Buy dream home in india

Having a house of one’s own is on everybody’s wish list, but while you are at it, ensure that it is not a hurried decision. Buying a property is a huge investment and involves a great deal of financial planning and strategy. If you are thinking of purchasing that dream home for yourself in 2016, we’ll help you make a smart choice.

Experts in the real estate industry believe that the government initiatives for enhancing infrastructure announced in 2015 will give a boost to the sector and restore investor confidence. The realty segment will certainly record an increase in sales thereby aiding reduction in unsold inventories across regions.

Promotion of 100 Smart Cities, AMRUT (Atal Mission for Rejuvenation and Urban Transformation), Housing for All by 2022 and infrastructure development projects are some of the steps that will benefit Indian economy. Moreover, reforms like easing of FDI policy, the apparent implementation of the Real Estate Bill and and the introduction of REITs(real estate investment trust) is set to bring in the much-needed  transparency into the real estate sector thus improving  investor confidence.

“The year 2016 is likely to begin on a positive note on the back of these reforms and increased investor confidence. Overall, the next few years may witness building of some strategic partnerships with select developers, private equity investors also looking at liquidating assets. Consolidation through joint ventures in development would unlock the potential of major cities,” opines Sanjay Dutt, Managing Director, Cushman & Wakefield.

If you are looking to buy a property in 2016, you need to be very careful with legal documents of the shortlisted projects as there are innumerable enticing deals in the market. We advise you to not get tempted with freebies and discounts rather conduct a detailed scrutiny on the project, the builder type, locality, etc to list a few.

We have attempted to enumerate some of the cities which may give you a good return on investment in the next five years.

 Thane:

This neighbourhood of India’s commercial capital is emerging as an attractive region for investment in the Mumbai Metropolitan Region in 2015 because of abundant options available here. The rapid growth in infrastructure such as the proposed extension of Mumbai metro is making Thane city a sought after residential destination.  Thane west saw considerable movement due to good connectivity and proximity to important commercial and industrial areas in the vicinity.

In terms of affordable areas, the Kalyan and Dombivli region ruled the roost. With the selection of Kalyan and Dombivli as smart cities, significant commercial as well as residential activity in these areas is anticipated.

 Mumbai:

Madh–Marve has been branded as a destination with an expected price appreciation of 94 per cent, emerging as a potential asset class for the next five years. Ulwe, scores second, with a 70 per cent price appreciation by 2020, while Majiwada– Kasarvadavali may experience an appreciation of 59 per cent during the same time period.

Ghaziabad:

With significant real estate activity seen across three prominent markets including NH -24, Raj

Nagar Extension and Krishna Vihar, Gaziabad has emerged as the dark horse of NCR. The Centre’s nod for road widening of NH -24 towards Ghaziabad coupled with the location advantage of the highway and the direct link with Delhi, Noida and other areas of Ghaziabad have driven growth here. The realty prospects in 2016 in this region look promising.

South and East Bangalore:

Abundant new supply and affordable prices, high consumer demand and wide range of options across segments have boosted buyers’ interest in these areas of Karnataka. Good connectivity and reasonable property prices will drive growth in areas like Whitefield, Panathur, Electronic City Phase 1, Begur Road, Kanakpura Road and Bannerghatta Road in 2016.

Bhiwadi:

An emerging industrial and real estate hub bordering Gurgaon, Bhiwadi is well connected with highways such as NH-8 and NH-71B. It falls along the Delhi-Mumbai Industrial Corridor, making it a potential destination for property investment. The proposed Neemrana airport in the vicinity is also expected to boost demand in the real estate sector.

 Hyderabad:

Low ticket prices and buoyant office space activity has boosted the realty prospects in the city in recent times. Post clearing of the political clout and division of the state, Hyderabad has emerged as one of the promising realty markets of India.

Knight Frank ((based on its report on Residential Investment Advisory 2016, has identified select locations in major Indian cities which will give good returns – New Airport Road in Viman Nagar and  Vishrantwadi in Pune, Thanisandra and Panathur in Bangaluru, Golf Course Extension Road and New Gurgaon in Delhi-NCR and Puppalaguda– Narsingi cluster  in Hyderabad. According to JLL India, Noida and Greater Noida (NCR), Thane, Navi Mumbai – MMR, Whitefield in Bangalore, Viman Nagar and Nagar Road in Pune and Kochi Are among top investment options in 2016.

Real Estate Sector

Real estate experts believe that the 2016 will start with the positive note for real estate sector and in coming year it may witness pickup in the sales with improvement in the number of unsold inventories. In simple words we can say that year 2015 was little bit good for realty sector as it has witness some  regulatory changes, which will do the big impact in year 2016 as regulatory changes have relaxed the foreign direct investment laws, after the direct approval of Union Cabinet and it was much awaited Real Estate Bill. On Real Estate Bill there were mixed reactions from real estate experts, but broadly everyone sees it as a positive move as currently real estate sector is in sluggish mood.

As per real estate experts, In September the rate cut of 50 basis points by the RBI under monetary policy review will also increase the demand and supply in the real estate sector as well as government panel is also planning to bring seventh pay commission. As per the reports of Financial Express, “Investment in the real estate sector in 2015 was about $ 8 billion or Rs 53,000 crore and it was even year high even when the sector is not in a good shape. However; BSE Real Estate index also plunged by more than 16 percent on a year to date basis at the December 18. According to reports of Cushman and Wakefield private equity players have invested about $ 2.8 billion or Rs 18,700 crore in the real estate market till end September 2015. Add to that estimation $ 4.5 billion, or Rs 30,500 crore was of NCDs till the end of November 2015 and due to that the overall tally was up by 74 percent in comparison of last year which was about Rs 17,600 crore.

