 million.

"The downward revision to multifamily starts this year is partly a response to the past three quarters, where multifamily starts declined an average of 31% annualized following the 229% annualized gain in 2Q15," said the note from BAML.

"This volatility largely reflected the rush to start projects in NYC before the expiration of a tax credit. If we subtract NYC building permits from the total, we see a more gradual weakening in building permits over the past few quarters."

The exemption, called 421-a exemptions, allowed developers to get tax relief for building affordable apartment on vacant land. It expired in January of 2016, and based on the economics team's estimation, the pressure to get projects started under the wire led to the spike.

Thus, with the exemption not renewed, the number of multi-family starts should settle in 2016.

Resource: http://www.businessinsider.in

See inside Ashley Olsen’s brand new apartment

We get obscene amounts of pleasure from nosing around our friends’ houses, so we can’t begin to explain our utter glee at looking at the pictures of the New York apartment that Ashley Olsen has just bought.

Bearing in mind that the ex child star and her sister Mary Kate run a $1.5 billion fashion empire, the condo which is based in Manhattan’s iconic and enviable Greenwich Village is a prime piece of real estate. The condo is a 3,000 square-foot, floor-through unit located on East 12th Street (in case you want to send her any mail).

And while it hasn’t been confirmed how much Ashley has purchased the property for, others in the eight-storey building have gone for around the $7.3 million (£4.86 million) mark.

The condo, which is in a 19th century building, and was at one time an art gallery, contains two bedrooms and 2.5 bathrooms, and has 11-foot ceilings , a private elevator and exposure on the north and south sides. There is also a 24-hour fitness centre, and round-the-clock doormen and security. It was converted in 2014 by development giants, Edward J Minskoff Equities.

While representatives for the 29-year-old Olsen twin would not comment on too many of the details of the apartment or her reasons for buying it, they did ensure the Wall Street Journey that the multi-million dollar pad was ‘very private.’

Being a billionaire fashionista, Ashley wasn’t exactly going to go for a pad kitted out in Ikea and free-cycle bits. According to streeteasy.com, the finishes and fixtures include brands Miele, Wolf and Sub-Zero kitchen appliances, Calcutta marble, and the piece de resistance – a reclaimed marble vanity from the Museum of Modern Art.

Resource: http://www.marieclaire.co.uk

This is how much Monica's apartment in 'Friends' would really cost

TV offers an escape from reality, but sometimes it goes far beyond what's possible. Special effects, medical miracles, huge inexpensive apartments in New York City. Case in point, Monica Geller's pad in "Friends."

 The New York Post looked at some of the most coveted real estate on TV and revealed the going rate for similar properties in real life. And most of our favorite properties would cost a very pretty penny.

According to the article, Monica's two-bedroom, one-bath apartment with an open kitchen/living room and outdoor terrace in New York City's West Village would cost at least $4,500 a month.

RELATED: 'Friends' cast reunites for James Burrows tribute: See the 6 best moments

Former interior designer Iñaki Aliste Lizarralde researched the fictional space, as well as properties in the area, to come up with the number. The average rent in the neighborhood is around $4,000, but anyone who watched "Friends" (and has done the real estate game in NYC) knows that the apartment would be considered a gem in the market — and a higher price tag would certainly come along with it.

The writers worked up a somewhat legitimate story line to make the 20-something TV chef and her roommates be able to afford the place on their salaries: a rent-controlled inheritance from her grandmother.

 Just as "Friends" viewers walked away with a deep desire to find their "lobster," they also dreamed of the day a family member would bestow upon them an inexpensive apartment in the heart of the city.

The famous NYC dwelling wasn't the only place featured in the Post article. Here are the others:

•     Jerry Seinfeld's NYC apartment in "Seinfeld — $3,400/month
•     Carrie Bradshaw's NYC apartment in "Sex & The City" — $2,700/month
•     Sheldon and Leonard's California apartment in "Big Bang Theory" — $2,000/month
•     Main NYC apartment in "How I Met Your Mother" — $3,000/month
•     Will and Grace's NYC apartment in "Will & Grace" — $6,750/month
•     Lorelai Gilmore's home in "Gilmore Girls" — $500,000
•     The Simpsons' home in "The Simpsons" — $375,000

Resource: http://www.today.com

Cause of Harvey apartment fire under investigation

Investigators are working to determine the cause of a fire at a Harvey apartment complex Monday morning. No one was injured in the blaze, which was reported just before 7 a.m. at the St. Germaine Apartment Homes, 2201 Manhattan Blvd., Harvey, said Capt. Mike McAuliffe, an inspector with the Harvey Volunteer Fire Company No. 2.

No one was home at the time of the fire. The residents left the apartment about 30 minutes before neighbors reported seeing thick smoke pouring out of the residence, McAuliffe said.

The fire appears to have been concentrated in a kitchen garbage can and spread to nearby cabinets, causing heat and smoke damage inside the apartment. The fire possibly burned for almost 25 minutes before being detected.

It took crews about 20 minutes to bring the blaze under control. While the cause is still under investigation, the department ruled out a cooking fire as the cause, McAuliffe said.

Stay with NOLA.com for more on this story.

Resource: http://www.nola.com

Property tax hike in Bengaluru capped at 25% for FY17

BENGALURU: The increase in property taxes in Bengaluru for 2016-17 is going to be capped at 25% regardless of the raise the BBMP self-assessment portal shows and the zone in which the property is located.

Chief Minister Siddaramaiah held a meeting with city incharge minister KJ George, Mayor Manjunatha Reddy, BBMP Taxation Committee chairman M Shivaraj and BBMP Commissioner N Manjunath Prasad on Thursday after the city MLAs and corporators started getting complaints from people as the increase was huge in many cases.

"I had received many representations from present and past mayors, and the public requesting to sort out the property tax issues after the recent revision. I conveyed them to the chief minister," George said. The root cause of the problem was the simultaneous jump in property taxes as well as the zone where a property is situated. Bengaluru is divided into six zones -- from A to F. While the natural jump in a property's zone -- say from B to A -- caused a certain hike, this was compounded by another raise in revision over the prevailing rates. In many cases, the BBMP's online portal showed jump by two zones: a property is supposed to move up by just one zone over the 2007 zonal classification. Where properties moved up by two zones, the tax payer was supposed to choose the next zone. But the confusion prevailed.

