Latest Real Estate India Property News

MCD property tax amnesty scheme has few takers

2009-11-04T23:27:00.000-08:00

Assetventures
The property tax amnesty scheme launched by the Municipal Corporation of Delhi (MCD) to encourage tax defaulters to pay up their dues

failed to people. Only 27,000 property owners came forward to pay their dues even as the civic agency was expecting at least 20 lakh people to turn up.

Meanwhile, looking at the dismal response, the civic agency decided to extend the date for the amnesty scheme to December 31 the last date before this was October 31. According to MCD officials, all those who fail to pay their property tax by December 31 will be issued showcause notices. Defaulters will have to face harsh penalties like sealing of bank accounts, attachment or auctioning of property and even prison terms, the officials said.

"We were expecting more people to file their property tax as there are approximately 30 lakh properties in the city while only 7.5-9 lakh people pay their tax. We have data on property owners and will issue showcause notices to them. Their properties can be auctioned if they failed to pay up by December 31,'' said MCD commissioner K S Mehra.

The amnesty scheme was launched to get such owners in the tax-net. "We have received Rs 70 crore as property tax from 27,000 people. The Survey of India is also conducting a survey to determine all those property owners who are not in the tax net of the civic agency,'' said an MCD official. The survey was completed in northeast district recently and around 3.5 lakh properties for which tax was not paid were identified in the area, the official said.

"We received a large number of representations from resident welfare associations (RWAs) who said they could not avail of the scheme due to the festive season. They had requested us to extend the last date for paying the tax,'' said Ram Kishan Singhal, chairman of the standing committee.

The civic agency had said that all those who remained defaulters after December 31 would have to pay a penalty of 30%. In addition to this, 1% interest will be levied every month till the amount is finally paid.

DLF to develop affordable housing in India Assetventures

2009-11-03T00:24:00.000-08:00

India’s leading real estate company DLF is said to be working on plans to build around 1 lakh houses that would cater to middle class in the country.

These houses would be build in all the major cities of the country and would be priced at around Rs. 20 lakhs.

These new housing solutions could be offered under a different brand name in the coming years.

DLF rival Unitech has already announced similar plans to build affordable houses around the country.

The company has officially declined to comment on these reports.

Rentals rose even as capital values of real estate dipped Assetventures

2009-11-03T00:19:00.000-08:00

Software engineer Ravi Kumar took a loan from a leading private sector bank and invested in the property market in 2008, at the height of the
realty boom. Today with values lower than what he purchased the property for, selling-out and exiting the sale is not an option for him.

With a stiff EMI to be paid out, renting out the apartment seemed a good idea. Kumar did not complain when he found rental values rising as the property neared completion. Today with high occupancy, the rental values are almost 15-20% higher than in March 2009.

Many people are facing this situation across cities in India. A Brix Research survey over 30 Indian cities showed that while capital values, which fell during the Jan-Mar 2009 quarter, rose from Apr-Sept 2009 but remained either lower than the previous values or at the same level.

However, rental values have registered a sustained rally from April 2009 onwards. Today it is between 15% and 50% higher than the September 2008 levels. A fact that buyers like Ravi Kumar should be happy about.

Says Chintan Patel, senior professional, real estate practice, Ernst & Young, "Rental values in mid-segment properties across prominent cities have witnessed an upward trend. Mid segment properties in key residential micro-markets of Mumbai (western and central suburbs) and NCR (East and North Delhi, Gurgaon) have witnessed sustained rise in rental values, in the range of 15-20%, over the last 5-6 months. Constricted supply of apartments for rent, coupled with strategic location offering good connectivity to prominent business districts of the city, have been instrumental in rising rental trends of some key micro-markets in these cities."

So, what other factors have really triggered this change? Take textile entrepreneur, Sumit Bansal, who was planning to buy a house for himself. The fluctuation in the real estate market since September 2008 has left him confused and he decided to take a house on rent till the markets stabilised.

According to RV Verma, executive director, National Housing Bank, "The real estate market today has shifted from being demand-based to need-based." According to the market researchers and brokers, rental housing has become a popular choice of housing owing to high and unstable capital values.

The Brix Research Quarterly Real Estate Value Analysis Reports have shown that rental values rose since April 2009 across almost all Indian cities. During the Apr-Jun 2009 period, rental values stabilised in most of the cities and recorded an appreciation in values during the Jul-Sep 2009 period.

Rental values for a 2BHK apartment have registered an average growth of 10-15% in most localities in the Jul-Sep 2009 period compared to the previous quarter.

Explains property investment adviser, Ashok Narayan, "Property values dropped 15-35% during the slowdown. Large developers such as DLF and Unitech started by completing existing projects rather than launching new ones. This trend continued across the country and projects which had been sold off drawing-boards saw the light of day. As projects neared completion, values rose by 15-20%. In established city areas property values dropped 10-25% during the slowdown but rose back to the same level when the sentiment improved. In newly-developed properties, rental values are today at least 15-25% higher due to projects being completed and occupied. In the established city areas rental values have risen by about 10-20% over the peak values before September 2008."

The Brix Research report shows that Gurgaon real estate market saw an annual appreciation of 10-15% in rental values in most localities during the Apr-Sep 2009 period as compared to the Jan-Mar 2009 period. According to city broker RB Singh, "This reflects end user demand for rental housing."

Other areas of the National Capital Region (NCR) such as Ghaziabad and Faridabad also registered an increase in apartment rental values. In Ghaziabad, during the Jul-Sep 2009 period, rental values stabilised and increased by around 13% as compared to the Apr-Jun 2009 period. This was due to the increased demand for 2 and 3BHK ready-to-move-in apartments in the city.

In Mumbai, rental values of apartments have risen by around 2-20% during the Jul-Sep 2009 period as compared to the Apr-Jun 2009 period. There has been a corresponding drop in apartment capital values during the same period. In Chennai, the rental values were more or less stable and saw a 5-10% appreciation during the Jul-Sep 2009 period.

The positive trend in apartment rental values has been reflected in smaller cities as well. Chandigarh witnessed a significant fall in capital values of apartments and plots during the Apr-Sep 2009 period but registered a growth in apartment rental values.

In the Jul-Sep 2009 period, rental values increased by around 10-15% as compared to the Apr-Jun 2009 period. Brijesh Bhabsar, a Rajkot-based realtor, said, "The rental segment is showing positive trends and is a preferred housing option among end users."

In the southern region, Kochi registered an increase of 5-37% in rental values post March 2009, as most buyers restrained from making large investments in the property market. Coimbatore and Visakhapatnam experienced a similar trend of 10-20% rise in the rental values of the end user dominated 2BHK segment.

