Cabinet Approves Real Estate Bill 2013, Brings Protection Against Fake Promises & Frauds

PM Modi and the council of Union Ministers in the cabinet has finally given their green signal to the pending Real Estate (Regulation and Development) Bill, 2013. Real estate buyers in India can now be relieved as they will get much needed protection against frauds and fake promises doled out by developers and builders.

This bill was first introduced in 2013 and it only included commercial properties. It was passed by then UPA Govt. but various organizations and consumer groups opposed several clauses and recommended some more changes. A Standing Committee of Parliament on Urban Development was formed to look into suggestions and to incorporate new changes.

Modi Govt. has now approved these amendments, and have added residential projects as well, along with commercial ones. The press release announcing the passage of bill said, “The Real Estate (Regulation and Development) Bill is a pioneering initiative to protect the interest of consumers, to promote fair play in real estate transactions and to ensure timely execution of projects.”

Some major pointers of this bill, which every real estate consumer should be aware of:

– Real Estate Regulatory Authority will be formed for every state and Union Territory which will mandate and regulate the rules pertaining to real estate transactions. And the best part is that all real estate agents, developers and promoters need to be registered with this body. Hence, no more shady transactions and fake promises wherein the buyer is stuck with neither way in nor way out. This is the single most important factor of this bill.

– Government appointed officers and nodal managers would exist to resolve disputes between buyers and sellers of real estate

– 50% of the money received from the buyer needs to be deposited in a bank; solely for the purpose of construction alone

– Any ‘major’ changes to the original design and construction plan of the project needs approval from atleast 2/3rd of all allottees of the project.

– All real estate developers and promoters are hereby notified to make all details of their projects fully public. This includes: “details of promoters, project, layout plan, plan of development works, land status, status of statutory approvals and disclosure of proforma agreements, names and addresses of real estate agents, contractors, architect, structural engineer”

– Real estate agents can only sell those properties which are registered with the regulation authority

You can access the complete; amended Real Estate (Regulation and Development) Bill, 2013 here.

Challenges and Growth of Real Estate In India

Despite excellent GDP growth and increase in consumer spending, real estate in India is reeling under severe losses. 23 listed real estate firms in India has incurred debts of more than Rs 35,000 crore as of 2014, with operative profits of Rs 3655 crore, a little more than Rs 3402 crore in 2013.

The 10 major real estate markets in India: Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Pune, Noida, Gurgaon, Bhiwadi and Mumbai registered a modest growth between 0-5.5% in 2014, and real estate returns are hovering between 6-9%, which is way too less compared to the dynamism which Indian economy is witnessing.

The inventory in 5 major real estate markets in India: Delhi, Mumbai, Bangalore, Chennai, Hyderabad, it will take upto 50 months to clear the existing inventory, with Delhi NCR region needing 86 months!

Such is the bad situation that the super-rich of India are now investing in real estate of foreign market, compared to Indian market.

But, there is some good news as well. Technology and Ecommerce are coming to rescue to the real estate market with new innovations such as virtual reality & innovative payments arrangements.

After the Real Estate Bill 2013 is fully applicable, real estate market in India is expected to improve, and instill more confidence among investors and buyers.

Resource: http://trak.in

Dream homes: Real Estate market in NCR

Fall in real estate prices in the Delhi-NCR is certainly a good news for buyers who have been deferring their purchase in the hope of more correction in the market, and this combined with the projections of better ROI on investment in upcoming NCR micromarkets like Neemrana and Bhiwadi means more cheer for those looking for their dream abode in the NCR region.

Resource: http://economictimes.indiatimes.com

Buy Indag Rubber; target of Rs 232:Firstcall

Indag Rubber Limited (IRL) was incorporated in July 1978 as a joint venture between Khemka group and M/S Bandag Incorporated, USA, one of the biggest players in the US retreading industry. The Khemka Group founded Indag Rubber during the early 80’s and pioneered the introduction of cold retreading technology in India. The company has provided retreading material to its customers ranging from precured tread to curing envelopes. The tread rubber is made from superior raw materials and pressed at a very high pressure resulting in a product that gives high performance both in terms of mileage and tread life. Indag is committed to deliver world class quality products & services and improve upon its quality standards to meet the best expectations of customers. Indag uses advanced technology in terms of machinery, equipment and raw materials. As a result, its products give mileage that result in LOWEST COST PER KILOMETER. Its processes have been certified as ISO 9001:2000 compliant. Indag continuously engages in R&D to develop and deliver superior compounds that give higher mileage to customers. The company constantly engages in testing of these compounds in the field to ensure that their customers get a product that gives superior performance. The company’s factories are located in Nalagarh, Himachal Pradesh and Bhiwadi, Rajasthan to ensure speedy delivery of its product to customers all over India and different parts of the World. For Speedy delivery of products, the company’s distribution network spread across 500 to 600 Retreaders, 100-150 dealers and 25 Depots pan India Presence. We recommend ‘BUY’ in this particular scrip with a target price of Rs.232.00 for Medium to Long term investment. For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 

Resource: http://www.moneycontrol.com

Chase From Gurgaon Ends In Andheri

Mumbai/Gurgaon: Sandeep Gadoli, Haryana's most wanted criminal and the leader of Gurgaon's biggest gang, was killed in a shootout inside a Mumbai hotel room on Sunday morning, cornered after a cat-and-mouse game with the cops for over three months since his cover was blown last November.