"We will place the subject before the BBMP Council by way of a resolution tomorrow (Friday), and send it to the governmentThe changes will take effect after the government's approval," Shivaraj told ET.

While many MLAs are in favour of a refund in cases where people have already paid excess tax online to avail of the 5% rebate, Shivraj said the rules came in the way of a refund, and hence, the BBMP would adjust the excess amount against next year's taxes. A city-based minister wondered whether it would be fair on BBMP's part to keep honest taxpayer's excess money, and penalise him for paying ahead of the deadline.

Transport Minister Ramalinga Reddy hailed the Thursday's developments as a welcome relief to citizens.

There are about 15 lakh property in Bengaluru's municipal limits, and the property taxes are the main source of income for BBMP.


Resource: http://economictimes.indiatimes.com

1001 startup ideas - A marketplace for Real Estate Brokers

What is the idea? 

The startup idea is to establish an online platform, which aggregates real estate brokers. The platform will provide tools and information for brokers to be more productive and knowledgeable; the platform will also facilitate information transfer between broker communities and the real estate developers, who can directly access the end consumers through the brokers who use the platform.

Market Definition

 According to an estimate, approximately 210,000 companies operate on the residential brokerage and management field. These companies generated $200 billion in revenue last year. The same report also estimated that there were 35,000 companies operating in the commercial brokerage and management field last year, generating $35 billion in revenue. 

Competitor Analysis

 Most of the current real estate portals are working on B2C model, ignoring the fact that most of the end customer sale still happens through on-field brokers. Through this model, one will be able to tap into existing network of brokers, producing more value for all the stakeholders. Broex is the early mover in the segment in India and has secured 1 million in seed funding last year. They are getting very good response for broker community and running their operation in Delhi-NCR, Mumbai, Bangalore, Pune, Mumbai, Pune, Ahmedabad & Jaipur. Globally there are quite a few startups that are disrupting this field, India is also seeing action with E-commerce player Flipkart's co-founders Sachin Bansal and Binny Bansal, along with other investors, have invested $3,50,000 in a real estate startup named Plabro Networks. Mobile collaboration startup for property brokers BroEx got $1M from Lightspeed in funding last year.

Pain Point & Target Audience

Currently, the brokers do not have an intra-broker platform, through which they can reach out to multiple brokers in a cost effective manner instantly. Unlike the United States, where there is MLS feed listing all deals in the market, there is a lack of such services in other developing countries, which aggregates listing from the brokers and then relays it further. The brokers do not have access to larger deal flow, there only source of information is the current listing sites, where the owner is directly listing the properties. There are many properties, which don’t get listed immediately and are traded through a close network of confidant brokers. The online portals are technology friendly, have better user experience and make recommendations on the basis of researched data. In the race to modernization, the brokers seem to have been left behind. The end consumer has better access to real estate reports than the brokers, thereby diminishing their credibility. The brokers do not have access to tools and knowledge, which can make them compete with other online portals; they are increasingly being seen as technologically challenged and lacking in market trends. The brokers need a platform which can aggregate all of them and give them tips, data points and market trend info in advance so as to be better prepared for deal making. The platform should make it easier for the brokers to scout for and close deals faster. 

Value Proposition

This platform will empower real estate brokers with tools to broker deals faster and compete effectively with other online portals. With this platform, the Broker will remain updated on real estate trends and will be able to effectively compete with online portals. Brokers will also get access to the wider market through fellow brokers for their customers / investors. Real estate developers can use this platform to launch their new projects and reach directly to the large pool of brokers across different cities; this tool will also help them to get early feedback about the market response, before launching the product to the end consumers by spending mega bucks on promotional events and advertisements. 

Business Model

The basic services like market information, deal listing should be provided free of cost to the brokers. Additional services like a an app for managing deal cycle, CRM tools and other tools to enhance productivity of the brokers should be charged on a monthly basis. The services should be delivered as a Saas. This is the same model, which is followed by LinkedIn, Dropbox and other aggregators. 

Way to market

The first step would be start collaborating with real estate associations, to get the database of brokers. Thereafter run a short survey amongst the end users to identify top pain points and develop a beta product strategy. It may be a good idea to scout for a knowledge partner, who can supply real time information from the ground for your consumption and relaying, its best to rely on other providers and outsource this to experts, so that you can focus on the core application.

 Milestones

The first couple of years in this business should be focused on creating a strong community of brokers who use the portal/app on an everyday basis. Based on the feedback and by tracking usage of the platform by brokers, the startup can create the upgrades for which it will charge its customers and start converting its user base into paid users. Typically a good business running on Freemium model can convert 3- 5 percent of its free users to paid users. 

Investment Needed For Prototype

For testing & building the prototype, pitch for raising $100K- $250K from angel investors or incubators like 500 startups. There should be no office rentals or salary payout; the entire budget should be apportioned for customer acquisition and technology. 

Team Capability

You would need to have a real estate expert and a tech expert as co-founders. The real estate expert will bring his expertise in real estate industry to help the tech expert in creating the platform.

Investors / Expert Take

Overall, the private equity investors threw a projected $1.5 billion at real estate tech startups in 2015; as per reports from CB Insights. That’s a big leap from $1.1 billion in venture/ private equity funding in 2014 and represents a threefold increase from 2010 numbers. Whilst most of the real estate technology startups are based in New York City, or at least in the US, there is an untapped market for such emerging products globally. International juggernauts like Jones Lang LaSalle, Cushman & Wakefield and CBRE have been in the brokerage business for generations and would be keenly watching this space as it has the potential to topple their applecart, if it picks up steam.

Resource: http://www.moneycontrol.com

Housing prices down 1% during March quarter in Delhi-NCR: 99acres

NEW DELHI: Housing prices fell by 1 per cent in Delhi-NCR during January-March this year compared with the previous quarter on sluggish demand, according to a report by realty portal 99acres.

Rentals also fell by 1 per cent during the last one year.

The report captures capital and rental price trends of the residential realty market on quarterly basis across seven major cities of India.

"Property prices per sq ft in Delhi NCR witnessed a minimal downtrend of 1 per cent in January-March as compared to October-December 2015," the company said in a statement.

The rental market, too, plateaued over the last one year, it said.