Local broker such as David Bose of Coimbatore maintained that this increased demand for rental homes reflects the end user expectation that capital values will fall further. This is corroborated by retired bank manager RC Gaur, who lives in rented accommodation in Faridabad, wishes to buy an apartment in Delhi, but prefers to wait for the right time to make his investment.

So is it a good time to take up rented property right now? Is there a demand being seen? "Demand for rental space has risen over the last few months. The improvement since April is between 12-15%, depending on the economic drivers of each city. This is generally a good time to rent homes, depending on location-based dynamics," feels Raminder Grover, CEO-Homebay Residential, Jones Lang LaSalle Meghraj (JLLM).

Today the market is driven by the need of end users who are still unsure about capital investment in real estate and are taking the rental option in an unstable market.

Real Estate finding a new track in Indian economy Assetventures

2009-11-03T00:17:00.000-08:00

A big impact of recession is seen in the worldwide market, where many big companies posted big losses, asked for a bailout and even filed for the bankruptcy. The recession had such an impact on the world over economy that even a core business of a particular country went in loss with many citizens pulling their hands off from investment part.

Same happened with the Indian real estate market, the most bullish sector where not many hesitated before putting their money forward for an investment related to some plot, flat, office, shop etc.

In the month of September 2008, when recession captured the world with a full grip, the real estate of India suffered a big loss session. All the major real estate players like Jaypee Group, Unitech and DLF came up with the schemes and rebates on flats to attract as many buyers as they can and sell off the reserve as soon as possible.

The cities like Mumbai, Delhi, Bangalore, Kolkata and National Capital Region accounts for big real estate business of the country with many property owners earning big money from the rental income from homes and offices.

One can analyse the downfall of rental income in these cities as many fully constructed buildings are standing with a very less space occupied with them and that too on a small amount of rent in comparison with the rentals of 2007.

This downfall was not limited to the rental part of real estate industry but the pure buying and selling of properties also came to a halt after financial crises reached the Indian economy.

With the global economic crises on one side, leading players of real estate India like DLF and Unitech are focusing more on the repayment of debts as soon as possible.

This has resulted in big real estate players selling their personal office properties, shifting their focus from core property business to some other businesses like insurance and hospitality and selling off some part of the company by getting listed on the capital market.

However, according to the recent study conducted by several industry watchers, the real estate of India is coming back on profitable track with the demand for offices is increasing in major cities like Bangalore and Mumbai, however Delhi and NCR are still far from witnessing growth in demand as many are expecting further fall in rentals here.

Besides the growth factor in office and shop rentals, a slight growth is also seen in the buying and selling transactions of properties.

With the Indian economy coming on track again, the demand for flats are seen rising in past one month. The real estate developers like Amrapali, Parsvanath and Unitech are nor registering some potential bookings on their order books.

The recent festive season has also added some profits to the real estate industry when many were keen on buying a new home.

During the last festive season, a very low rush was seen for the real estate buying but this year, the banks came up with some attractive home loan schemes with the help of rebate provided by Reserve Bank of India.

Anshuman is a professional real estate property consultant in India and investing in Indian real estate from years. To know more about real estate india, reality projects as sheth heights chembur, neelkanth greens thane, please visit: www.paisawaisa.com

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2009-10-26T01:07:00.000-07:00

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Guj builders plan permanent property show

2009-10-26T00:37:00.000-07:00

Gujarat based builders are planning to replicate the Japanese model of permanent property show to display large number of real estate

projects at a single venue near Ahmedabad.
The idea of developing a facility for displaying built sample houses along with layouts has come from a recent study tour of Gujarat chapter of Confederation of Real Estate Developers’ Association of India (CREDAI) to Japan and South Korea. Around 120 real estate developers from across Gujarat visited the two countries earlier this month.

The permanent property show near Osaka drew attention of the entire delegation. “Most of us believe it would make sense to replicate the model somewhere near Ahmedabad instead of holding property shows periodically,” said Jaxay Shah, president CREDAI (Gujarat). Prospective buyers also don’t have to waste time by visiting different construction sites.

Mehsana-based builder Sandeep Sheth, who coordinated the study tour, said, “Under one roof, customers would get an idea about overall realty development across the state and developers will have the advantage of a large platform which would attract a broad base of prospective buyers.”

The Osaka model has excellent landscaping, gardens, restaurants and an entertainment zone for children where families spend considerable time before taking the crucial decision on which residential or commercial space to buy.

Suresh Patel, vice-president of Gujarat Institute of Housing and Estate Developers (GIHED), said if the state government supports the idea, it could generate good revenue out of rentals from developers who book space in the project.

There were other unique schemes which impressed the local realtors. Ahmedabad-based realtor Dushyant Pandya said he was eager to replicate a solar bungalow project. The one he saw had 120 dwelling units running only on solar energy. “Cost-wise, these would be expensive initially but they would be cheaper in the long run,” he said.

Among other projects they visited was one especially developed for artists like painters, sculptors, designers and creative people. The homes offer an ambience which helps creativity blossom

City realtors aim high Assetventures

2009-10-26T00:33:00.000-07:00

mpressed by the infrastructure development and synergy between town planning and bylaws in Japan and South Korea, real estate players in the city now believe vertical growth is the solution to the crunch of land in Ahmedabad. Recently, a team of around 120 real estate developers of Gujarat had been on a 10-day tour to Japan and South Korea. The tour was organised by Gujarat chapter of Confederation of Real Estate Developers Association of India (Credai).

The developers were very much impressed by the city development projects undertaken by the governments of the two countries. Unlike the US, Japan and Korea feel severe crunch of land, so they prefer vertical development, said Dushyant Pandya of Vishwanath Group. He also said horizontal development would mean higher prices of land.

"At present, the land prices in the city are no longer affordable for citizens. Though, many say the prices here are still lower than that in Pune or Bangalore, one should not overlook the fact that even the average earning of people here is lower," he said. Suresh Patel, vice president of Gujarat Institute of Housing and Estate Developers (Gihed), said though Japan is under higher risk of earthquake, the government allows 100-storey buildings. "It makes us wonder why we are not allowed to build 20-25 storey residential complexes in the city," Patel said.

Almost half of the representatives of the delegations were from Ahmedabad. The delegation visited Osaka, Tokyo and Kyoto in Japan and Seoul in South Korea during the 10-day tour. It had business to business meeting along with having a look at various infrastructure projects there.

