“Mom will design my new home,” says Varun Dhawan

After actors like Alia bhatt, Taapsi Pannu, Shraddha Kapoor ventured out into the real estate market to buy their own properties in the maximum city, it is now the turn of the Badlapur boy to move out of his parents’ home.

Varun Dhawan has recently bought a four-and-a-half BHK flat in the same building where he is currently staying with his parents, David and Karuna Dhawan in Juhu area of Mumbai.

“I have been wanting to buy my own apartment since a while now, but not by borrowing money from my father,” he says. Varun’s bachelor pad is on the first floor of this building. “It is always nice to stay closer to your parents,” the 29-year old reveals.

While Varun’s co-star Alia Bhatt is getting her Mumbai home designed by interior designer Richa, for Dhawan kid, mommy knows best! “My mom will design the interiors of my new home,” he chuckles.

Varun is expected to move into his own den by December this year.

You can also reach him on :

Facebook :  www.facebook.com/VarunDhawan.co

Twitter : twitter.com/varun_dvn

Indian real estate sector 2016

In present, the rest of the world is considering our country as the land of opportunity for investment and business.  If we are talking about the real estate scenario for 2016, so no doubt it could be great year for residential as well as commercial projects.

1. Residential Properties:

It is expected that year 2016 will not bring some great hope for the residential sector as demand will remain constant. However; we can expect that silver lining will shine more and bad days of the real estate segment will be bottomed out; as according to reports in some cities sales have picked up and these cities are; Mumbai, Hyderabad and Bangalore. However; you can expect less launch in the cities such as; Mumbai as inventory level is already high. Real estate developers initiatives such as; attractive schemes, freebies, deal terms and heavy discounts with lower interest rates by RBI have activated fence-sitters. It is expected that year 2016 will end the long and painful journey of real estate market and signal an upward growth trajectory. It will definitely mature further into an organized industry in which some lesser- organized players become casualties.

2. Office or Commercial Properties:

The absorption rate of commercial properties as well as office spaces are still at 35 million sq ft and it is second highest figure in the history of country after the year 2011. However; the PAN India vacancy is still at the 16 percent, whereas; the realistic vacancy actually stands about 8 to 9 percent. It is expected that in the year 2016 the demand will remain consistent as occupiers are showing a positive bias. The years 2016 will bring more demand for leased spaces however; the quality supply will be lower. It means in year 2016 we can expect higher occupancy for Grade-B office spaces.

3. Retail Properties:

In 2015, there were no launch for the quality retail space and the major trend which we observed in the year 2015 were; the consolidation of retail real estate by retailers and big brands are focusing on the profit making stores and they are closing down the loss making stores. These days there are more institutional investors and all credit goes to relaxation of sourcing norms as single-brand retail companies are able to explore the Indian market. It is expected that years 2016 will be good year for the retail investors as there are many ecommerce companies which are planning to set up their retail stores in near future. Retailers will have to revisit their real estate strategy and have a flexible approach, customized to different micro-markets.

Capital Markets:

The year 2015 was the interesting year for capital market activities in the real estate market as PE focus continued to remain high for the office and residential projects. The platform-level deals and entity-level investments are also came into the limelight as the level of confidence are increasing among the investors.  The income yield of the office projects are attracting the majority of equity investments and when it comes to the geographical spread, so we can say that tier I and tier II cities are good for the investment in the offices spaces because over there you can earn more rent.

New year gift for property buyers

Ready Reckoner, RR is an annual statement of rates based on which the stamps and registration department collects stamp duty from property buyers which are revised on January 1 every year. However, in a key policy shift, the Maharashtra Government has issued a gazette notification that the prevailing RR rates with an average increase of 14 percent (revised in January 2015) will continue till March 2016.

Realty players had made a series of representations citing that there is a restriction on transactions happening below RR rates under Section 43 (c) of the Income Tax Act; they argued that it has become difficult for developers to reduce property prices even if they wish to.  Responding positively to representations, the government has decided to apply the revised rates from April 1, 2016. In view of the slow-moving real estate market, this decision protects the interest of property buyers.

“After a proposed amendment to the Bombay Stamp (Determination of True Market Value of Property) Rules, 1995,  The revised rules titled Bombay Stamp (Determination of True Market Value of Property) Rules, 2015 were issued by the government vide a gazette notification. The RR rates will now be revised from April 1 instead of January 1 every year in compliance with Rule 4,” told a senior government official.

Buy Property in Mumbai

If you are looking for the best time to buy property and you are looking for the indicators in real estate market such as; price and sales, so you can say that in many cities property market could be head for a revival. As per the reports of RBI, the average prices of residential units have increased by 13.7 percent in 10 major cities of the country in the period of July to September 2015. If we will see the brokers sales reports, so we can easily say that sales in real estate market have got a boost too.

