Given the significance of the construction sector in the overall growth of the Indian economy, it is imperative that sector integrate common aspects of infrastructure needs that ensure planning for sustainable and affordable development with Information Communication and Technology (ICT). This is to accumulate timely and accurate information, reduce dependency on human resources, and manage costs.

The increasing awareness on the inter-linkage between real estate assets, ICT tools are helping pave the foundation that provides the basis for social, economic and physical well being of projects. It is with this endeavour that Royal Institution of Chartered Surveyors (RICS) India had organised construction workshop series IV – ‘BIM and the Future of Technology’, to encourage practitioners to understand and adopt futuristic technologies that will impact real estate and construction projects in the future.

To take up the workshop, RICS called upon Paul Doherty, President of Screampoint as the international faculty, who is one of the global industry’s most sought after thought leaders, strategists and integrators of process, technology and business. Doherty helped deliver specialized content for this one-day awareness workshop which concluded in Delhi NCR on 28 May.

Doherty, who has extensive expertise in orchestrating all aspects of large scale projects and delivering them on time and under budget to increase profits, highlighted the problems associated with fragmented projects and how technology, especially Building Information Modelling (BIM) can be an enabler of change in the process of design and delivery. He conducted informative and interactive sessions with lively discussions focusing on the key issues of building and facilities technology; leadership support and cultural adoption of information technology; and the technology and standards aspects of BIM from a management, user and business perspective.

With fragmentation across people, tasks and tools which result in lost time, money and quality termed as the central issue in ‘building’ today; the workshop provided an overview of how BIM can transform organisations’ and provide them with more information at the appropriate time and process and be more interactive between project participants. It was also indicated that BIM makes organisations better, through better communication channels across stakeholders, improved understanding of how designs work and as a tool for change management. Also, BIM makes organisations faster, through faster and more complete design coordination and faster resolution of changes.

Discussions were also held on the various benefits of BIM, workflow processes, practical BIM applications and the various global projects that were making use of this remarkable tool. The faculty also deliberated on the role of BIM in the lifecycle of a building, 4D in action, coordinated documentation and BIM as an augmented reality, fabrication and service. Subsequently, BIM as a process was also discussed.

The day-long event in Delhi, was attended by over 65 participants comprising of project managers, contractors, consulting engineers, real estate developers, architects, construction engineers, town planners and technology analysts amongst others, representing various renowned and respected organisations from within the real estate and construction sector.

As part of the on-going series, the second and third workshops from the current series will take place in Bengaluru on 30 May and Mumbai on 01 June.

Source: MagicBricks.com Bureau

Slow demand for properties across Mumbai city kept the change in average capital values within a stable range. Factors that have pulled back percentage change growth in average capital values in the Jan-Mar 2012 quarter compared to the Oct-Dec 2011 quarter are negative consumer sentiments, local policies and high prices.

These were the key findings according to MagicBricks.com PropIndex tool, which tracks residential apartment prices and supply across India. Realtors believe that demand for multi-storey apartments for both rental and purchase has moved to Western suburbs from South Mumbai, primarily because of good connectivity, availability of modern amenities in the projects and higher standard of living. Capital values in Jan-Mar 2012 quarter rose between 1-5% compared to a 5-15% range in the previous quarter in localities across Western suburbs. These include Andheri, Bandra, Goregaon East, Kandivali, Borivili East, Malad West, Juhu and Mira Road.

Drop in average increase in property values was primarily attributed to a fall in the number of transactions in Western suburban localities, said Shashikant Gosavi of Siddhivinayak Properties. Outright purchase of apartments has been weak because of factors such as high raw material prices and general sentiment among buyers of prices coming down. The exceptions were Dahisar East and Virar that witnessed a rise of 8% and 11% respectively.

Andheri West, Goregaon East, Kandivali West, Malad West saw an increase of 3-4% in values in this quarter, whereas Borivili East, Andheri East, Kandivali East and Mira road witnessed a 1-2% rise in values in the period. Demand and capital values in
Western suburbs such as Andheri West mainly increased on account of regular demand for properties, primarily attributed to proximity to domestic and International Airport and accessibility to Western & Eastern Highway, Pande said.