As per the statement of Anuj Puri, Chairman and Country Head of JLL India, “In past two years the real estate market is seeing some improvement and it has been adjusted to new trends in terms of aligning supply for relevant demand. The more he added that now real estate developers are paying more attention to the requirements of buyers and they are developing more property as per need of middle class which is in the price range of Rs 75 lakhs to Rs 90 lakhs in tier-I cities”.  According to Vikas Malpani, co-founder and Head of CommonFloor Groups, “The real estate bill approval is positive sign for real sector, which along with other trends could shape the real estate sector in 2016”. There are many experts, who are giving thumps up to the recently approved Real Estate Regulatory Bill as it can be helpful to clear the unsold inventory. We all know that whenever any new bill or law comes in the existence, the real estate developers tend to adopt a wait and watch approach. And due to that in present, the completions of existing projects are the prime focus of developers for some more months.

On the other side at the positive note the developers are focusing more on completing their existing projects as well as clearing the inventories and according to JLL India listed that following regions as the best bet for real estate sector in 2016; Noida & Greater Noida, Thane – Mumbai Metropolitan Region (MMR), National Capital Region (NCR), Nagar Road – Pune, Whitefield – Bangalore, Navi Mumbai – Mumbai Metropolitan Region ( MMR), Viman Nagar and Kochi.

smart city

A turn on mega projects worth Rs. 4 lakh crore are for developing smart cities and towns to provide “Housing for All” for next seven years besides all the proposed amendments in real estate rules which was marked for the year 2015 in the urban development sector.

The central government has also approved many amendments in the Real Estate Bill, 2015 (Regulation and Development); with various provisions for depositing 70 percent of the real estate projects cost by the real estate builders into escrow account and fine or punishment for violations of the proposed real estate laws. However; the main aim of amendments is to protect the interest of the buyers and encourage the investors and buyers to show more interest in the real estate market by ensuring transparency. Apart from that the other major reform was to introduce the allocation of central assistance to the Union Territories and States based on the number of statutory urban local bodies and the total urban population besides slum dwellers and number of urban poor in each state.

However; the allotment of the bungalow of late President A P J Abdul Kalam, which is located at 10 Rajaji Marg to Mahesh Sharma, Tourism and Culture Minister was also created a lot of controversy through the efforts of Aam Aadmi Party as AAP was criticizing the move. Apart from that Aam Aadmi Party also demanded that the bungalow of late President A P J Abdul Kalam after his term as President which was ended in 2007 should be converted into a knowledge centre. But M Venkaiah Naidu, Urban Development and Housing & Urban Poverty Alleviation Minister defended the move and allotment of the bungalow by saying that allocation was made as per previous rules and regulations and the the central government had already decided to set up a memorial in memory of late President A P J Abdul Kalam at his native place of Rameswaram in Tamil Nadu.

Ambitious Housing Schemes of Modi Government:

PM Modi, launched his most ambitious schemes such as; AMRUT (Atal Mission for Rejuvenation and Urban Transformation), PMAY (Prime Minister’s Awas Yojana) and Smart City Mission on the June 2015 with a call to promote the planning and development in the country to set of new beginning in urban regions, which could be the key drivers in the economic growth of country. According to reports, 100 smart cities will come in existence in next five years, more than 500 cities will be developed under AMRUT scheme and PMAY scheme will aims to construct two crore houses in urban areas in the duration of next seven years under “Housing for All” scheme. While summing up new initiatives, Naidu told PTI; “Year 2015 is very significant the sense as we have set up urban planning in the country under many new different schemes. However; considering the provisions under AMRUT, Housing Mission and Smart City Mission there are new conscience on the part of urban local bodies which could be for effective for planning and execution”.

The introduction of competition for selection of Smart Cities Mission is first of its kind in the allocation of resources and funds. Apart from that government is also taking the consultation for prioritization and planning of the projects from normal citizens at city level and it is mandatory under the new urban initiative which is launched in 2015.

Image Credits : DNA

This week, the Central Government is seems to intend the passage of Real Estate Bill in parliament, and the Cabinet is likely to approve the previous few changes that have been made after the recommendations of the select committee. According to sources, the housing ministry has incorporated approx. all the amendments which were recommended by the panel and due to that now there is no scope for political party to oppose this Real Estate Bill with an aim to protecting the interest of home buyers or other consumers in the real estate industry.

According to one of the Government official, “We are positively hopeful about the Real Estate Bill since there are many home buyers and other people in the real estate industry who are suffering from no mechanism or framework to get protect from any kind of unfair trade practice or exploitation by the real estate developers and real estate firms”. The more he added that the Cabinet has approved the changes which were mandatory as the revised bill is taken up for discussion. It is expected that new recommendations which have been accommodate in the bill will include the provision of parity in the interest payable by consumer and developer in case of any default by either.

In Presents, real estate developers only pay 2 to 3 percent interest in case of their default whereas; consumers are liable to pay about 16 to 18 percent for their default. However; on the same issue the Rajya Sabha panel had said that the interest rate payable by the promoters and the interest rate payable by the allottees should be the same in eventuality of any default by either of them. The panel was also recommended that 50 percent of payments made by the home buyers for a real estate project be kept in a separate account and it should be used for that specific project only.

However; in addition to the provision of imprisonment of up to three years proposed by the government, the committee had recommended that the clause of imprisonment for a realtor should be failing to abide by the orders of the appellate tribunal.