According to one of the most reputed developer, “We are going for the pre-launch of our project because buyers are lined up outside of the office to book a flat. And at this point of movement we are expecting some good sales and price in near future”. According to statement of Sanjay Dutt, MD of Cushman & Wakefield, India, “It doesn’t mean that in near future real estate market will witness a turnaround, but it is expected that the trend will sustain for the next 6 to 8 months and we can call it revival”. The more he added that there are contradictions in the data as there are many launches in real estate market where buyers and investors are frenzy to buy. In past few months office and commercial demand has picked up, which means city is creating new job opportunities and if it will sustain for next few months so there will be a turning point for the industry.

Why it’s good time to buy property?

According to real estate experts, if you are end user, so it’s good time to buy residential property. As per the statement of A S Sivaramakrishnan, Head of Residential Services at CBRE South Asia, “These days smart buyers are already scouting for a property, as these days realtors are still flexible with the demand of buyers”. In Mumbai there are more than 77,000 apartments are in the inventory, as per reports of JLL India and it is expected that it will take 11 to 12 quarters to clear off that inventory against a healthy expected cycle of 5 to 6 quarters, as per the statement of Ashwinder Raj Singh, CEO of Residential Services at JLL India. The more he added that there are chances that developers will not raise up their prices if the sales pick up because it can make buyers uncomfortable.

Apart from that there are some developers in city which are offering flexible payment option with attractive interest rates, but they are aiming to sell houses at little higher price than the rates prevailing in those regions. Ashutosh Limaye, Head of Research at JLL India, Don’t just go by the quoted rate of the flat because developers might offer little lower priced with some additional charges such as; club fee, and fee for other amenities. Apart from checking the track record¸ titles and approvals, its recommended to check the discounts, offers and schemes for different real estate developers before making any kind of purchase, as per the statement of Mudassir Zaidi, National Director of Residential Agency at Knight Frank.

If you are looking for the under-construction flats, so its recommended to take some time and evaluate the projects and ideally buyers should take 30 to 60 days to visit the site and check if the construction is happening as per schedule or not. If there is any kind of deficit, then better to stay away from that project. However; buyers can find the good deal for old flats, which was constructed 5 to 10 years ago. Apart from that if you are at real estate investor, so better to wait and watch for the trends and developments for next two to three quarters.

Commercial Property

According to real estate experts, it’s good times to make an investment in the commercial property as companies are expanding their business with an aim to improve their business sentiment. If you are looking for regular cash flow with higher return and rental, so investment in commercial property is better than residential property.

As per experts, now commercial real estate space is witnessing a revival with little high demand at the time when real estate developers are not building commercial space from last four to five years due to global financial crisis and now its expected that soon existing stock will get consumed. And in simple words we can say that it’s the main reason why real estate developers and commercial property owners are receiving higher rental yields and now people are looking it as good investment option. Indian economy is growing with growth rate of 7.3 percent, apart from that inflation has been reined in with the gradual growth in manufacturing sector. However; with all these kinds of growth commercial office spaces are also gaining momentum because companies are looking for expansion due to improved business sentiments. These days big e-commerce such as; Snapdeal, Amazon and Flipkart are looking for commercial spaces to set up their warehouses, followed by IT-enabled services and the information technology sector as well as financial services and insurance (BFSI) segments and banking sector and they all are resulting in high absorption levels in commercial properties and quality office spaces.

It is expected that in near future the industries such as; engineering, pharmaceuticals and manufacturing will provide further impetus to the real estate market. According to Amit Bhatia of Assets and Business Banking in Deutsche Bank India, “Its best time in India to invest in the commercial properties as it is giving low capital values with high rental yields. However; there are many micro markets where price of commercial properties are still low than the residential property and commercial properties are offering double the rental yields”. The more he added that Grade-A properties including offices, retails or other spaces at high street are also are bound to deliver capital appreciation and higher rentals. However; for commercial properties the capital appreciation is low due to many speculative buying in residential property. On the other hand office spaces are more driven by end users whereas; commercial space might not be as easy to sell as residential spaces are and its also easy to find tenants for offices spaces in comparison of residential.

Why it’s best time to invest in commercial property:

From investment point of view the difference between commercial and residential property is that in commercial real estate you will get more rental in comparison of residential property, but when it comes to sale property, so its pretty easy to sale residential property, but its tuff to sale commercial property, as per the statement of Viral Desai, National Director at Knight Frank India. The more he added that in past few years, residential real estate market has seen more appreciation, but now its on peak and about to get over. However; it is expected that in near future office spaces are continues to give better rental yields. In residential property the annual rental yields are about 2 percent, but when it comes to office space annual rental yields are about 8 to 11 percent. Offices spaces are offering good opportunity for investors as tenants are looking for good quality lock-in of leases spaces.