"Town planning is not only about building houses, it is also about traffic, law and order and civic amenities," said Jaxay Shah, president of Credai, Gujarat Chapter. He said there must be a perfect blending of development and services. He felt that since the government was about to prepare a plan of Ahmedabad's development for 10 years, the officials concerned should also visit these countries.

Shah said there was a need to create skilled human resource pool that for providing quality works. He said Credai is planning to set up centres for training of all levels of people involved in real estate sectors. However, the government should help the association with providing adequate land for setting up such centres, he said.

"We want to set up such training centres first in four major cities of the state - Ahmedabad, Vadodara, Surat and Rajkot, and then take it further to small towns," he said.

Shah also stressed the need to develop knowledge back up. "Though the government-run ITIs are running some courses, for real development public-private partnership is a must," he said.

Pay less upfront to get a home loan Assetventures

2009-10-22T03:13:00.000-07:00

Mr X (name changed), who works in the chemical industry, can now afford to buy his dream home, thanks to banks lowering down-payment for home loans.
When he first inquired with his bank, he learnt that to avail of a loan for a house worth Rs53-55 lakh, he needed to shell out Rs10.6 lakh (roughly 20% of the value of the house); the loan amount would be the remaining Rs42.4-44.4 lakh.

A week back, he visited his bank again and found that the down-payment requirement had come down to Rs7.95 lakh, or 15% of the value of the house.

Till sometime ago, banks were cautious about home loans as property prices had been falling. They wanted a higher cushion by way of higher down payment. The cushion is called margin in banking terms. On a property worth Rs20 lakh, a bank would extend a loan 15-30% lower than the value to ensure that in case the borrower defaulted, and the price of the property fell, the bank could sell the property and recover the dues.

"The situation is better now as property prices are reasonably stable. At most other places, except Mumbai, prices have not gone up beyond 10%. Because of the reasonable prices, LTV (loan to value, or the percentage of property value financed by a bank) has started slightly moving upward," said Kamlesh Rao, executive vice president and business head, personal finance, Kotak Mahindra Bank.

home loan down-payment requirements were increasing, sometimes as high as 30% of a property's value, as realty prices were coming down. But Rao said that down payment is decreasing only in cases of ready property or where a flat will be under possession in six-nine months. In a survey of 11 banks, nine banks would provide 80% of a property's value as loan and one 85% to first-time borrowers.

An agent from a leading private sector bank told that the bank would provide 85% of a property's value as loan. "But I can get it for you with stamp duty and registration cost. If you consider that, the amount will almost be 100% of your property value," he said.

It is learnt that public sector banks such as the State Bank of India, Indian Bank, Bank of India and the Punjab National Bank have lowered down-payment levels to 15-20% from up to 30% till recently.

This was not the case a few months ago, when nobody was sure when the fall in property prices would stall.

RR Nair, director and chief executive, LIC Housing Finance, said: "We are having it (down payment) at 15%. When property prices were down, we had not officially reduced the margin (the percentage to be paid by the borrower). But we were cautious about appraising the property. Depending upon the quality of the property and the project, there was a call taken (on the margin). So, right now we don't have to officially change the margin."

Some banks and non-banking finance companies are adopting a wait-and-watch strategy. Sanjay Shukla, business head (mortgage), Tata Capital Housing Finance, said: "Real estate firms were holding up the price and hence sales were not happening. After Dussehra, there have been some sales. The loan to value from the customer's point of view is 80-85%, depending on his or her credit profile."

But some bankers want to avoid a situation where home buyers overreach. CS Jain, executive director (head of personal banking), IDBI Bank, said: "We have retained the down payment at 20% (from 15% earlier). We haven't rolled it back and are not planning to reduce it yet."

The Housing Development Finance Corporation is one of the financers that did not change down payment amounts during the tough phase and so haven't changed now. Keki Mistry, vice president and managing director, HDFC, said: "Nothing was changed last year and nothing has been changed now."

British firm to host India property show Assetventures

2009-10-22T03:11:00.000-07:00

With the global economy looking up, a London-based firm plans to host a property show to showcase residential projects in India to British investors.

The event, organised by real estate agent Hamptons International, will be held Oct 30-Nov 1 at the firm's head office in London.

"India has always been a major market for Hamptons International, given the UK's long and close ties with this country," said company international sales manager Dean Foley.

"We have certainly seen, over the last few months, an upturn in the amount of transactions completing by our UK NRI (non-resident Indian) clients due in part to long term growth plans and affordable real estate," Foley said.

The event has been organised in partnership with leading developers including Emaar MGF, Spire Edge, Ansal, ANR Infrastructure, Santa Fe Realty and Godrej.

Man can claim house bought in wife's name: HC Assetventures

2009-10-20T03:45:00.000-07:00

More than 20 years after a Ratnagiri couple got divorced, the Bombay high court has given the man the right to claim the property he had bought for his former wife in happier times.

"The husband had purchased the property in the name of his wife with his own money and, therefore, she was only [the] benamidar, or the ostensible owner, while the husband is the real owner," justice JH Bhatia observed in his order last week. Since the husband bought the house in 1981, the transaction was not barred by the Benami Transactions (Prohibition) Act, which came into existence in 1988.

Family court advocate Kranti Sathe said the ruling would affect many couples who buy property jointly. "The court has tried to strike a balance -- the wife is entitled to maintenance after divorce, but even the husband has not been denied the property that he purchased with his hard-earned money," Sathe said.

This means if a spouse cannot prove to have bought the property with his or her own money, he or she may lose the right to claim it, Sathe said.

In this case, Jayant and Sonali (names changed) were married in 1979. In January 1981, Jayant said he bought the property worth Rs5,000 in Ratnagiri in Sonali's name out of "love and affection". He said he had paid for it after securing a bank loan of Rs1,500 and using savings from his salary, which was Rs350 per month at the time.

In 1984, after their relationship soured, Sonali moved out of Jayant's home and started living separately with her parents in Kolhapur. In 1993, the trial court held that Jayant had paid for the property and it was not bought for the benefit of his wife.

Sonali challenged the decision before the high court, claiming she had paid for the property from the money her "rich" father had given her and the scholarship she earned as a student of biochemistry.

Justice Bhatia, however, observed that there is "no material to show" that Sonali had received "any funds, either from her father or any scholarship", to purchase the property.
The court said it was "logical and reasonable" for Jayant to buy the property in Sonali's name when they were married and living cordially. But after their separation, when Jayant's first claim was allowed by the court in 1989, Sonali made no attempt to claim the property.

The court dismissed Sonali's appeal and permitted Jayant to claim the property that was rightfully his.

Neelofar Akhtar, member of the family court bar association, said the ruling assumes importance as there are not enough provisions in law to deal with property disputes arising out of divorces.

