gold vs property vs shares

Recently, in an interview with CNBC-TV18, Manishi Raychaudhuri of BNP Paribas stated that recent weakness in the prices of property and gold can be the main reason why domestic investors are flocking towards the stock market and it could be bounty for equity investors in the long term.

In present, it’s difficult to make any prediction because market is still uncertain. These days Indian public sector banks like Bank of Baroda and other banks are recording little small increase in non-performing loans (NPLs). Now in India market seems to be volatile as China and government is expecting to act as the backstop for their equities. According to experts, for short term India will continue to outperform because these days investors are appreciating as still it is one of the best markets with a good options and choice of stocks. As an investor we all like to invest in private sector banks because they are able to raise their capital and asset quality, which is very much alive. However; retail clients love to deal exclusively with institutional clients, but if you will analyze the performance of gold and property, so you will understand that they are used to occupy the lion’s share in the asset allocation when it comes to middle class. It means in the developing country like India most of the people are investing their more than half of the saving in real estate and gold. Apart from that now people also prefer to invest in the alternative asset classes and it seems to be pretty relative attractiveness of equities and unattractiveness of the alternative asset classes.

The saving rate of India is 30 to 40 per cent and it is a USD 2 trillion economies out of half comes from financial assets which is about USD 350 billion and if 10 per cent will go to the equities, so it will become the 30 to 40 billion per year. And it will be larger than the FII inflow in country, which India has received ever. These days financial experts are targeting a Sensex on 30,300 by the end of this calendar year and it will approximately 8 to 10 per cent from the present level. However; the appreciation of US dollar would obviously be another tailwind for this sector. There are few commodities such as; oil and gas or energy, and they all are refining the margins. With the performance of NIFTY at last Friday its clear that it was surprising as the entire rise are for short volume as well as momentum support. Nifty is closing in decisive manner and for August month we can expect certainly positive response.

Supertech to raise Rs 500 crore

The leading real estate firm Supertech is planning to list its six of the rented as well as operational malls with REIT (real estate investment trust) to raise Rs 500 crore in the duration of next two years which is the year 2015 and 2016. As per one of the latest survey Supertech has more than 2 million sq ft of retail space in its six malls out of which two are in Ghaziabad and one each is in Noida, Rudrapur, Haridwar, Rudrapur, and Meerut.

However there are few products under construction by Supertech. Currently Supertech is in discussion with one of the Singaporean company which has experience in setting up the real estate investment trust in various real estate markets. As per the statement of officials we are in the starting stage for the listing of our assets and REITs own the properties to get the rental income and distribute it among investors. For real estate investors they provides high dividend with a liquid option where one can invest in the real estate sector.

Most of the real estate firm in the country and as well as some of the private-equity funds are showing interest to set up the REITs because stock market regulator SEBI (Securities and Exchange Board of India) notified its rules to list the trusts in September 2014 with a aim to view and attract more and more funds in a transparent manner, so that real estate developers can pool the money for the development of new projects. But till now no REIT is listed in India and it’s just because the lack of clarity in taxation process. With a aim to encourage local listing, central government is decided to do some capital gains in the favor of sponsors in the Union budget of 2015 at the time of listing of REITs on rental income.

However the capital gain will be applicable for all the direct transfer of same or different assets to any kind of these trusts. But still the budget is not offering any clarity on dividend distribution t as. The major real estate developers such as; RMZ, DLF, Embassy Office Parks, Ambience and many others with PE firms such as; Kotak Realty Fund, Red Fort Capital and Blackstone is known for listing their assets as REITs. They have develop the acquired rent producing assets in past few years as it could attract more than $1 billion or Rs 6,280 crore in 2015 witht eh additional tax benefits announced in the union budget of 2015, said the property consultant from JLL India. However most of the property experts said that in near future more exemptions can be made by the state as well as central government to make its segment more attractive for real estate players.

But it’s clear that the Capital gains taxes will exempted on the transfer of any SPV (special purpose vehicles set up to carry new real estate projects) share by different or same sponsors but at the MAT ( minimum alternate tax) is still applicable. If the minimum alternate tax will be so it will make REITs more attractive for real estate developer, says Shweta Aggarwal, Director of BMR & Associates.

Most part of Mumbai in terms of residential investment will fetch the investor good returns. Everybody waits for the best possible investment opportunities in metropolitan cities of the country and when it comes to a city like Mumbai, opportunities are endless. Property in Mumbai and Property in Thane are among the top ten best investments that can be done by any person.

With the REIT passed by the new finance minister, investment has taken a boost in parts of the country and the price of the property has increased. With the current stable stock market, equity market is expecting involvement from retail estate investor and now will be the right time to probably to invest in finest Property in Mumbai and that of Property in Thane.

Investing in property is a combination of investment as well as intelligence. As per the reports published by JLL India, there has been a considerable change in terms of best affordable properties. Property in Thane, especially in the west of Thane is becoming a chosen area for most of the investors. The price of property per/sq ft has been showing an upward trend due to its closeness to many primary parts of Mumbai. The infrastructure in terms of connectivity and other basic amenities have added to the attraction quotient of the Property in Thane.

Availability of the residential Property in Mumbai has increased the property sale in the recent couple of months. Even though there are still quite a section of people in Mumbai who are unable to afford a residential property in the heart of Mumbai, the recent change recommended by the finance ministry will probably come to the aid of many looking for investment in other options like Property in Thane.

Investment options in Property in Thane or Property in Mumbai:
Thane being one of the well developed sub-urban of Mumbai has been gaining lot of attention from potential investors. There has been 34% of premium launches in the first six months. If one is looking for a low budget investment rather than investing in Property in Mumbai, then Property in Thane is the go to option.

Best investment localities or Property in Thane can be found in areas such as; Palghar, Dombivali, Vasai, Virar. With the increasing quality and number of builders/investors, there are increasing numbers of housing projects like Riverdable Vista, Mayureshwar Park , Falco World etc which are currently in hotspot.