Versova-Ghatkopar metro line expected to become operational from this year end will impact values and demand positively in Western suburbs, Pande added.

Areas along Central Mumbai line too have witnessed a fall in percentage growth in Jan-Mar 2012 quarter. Bhandup West, Ghatkopar West, Mulund West, Parel and Worli have seen a rise of 3- 6% in average capital values.

No major residential project launches have taken place in the quarter in these localities, Uday Naik of Bhageerati Real Estate said. Demand was been impacted due to high construction costs, increase in booking rate of apartments, etc.

Anal Shah of Modern Estate Agency said that demand and values across localities in Mumbai have neither been good nor bad. “Values have remained stable and there has been stable demand owing to proximity to key areas such as Bandra Kurla Complex (BKC). Worli, Prabhadevi and Dadar continued to see sustainable rise in the values on the back of Worli Sea link that significantly reduces travel time from Bandra to Worli,” Shah said.

Neha Kashyap, MagicBricks.com Bureau

Bangalore real estate is witnessing a rapid growth and development. The shrinking space in the city has resulted in city’s expansion and emergence of new corridors of growth and one such upcoming area is Greater Bangalore. The peripheral and outer ring road development in Bangalore has further opened channel of real estate developments at Greater Bangalore.

According to Aseem Kumar from Welwoth Properties, “the saturation of Central Business District (CBD) areas and prevailing high capital and rental values of residential and commercial spaces has shifted demand to areas such as Grater Bangalore”. Most of the upcoming as well as new multinational companies are shifting their base to areas of Greater Bangalore, he added.

There has been an increase of up to 50% in the capital values of plots in the past two of years, said Ankush Jain, property consultant at Jain Associates. The villages in Greater Bangalore are transforming into big towns giving way to real estate activities. More than 50% of such developments have already taken place, he added.

Though the real estate market at Greater Bangalore is yet to establish its ground, the property values have already started rising and have noted a 10-20% appreciation in capital values of plots during the past six months, said, Abhijeeth Kaushik from SVS Group. The completed and ongoing projects on the highways have enhanced accessibility and connectivity of Greater Bangalore to a large extent and this has also contributed in soaring land prices.

Areas like Yelhanka, Dasarahalli, Bommanahalli and Hormavu has already witnessed a massive growth in realty sector in recent past. The current capital values of residential sector varies between Rs 1,800-4,000 per sq ft which is very much affordable compared to other upscale localities of Bangalore.

Number of projects such as integrated township projects, multi-storey apartment’s commercial complexes and retail projects by both private and public entities are being planned to come up in Greater Bangalore in the coming years, added Kumar. State authorities are also taking several initiatives to develop proper transportation, roadways, drinking water, power, sewage and other civic amenities required for good living in the area. With all these activities happening real estate market is estimated to undergo an upliftment in near future and rise in property values.

Nidhi Vashisth, MagicBricks Bureau

Ahmedabad, the city well known for art and architecture is witnessing a boom in the residential real estate sector. The influx of industries and rapid commercial development in and around the city is the reason for this spike. The city houses auto companies like Tata Motors, Ford and Peugeot in addition to multinational companies such as Bosch, Hitachi Hi-Rel Electronics, Colgate Palmolive, Hyundai Transformers and AIA Engineering have bought land for their respective businesses. Due to this, unstoppable demands from working class for 2BHK-3BHK apartments has cropped up which further increased the residential prices across the city and boost all major developers across India to join this profitable bandwagon.

The industry experts and MagicBricks.com PropIndex tool, which tracks residential apartment prices and supply across the Indian market quarterly, revealed certain facts about the city’s growth and reasons behind the same in the Jan-march 2012 quarter.

Rushabh Patel, VP, CREDAI & President, Gujarat Institute of Housing & Estate Developers (GIHED), said, “Gujarat government has taken steps to ensure that real estate development is free of hurdles. A transparent and organized system, stricter laws for funding and speedy execution of policies have brought a sense of stability and consistency into the system – some key factors that were missing in the last few decades. It seems that real estate in Gujarat is what experts call ‘a sustainable investment’. We have set the tone in this industry to make it more sustainable and accountable.”