"The woman has the right to alimony after divorce but if she claims property also, what remains with the man?"

Family court lawyer said sometimes men may buy property in the wife's name for tax benefits and sometimes women may end marriages too soon to get a "back-door claim" to the man's property.

Sathe said the length of marriage is also crucial while deciding such cases.

But divorce cases are very delicate and tricky as they differ from couple to couple and it is difficult to apply anything as a blanket rule, Sathe added.

NRIs to get immediate property possession in Chandigarh Assetventures

2009-10-20T03:40:00.000-07:00

Non Resident Indians (NRIs) having property in the union territory of Chandigarh can now gain immediate possession of both resedentian and non-residential property, officials said here Monday.

"We have received a notification from the union government regarding the extension of the East Punjab Urban Rent Restriction (Amendment) Act 2001 in the city. Now NRIs can have immediate possession of their property by just applying to the relevant authority," said the official spokesperson of the union territory here Monday.

He added: "Chandigarh administration had been for long urging the centre to make provisions or to devise a mechanism for safeguarding the properties of the NRIs having roots in Chandigarh."

Chandigarh already has an NRI cell, which was established Aug 15, to deal expeditiously with various representations and complaints received from NRIs.

Real estate payment plans Assetventures

2009-10-20T03:34:00.000-07:00

Do you understand the nuances of your payment plan to your developer? When you buy property and pay by installments, soon after the initial payment you make at the time of booking, you will be expected to make recurring payments to the developer.

Here we explain the process of how this works and what you stand to gain or lose under each option.

Time-Linked Payment Plan

Time-linked plans require you to pay installments to the developer based on a pre-determined time schedule, independent of the rate at which the project’s construction progresses. This is a contractual commitment you are signing up for, and is non-negotiable.

If your payments are late or if you miss an installment, you can be liable for penalty interest or anything that you might have contractually agreed to as a penalty.

A typical time-linked plan conceptually looks like the following:

- 10% of basic selling price (BSP) at time of booking

- 10% of BSP every quarter thereafter for next 8 quarters

- 10% BSP at time of possession + other dues (such as club membership, development charges if any, parking fees)

The disadvantage with time-linked plans is that you are at the mercy of the developer - even if the project is delayed you are contractually bound to pay your installments.

So, effectively you are funding the developer for no noticeable progress, which clearly is not a fair deal to you. The question to ask is what the developer is doing with your money if it is not going towards the construction or related activities.

Construction-Linked Payment Plan

Construction-linked plans require you to pay installments to the developer based on a pre-determined rate of progress of the project, usually related to construction related milestones.

The advantage of such a payment plan is that you pay only when the milestones are being achieved – you can see visible signs of progress, and there is a noticeable correlation between what you are paying for and the development of the project.

Like in time-linked plans, if your payments are late or if you miss an installment, you can be liable for penalty interest or anything that you might have contractually agreed to as a penalty.

A typical construction-linked plan conceptually looks like the following:

- 10% of BSP at time of booking

- 10% of BSP at time of excavation

- 10% of BSP at casting of the ground floor slab….and so on

- Final installment at completion of the roof + other dues (such as club membership, development charges if any, parking fees)

The advantage of a construction-linked plan, as you might have guessed, is that you pay for progress, and are not uselessly funding the developer to do what it pleases with your money.

What if you choose the Down Payment Plan?

The Down Payment Plan requires you to pay the entire price of the property at the time of booking. One possible advantage of this is that you can expect to get a 10%-12% discount on the property by paying the entire amount in full.

However, depending upon the project and the builder, you might be able to negotiate a higher discount.

The disadvantage of these plans is that once you have paid the entire money, you are at the mercy of the developer if the project is delayed or postponed.

What happens if you cancel your booking?

Irrespective of which payment plan you choose, the outcome depends upon how helpful the developer wants to be in dealing with your cancellation request. You will likely have to put in your request in writing and then just wait for the developer to respond.

However, don’t expect the developer to act quickly. It is not in their interest to do so, because now they have to find a new buyer for the unit that you are exiting.

As far as getting a refund is concerned, you must understand what contractual penalties you might be obligated to pay.

In any case, don’t expect the developer to pay the pending amount back to you immediately. Chances are you will be made to run around a lot to get anything back from the developer, and the process can take up to a few months.

Festive real estate and loan offers Assetventures

2009-10-20T03:31:00.000-07:00

Festive real estate and loan offers

Diwali is a time for festive offers. But, real estate and housing loans aren’t consumer goods and the advertised festive offers are usually just a marketing gimmick.

There is very little similarity between buying a domestic items like a kettle, on which one can get genuine deals, and getting a big ticket item like a house or a housing loan. Here we tell you why you should not fall into the trap of a so-called festive offers on real estate and related loans.

Why the marketing spin?

Marketers recognize that during festive seasons, whether its Diwali in India or Christmas in the western world, consumers are looking for good deals.

In India, Diwali is also seen as an auspicious time to make financial decisions. So, marketers play on this pre-existing momentum in the minds of consumers looking to make a house purchase decision during the festive season.

However, the deals are usually no different than what you would get before Diwali, or just after the festival season.

Don’t rush the big decisions!

Buying a house and getting a housing loan against it are the probably the biggest financial decision that any family will make. We aren't talking of a toaster oven here, that costs just a few thousand rupees at most. We are talking of at least Rs 20-40 lakhs, and a loan that will likely keep you indebted for up to a decade.

Such decisions cannot be rushed, because you will have to live with its consequences for a long time. And, the risk of getting it wrong is very high if you rush through your decision.

What drives real estate and housing loans? The economic cycle

Real estate companies and housing lenders are at the mercy of the financial markets. The prevailing interest rates, that are set by the market or policy makers, are one of the key drivers of real estate and housing loan prices.

To stimulate demand, a company might offer what appears to be a discount, but realistically speaking the pricing criteria for these products is no different around Diwali from the weeks just before or after the festive season. If the economic situation is good or bad that has a bigger influence on the pricing of real estate and housing loans.

So what deals are genuine?

At best, you might be in position where the developer reduces a modest fee to stimulate demand, or a housing lender reduces their processing fee.

However, its unlikely that the monetary benefit of these reductions will be any more than say Rs 10,000 – Rs 20,000 maximum, and if you tried hard enough you could get these reductions at other times of the year as well.

For instance, some developers in North India were offering a Navratra discount of up to Rs 100 on the booking amount. However, this was no different from the inaugural discounts usually offered. Similarly, some lenders might waive the loan processing fee during the festive season. But such waivers are no different from what you can get during the rest of the year if you negotiate with your lender.