Income from commercial property:

It is suggested to invest in the property which is on the lease already because it will provide you regular cash flow, as per the statement of Desai. In normal cases, people prefer to go for the rental agreements of two to five years, if the space is for office and during that duration the tenants are locked in for that period. So if you are about to invest Rs 5 to 6 crore in an office space, so you can expect to get Rs 50 to 60 lakh as annual rental income. Apart from that you should also check that which kind of company has leased out the property and for what kind of business, for example if banks or some other brands has leased out that property, so you can expect that they will continue for next 15 to 20 years at least because they will avoid to change their address. If you are planning to buy property no multiple owners and large part of property is with real estate developers, so property maintenance will not be big challenge. As per the statement of Sanjay Dutt, Managing Director of Cushman & Wakefield, “The top three cities which have saw good supply and demand in the period of January to September 2015 were Pune, Delhi-NCR and Bengaluru. However; till now they have collectively contributed 77 percent to incremental supply and 65 percent to commercial absorption and on the same time you can expect annual rental yields of 11 to 12 percent for Bengaluru, whereas; in Delhi and Pune you can expect annual rental yields of 7 to 9 percent.

Why should you leverage the opportunity?

We all know that unit size of commercial real estate is larger than the residential and due to that investors need to invest much larger amount in commercial property. And apart from that they will get no tax incentive for investing in commercial real estate, as they are used to get for homes. If you are thinking that price of property is too high and you will be not able to manage it, so you can take loan for the property against rental income.

Checklist before buying commercial property:

1. It’s recommended to check the background and experience of real estate developer in commercial property.
2. If there are any existing tenants, so better to consult with them and its suggested to check that what kind of companies have leased out the space and the business the tenants are into

• Check the infrastructure, society, location as well as surrounding area.

1. If you are taking loan or borrowing money, so never keep your property vacant for long periods.
2. If buying resale property, so prefer to buy leased out property.

Image Credits: DNA

If you are the one who is cursing the Mumbai city due to lack of space, proper amenities and other shortcomings, so here are some heartening news for you; Mumbai is one among top five emerging world cities. According to the report of JLL, a global property consultant, “Mumbai is 4^th on the list of emerging world cities, however; the top three are Shanghai, Beijing and Dubai. Apart from Mumbai; New Delhi and Bengaluru were also in the report which titled “Globalization and Competition: The New World of Cities”.

In report, According to JLL emerging world cities are the business capitals of major economies as these cities are experiencing higher growth percentage, attention of governance and implementation of strategies to become more stable and establish regions. These cities often get support from the national government, as government is in the process of economic adjustment and busy in the restructuring and optimization of urban and metropolitan regions for the benefits of global engagement. The report explains that Mumbai is witnessing urban consumer demand between now and 2030, along with other regions such as; Jakarta and Istanbul. According to experts, this growth can help the retail sector as demand and supply ratio is different in these cities as per region preferences and requirements.

JLL Report Findings:

According to report, it is expected that 26 percent firms have the revenue of more than $ 1 billion and by the end f 2025 this share could reach 50 percent. However; report, also pointed out that in present real estate market of Mumbai is performing well as it is attracting real estate investment and outsourcing activities, but still at certain points its facing chronic infrastructure supply challenges and these challenges can be hurdle for transnational firms. Apart from that Manila and Jakarta also reported the same issue. In these cities transnational firms are performing well as they are able to expand their operations in South and South East Asia in very low cost with huge market opportunities, whereas; on certain pints they are also facing considerable urban infrastructure shortages.

Recommendations of JLL:

It is recommended to these cities that now its need of time to focus on the other aspects such as; reducing complexity of preparation, assembling and project execution because it could prevent capital investment budgets on a year-by-year basis. However; there are substantial improvements in Mumbai as government has taken steps to improve transparency, reduce red-tapism, and strengthen governance with aim to reduce the complexity in execution of projects. For example; In Mumbai the civic corporation has cut building permissions from 150 to 70 and it also reduced the time limit to give such permissions. Apart from that state government is also working on a plan to digitize permissions which real estate developers need. It is suggested that there is need to address three major issues as it could be hurdle in the growth and success of the cities and these three issues are; how to build and sustain multiple sources of investment, how to attract talent and local skills and co-ordination in metropolitan space.