"Delhi NCR's real estate graph continued to delineate a marginal downtrend, with the land pooling policy of the government offering a ray of hope," said Narasimha Jayakumar, Chief Business Officer, 99acres.

The national capital also witnessed the second highest absorption of office space in the country, predicting an optimistic future for the rental landscape, in the long run, he added.

In Delhi, the capital market of apartments continued to remain lacklustre in the first quarter of 2015 with limited number of new launches across the city.

"A few localities fared well on the capital growth index, primarily due to over-ambitious 'ask' rates by sellers. One such locality, Dilshad Garden, noted a capital hike of 5 per cent in January-March 2016 against the previous quarter,"

Despite the huge supply pipeline, some sectors in Dwarka -- sector 14, 12 and 7 -- witnessed a quarterly increase in capital values to the tune of 2-3 per cent.

Resource: http://economictimes.indiatimes.com

Cousins Properties to merge with rival

Noted Atlanta real estate developer and property manager Cousins Properties said Friday it will merge with fellow real estate investment trust Parkway Properties in a move that will expand Cousins’ reach in the Sun Belt.

The stock-for-stock merger deal will involve a spinoff of properties in the Houston area going to a new firm called HoustonCo. The new Cousins will operate 41 properties totaling nearly 16 million square feet in Atlanta, Austin, Charlotte, Phoenix, Orlando, and Tampa, the company said in a news release.

Additional terms of the deal should be known after an 8:30 a.m. conference call.

“These creative transactions continue Cousins’ heritage as a proven ‘sharpshooter’ in the growing Sun Belt markets, deepening our presence in Atlanta, Austin and Charlotte and establishing a strong presence in Phoenix, Orlando and Tampa. We firmly believe our shareholders will benefit by having an expanded portfolio of office towers in key urban submarkets, greater tenant and geographic diversity and enhanced access to the capital markets,” Larry Gellerstedt, President and CEO of Cousins, said in the release. “At the same time, we believe that unlocking the value in our Houston portfolio allows us to capitalize on that market’s eventual resurgence through the creation of HoustonCo.”

Cousins, founded by legendary Atlanta developer Tom Cousins, is one of Atlanta’s best known real estate brands. The firm in recent years has shifted strategy to become a more urban-focused developer and property manager.

The firm owns notable Atlanta towers such as 191 Peachtree, Midtown’s Promenade and the Terminus towers in Buckhead. The company in its history also developed the CNN Center complex and Bank of America Plaza.

After the recession, Cousins focused much of its development and acquisition attention on what were then fast-growing markets of Austin and Houston. But of late, the company has been growing its portfolio in Atlanta and the Carolinas.

Its ownership of trophy office towers in the Houston area has been a headwind for the company’s stock in recent quarters as oil prices hurt the city’s energy-strong economy.

Cousins’ portfolio of Houston office towers has performed well despite the broader weakness in the Houston economy and commercial real estate market.

Gellerstedt will remain the company’s CEO and Cousins Chairman Taylor Glover will remain in his role with the combined company. The board will have five legacy Cousins board members and four from Parkway.

The deal is expected to close by the end of the year.

Resource: http://www.ajc.com

Large realty firms scouting for stuck projects to fuel expansion

Mumbai: Large real estate developers, such as House of Hiranandani, Tata Housing Development Co. and Godrej Properties Ltd are expanding their portfolios and footprint by acquiring residential projects that are stuck, usually for want of money, or buyers, or both.

House of Hiranandani (HOH), a real estate venture of Surendra Hiranandani, plans to expand its presence in Mumbai and enter markets like the National Capital Region (NCR) and Pune by buying stressed assets from or forging alliances with developers whose projects are stuck.

In a 20 April interview, Hiranandani said that his company is looking to acquire projects worth between Rs.500 crore and Rs.750 crore or with land of around 10 acres in NCR, Mumbai and Pune.

So far, the firm has focused on building residences in Bengaluru and Chennai, though it recently entered Mumbai—a stronghold of the other Hiranandani company Hiranandani Constructions. (Surendra is a co-founder, although his brother Niranjan runs it.)

Tata Housing is at present scouting for projects which are at an initial stage of development or at a planning stage, in Mumbai and Delhi.

Brotin Banerjee, chief executive and managing director of Tata Housing, said that the number of local builders approaching Tata Housing, either for joint development or sale of under-construction projects, has increased significantly in the last two years.

“There is a good amount of opportunity for a brand like us. We are right now talking to different developers and exploring opportunities in the four metro markets. The size of the deal depends on the market. In Mumbai, it has to be close to 5-7 lakh sq.ft; in Bengaluru, it could be larger. In terms of value, it has to be more than Rs.300 crore,” said Banerjee.

The company plans to add about of 8-9 new projects across the four metros this year. It also expects to double the number of homes it will deliver to 10,000 units during the period.

In November, Tata Housing entered into an agreement with Mumbai-based Neptune Group to jointly develop a 10-acre residential project in Bhandup, a Mumbai suburb.

In the last two years, 30-35% of Tata’s product portfolio has come from outright purchase of assets from local builders. The rest has been jointly developed with other firms.

Even lesser-known firms are following this strategy.

Mumbai-based developer Wadhwa Group said it plans to start work on two projects worth about Rs.1,000-1,500 crore, spread across a million sq.ft in Mumbai this year.

The company’s managing director Navin Makhija said he is looking at about five to six projects in Mumbai. A couple of them are in an advanced stage of negotiation, he added. Makhija’s plan is to enter into a joint venture or opt for a joint development model.

Deals such as these work to the benefit of both parties.

In an earlier interview with Mint, Pirojsha Godrej, managing director and chief executive of Godrej Properties, said a developer such as Godrej Properties could help monetize projects faster and “bring greater value to them”.

“We are seeing a lot of opportunities from the fact that we have been able to sell quite well despite the market being sort of subdued. And what that has allowed us to do is to make a case to other developers that we can help them monetize their products,” he had said.

And there are many in need of such help.

According to Samir Jasuja, founder and managing director of real estate database firm PropEquity, the number of stressed assets mainly in the residential segment has grown by at least 50% in the last two years. Most are located in NCR and Mumbai.

Ramesh Nair, chief operating officer, JLL India, a property consultant, said many smaller developers are looking to partner with branded names to relaunch their products, and in “many cases investors are pushing the developer to partner with a better marketable name”.