NRIs seek Tharoor's help to protect property in India

2009-10-12T06:19:00.000-07:00

Seeking to protect their properties and investments back home, non residents Indians have asked minister of state for external affairs Shashi Tharoor to sponsor a new bill that will safeguard their interest.

Supporters of the proposal voiced their grievances at the gathering on how their properties were allegedly taken over by government, mafia and illegal occupants.

However, at the meeting organised by the Keralite community in New York, Tharoor expressed his inability to sponsor the proposal as the matter is not under the jurisdiction of his ministry.

"The truth of the matter is that when it comes to this issue, I cannot sponsor a bill because in our parliamentary system it is not permitted," Tharoor told the members of the Malayali community, at his first public appearance during his visit to New York.

Tharoor underlined that while he could not sponsor the proposal, he would take up the matter with the relevant authorities in India. "I will be very happy to speak to the overseas affairs minister and law minister because if the government takes on this bill and recommends it then the chances of passage are much greater," he noted.

They pointed out that the 25 million strong Indian Diaspora contributes $52 billion as remittances annually, which is four per cent of India's gross domestic product.

Commenting on the proposal to grant voting rights for NRIs, Tharoor said a bill to this effect may not get support back home.

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22 pages

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Real Estate India Property News Prices Trends Assetventures.in: Real Estate Asbestos Prevention Tips for Healthier, Sustainable Homes Assetventures

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10/
3 pages

Real Estate India Property News Prices Trends Assetventures.in: MCHI announces Property 2009, India's Largest Official Property Exhibition

Real Estate India Property News Prices Trends Assetventures.in

Real Estate India Property News Prices Trends Assetventures.in: Hosing sector demand to go up by 30 percent: FICCI Asetventures

MCHI announces Property 2009, India's Largest Official Property Exhibition

2009-10-10T02:45:00.000-07:00

At MMRDA grounds BKC during October 1-4, 2009

Maharashtra Chamber of Housing Industry (MCHI), the most prominent body of real estate builders and developers in the country, today announced ‘Property 2009’ their 15th Real Estate and Housing Finance Exhibition to be held at MMRDA grounds, Bandra Kurla Complex, scheduled to be held during October 1-4, 2009 from 11am to 8pm.

Property 2009, India’s only official and largest real estate and housing finance exhibition organized bi-annually by the MCHI from last ten years, is a one-stop destination for the potential property buyers in Mumbai. It offers home buyers a wide range of properties both Budget, High End and Commercial Properties along with a wide choice of Home Loan options.

As many as 75 real estate developers would be showcasing the properties located in Mumbai and the suburban areas, Thane, Navi Mumbai, Pune and other parts of India during the exhibition. The exhibition is organized by MCHI and co-organized by the State Bank of India, Platinum Partners – ICICI Home Finance Company Ltd., Axis Bank, and LIC Housing Finance Ltd. IDBI Bank is the Gold Partner and HDFC Ltd is the Silver Partner.

Prominent housing finance companies such as Citibank N A, Dewan Housing Finance Corporation Ltd., GIC Housing Finance Ltd, IDBI Home Finance Ltd and Kotak Mahindra Bank Ltd will also be participating in the exhibition, offering their best deals.

Mr. Pravin Doshi, President MCHI said, “As the festive season begins, we would like to offer an opportunity to the thousands of prospective home buyers to buy the house that suits their requirements from the properties being displayed at the exhibition.”

Mr. Harish Patel, Convenor Exhibitions adds, “Riding on the revival in the overall economy, real estate has recently seen demand is picking up in all the segments. We are very much confident that forthcoming mega real estate exhibition would serve the cause of bridging the gap between the potential buyers and the real estate developers by bringing them at the one platform”.

Mr. Deepak Goradia, Co-convenor Exhibitions, said, “MCHI’s property exhibitions have always reflected the market’s true sentiment. Be it the mega shows or the budget shows, these exhibitions have become a convergence point for property seekers. This time too, we foresee a great potential as thousands of prospective home buyers are awakening to the prospect of investing in property to get the best returns”.

About MCHI:

Maharashtra Chamber of Housing Industry (MCHI), formed in 1982 is the most prominent body of real estate builders and developers bringing together members dealing in real estate and construction industry on one common platform to address issues facing the industry. Members of MCHI account for providing 80 % - 90% of residential accommodation in Mumbai and its vicinity. MCHI helps both the Central and State governments in meeting their objectives of providing shelter. MCHI works towards raising awareness among the general public, real estate and construction industry while providing them with exhaustive information on projects and new developments in and around Mumbai. With over 400 well-recognized and reputed member builders, developers MCHI is affiliated with leading industry associations like Ficci, IMC and Credai.

2009-10-10T02:36:00.000-07:00

The IndiaHome Property Exhibition, which helps the Indian diaspora get information on a range of residential real estate opportunities in
India, will be held in Dubai from October 9-11.

The exhibition invites prominent builders from across India to showcase their projects under construction and will feature Emaar MGF, ETA Star, Hiranandani Constructions and K Raheja Corp, among others. The cost of the properties showcased is likely to be in the range of Rs 40 lakh to Rs 10 crore.

"Owning a home in India is a long-cherished desire of all NRIs worldwide. Our endeavour with the IndiaHome Property Exhibition is to create a convenient interface for NRIs with India's reputed real estate developers and help make the purchase process seamless," Citibank India Head Consumer Assets Ashish Mehrotra said.

NRI customers can avail loans ranging from Rs 20 lakh-Rs 5 crore for ready-to-move and under-construction properties which can be obtained under flexible repayment plans and periodic payments can be conveniently routed through the Citibank NRE/NRO Account, Mehrotra added.

Other companies participating in the event include Brigade Enterprises, Chaithanya Projects, Fairy Land Foundations, Gera Developments, Goel Ganga Group, Jaiprakash Associates, Kumar Properties, Lancor Holdings, Paranjape Schemes (Constructions), Sobha Developers and Three C Universal Developers.

Hosing sector demand to go up by 30 percent: FICCI Asetventures

2009-10-10T02:24:00.000-07:00

The residential sector will lead the revival of India's reality industry as it will see a surge in demand by 30 percent by 2009-end, according to an industry lobby survey.

'Although the real estate sector has started showing some signs of revival, a majority of the industry experts expect the residential segment to recover by the end of 2009 with a 25-30 percent renewal in demand,' said the survey report by the Federation of Indian Chambers of Commerce and Industry (FICCI).

However, the commercial and retail segments will take some more time to recover.