In the absence of strategies and systems of address these issues, the emerging world cities will struggle and find it difficult to manage their growth effectively in the ratio of economic development.

Housing Price Growth in Mumbai

For the duration of July to September or in Q3 2015, the housing price index grow by 13.7 percent, whereas; the cities such as; Jaipur, Lucknow and Kolkata have contributed to the slower pace of growth, as per data and reports of RBI.

As per data of Reserve Bank of India, till the end of July – September quarter home prices have not bottomed out. Indian Housing Price Index is the barometer for home prices in Indian real estate market and it released by the central bank. For years 2015, the Indian Housing Price Index has grown by 13.7 percent for the period of three months, which ended on September 2015, however; in last quarter it was 14.5 percent for the same financial year. On the other side it was city Kolkata, which has witnessed maximum fall in Indian Housing Price Index with 224.1 in the second quarter of 2015-16 and it was 3.13 percent less than the previous quarter. But New Delhi, the capital city of country have cheered the real estate developers because in Delhi real estate developers were offering freebies such as; free parking space, air tickets, cars, heavy discounts and more including latest gadgets. For the same period the Housing Price Index growth was about 21.9 percent in Delhi and it was maximum in whole country.

Overall increase in Indian Housing Price Index was 219.5 in the second quarter, however; in first quarter of 2015 it was 215.3 and this increase was due to the metro cities such as; Delhi, Ahmedabad and Chennai, as per press release of RBI. Whereas; in Q2 2015, the Housing Price Index for Bengaluru, Kolkata and Kochi decreased from the previous quarter. To give more curate data the Reserve Bank of India compiles quarterly house price index of top ten major cities such as; Mumbai, Bengaluru, Lucknow, Delhi, Chennai, Ahmedabad, Jaipur, Kolkata, Kanpur and Kochi.

Bengaluru has emerged as real estate capital of India

According to reports, Bengaluru has emerged as real estate capital of India with the major headlines of the day which dominate on national and international real estate market. Earlier, it was Mumbai, but now Bengaluru has overtaken Mumbai to become one of the most preferred real estate destinations for investment in India, as per the reports of PwC (PricewaterhouseCoopers) and ULI (Urban Land Institute).

Few Major Headlines from Leading Portals:

According to “Emerging trends in real estate Asia Pacific 2016” Bengaluru is one of the most preferred real estate capitals of India, published by “The Hindu”.

We all know that in our country, the major property market includes Bangalore, Mumbai and New Delhi and they are witnessing more appetite from NRIs and foreign investors for investments in real estate market, as per the rankings of these cities as perceived by investors, according to perception study of PwC (PricewaterhouseCoopers) and ULI (Urban Land Institute), published by “Economics Times”. According to reports of Economics Times, the State Government of Gujarat will consult all stake holders such as; real estate developers, while constituting the state RERA (Real Estate Regulatory Authority), as per the statement of Anandiben Patel, Chief Minister of Gujarat.

There are some pockets in Bengaluru residential market such as; Thanisandr and Panathur-Varthur are expected to see price appreciation of more than 55 percent and 61 percent respectively by the end of 2020, as per the reports of Knight Frank Report. A relaxed FDI policy for the real estate sector has reinforced the confidence of foreign investors and has helped the regions in India to become one of the most preferred investment destinations, as per PwC survey, published by “Economics Times”. Ulwe and Madh-Marve in Mumbai are among the top residential investment destination in country as it promise the property price appreciation of more than 70 percent and 90 percent by the end of 2020, respectively as per the reports of Knight Frank India¸ property consultancy, published by “Economics Times”.

BroEx, which is network of real estate brokers stated that it has associated with Rentomojo, which is an online furniture and appliances rental. After this association, BroEx distributed exclusive coupons to its clients on behalf of Rentomojo with an aim to enhance the end customer experience, published by “Hindu Business Line”. Apart from that Hilton Worldwide Holdings Inc. is also pursuing a spinoff of its hotels into real estate market through different investments and it is one of the moves which have become popular among companies who are looking for the way to slim down and boost their stocks, published by “The Wall Street Journal”.

Image Credits: DNA

From New Year, onwards it could become costlier to buy property near the Yamuna expressway as commercial property rates have been raised by 20 percent whereas; the allotment rates of residential and housing properties have been hiked by more than 10 percent and institutional and industrial property rates  have been hiked by 5 percent.

On Monday, in the joint board meeting of three major development authorities of Gautam Budh Nagar, the YEIDA (Yamuna Expressway Industrial Development Authority) passed a proposal to hike the allotment rates of land by 5 percent to 20 percent for commercial property, residential and housing properties and institutional and industrial properties and it will be come in effect from January 01, 2016.