“This trend is expected to continue until sales pick up. It is also a win-win as big developers get projects that have already been approved and at a lower cost of entry,” Nair said.

Resource: http://www.livemint.com

Work begins on luxury residential project in MBR City in Dubai

Dubai-based Gemini Property Developers has commenced construction of Gemini Splendor, a luxury residential project, in Mohammed Bin Rashid (MBR) City.

The project with a built-up area of over 320,000 square feet is expected to be completed in early 2018.

Following its groundbreaking earlier this month, the construction work has been initiated at the site by the developers.

The project will feature a total of 134 units of well-planned one, two and three-bedroom apartments, penthouses and townhouses equipped with state-of-the-art amenities. Apartment units range from 780 square feet to 3,400 square feet.

Sudhakar R. Rao, Managing Director of Gemini Property Developers, said: “Gemini Splendor will help in satisfying the rising demand among Dubai residents for luxury apartments built to best-in-class standards. The project marks an important phase of our entry into the real estate industry and reinforces our commitment to deliver key projects in one of the most sought-after Middle Eastern markets.

The company has awarded the enabling works contract to National Piling and will be announcing the contract for the main construction soon.

The company will be announcing the sales and marketing plan soon.

"The UAE has emerged as one of the most vibrant, cosmopolitan and progressive regions in the Middle East and there is very strong demand for value-for-money housing in many parts of the country. We are confident that due to UAE’s preference for high-quality living, our projects will be well received," said company Joint Managing Director Prabhakar R. Rao.

Resource: http://www.emirates247.com

The bestselling residential projects of 2015-16

Bengaluru: Even in a slow real estate market scenario, when sales have been tepid and property prices in correction mode, top developers seem to have sold their premium and luxury projects in a better ration than the others in the last financial year. Wealthy homebuyers paid a premium for homes that were sold by large, branded realty firms, for the location and detailing of the project and faith that they will be delivered on schedule. While affordable projects sold well in property markets such as Bengaluru and Pune, Mumbai saw homebuyers willing to pay the price for quality projects and developers.

Property analysts said that buyers today are looking beyond price and location, considered to play key roles in buying decisions.

“Buyers look at specification and detailing of the project, reputation of the developer and want to buy into projects that are closer to completion,” said Ashutosh Limaye, head of research at property advisory JLL India.

Mint takes a look at some of the best performing projects last year:

Mahindra Lifespace Developers Ltd

It sold about 60% of its inventory in its newly-launched ‘Vivante’ project in Mumbai’s Andheri area. The project, which was launched in January, has already sold off all the 700 sq.ft one-bedroom apartments, priced at Rs.1.45 crore each. The developer’s first project launch in Bengaluru, Windchimes off Banerghatta Road, also sold 60% of its 200 units since its launch in June despite the premium pricing range of Rs.1.4-2.8 crore.

“Despite premium pricing for both the projects, what seems to have worked is the research behind designing the right product and confidence in the brand,” said managing director and chief executive Anita Arjundas.

Indiabulls Real Estate Ltd

The developer’s ultra-luxury project ‘Blu’ in south Mumbai was its best-performing project last year despite the overall slowdown in the luxury segment across the country. The project sells at a premium to most projects in the vicinity, with Rs.20-25 crore an apartment a floor, in one tower, and Rs.10-15 crore an apartment in the second tower. It has sold about 65% of the stock.

“It’s a unique project, being spread across 10 acres and built on a low FSI (floor space index, the ratio of the building floor area to the size of the land) of 1.33 which gives a sense of expanse. Wealthy individuals, who want to live themselves and not just for investment, have bought homes in this,” said Gagan Banga, vice-chairman and managing director, Indiabulls Housing Finance Ltd.

Embassy Group

Embassy Group in Bengaluru, which has a sizeable portfolio of residential projects, saw strong sales in its luxury villa project ‘Boulevard’ in Yelahanka. Launched in 2014, it has 43 of the 169 villas, priced at Rs.6.5-14 crore, left to be sold.

Jitu Virwani, chairman, Embassy Group said that the project is nearing completion, and buyers of luxury homes seem to prefer buying in projects that are more mature in terms of development, and that’s what worked towards the sales in the Boulevard project last year.

Kolte Patil Developers Ltd

The Pune-based developer sold maximum homes in its project ‘Corolla’ in Wagholi where one-bedroom apartments are priced at about Rs.30 lakh each. Launched last May, it has sold about 4.2 lakh sq.ft. its second project, Western Avenue at Wakad, is a 17-acre sprawl where a two-bedroom project costs Rs.77 lakh.

“The reasons behind the sales momentum in Corolla would be the pricing and the easy payment scheme. The Wakad project, on the other hand, has all the possible modern amenities and that’s what buyers liked,” said Gopal Sarda, chief executive-Mumbai, Kolte Patil.

Lodha Group

India’s largest developer in terms of residential sales, which crossed Rs.8,000 crore in 2015-16 in terms of gross sales, saw its new project ‘Amara’ in suburban Thane contribute about 30% to its sales, followed by sales in its township Palava, near Mumbai.

“The product, brand and price are the three things that played important roles in generating this kind of sales. We have also been able to significantly improve the net to gross ratio without sustained consumer-centric approach,” said Prashant Bindal, chief sales officer, Lodha Group.

Sobha Ltd

The Bengaluru developer’s new sales of 3.38 million sq.ft, valued at Rs.2,012 crore in 2015-16, was driven by its first affordable housing project under the Dream Acres brand in the city and the launch of its plotted development project ‘Sobha Retreat’ in Mysore.

“We believe that the company’s focus on mid-income housing going forward backed by rapid execution owing to investment in technology will be a major driver for its operating performance,” said Adhidev Chattopadhyay, analyst, Elara Securities Ltd.

DLF Ltd

The ‘Camellias’ project in Gurgaon continued to the biggest sales churner for the developer even when the National Capital Region (NCR) continued to be slow in terms of sale and project launches. DLF, which didn’t launch any new project in 2015-16, has sold about 1.39 million sq.ft in Camellias till the December quarter, its best performing project among its new projects.

“Undoubtedly, Camellias was a standout. Sales were better than 2014-15 and customers are again coming back,” said DLF’s chief executive Rajeev Talwar.