“Being one of the growth epicentres of the economy, it is essential that we follow a deep-rooted system that secures the aspirations of the developers and the investors”, he added.

According to PropIndex data, the average capital values of multi-storey apartments in localities such as Satellite, Bopal, Bodakdev, Vastrapur and Gurukul has witnessed increase in values in Jan-March 2012 quarter.
The newly developed locality like Vejalpur also saw an increment of 6% in the capital values in the same period. Factors driving growth here are proximity to Prahlad Nagar and SG Highway and affordable capital values, said Vikas Jain of Jain Estate.

Many affordable projects are in the pipeline in Bopal which is attracting buyers significantly. In addition, the area is within 1-5 kms from Satellite locality where all automobile brands have manufacturing operations. Satellite also enjoys good commercial properties, malls and shopping complexes coupled with good connectivity to prime areas and developed neighbourhood, said Prakash Bavadiya from Estate Management Pvt Ltd.

Gandhinagar, the capital of Gujarat, witnessed maximum rise in capital values, by approximately 10% as per PropIndex data. The reason behind this rise was the quick development taking place in the area. Gujarat International Finance Tech-City (GIFT), one of the most ambitious projects spearheaded by the government of Gujarat through a joint venture (JV) between Gujarat Urban Development Company Ltd (GUDCOL) and Infrastructure Leasing & Financial Services (IL&FS) was a major factor boosting values here. The project is being designed as a hub for the global finance services industry.

GIFT will have a Special Economic Zone (SEZ), international education zone, integrated townships, entertainment zone, hotels, convention center, international Tech park, Software Technology Parks of India (STPI) units, shopping malls, stock exchanges and service units. Therefore, this is directly helping in boosting the residential prices in the locality, Mistry added.

He said that GIFT is proposed to be a globally benchmarked International Finance City with a built-up area of approximately 85 million sq ft. “Currently, two commercial towers, each of 29 floors each is under construction, while the work on a third residential tower of 33 floors will start soon. Also, a 250 ft wide road is to be built connecting GIFT to the Ahmedabad-Gandhinagar Highway in the next couple of years,” Mistry added.

Gandhinagar is surrounded with lush greenery and it is a peaceful area to live in. Therefore, people prefer to buy property here. In addition, the proposed metro connectivity is expected to further reduce the distance between the locality and main city of Ahmedabad, he said.

With more smart buildings to crop up in the following decade, the entire dimensions of the business in the Ahmedabad have changed to give way to a smart business policy which not only harbours a healthy sense of competition among developers to give the consumers the best, but it also builds a firm spine of the industry – The spine that will carry the expectations of a booming economy. The commitment and diligence of Gujarat’s real estate developers have scripted a growth story that only few dreamt of.

Neha Nagpal, MagicBricks.com Bureau

Housing societies that have applied for government funding for their infrastructure – like roads, water supply, and street lights – under the Swarnim Gujarat Chief Minister’s Urban Development Fund can now track the progress of the work every month.

The planning department of Ahmedabad Municipal Corporation (AMC) has sent forth a detailed format, using which each zone and every ward office has to report the progress of each work undertaken under the scheme, They will also have to report the progress of the application made by the societies.

A detailed program schedule has been sent across various zone offices of the AMC on May 23. A budget of Rs 100 crore has been earmarked for the scheme for private housing societies. The format involves details pertaining to type of request made by the society, monetary contribution by the society, the resolution of the society to participate in the scheme, the contribution from the government for the civic work, an estimated budget for the works, and the agreed tender amount.

“These details can be put on the web and the public can access information regarding the progress of the work. But, first we have to make operational the system – funding and commissioning of work remains a primary concern. A bigger task is the cluster of poor residential areas in the city. Most of them are illegal, the question of whether we can provide these facilities to them is also to be considered,” says a senior AMC official of the central zone.

With the assembly elections scheduled later this year, the state urban development department has announced plans to resurface housing societies’ internal roads and install streetlights and drinking-water pipelines on the public-privatepartnership model. Under the project, the government will pay 70% of the funds, while the remaining 30% will be shared by AMC and a society which will have to pay only 20%.

The societies will be selected on the first-come-first-served basis. Only those societies that submit a resolution adopted by them or have signatures of all members would be considered eligible.