The commercial and retail segments are expected to pick up after the third quarter of 2010, the report said.

'Affordable housing seems to be the flavour of the day as more than 34 percent of the demand in the residential segment is in the price bracket of Rs.5-Rs.15 lakh,' the survey said.

Demand for houses in the range of Rs.15-Rs.25 lakh will go up by 26 percent, while those in the bracket of Rs.25-Rs.40 lakh will see demand rising 22 percent, the chamber said.

Properties priced between Rs.35 lakh and Rs.50 lakh will see 12 percent increase in demand, while the houses priced above Rs.50 lakh will see a mere 6 percent rise.

However, banks are still cautious in lending, and prefer lending to credible developers, the survey said.

The real estate mutual funds have not taken off well in the Indian market due to 'lack of awareness and ambiguous policy framework'.

The taxation and exit-related issues need to be resolved and the guidelines need to be comprehensive and transparent for them to do well, it added.

'Lack of standardised policies is the most serious issue. Multiple state laws hinder and delay the execution of projects. Absence of single window clearance emerged as the second most critical issue,' FICCI said.

Unclear land titles pose a major challenge in the development of real estate sector, it added.

Real Estate Asbestos Prevention Tips for Healthier, Sustainable Homes Assetventures

2009-09-24T01:08:00.000-07:00

Owning a home is regarded as one of the great moments of your life. It is a time that will bring many joyous memories for you and your family, but is also one that can create additional responsibilities. With many older buildings, there is the potential for hazardous materials that may be present.

Newly bought homes are often remodeled and repairs are always needed. This is often the case with older homes, which still run with old, corrosive methods that were once used to build structures. If you believe that your home contains asbestos, a home inspection could be extremely important for safety, health and investment reasons.

Many real estate agents have begun to understand the many risks and responsibilities involved in the home buying process. Real estate experts make sure potential home buyers receive all the information they need before making the all important step.

Asbestos

Asbestos is a fibrous mineral that gained popularity throughout the 20th century. Its qualities as flame and heat resistant made it perfect for use in construction and building applications. Asbestos that is disturbed or damaged due to age is known as “friable” asbestos. This is a serious concern because its toxic fibers can easily circulate and become inhaled.

Homes and buildings constructed prior to 1980 still hold the potential of containing asbestos materials. In most situations, asbestos appears in roof shingles, dry wall, attic insulation, popcorn ceilings, joint compounds and electrical wires. It is not always an easy process to determine whether or not a particular insulation contains asbestos. Anyone who is unsure about the insulation in their home should have the materials in question inspected and tested.

If exposed to airborne asbestos fibers for a prolonged period of time, it can lead to the development of related lung ailments such as asbestosis and mesothelioma. Treatment has varied effects on victims. The age of diagnosis and latency period typically have a direct impact on patients.

Healthy Tips

If asbestos materials are present, most contractors will advise home owners to leave it alone. A home inspector can determine the toxicity levels present. Sometimes the best action is no action at all. A general contractor will usually be responsible for providing materials, equipment and labor for a remodeling project. Consultants will identify material defects in structures and components of the home, in adherence to or exceeding national, state, and industry regulations and standards.

Asbestos insulation should be left undisturbed in your attic. Limit the amount of accessories and items stored. Do not allow children’s access. If you plan to remodel or conduct renovations, hire professionals to handle asbestos to safely remove the material. Removing asbestos by yourself can potentially spread fibers throughout your home and your family will be at risk of inhaling asbestos dust.

If an inspector deems the substance harmful, the removal of asbestos in public facilities, workplaces and homes must be performed by licensed abatement contractors who are trained in handling toxic substances. Depending on the condition of the asbestos, many experts feel it is better to seal it off than remove it.

Green insulation alternatives to asbestos include the use of cotton fiber, lcynene foam and cellulose. Cotton fiber is quickly becoming a favorite for home builders and renovators. Made from recycled batted material, it is also treated to be fireproof.

Best time for a value deal in real estate Assetventures

2009-09-24T00:09:00.000-07:00

It's perhaps the best time to look around for a value buy in real estate. With lower price points in locations which were not earlier within your wallet’s reach, buyers are scouting for good ‘value’ bargains at this time.

And with developers going big on affordable home launches, the timing may just be one of the best for buyers seeking a steal deal.

Anshuman Magazine, CMD of global real estate consultancy CB Richard Ellis (CBRE) says that value buying is happening mostly in suburban locations as that is where the current supply is.

“Certain pockets in Gurgaon and Noida, where the price earlier used to be Rs 65 lakh-Rs 1.5 cr, today have deals to offer anywhere between Rs 35 lakh to Rs 50 lakh! Developers have reduced the total ticket sizes, adjusted area, price and given amenities. This has got people back and is making them hunt for value deals right now.”

Locations such as Gurgaon, Faridabad, Noida in Delhi NCR and Navi Mumbai and Thane in Mumbai are some of the good locations for value buying, feels Navin M Raheja, chairman and managing director of Raheja Developers.

“Anything which is available between Rs 2,500 to Rs 3,500 per sq ft is the right price depending, of course, upon the location and infrastructural facilities available in the vicinity with specifications offered .”

The developer is soon going to launch a housing project, ‘Raheja Shilas’ near IGI airport wherein the price would range between Rs 2,575 to Rs 2,875 per sq ft.

Raheja further adds that there are three kinds of value buying that are taking place in the real estate market right now.

Ready to move in residential property in and around metros and their suburbs, ready to move in commercial property which is already leased or generating income and low income and middle-income housing ranging from Rs 15 lakh to Rs 40 lakh are the primary types of value purchases in his opinion.

Many of those who were holding out have also decided to make a purchase now as prices have bottomed out. Plus with many affordable housing launches by developers , the view is that prices are more pocket friendly at this time.

“Prices have reached the bottom and in these prices you are bound to get good appreciation in future . So if you are buying a particular property now, one is definitely going to feel later that they grabbed a good deal,” says Vijay Jindal , CMD, SVP Group.

Jindal’s view is shared by many others in the market as well. Smaller investment opportunities with a starting price bracket of Rs 35 lakh-Rs 40 lakh have fuelled the demand .

“Earlier the prime focus was on high-end purchases, but today, the conversions are happening mostly for smaller properties. At least 50-60 % conversions are there in the market today for properties priced between Rs 30 lakh - Rs 80 lakh, 20-25 % are for the expensive ones priced between Rs 90 lakh - Rs 2.5 cr and a miniscule number is for the ones above Rs 5 cr,” says Pankaj Jain, executive director of Realistic Realtors, a North Indian real estate consulting firm.