Godrej Properties Ltd

The Mumbai-based developer sold 348 apartments in its flagship project ‘The Trees’ in suburban Vikhroli for Rs.862 crore within a month of the launch in November. Godrej sold at an average of Rs.19,000 per sq.ft, managing to achieve premium pricing even in a highly competitive scenario. Last May, it sold 200 apartments in about three weeks after the launch of Godrej Icon, a residential project in Gurgaon, a market where some of India’s biggest developers are struggling.

Resource: http://www.livemint.com/

Residential projects: Low demand yet prices rule high

With residential housing sales not witnessing a pick-up despite a 150-basis point cut in rates by the Reserve Bank of India over the last 16 months, RBI Governor Raghuram Rajan has called for a cut in real estate prices in a bid to encourage homebuyers to enter the market and buy properties.

The call from the RBI Governor comes at a time when the industry remains saddled with high unsold inventories and many within the industry terming 2015 as one of the worst years for the sector in a decade in terms of sales and new launches.

“I am hopeful that as interest rates come down, there will be more credit and buying. And I am also hopeful that prices adjust in a way that encourage people to buy,” Rajan said earlier this week in Mumbai. He added, “there is a little bit of everything that needs to happen” for the revival in the real estate sector.

The realty industry has been quick to react to the governor’s call and has responded by saying that the market has already witnessed price correction over the last three years as they have declined by around 30 per cent.

“There has been consistent correction in property prices in the past 3 years by nearly 35 to 40 per cent across the industry. In fact nearly 90 per cent of the home supply in the country has already shown price correction. Given the ever increasing cost of land and cost of construction any further fall in prices will only lead to non performing assets (NPAs) and non delivery of projects,” said Amit Modi, director, ABA Corp and vice president of Credai, western UP.

But the residential price data for last three years accessed from Knight Frank reveals that the average price across the major markets have either gone up or have remained stable.

Data on Housing Price Index (HPI) released by the Reserve Bank of India on Thursday showed that housing prices across the country rose during the quarter ended December 2015. While the highest price increase was witnessed in Lucknow, Jaipur saw a mild correction in prices during the quarter against the corresponding quarter last year.

The HPI-All India rose to 221.7 in third quarter of FY16 from 218.2 in the previous three-month period. However, as homebuyers stayed away from the market, there has been a moderation in the pace of price increase. “The annual increase of HPI-All India moderated since Q1, FY16. During Q3, FY16, the rate of increase fell below 10 per cent,” RBI said.

The RBI released the data for the entire country and 10 major cities — Mumbai, Delhi, Chennai, Kolkata, Bengaluru, Lucknow, Ahmedabad, Jaipur, Kanpur and Kochi for the October-December quarter of 2015-16.

Another set of real estate price data accessed from Knight Frank for eight major cities — Mumbai, Delhi-NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata and Ahmedabad — shows that all the eight cities have seen the average residential price going up by 3 to 15 per cent between 2013 and 2015.

While average prices in Bengaluru went up 15 per cent from Rs 4,158 per sq ft (psf) in 2013 to Rs 4,780 psf in 2015, average prices in Mumbai rose by 12.8 per cent in the same period from Rs 7,085 psf to Rs 7,994 psf. While the Delhi NCR market witnessed a price increase of 7.4 per cent, Kolkata and Chennai remained the most stable as prices went up by 3.1 per cent and 5.6 per cent, respectively.

Also, according to a report released by online real estate firm PropTiger earlier this month, both the sales and new project launches for the top 9 cities for the year ended March 2016 slid to a three-year low.

While factors such as lower-than-expected economic growth, slowdown in job creation played a role in decline in demand, factors such as prevailing high real estate prices, high interest rates and delay in delivery of projects by the developers have also played a big part in keeping prospective homebuyers on the sidelines over the last few years.

Pointing at the need for adjustment so that more people want to go and buy houses, Rajan said that apart from interest rates, measures such as including affordable housing loans under the priority sector lending requirements will encourage homebuyers. He also called for greater transparency. “We need action on real side (as) also on transparency on land acquisition, on transparency on construction and on sales,” he added.

On the other hand, while developers have been claiming to have reduced the prices, they also say that there is a limitation to the price cuts that they can bring in as there is a fixed cost that they work on and if they reduce the prices further they would be operating in losses.

Anuj Goel, executive director of KDP Developers said: “Service tax, VAT, registry cost and various other government levies only add to the fixed cost and hence leads to an overall increase in the basic cost of a project. If any further reduction is done on our end the project would only act as a NPA for us.”

Concerns have also been raised on banks not fully passing on the benefit of repo rate cut (rate at which RBI lends to commercial banks) by the RBI and thus there is an issue of transmission of the same. While RBI has reduced the repo rate by 150 basis points, the banks have brought the lending rates down by up to 80 basis points.

“We sincerely hope that both finance ministry and the RBI push all the banks to transfer the entire benefit to the end consumer for whose benefit it is meant, else these moves will severely stop short of benefiting the consumer and only help in buffering the bottom lines of the banks,” said Modi.

The average price of residential units not coming down despite weak sales and rising inventory only shows that developers are also in a wait-and-watch mode and are looking to hold on to the prices in the hopes of a market revival. While they are not bringing the prices down they are also looking to sweeten the deal with some offers and by offering to pay the EMI till the time of possession.

An industry insider said that some developers are open to negotiation on the price with customers: “The developers are negotiating on price with serious buyers but are not announcing a cut in prices as they think that it will send a wrong signal in the market. Also they are looking to hold on to units and waiting for markets to improve instead of going for a cut in prices and reducing their overall realisation from the project.” He, however, added that the prices had moved significantly higher and they need to come down to attract the homebuyers.

Resource: http://indianexpress.com

Time-frame for depositing TDS on sale of property extended

BENGALURU: As a relief to property buyers, the Income Tax department has extended the time period for depositing TDS on sale of property by 23 days.

Anyone buying real estate worth more than Rs 50 lakh has to deduct 1% of the sale price of the property before paying the seller. That TDS has to be deposited with the tax department using Form 26QB. Earlier you had to deposit this TDS within seven days of the following month of making the payment. Now, it can be deposited within 30 days from the end of the month in which it was deducted. So, those who make purchases towards end of a month would get more time to fill up the extensive 26QB challan and deposit the income tax.