In addition, AMC will fund proposals for only conventional street lights. However, if a society wants to install power-saver lights, they can pay extra.

Source: The Times of India, Ahmedabad

Improved market sentiments have led to an enhancement of capital values of multi-storey apartments in the Jan-Mar 2012 quarter in Delhi. According to MagicBricks.com PropIndex tool, which tracks residential apartment prices and supply across India, the latest quarter has seen a uniform rise in values across localities in North, South, West and East Delhi, similar to the previous quarter.

Sectors in Dwarka continued to witness a rise in capital values across Sectors 4, 6, 9, 11 and 12 owing to consistent demand from buyers. The rise has been in the range of 6-12% in the Jan-Mar 2012 quarter. Supriya Prakash of Shree Vinayak Estate said that this quarter saw maximum demand for 3BHK apartments for Rs 1 crore and above. “There are very few 2BHK apartments in Dwarka as most residential developments are by Cooperative Group Housing Societies (CGHS) here,” Prakash added.

Other West Delhi localities such as Uttam Nagar and Vikaspuri saw an increase of 3% and 9% respectively. CL Babbar of Babbar Property Pvt Ltd said that the primary reason behind price rise in Vikaspuri is the constant demand for properties and slow supply.

North Delhi localities such as Sectors 13 and 24 in Rohini saw a marginal rise of 3% and 1% respectively. Unlike the last quarter, when Rohini saw record high asking values, this quarter
witnessed a drop in percentage growth. Darpan Puri of Corner Stone Realty attributed this to a fall in demand and rise in supply in Rohini. “The internal infrastructure in Rohini has deteriorated and issues like electricity and water are now discouraging buyers from purchasing here. People would instead invest in Pitampura,” Puri said.

In East Delhi, localities such as Mayur Vihar, Indraprastha Extension and Vasundhara Enclave continued to witness a rise in the range of 3-6%. Availability of projects at lesser values, metro connectivity and good road infrastructure were the key reasons, said Kamal D Patil of Landmark Real Home. “Vasundhara and Indraprastha Extension offer comparatively lower rates for property, which is the main reason for consistent rise in values quarter-on-quarter,” Patil said.

South Delhi localities saw a healthy jump in values, contrary to the previous quarter. Safdarjung Enclave, Panchsheel Enclave, East of Kailash, Greater Kailash I, II and Shivalik witnessed a rise in the range of 6-14% this quarter. Vikas Thapar of Realty Expert said that although demand has not increased significantly, yet the improvement in market sentiment in the hope of a fall in interest rates and inflation early this year led to a hike in values. Most residential space that is witnessing a good demand in these localities is in the size range
of 1,500-2,000 sq ft area, he said.

Neha Kashyap, MagicBricks.com Bureau

Property buying needs to be looked at with a long-term perspective in mind. Typically, an exit from the property investment after 4 years yields great returns, said Ananta Singh Raghuvanshi of DLF India Ltd. It is important for infrastructure development to keep pace with the swanky townships being planned in most cities, she added.

“If water supply, electricity, safety or security, law and order, road infrastructure etc are also progressive, we can only expect appreciation in the land value,” said Ananta Singh Raghuvanshi, Director – Sales and Marketing of DLF India Ltd. Answering over 40 queries, Ananta offered property advice to users on Gurutalk chat forum of MagicBricks.com on May 29. Prospective buyers posed queries ranging from investment potential in National Capital Region (NCR) and other emerging cities, charges to be aware of before investing in property, future potential in Ludhiana market, affordable project versus luxury project, among others.

When a consumer asked about growth potential in Delhi/NCR market and Mumbai, Ananta Singh Raghuvanshi said, “Gurgaon and Noida are established real estate markets where investors have booked huge profits in the past. The areas in and around Mumbai will continue to grow because of the demand-supply deficit in the main city.”
Talking about the return on investment one can expect over a 2-4 year time horizon from Noida Expressway, Raghuvanshi said “For built-up properties, the hike in steel, cement, labour cost is one part of the appreciation story while demand supply equation is the other.