Gadoli (32) was tracked down to a ground-floor room at the Airport Metro Hotel in Andheri (east) by a Gurgaon crime branch team that decided to move in after a stake-out of the building. He received bullet injuries in his chest and leg during the shootout in which two cops were injured. Police said a woman was with him in the room and was taken into custody for questioning.

Two aides of the gangster, Manish Khurana and Deepak, were arrested from another room. Two more women, both foreign nationals, were detained for questioning. Police said they were all part of Gadoli's retinue as he kept shifting cities, and travelled with him in his SUV. The woman in Gadoli's room is from Gurgaon while the two foreign women are based in Jaipur, a police officer said.

A team of eight cops from the crime branch led by Pradyuman Singh monitored Gadoli's movements since Friday as he shifted from Bhiwadi to Jaipur and Mumbai.

On Saturday night, he checked into Andheri hotel that opened for business only three months ago. He arrived in his white Scorpio. That was the confirmation the cops needed. "Gadoli checked in as Rishabh Singh. He was allotted a room on the ground floor. Khurana and Deepak were on the first floor. The foreign nationals stayed in a third room," said a police official.

Around 11am on Sunday, three cops parked themselves in a narrow lane where the hotel is located.

"We were concerned Gadoli would try to jump out of the window," said inspector Amit Kauhar of the crime branch. "Five cops went into the hotel. At that point, they weren't aware Khurana and Deepak were there too. Head constable Paramjit Ahlavat knocked on Gadoli's door. When he opened, Gadoli saw the cops and tried to shut it. But the police team pushed their way in. There was an exchange of fire. A bullet grazed Ahlavat's forehead and another hurt constable Vikram Singh on his leg. Gadoli was taken to the Cooper Hospital where he was declared dead around 12.55 pm," Kauhar added.

Mumbai Police was reportedly kept in the dark about the whole operation. Gurgaon Police chief Navdeep Singh Virk told TOI, "It's a great achievement for Gurgaon Police. Our team executed the operation well. The arrested gang members will be produced in court where we will seek transit remand."

Gadoli was wanted in 36 cases of murder, extortion and kidnapping and carried reward of Rs 1.25 lakh on his head. Cases against him date back to 1999 when he was involved in a robbery in Udyog Vihar, but efforts to arrest him were stepped up last year with a Special Investigation Team being formed.

Gadoli had covered his tracks for two years but a lucky break put the police on his trail. Last November, a Haryana resident was arrested in Mumbai for sexually harassing a model at Bandra bandstand. A Mumbai Police team came to Gurgaon to make inquiries. It turned out that the arrested man was Sonu, Gadoli's most trusted aide. Sonu had an "accomplice" who has slipped away. Cops were sure it was Gadoli. TOI had made these revelations in an exclusive report on November 5.

On October 4, Gadoli and his men were accused of killing Ashok, an aide of Gujjar. It triggered a series of street shootings in Gurgaon as the two gangs locked horns, with an aide of Gadoli getting injured and a property dealer believed to be close to Gadoli shot in full public view at a petrol pump the night before Diwali.

Resource: http://timesofindia.indiatimes.com/

Fraud case filed against 'builder baba', realty firm in Noida

NOIDA: A case of fraud has been registered against 'builder baba' Sachin Dutta and seven others for allegedly mortgaging sold flats in an Indirapuram housing society to obtain bank loans.

Dutta was crowned 'mahamandaleshwar', or high priest, earlier this year and christened Sachidanand Giri Maharaj. But he was stripped of the title soon after allegations that he owned a bar at a Noida mall.

Dutta's family also owns Balaji Constructions, the real estate company that has developed Balaji Residency in Indirapuram, which is at the heart of the latest controversy. Dutta had dissociated himself from ownership of the firm when he was elevated to high priest.

Six of the Residency's flat buyers filed a complaint with Noida Police chief Kiran S on Wednesday that officials of a housing finance company had visited them and asked them to repay loans they had never taken. "The officials said they will seize the flats if the loan is not repaid. This is surprising as we had not taken any loan from this company," one of the flat buyers said.

The finance company officials also allegedly told the flat buyers they had received EMIs for a few months but the payments had stopped. The flat buyers said they suspect the developer had forged house documents to procure loans without their knowledge.

Vishwajit Shrivastava, SP (crime) Noida, a case had been registered eight persons, including officials of Balaji Constructions, the housing finance company and Dutta at Sector 58 police station. "We are investigating the matter to join the dots about the alleged illegal transaction," he said.