"Earlier if you bought a property on 30-31st of a month, you only had seven days to submit Form 26QB. Now, the buyer would have at least a month to comprehend and comply by the rules," says Archit Gupta, founder and CEO, ClearTax.in

The rule will come into effect from from 1 June 2016. However, there is a confusion about payments made during the month of May on whether they should follow the old-7 day rule or the new 30-day time period. While some CAs are of the opinion that if any property payments are made before 1 June, TDS will have to be deposited within 7 June, others believe that you should be allowed to submit the TDS by 30 June for transactions that took place in May.

Last month several taxpayers had received I-T notices for failing to deposit the TDs with the department on time. The forfeit for late filing is an interest on the TDS--1% per month if tax wasn't deducted and 1.5% in case this was done but not paid, which is calculated from the date of payment. There is also a Rs 200 per day flat fine for missing the deadline. The AO, under Section 271H, can also put penalty of up to Rs 1 lakh for defaulting. So, to be on the safe side, it is better to submit th ..

Resource: http://economictimes.indiatimes.com

Distressed office projects emerge as good buyout options

Bengaluru: Distressed office assets are emerging across cities, throwing up opportunities for large developers backed by private equity (PE) funds to buy into incomplete or stalled office projects, special development enclaves or undeveloped land, a trend that has played out in the residential sector in recent years.

Bengaluru-based Embassy Group is buying out a 60% stake in a stalled special economic zone (SEZ) in Chennai’s Pallavaram area, in a transaction that is expected to conclude soon. In a revenue-sharing arrangement, Embassy will pay an initial deposit of Rs.60 crore to Hyderabad-based SNP Infrastructure Ltd, which built the basement of a few buildings in the SEZ and then decided to not continue with the project.

“Embassy is going to invest about Rs.1,400 crore to construct the project, about 4.5 million sq. ft in area, over the next 5-6 years,” said a person familiar with the development, who didn’t wish to be named.

Despite the gloom-and-doom situation in India’s residential sector in recent years, the office space has fared relatively better. A number of large developers, with a background in building office projects, are now mainly focusing on these, while smaller and mid-sized developers, who don’t have the operational competence to build such projects or the financial bandwidth to stay invested in them, are looking to exit fully or sell stakes to the former.

Mumbai-based Tata Realty and Infrastructure Ltd (TRIL), a subsidiary of Tata Sons Ltd, and its investor partner, Standard Chartered Private Equity, are looking at both greenfield opportunities as well as brownfield projects, where they can step in and take over.

TRIL’s managing director Sanjay Ubale said that they are evaluating all kinds of assets in mostly Tier I cities.

There are mainly two dominating trends in the office sector—one, buying out of built and leased office assets where global PE investors such as Blackstone Group Lp predominantly operate and, second, buying land to build greenfield office projects.

In one of the biggest transactions in commercial office space this year, DLF Ltd, India’s most valuable property developer, has sought expressions of interest from several top global investors to sell a 40% stake in its rental assets arm as it seeks to pare debt. The rental assets arm holds about 20 million sq. ft of leased-out office space and is valued at about $2 billion.

“While there are many such opportunities to buy projects that are incomplete and stalled, and we are open to them, the most critical factor for us would be to get the right partner,” said Vinod Rohira, managing director, commercial real estate & REIT, K. Raheja Corp.

Pune-based Panchshil Realty Ltd, which has partnered with Blackstone for some of its projects, is in talks to take over a brownfield project in Mumbai. Panchshil chairman and chief executive Atul Chordia said that Mumbai has many such so-called distressed office projects, where developers are looking for new partners and investors to come in and enter into joint development agreements or buy partial stake.

Prominent office developers are evaluating projects in top property markets such as National Capital Region (NCR), Mumbai, Hyderabad and Chennai. Bengaluru-based developer RMZ Corp. bought over a partially stalled project in Chennai from a Kolkata-based firm last year and is looking at similar deals in Mumbai, Delhi and Chennai.

RMZ managing director Raj Menda said that while there are many opportunities, the question is if it is at the right price. “This year we will see more such under-development office asset deals along with buyout of completed assets. These are slow times for the sector and it’s a matter of time when someone has to let go. Our model is to take 100% control in a project we like, or do a joint development where the assets are clearly divided between the partners,” Menda said.

Property analysts also believe that commercial real estate will also witness the kind of consolidation and collaboration that the residential sector has undergone in the last two years. Though commercial office projects are doing far better than their residential counterparts, the capital-intensive development and niche skills needed for the former will see only a few large developers remaining in the fray over a period of time, they said.

“Commercial office is a niche game and many developers will find it tough. Unlike residential, it is a B2B (business-to-business) and not a B2C (business-to-consumer) business, where a developer needs the skill to build and then lease it out to corporate groups and operate them over a long tenure,” said Juggy Marwaha, managing director-south, JLL India, a property advisory.

Resource: http://www.livemint.com

Housing prices down 1% during March quarter in Delhi-NCR: 99acres

NEW DELHI: Housing prices fell by 1 per cent in Delhi-NCR during January-March this year compared with the previous quarter on sluggish demand, according to a report by realty portal 99acres.

Rentals also fell by 1 per cent during the last one year.

The report captures capital and rental price trends of the residential realty market on quarterly basis across seven major cities of India.

"Property prices per sq ft in Delhi NCR witnessed a minimal downtrend of 1 per cent in January-March as compared to October-December 2015," the company said in a statement.

The rental market, too, plateaued over the last one year, it said.

"Delhi NCR's real estate graph continued to delineate a marginal downtrend, with the land pooling policy of the government offering a ray of hope," said Narasimha Jayakumar, Chief Business Officer, 99acres.

The national capital also witnessed the second highest absorption of office space in the country, predicting an optimistic future for the rental landscape, in the long run, he added.

"Most buyers and inventors await the completion of the Noida-Greater Noida metro corridor, anticipating an overhaul in the real estate story of the twin cities," Jayakumar said.

In Delhi, the capital market of apartments continued to remain lacklustre in the first quarter of 2015 with limited number of new launches across the city.

"A few localities fared well on the capital growth index, primarily due to over-ambitious 'ask' rates by sellers. One such locality, Dilshad Garden, noted a capital hike of 5 per cent in January-March 2016 against the previous quarter,"

Despite the huge supply pipeline, some sectors in Dwarka -- sector 14, 12 and 7 -- witnessed a quarterly increase in capital values to the tune of 2-3 per cent.