But are people also looking at Tier II and Tier III cities right now, which were prime investment hubs in the good times? “People are not primarily seeing these locations for investment at this time. Value buys here are mostly end-user driven,” adds Magazine.

However it’s best not to overlook the pros and cons before deciding on such value buys. Though the pricing and the product may both look highly appealing, it’s best to read the fineprint carefully.

This will hold in good stead for the future. Rajeev Rai, vice president, corporate, Assotech, advises about key strategies that should be followed.

“One shouldn’t get carried away by sops or discounts offered and one must also not ignore the sold stock status of such a project. As far as the dos are concerned, one must set their priority of the price, location , size etc. A due diligence about the supply and demand of such projects is necessary .

Lastly, one must check the developer’s profile, delivery schedule and legality of the project.” Assotech has projects such as The Nest in Crossings Republik at Rs 2,300 per sq ft and Metropolis in Rudrapur at Rs 1,850 per sq ft.

So if you have been thinking of investing your money in a home, it’s the right time to go deal hunting. Negotiate a bargain, go for value and close the deal.

Tips to buy real estate this festive season Assetventures

2009-09-24T00:04:00.000-07:00

Dussehra and Diwali aren’t just the season for Durga pooja, laddoos, and Ram Lila. Its also the time when the maximum number of new real estate projects get launched.

Developers use this season to their advantage because they know that you will be most keen to make a real estate investment during these auspicious days.

But don’t rush in blindly just because you want to buy something before this holy time period finishes. Here are 5 tips that you must keep in mind before you buy property this festive season.

But first, here is a preface to the current environment in real estate. Many developers are still in a financially weak condition. The situation in the market is still a little fragile.

Just because the stock market is going up does not mean that normal conditions have returned to the real estate sector as well. So, please keep this background in mind as you think about the following 5 tips.

1) Choose your builder wisely: The real estate sector, globally and in India, is notorious for developers who take investors’ money and then run away. Make sure that you go with a reputed builder who has been developing properties for a while and has had an operating history.

Don’t just go with any builder, it might be worth paying a premium to go with someone who has built their reputation over a few decades.

If you have not heard of your developer, always ask your developer what properties they have developed, and if possible speak to customers who bought properties at these developments to learn from their experience.

2) Ask for a construction-linked payment plan: As discussed, the financial conditions of various developers are still not totally safe. So, rather than give them money at their will, ask for a construction-linked payment plan.

This way you know that your installments are actually going towards financing the development, rather than being used for other unknown purposes. Beware of time-linked payment plans, and if you have the option stay away from such plans.

3) Penalties for delays: As it happens, many if not most of the projects launched last Diwali have not even seen construction begin. Yet, many customers have paid their installments on time with nothing to show for.

Understand what rights you have in case of delays. Ask for a definitive date for when construction should begin.

If you are dealing with a small builder, that does not have a long operating history, make sure that the contract gives you adequate protection against the builder just sitting on your money and delaying the project’s completion.

4) Location: Don’t be in a rush to buy property just because the price looks tempting, and its an auspicious time to buy property during the festive season. Recognize that the single most important factor in buying real estate is usually the location of the property.

Can you see yourself living there, or someone renting this property? Is it close to civic amenities and is the planned connectivity convenient?

5) Don’t buy to flip: Don’t assume that you will easily be able to flip your property to another buyer for a premium just on the back of paying your booking amount and some installments.

In the near-term, there could be an over supply of apartments. Also, keep in mind that there are 1000s of other people who are already sitting on apartments where they want to sell them.

Buy a property if it makes economic sense for you as an investment, or as a residential home. Don’t gamble.

Real estate firms back in hiring mode Assetventures

2009-09-23T23:57:00.000-07:00

NEW DELHI: Some of the country’s largest real estate developers such as DLF, Unitech and HDIL have started hiring again, as they look to launch new projects and speed up execution of existing ones to cash in on a pickup in home demand.

“We are launching new projects and plan to hire in large numbers,” said a spokesman for DLF, India’s largest real estate firm that fired more than 300 people during the downturn.

He said the company hired people with specific skills such as mall management even during the crisis. DLF on Tuesday launched a project in Delhi and sold the entire stock of 1,250 apartments in two hours, he said.

The companies expect high demand in the coming fiscal quarters with the economy showing clear signs of a revival in the fiscal year started April 2009. The financial year ended March 2009 recorded 6.7% growth after two bad quarters pulled down annual growth rate from 9% plus levels seen in the previous three years.

Unitech, India’s second-largest property firm that struggled for months to avoid bankruptcy, is back in action with two rounds of share sale and a revamped business model.

The company, which has 1,200 people on its rolls, has added 300 employees at different levels in the past few months. Its project sites, where construction had stopped for lack of funds last year, are again humming with activity, a company spokesman said. Unitech had raised $900 million through two rounds of stake sale to qualified institutional buyers to bring down its debt level, which was hovering around Rs 10,000 crore last year. The company also changed its business model and launched homes in the ‘affordable’ category and hired more people to sell directly to customers.

A revival in demand has prompted more firms such as Omaxe, Lodha, Ansal and Gera Developers to launch new projects, while some others like Parsvnath Developers and Prestige group are still playing it safe. Rohtas Goel, chairman of Delhi-based Omaxe, said he hired around 70 people, almost the same number the company had fired last year.

“Much of the hiring will happen at mid-level and in sales and project management. These are the categories where maximum jobs were lost,” said Vivek Gandhi, senior vice-president with Delhi-based Ansal Properties and Infrastructure (API), which plans to hire at least 200 people in three months. He expects salaries to remain at levels marginally lower than those during the peak of boom in 2007.

The years between 2004 and 2007 saw Indian property market booming with hundreds of new projects being launched and property prices going up several fold. The boom and the resultant scramble for talent saw salaries in the sector shooting up.

But a property slump, which started as a result of extremely high property prices and high interest rates early last year, deepened due to the impact of the global recession. This saw companies shelving several projects resulting in mass job losses at several property firms.

“We offered an average 10% salary hike to our staff. The new people too are joining us on a scale similar to our old staff,” said Abhisheck Lodha, director with Lodha group that has hired 80 employees since August. The company, which has a 1300-strong workforce, plans to add 350 more in a year.

Another leading Mumbai-based developer HDIL is also hiring. “We require additional manpower as we are speeding up on execution of existing projects and planning to launch more,” said Sarang Wadhawan, managing director of the company. However, a few other players such as Delhi-based Parsvnath Developers and Bangalore-based Prestige group are still cautious. “We didn’t fire people in the first place and so don’t immediately need to hire new people,” said Prestige group director Uzma Irfan.