As per the recommendations of YEIDA, the commercial property rates have been raised by 20 percent, whereas; the allotment rates for residential and housing properties have been hiked by 10 percent and institutional and industrial property rates have been hiked by 5 percent. Apart from that the Yamuna expressway region has also seen a hike by 5 percent in the allotment rats for recreation of green fields. In June 2014, the Yamuna Expressway Industrial Development Authority had also hike the land rates between 10 percent to 20 percent. However; as per the statement of Arunvir Singh, CEO of YEIDA, “The increase in price is just routine affair and we are used to do it at the starting of every years, but this time we are revising the rates after 20 months”. The more he added that the hike in the allotment rates is also crucial and it is crucial to consider the increase in land costs, inflation and more.

According to Arunvir Singh, the residential plots which are falling in the YEIDA region will be dearer by almost Rs 1,420 per sq m, whereas; all the commercial plots which are falling in the YEIDA region will be charged by Rs 5,680 extra. It is sure that commercial rates will go up by Rs 28,400 to Rs 34,080, however; while recreational greens will be allotted at Rs 5,355 per sq m as in comparison of Rs 5,100 per sq m which was previous. The more he added that it is decided to use the new land rates for mixed land as per new land rates. Apart from that YEIDA has also reduced the property transfer charges in order to provide relief to property owners as earlier it was 10 percent and now it is 5 percent. These charges are levied on transfer or sale of a plot from one owner to another owner. However; till September 2014, the transfer charges were 5 percent. Meanwhile; the real estate developers are trying to come up with the brave face and they are saying that it can draw an impact on the future booking as it could be more because any kind of land price hike makes an area no longer an affordable destination. With this much rise in the land price its difficult to sell properties.

In YEIDA region, hike could be more detrimental for the real estate market, as YEIDA region is developing area, as per the statement of Getamber Anand, president of CREDAI. As per one of the real estate developer, “Yamuna expressway region will not be affordable in coming days and it will leave negative impact on the middle and the upper middle class”.

Image Credits : DNA

In past few years, Pune and Mumbai have seen aggressive growth in term of property prices since year 2012 by 49.97 percent and 73.91 percent respectively, whereas; the second most pricey real estate market was Delhi/NCR as it was observed that in Delhi/NCR the marginal price rise was 9.13 percent since year 2014. According to reports, it’s clear that if you want to rent or buy an apartment, so Mumbai and Delhi-NCR are among the most expensive cities, especially than when you are from middle class, whereas; Hyderabad and Ahmadabad are still most affordable city to buy or rent house as per the reports of ArthaYantra, a Financial Life Management Advisory Firm.

According to reports, since 2012, Mumbai witness 73.91 percent, Pune witness 49.97 percent and real estate market of Delhi-NCR has observed the marginal price rise of 9.13 percent, whereas; reports showed that Bengaluru witnessed a price rise of 9.76 percent since 2012 and Chennai was with 5.55 percent  marginal price rise. However; when it comes to Ahmedabad and Hyderabad so they have a negative growth in price and it was -20.70 percent and -10.46 percent respectively. In terms of property prices the growth since 2014, Mumbai again led the pack with 16.04 percent rise in home prices and it was followed by the Kolkata with 11.27 percent, Chennai with 8.78 percent and Delhi-NCR with 6.37 percent. Whereas; Hyderabad, Ahmedabad and Bengaluru was among the cities which witnessed a negative rise in home prices since last year and it was -0.42 percent, -4.46 percent and of -2.55 percent respectively.

According to report of ArthaYantra, Ahmedabad has seen a negative growth since 2012 in terms of property rents and due to that to placing it on the top most position in affordability-to-rent city. Whereas; Hyderabad has seen reasonable increase in the rental values, but drop in the property price, so it’s sensible to place it on the top most position in the list of cities where property prices are affordable.  However; Bengaluru is more favorable towards renting in comparison of buying property as it has seen a drop in property prices due to its demand in real estate industry. When it comes to affordability, so survey showing that someone with the annual income of Rs 25 lakh cannot afford residential property in Mumbai, however; same person with same annual income can buy property in Delhi/NCR. Buying property in the city like Chennai is only suitable for those people who have annual income of over Rs 20 lakh, however; if you have annual income of above Rs 17 lakh, so you can attempt to buy property in Pune city too.

In present, Bengaluru is one of the most affordable buy destinations for people who have the annual income of over Rs 15 lakh, and people with the annual income of over Rs 15 lakh can also buy property in Kolkata. But when it comes to buy property in the city like; Ahmedabad and Hyderabad, so they are among the cheapest cities and due to that people with the annual income of over Rs 9 lakh can buy residential property.