Resource: http://economictimes.indiatimes.com

Delhi-NCR has highest unsold housing inventory: Assocham

NEW DELHI: Levels of unsold inventory in the residential and commercial real estate segments have risen to between 18% and 40% in different cities with the maximum unsold stock lying in the Delhi NCR over the last one year, according to a new study by industry body Assocham.

This is creating a big drag on several other sectors like financial services and steel, according to the study.

"In spite of a fall in prices and interest rates, the demand for residential market has witnessed a steep decline by 25-30% in the whereas the demand for commercial space dropped by 35-40% in the NCR region over the last year," Assocham pointed out.

Mumbai which had been witnessing an increased activity around Navi Mumbai, Thane and other suburbs, is carrying the second largest unsold inventory, followed by Bengaluru and Chennai.

While Mumbai had unsold sold of 27.5%, for Bengaluru it was 25%, Chennai (22.5%), Ahmedabad (20%), Pune (19.5%) and Hyderabad (18%).

According to Assocham, NCR has an estimated unsold inventory of 250,000 housing units, which is approximately 35% of the units under construction due to delay in regulatory clearances and litigations.

"It is a difficult period both for the developers and the consumers who have booked flats. The regulators, developers, banks and consumers should form joint groups to work out the solutions," DS Rawat, secretary general of Assocham said.

"The ticket price (of) three-bedroom, two-BHK and single room flats has seen correction by 35% in Noida, 30% in Gurgaon and 25% in some key areas of Delhi but still, the demand stays subdued," the Assocham paper said.

This year the unsold inventory in residential real estate was the highest in Delhi-NCR at 250,000 units, followed by the Mumbai metropolitan region at 98,000. Bangalore came next with 66,000 units, Chennai with 60,000 units and Pune followed with 55,000 units.

The subdued construction activity has had a huge negative impact on the labour market since there are about 10 to 12 million workers engaged in the real estate sector. The slump in sales and launches clearly indicates that the ressidential market is facing a strong price resistance.

According to the report, many stakeholders including developers, financial institutions and other supply-side stakeholders believe that the current market scenario is worse compared to last year. Delayed reforms seem to have affected sentiment. Residential launches, sales, and price appreciation are at a much lower level than the last year.

The total number of new project launches in the National Capital Region (NCR) had come down by 30-35% in comparison to the last year. The unsold inventory is highest in Noida, with over 120,000 units while the remaining unsold inventory is in Delhi, Ghaziabad and Faridabad.

Resource: http://economictimes.indiatimes.com

Ashiana Housing launches Ashiana Tarang

Located in a fully developed neighbourhood of Bhiwadi, Ashiana Tarang offers a huge location advantage along with affordability. It’s just 45 min. from Gurgaon & 55Kms from Indira Gandhi International Airport & just off the Delhi- Jaipur Highway.

Delhi based, Ashiana Housing Ltd., (NSE & BSE Listed), one of the renowned developers in India, has launched yet another project in Bhiwadi, christened as Ashiana Tarang. In the past two decades, Ashiana has successfully built and delivered 15 projects in Bhiwadi. Now it’s time for another offering.

Located in a fully developed neighbourhood of Bhiwadi, Ashiana Tarang offers a huge location advantage along with affordability. It’s just 45 min. from Gurgaon & 55Kms from Indira Gandhi International Airport & just off the Delhi- Jaipur Highway. This iconic marvel is located strategically in the heart of the city at Sector -24, UIT, Bhiwadi. This project is well -planned and equipped with facilities and features for a modern comfortable living.

Commenting on this new offering Mr. Vishal Gupta, Managing Director, Ashiana Housing Ltd. said, "Aimed at providing that comfy experience with an uncompromised leisure, Ashiana Tarang, offers spacious apartments in affordable price range. Its strategic location and proximity to school, malls &  hospitals  are yet another advantage.”

With a total saleable area of 11.10 lakh sq ft. (approx.), Ashiana Tarang is spread over 12.76 acres of land. The project will have 11 towers with 960 residential units (approx.)  In Phase -1 they will  have 192 residential units (approx.), S+12 including 2 and 3BHK option in sizes ranging from 1065 sq ft to 1331sq ft at a starting price of 30.99 Lacs all inclusive.

Over the past 25 years, Ashiana Housing Ltd   has already been built and delivered 15 projects in Bhiwadi itself. The project will provide facilities for comfortable living with organized lifestyle and better community living. Facilities include secured gated complex, in-house club, green area, jogging tracks, swimming pool, gymnasium, landscaped gardens, kids play area, badminton, and tennis courts.

At Ashiana Tarang, the potential buyers will be offered easy access to reputed educational institutes like Modern public school, UCSKM School, Presidency School, St. Xavier’s, DPS & Raman Munjal Vidya Mandir. Hospitals, Banks, Supermarkets, Shopping malls, multiplexes, like Capital Mall, BB Mall & Central market are in close vicinity.

Not only this, the phenomenal industrial growth gives a good return on investment, due to high rental returns. Industrieslike St. Gobain, Relaxo, P&G, Federal-mogul and much more in   proximity offering thousands of employment opportunities. The established and upcoming industries will offer great employment opportunities and Ashiana Tarang will be offering housing alternatives to its employees.

Resource: http://www.indiainfoline.com

Widening of NH-24: The highway to affordable housing

Connectivity and infrastructure development are the two most critical elements needed for the development and evolution of a real estate destination. If construction of the Yamuna Expressway saw realtors moving to develop residential housing and townships, developers in the Delhi-NCR region feel that the construction of the Delhi-Meerut Expressway, recently launched by the Prime Minister Narendra Modi, will not only improve the connectivity of various towns in the region with Delhi, but will also change the dynamics of the real estate market in the zone.

Developers and real estate experts told The Indian Express that the NH-24 Expressway may emerge as a hub for affordable housing and could offer solutions for accommodation in the 1-2 BHK category within the price range of Rs 15 lakh-Rs
30 lakh.

Manoj Gaur, managing director, Gaursons India and president of Credai-NCR, pointed that it is a long stretch and the development around the highway was stuck because of heavily clogged roads. He added that the widening of the road would not only ease the traffic and reduce travel time but would also result in development of residential housing along the road.