Balaji Residency is located near Shanti Gopal Hospital and has 95 flats that were developed between 2006 and 2010. A complainant told TOI that he had booked the flat in 2006 and got home loan form a private bank.

Anurag Garg, the complainants' lawyer, said that the matter was reported to police four months ago. Police said they investigated the matter after which an FIR was registered against Dutta and his associates.

Resource: http://realty.economictimes.indiatimes.com

Ashiana Housing, Escapade Real Estate to offer retirement home in Chennai

BSE-listed real estate developer Ashiana Housing Limited has entered into an agreement with Escapade Real Estate Pvt Limited, a joint venture (JV) between Arihant Group and JP Morgan Property Fund, to develop Ashiana Shubham, a senior living home, in Chennai.

The project is expected to come up with an investment of Rs 180-200 crore.

The JV expects revenues of around Rs 350 crore from the project.

Ankur Gupta, joint MD of Ashiana Housing Ltd, said, “We are planning to develop 800 units in Chennai. While we will bring in our expertise in building and managing the project, the land and local support would be from Arihant.”

While Ashiana Housing Ltd will invest in development and marketing of the around One million square feet project comparising primarily of homes for the elderly, residential and various support components, Escapade Real Estate will bring in land as equity to the joint venture.

He said that under the partnership, the company would build and manage the senior living units and has arrived into a revenue sharing model with Escapade Real Estate at the time of sales of the units. E The project is part of Villa Viviana, a 45 acre township in Maraimalai Nagar, in the outskirts of Chennai, near Mahindra World City. The senior living project would be coming up in around 20 acre out of this. The units will be priced within the range of Rs 25-50 lakh and the works are expected to start in by November, this year, he added.

Ashiana has so far completed around three senior living projects in Bhiwadi in Delhi National Capital Region, Jaipur and Lavasa project in Pune. The company, which has

Escapade Real Estate is a 50:50 join venture between Arihant and JP Morgan Property Fund, in which the equity capital is around Rs 50 crore, said Bharat Jain, director, Arihant Foundations & Housing Ltd.

Ashiana Housing, which has clocked in a revenue of Rs 600 crore during the last fiscal, has five projects in the pipeline for launch in this year. Out of this, two projects are in the senior living space, said Gupta. It also has a subsidiary, Ashiana Maintenance Service, to take care of the maintenance of these retirement homes, he added.

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

Kochi emerges top real estate destination among tier II cities

Kochi is now the top real estate destination among Tier-II cities, according to a study.

Nashik is next, followed by Visakhapatnam, Vadodara, Thiruvananthapuram, Jaipur, Mangaluru, Indore, Goa and Coimbatore, says analytics firm PropEquity.

The research was based on prices of property, supply, demand, sales, inventory of unsold houses and implementation delays over the past two years.

Cities in the south dominate the list. There’s only one from the north, Jaipur at number six, in the league. Agra, Lucknow, Bhiwadi and Mohali, all from the north, were the worst performers among the 19 Tier-II cities surveyed.

Kochi, along with Indore, scored high on the volume of sales and number of project launches. Kochi, one of the proposed smart cities, is also home for several emerging software companies, says the study.

While all southern Tier-II cities in this list, except Coimbatore, showed inventory in the range of 15 to 22 months (within the comfortable level of 24 months), Gujarat stood out for several reasons.  For instance, Gandhinagar (capital of Gujarat) experienced the lowest delays in execution of projects, at eight months. This is almost half of the average delay of 15 months of all the Tier-II cities. Also, Vadodara is ahead of all other Tier-II cities in absorption, with an average of 12,500 units or 16 per cent of the overall absorption in Tier-II cities. In contrast, three of the four cities in the north showed a high level of inventory overhang, with the worst performance by Mohali at 50 months.

No city could come on top in more than two advanced parameters. And, most of those doing extremely well on some parameters fared poorly on others. “A case in point is Dehradun, which is top on two and last in the other four. Hence, it has fallen in overall ranking.’’ As an earlier study on Tier-I cities had shown, real estate in the north is marred by project delays, expensive properties and a demand and supply mismatch, PropEquity said. “Although the Tier-II and Tier-III cities have performed better in India, they have been adversely affected in this current slowdown, which has severely impact the Tier-II cities,” said Samir Jasuja, founder and managing director of PropEquity.

The 19 Tier-II cities (consolidated) have annual primary sales of Rs 32,600 crore annually. This is lower than that of Bengaluru ( Rs 36,100 crore) and Mumbai (Rs 34,100 crore).

Overall, the new residential supply in the top 19 Tier-II cities has fallen by 64 per cent in the past two years, as against a fall of 40 per cent in the top 14 Tier-I cities, in the same period. Absorption across these cities fell 17 per cent in the past two years, as against a fall of 32 per cent in the top 14 Tier-I cities in the same period.

As for launch prices of Tier-11 cites, these have increased at an annual nine per cent over two years, compared to 10 per cent for Tier-I cities. The Tier-II markets are seen as end user-driven than investor-driven.

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