Another consumer enquired about the returns that can be expected from Sohna Road, to which, the Expert said “it is impossible to predict a return in two years. Property buying as an investment must be looked at in case, of long term holding capacity. While in the last 2 years, Gurgaon properties have gone up by 20-80% in some cases but that cannot be an indication of what the future holds.”

To the query whether an affordable project from a local developer is better or a luxury project from a reputed developer,
Raghuvanshi added that both categories are good, however, the choice is to be made based on the buyer’s disposable income. “A reputed developer obviously scores over a new entrant in terms of experience and delivery,” she said.

For non-resident Indian (NRI) investors, Raghuvanshi added that there is no better time to invest than now. “Since NRIs are not going to use the property regularly, I would suggest luxury plots at Kasauli, New Chandigarh, Lucknow which are new growth corridors and DLF is offering properties at all these locations.”

Talking about the future potential in Punjab, Ludhiana is amongst the most prosperous cities and traditionally people like investing in land. Therefore, the future is bright.

Pointing out the charges applicable while buying a multi-storey apartment, she said that maintenance, security, registration charges, preferred location charges, external development charges (EDC), internal development charges (IDC), service tax etc are basic charges.

Source: MagicBricks.com Bureau

The repo rate (the rate at which the RBI lends to banks) was cut by 50 basis points from 8.50 percent to eight percent. Consequently, the reverse repo rate (normally fixed at a spread of 100 basis points below the repo rate) is now at seven percent.

The inflation rate was the key driver that guided the RBI to tighten the money supply earlier. The RBI raised the key lending rates 13 times between March 2010 and October 2011 to contain the inflation rate which had been hovering in double-digits. Now, after almost three years, the RBI has slashed the shortterm lending rate by half a percent to eight percent.

This helps in the reduction of lending interest rates on loans, including home loans. The RBI’s move to reduce the repo rate has been triggered by a visible fall in the growth rate as well as reduction in inflation numbers. Also, after two consecutive cuts since January, the RBI has retained the cash reserve ratio at 4.75 percent.

According to the RBI governor, ‘the cut is aimed at spurring growth to the nine percent levels seen before the global financial crisis that began in 2008. The reduction in the repo rate is based on an assessment of growth having slowed below its post-crisis trend rate, which, in turn, is contributing to the moderation in core inflation’. The reduction in the repo rate will help banks cut their lending rates. It is expected that the interest rates will come down by up to 50 basis points.

This was the first time in three years that the RBI slashed the key interest rate by 50 basis points. If the housing loan interest rates drop, it facilitates more homebuyers to buy property.

Initially, a reduction in home loan rates will benefit new borrowers more as the existing borrowers will have to bear with the old rates for some more time. With a reduction in the lending rates, the home loan EMIs will come down too. Banks will pass the rate cut to borrowers, enabling more to invest in real estate.

The key rate reduction is expected to help builders as well. This reduction in the key rate will reduce the cost of funds as it will allow banks to lower their lending interest rates. With a lowering of interest rates, demand is expected to get a boost.

Source: Times Property, The Times of India, Bangalore

A copy of the power of attorney should be notarised with the Indian consulate in the respective country which will provide authenticity on their behalf for an investment in property in India. The property can be registered in the name of the NRI, and the power of attorney holder can sign on their behalf by producing a copy of the power of attorney to the appropriate authorities.

If a NRI decides to acquire a house through a power of attorney, he can still proceed abroad. This is because, for the purposes of income tax and wealth tax, the power of attorney holder accompanied by the actual possession of the property through the agreement to sell is deemed to be the owner of the property for the purposes of Section 27 of the Income Tax Act.

A general power of attorney in favour of the NRI’s relatives will enable them to sell the property and arrange to repatriate the sale proceeds through an authorised foreign exchange dealer after payment of the taxes due. They can also rent out the property and credit the proceeds to a NRO account.

Similarly, NRIs can seek home loans through their power of attorney holder and documents can be signed on their behalf while investing in property. They can issue the EMI cheques on behalf of their relatives here as the Reserve Bank of India (RBI) has relaxed the norms of operation of joint accounts considerably recently.

A significant development is the proliferation of housing finance companies and banks in countries abroad. In the Gulf, Dubai boasts of many housing finance companies and banks having arrangements with exchange houses. Home loans can be processed through overseas representative offices for NRIs. As a result, the power of attorney enables their relatives to interact directly with developers in India. A number of nationalised banks have remittance arrangements with the exchange houses.