“I think that this has the potential for development till Hapur-Pilkhua and it will be one of the most preferable stretches because of its approach and access to Delhi-NCR,” said Gaur. However, he added that while there has been a slowdown in sales across Delhi-NCR, there is demand in the affordable housing category and developers should ensure that they cater to the demand of that segment. “I see development of affordable housing around this road going forward,” he said.

Importance of NH-24

Among the several highways/expressways that connect Delhi to cities — Meerut & Hapur (NH-24), Jaipur (NH-8), Panipat (NH-1) and Agra (Yamuna Expressway and NH-2) — NH-24 is probably the most densely populated, as there are several small cities along the corridor. Providing access to Ghaziabad, Noida and Greater Noida, the road, once fully developed, will connect up to Meerut and Hapur and is set to be a very busy stretch. Therefore, widening of the expressway will only act as a catalyst for real estate demand and development on both sides of the road in the future.

Rami Kaushal, head of consulting and valuations at CBRE said that while decongestion of the roads will help the existing cities such as Noida, Greater Noida and Ghaziabad, it will also help in decongestion of Delhi.

“All the cities leading up to Hapur will become more accessible and habitable. Since a lot of manpower comes from adjoining cities, lack of good connectivity forces them to stay in NCR only. However, once this expressway is built and there is good public transportation available, a lot of these people will live in their home towns or in the new destinations that develop around the road and can commute to Delhi for work,” said Kaushal.

There are others who agree to this fact. Gulam Zia, executive director at Knight Frank said that it is a long highway and passes through dense localities. “By declogging, it will provide a new lease of life to all real estate destinations along the road. The widening of road will also result into realignment as the travel time will reduce significantly and therefore will allow people to move away from the cities,” said Zia.

Activity and impact on pricing

While it is too early for things to kick-start, existing projects around the proposed road have received a shot in their arm. Gaur said that his existing projects around the road in Noida Extension and in Crossing Republic will benefit as the connectivity will improve. While he said that he would look to take up new projects on the proposed expressway, he said that he would take up the phase II of his project in Crossings Republic.

Aman Agarwal, director, KV Developers also did not rule out the possibility of land purchase and development of residential housing project on the stretch. Stating that the activity will pick up over the next two years, he said, “Most of the activity will be in the affordable housing category and there will be a number of projects offering 1 and 2 bhk flats in the price range of Rs 15 lakh and Rs 30 lakh,” said Agarwal. While aspiration for better housing is growing, the need for better livelihood will see fresh demand in the affordable housing segment.

While prices in the Delhi NCR market is currently impacted by high unsold inventory, the market has not seen any uptick in prices over the last couple of years. In fact, the prices have witnessed some correction. Experts say that fresh supply on NH-24 in the coming years may keep the prices under check even in the existing markets of Noida, Greater Noida and Ghaziabad.

“Over the last couple of years the prices in Noida and Greater Noida have been stable because of huge supplies. With more supplies, the prices may remain under check in these existing markets,” said Zia.

Even Kaushal said that the prices in these areas may not rise in a hurry and there will be stability in prices across these markets.

While it is almost certain that the development of the expressway will add a new dimension to the real estate market in Delhi NCR and help decongest Delhi by development of affordable housing in the proposed expressway, the planners will have to be thoughtful and ensure that better connectivity is complemented with a stable public transportation system so that residents have multiple options to reach their work places in Delhi NCR.

Resource: http://indianexpress.com

Rajasthan clears Bill for govt to set up townships in DMIC

The Bharatiya Janata Party-led Rajasthan government threw another surprise after it managed to pass the Special Investment Region Bill, 2016, in the Assembly amid strong protests from its own legislators and the Congress.

The Bill will allow the state government to set up integrated industrial townships in the Delhi-Mumbai Industrial Corridor (DMIC), which runs 150 km on either sides of the 1,500-km dedicated freight corridor.

The state government is initially planning to set up townships in two nodes identified in Khushkhera-Bhiwadi-Neemrana and Jodhpur- Pali-Marwar regions of Rajasthan. But its Bill has already run into rough weather.

Sachin Pilot, Rajasthan's Congress chief, called it an anti-farmer Bill. His party had staged a walkout when the Bill was being passed in the Assembly on Monday.

"The Bill has draconian clauses and moreover it will not pass court scrutiny as no state Bill can override any central law (Land Acquisition Act, 2013)," he said.

According to the state Bill, the state government "may, by notification in the Official Gazette, declare any area of land, including an industrial area, to be a special investment region."

The Bill entails the state will set up a board and a regional development authority having 15 members, including the minister in-charge of the DMIC project in the state, and parliamentarians and legislators representing the areas included in the special investment region. These areas will only be governed and developed by the regional development authority.

Maneesh Chauhan, Commissioner, Rajasthan DMIC, clarified that the Bill was required to provide a legal framework and power to the regional development authority. "The authority will acquire the land according to the provisions of the Land Acquisition Act, 2013. It is similar to the Jaipur Development Authority, which acquires land for residential purpose, and the Rajasthan State Industrial Development and Investment Corporation, which acquires land for industry," Chauhan said. "Those who don't wish to give up their land will be given the option to develop it according to the master plan of the special investment region," Chauhan said.

The state government has identified 165 km for the Khushkhera-Bhiwadi-Neemrana node. The state government will develop a nucleus of 14 km and the first phase of development is expected to be over by 2021, followed by the second phase in 2031 and the third in 2041.

Officials in Delhi said setting up of the regional development authority was necessary to speed up the DMIC project, which passes through Uttar Pradesh, Rajasthan, Madhya Pradesh, Gujarat and Maharashtra.

"We force the state governments to set up regional development authorities so that the DMIC along with the state government can launch a special purpose vehicle for the development of a particular area," said an official on condition of anonymity.

"Some states already have legislation that allow them to set up regional development authorities, while others like Uttar Pradesh and Gujarat have brought in amendments," the official added.

Around 40 per cent of the freight corridor passes through 22 districts of Rajasthan, which was the last state to set up a board and regional development authority. The state, however, has surprised everyone after Chief Minister Vasundhara Raje introduced a series of industrial and labour reforms in the last two years.

Resource: http://www.business-standard.com