Realtors must tell buyers about banks' claim on property: RBI

2009-09-19T03:54:00.000-07:00

MUMBAI: Prospective home buyers will now know if the land on which their building stands is free of outside claims after a recent Reserve Bank of Greatest ceilings

India (RBI) circular mandating builders mortgaging the land to raise money to disclose it in all advertisements and brochures.

RBI has asked lenders to ensure that all publicity material relating to the sale of real estate make a mention of the bank’s lien on the property so that home buyers are not kept in the dark about this legal claim or ‘hold’.

RBI aims to prevent prospective buyers from being lulled into the belief that the flats they own are on ‘free-hold’ land through this move.

Says Anuj Puri, country head of real estate consultant Jones Lang LaSalle Meghraj, “The RBI circular will bring transparency and accountability on the part of developers. It would also give a chance to buyers to see the viability of projects especially when the loan amount is very high.”

In cities such as Mumbai, a flatowner gets rights over his house through membership of a cooperative housing society, which owns the building. The land is not owned by the society unless it is transferred through a conveyance.

According to senior advocate R N Shetty, who specialises in real estate matters, property where a bank has a charge does not have a clear title and therefore cannot be transferred to the society through a conveyance. He added that the bank could also attach and auction the property in the event of a default by the builder.

RBI has said banks should as a pre-condition to lending insist that builders disclose complete details of the charge on the property. This should include the name of the bank that has a lien on the property which a builder is seeking to develop and for which it has sought a loan from the lender.

The builder or developer will have to add as an appendix information relating to the mortgage while advertising a particular scheme. Besides this, it will have to provide a No Objection Certificate of the mortgagee bank for sale of flats/property, if required.

Indian real estate sector to witness recovery from end-2009

2009-09-19T03:51:00.000-07:00

The Indian real estate is expected to enter the recovery phase by end-this year and macro-economic and sector-specific factors will act as catalysts in this recovery, a leading real estate consultancy said

Economic recovery during CY 2010-11 is likely to reinvigorate the interest of foreign investors in India's real estate market. We expect enhanced capital inflow in the real estate sector in the medium-to-long-term," Jones Lang LaSalle said in its report.

Initial yield is expected to show compression during CY 2010-11 and capital values are likely to decline during 2010 before recovering in 2011, the company said in the report.

"Initial yield has already started to show a declining trend during 2009 which is likely to be the case in the near-term. Yield on 10-year Indian Government Bonds is likely to harden due to higher fiscal deficit," it said.

The report said although the high fiscal deficit is likely to harden interest rates in the economy, all other macro-economic variables are expected to improve during CY 2010-11 which is likely to induce real estate market recovery after the slowdown of CY 2008-09.

According to the World Economic Outlook Report by IMF, the world economy is likely to contract by 1.4 per cent during 2009.

While advanced economies are expected to contract by 3.8 per cent by the end of this year, emerging and developing economies are likely to grow by 1.5 per cent. India and China are expected to grow by 5.4 per cent.

"India and China are expected to witness a robust recovery with increase in real GDP growth from CY 2008-09 levels and Indian economy is expected to grow at 5.4 per cent during 2009 (the second highest in the world after China, which is likely to grow at 7.5 per cent)," the report said.

Fiscal deficit in India leaped from 3.1 per cent in 2007 to 6.1 per cent in 2008 and is further expected to inch up to 6.4 per cent during 2009, it said.

Govt plans regulatory reform for housing sector Assetventures

2009-09-19T03:46:00.000-07:00

The central government is working on a model real estate regulation bill to provide guidelines to facilitate growth and promotion of healthy and transparent efficient and competitive real estate sector in the country, said the housing and urban poverty alleviation minister Kumari Selja.

This is a welcome move and will help the sector in becoming efficient and competitive. However, developers feel the government should form a separate regulator on the lines of Securities and Exchange Board of India (SEBI) to regulate the sector.

Addressing a conference on real estate, the minister said Indian real estate market is unorganised and fragmented and that most of property transactions are based on certain perceptions and not necessarily on sound business principles. In this, customer satisfaction is low and redressal procedure is long and cumbersome. This has created problems for both buyers and developers. As end users are not sure of delivery of a house by builders on time, they dont want to risk a purchase by taking a loan from the bank.

Apart from this, many buyers are not even sure of the specifications, which developers promise while selling them the houses/flats. Worse still, when developers do not deliver on time or stick to the promised specifications while selling, buyers do not know where to for redressal.

Going to a court is not only time consuming but also expensive. This has forced buyers to either defer their purchase or to go for completed projects. But, this apprehension of end users has affected genuine developers as well, which have a plan and required finances to complete a project. However, in the last couple of months, end users have started showing interest in buying new projects. But, they want to buy in the projects of reputed developers alone. This has created problem for the new but good developers.

A senior developer says if the sector is well regulated, the role of brokers and investors can be reduced. In most of the cases, investors, who have better understanding of the sector and who can invest time and money to know about developers, invest at the early stage of implementation of a project and make easy money by selling them to end users at high prices when the project comes to a close. The end users, on the other hand, are comfortable in buying a house when projects are close to completion, hence making the sector over dependent on investors.

Consequently, in the last one year of market downturn, the entire real estate sector came to a screeching halt as investors disappeared from the market. But, had the sector been well regulated, end users would have been bold enough to buy at the early stage of project implementation. This would have helped developers also.

However, another problem in regulating the sector is that it comes under the state subject as well. Thus, a senior official says nothing much can be done unless state governments show interest. Haryana Government has already passed an act to regulate the sector. But, the results are not encouraging, thus far. It was assured all the stakeholders that the government will accord full cooperation and support to encourage affordable housing.

She said the housing sector in India holds tremendous potential and has positive impact on the social and economic development of the country. In
2006-07 the sector was about 4.5% of country's Gross Domestic Product and comprised approximately 7% of the total urban workforce. Housing is the largest component of the construction sector and central to economic growth.

However, provision of affordable housing for all is a complex problem with challenges emerging from many facets of urban sector. The minister said there are many impediments to the growth of affordable housing land and capital being the two key constraints.

To increase the stock for affordable housing the focus has to be on augmenting land supplies. Kumari Selja said the issue is a critical one and requires a number of measures such as alternative methods of land assembly, development and disposal to be pursued, check on prices of urban land, encouraging public-private partnership, promoting intense use of land-higher densities, revision in Floor Area Ratio or Floor Space Index and change of norms to suit local situations, discouraging speculation in land development, and allotment or disposal process to check rising prices of land.