The RBI also said that any citizen who was earlier residing in a foreign country can own or transfer property or other assets in that nation if it was acquired during the time of his residence there. A person resident in India is free to hold, own, transfer or invest in foreign currency, foreign security or any property situated outside India if such currency, security or property was acquired, held or owned when he was resident outside India or inherited from a person who was resident outside India.

Similarly, returning NRIs can retain and reinvest the income earned on investments made under the Liberalised Remittance Scheme. There was lack of clarity earlier as to whether the income earned on assets held abroad by NRIs who have returned to India for permanent settlement and assets held outside India through Liberalised Remittance Scheme are required to be realised and repatriated to India. Now, the RBI has clarified that income and sale proceeds of assets held abroad need not be repatriated to India and can be retained and invested outside India.

Foreign exchange rules eased

The RBI has recently allowed NRIs to hold joint accounts with Indian residents, a move that helps increase remittances. The central bank has also permitted sale proceeds of foreign investments in India to accrue to NRE or FCNR accounts after tax deductions, under the Foreign Exchange Management Act (FEMA).

Foreign Currency Non-Resident (FCNR) account and Non-resident External (NRE) account are opened by NRIs with Indian banks. As per the recommendations of the committee constituted to review facilities available under FEMA, the central bank has taken such steps.

The RBI has allowed residents of India to include nonresident close relative in their resident bank accounts on ‘former or survivor’ basis.

However, such non-resident relative will not be eligible to operate the account during the resident’s lifetime. It also permitted NRIs to open NRE and FCNR accounts with their resident close relatives. In this case, the resident relative can operate the account as a power of attorney holder.

Source: Times Property, The Times of India, Bangalore

Rupee value

The rupee has been depreciating since last August and has provided an opportunity for NRIs to increase the remittances for varied purposes. In fact, between January last year and now, the rupee has depreciated by 22 percent from Rs 44.67 to a dollar to Rs 54.51. The immediate beneficiaries are NRIs and persons of Indian origin (PIOs) earning in dollars or currencies linked to the US dollar.

According to financial analysts, while the exchange rate will have benefited all NRIs, it will be particularly beneficial to those looking at long-term investments in real estate. There are an estimated eight lakh residents leaving the country every year and one lakh NRIs returning to India for permanent settlement. The availability of term loans with lower lending rates is a boost for NRIs, particularly endusers, looking for investments in residential property.

Finance options

The US government is encouraging consumers maintaining a good credit record with zero percent interest loans till the year 2013 in order to prop up the local economy. Many NRIs and PIOs will look here to plough back the money into more profitable avenues as both the exchange rates and real estate price appreciation provide an ideal opportunity for them to maximise the yield on investments.

Value appreciation

In Bangalore, capital values of residential properties are up from five to 15 percent annually depending on the location. Besides the exchange rate fluctuations, NRIs and PIOs stand to benefit from the current market values as prices are good at the moment. The spurt in demand from NRIs for investments in residential property has been gradually increasing ever since the rupee started depreciating, say property consultants monitoring the sales movements in the city. This is particularly seen in high-end luxury apartments.

Favourable repatriation norms

Yet another significant factor is that NRIs and PIOs are allowed to repatriate the amount paid for the acquisition of property in foreign exchange after a lock-in period of three years. The facility is restricted to not more than two such properties. The balance amount can be credited to a NRO account.

They are also permitted to remit an amount of up to USD one million per financial year out of the balance held in a NRO account or from the sale proceeds of assets (inclusive of assets acquired through inheritance or settlement), subject to the satisfaction of the authorised foreign exchange dealer, and on the production of an undertaking by the remitter and a certificate by a chartered accountant in the prescribed formats.

Easy Maintenance

Unlike earlier, availability of property management services provides more cushion for real estate investors in the city. This is because such services are handled by professionally-qualified agencies who have set up shop across major cities in the country. In Bangalore alone, there are five agencies currently operating and 12 more agencies are in the process of setting up shop in the coming months.

Source: Times Property, The Times of India, Bangalore