Property Info World

Having been hit the hardest by the economic downturn, realty majors are betting big on the Budget 2012 in a bid to revive the sector’s fortunes. Experts say the sector needs government support as well as further stimulus to get out of the current slump.

As a first step, experts seek industry status for real estate, since the sector is a major driver for economic growth and generates countless jobs across its various verticals and associated industries. It will also help the sector raise debt from FIs at a much lower rate.

The CEO of a real estate data analytics and intelligence firm said that in this budget, they expect the central government to grant the real estate sector the industry status as that would help the reeling sector raise debt from financial institutions at a much lower rate, which may partly improve the liquidity crunch crisis.

Further, affordable and low-cost housing needs some incentives because it has now largely been abandoned for big-ticket developments. The chairman of Jones Lang Lasalle India added that last year, a 1% interest rate subsidy was provided for loans towards affordable housing. The scope of this subsidy should be amplified and broadened to include a wider price band of budget housing to benefit home buyers, especially in lower income groups.

The ED of Wave City affirmed that affordable housing remains a segment where the government should definitely continue to provide developers with tax free status which was available earlier. Rather than restricting it to unit sizes, the government should restrict the prices at which these units can be sold. Affordable housing developers need to be given incentives for creating such an infrastructure in the country. Hence, integrated affordable housing project development should be accorded infrastructure status for the purpose of RBI etc.
He further added that the stamp duty needs to be brought down further to 4-5% and made uniformly applicable across all states. Also, if stamp duty has already been paid on one transaction, there should be a mechanism to provide concession or a system of credit for any subsequent transactions.

Further, the implementation of the revised DTC will have strong implications on SEZs. The industry requires clarity on the issues that may emerge, and how businesses would be promoted.

A mega township Wave Estate is spread over 300 acres and comprises the entire Sector 85 and a part of Sector 99 of Mohali. Wave estate is a paradise with its collection of modern contemporary villas, plots, floors and plush condominiums.

Wave estate takes modern living into a whole new level by designing for its privileged clients the unmatchable quality of an international lifestyle, with the best facilities in education, sports, entertainment, shopping, healthcare and fitness, all this against a backdrop of immaculate greenery and landscaping.

Wave Estate is designed by Studio DRA, UK – an internationally renowned architectural firm conceived by global designers and experts, ATKINS from UK.

Apart from the breath taking residential space, the area would be laced with an exquisite star hotel and an impressive mall and multiplex to attract the discerning crowd.

Wave Estate also stands among the vicinity of unmatched landmarks lending the area immense value. These landmarks are the globally lauded Mohali Cricket Stadium, Chandigarh International Airport, the Indian school of business and the upcoming city centre.

Creating ripples since its launch, Wave City, the futuristic project by Wave Infratech is all set to change the real estate scenario of Delhi NCR. Spread across sprawling 4,500 acres the mega self sustainable integrated township will be among the largest integrated city development happening in the NCR region.  This ultra-modern city has been meticulously planned with emphasis on open areas and ambience.

Wave City is planned to bring forth a living space that matches the lifestyle needs of its residents. The prestigious residential project in the capital’s neighborhood with more than 200 acres of greens, wide congestion free roads, along with a host of world-class amenities is designed to take care and bring joy to all its citizens. The landscaping for this extravagant city has been done by world class landscape planners.

First Phase will involve developing 1,671 acres of land consisting of around 7,500 plots which would house plotted development, row-housing, built-up floors and bunglows. In addition to this, the first phase will have around 1.7 crore sq. ft. of group housing schemes consisting of built-up flats starting from an area of 900 sq. ft. to 3,000 sq. ft.

The residential offerings in the Wave City will span across 600 acres of residential area and will comprise. Residential plots sizes of 112.5, 162, 240, 450 and 800 sq mts. Independent/Expandable Built-up’s, including prime floors and prime villas with additional spaces to accommodate innovations. These magnificent villas will exemplify the best in class and epitomize grandness. Group Housing would comprise of apartments spread over large areas.

The overall development in this phase will include one-of-its-kind Central Business District – a place where walking to work will be leisure. Alongside the commercial offices, there would be world-class shopping and lifestyle experiences. Wave City will have branded retail stores and multiplexes along with convenient shopping centers located at strategic points.

On the educational front, an area of more than 100 acres has been earmarked for development of educational institutes, which would ensure complete development of the young minds. Wave City will have state of the art education facilities, including schools and one big 50 acre university for that complete learning curve.

Giving health, the utmost importance, Wave City will include healthcare facilities, which are at par with the international health services. The City would have complete 24 X 7 medical support.

The entire city will be environment friendly and have 51 acres Central park surrounded by 50 neighborhood parks. A huge land parcel of 200 acres has been earmarked for the development of recreational facilities covering a substantial area of the.

Wave City will have infrastructure amenities like an efficient system of water treatment plant, supply networks, an eco-friendly route of Rain Water Harvesting, Electricity Sub-Station and mechanized garbage disposal system.

This self sufficient city will have a Bus Rapid Transit System (BRT) so that there’s always a bus station within 800 meters radius in the city. The road network is planned in a manner to provide for anticipated traffic volumes in future. This unmatched lifestyle experience, that has been conceived with world-renowned city planners, Bentel Associates from South Africa.

Impelled by new product offerings, rising demand and an increasing upwardly-mobile segment, luxury and ultra-luxury housing projects, with prices ranging between Rs 1 crore and Rs 15 crore, again seem to be making a comeback.

More than a dozen of luxury projects are coming up in the NCR alone, with Noida being the hub of such projects.

The rise in affordable housing projects, owing to the 2008 economic downturn, and the oversupply in the premium housing market is currently going through market lethargy. Exponentially increasing interest rates, rise in cost of building materials and increasing labour charges have put developers in a fix with regard to profitable execution of such projects.

Luxury housing, on the other hand, is experimenting with a variety of new product offerings ranging from Singapore-style apartments to branded luxury residences. This has managed to attract the interest of buyers in the luxury market, who previously had to look outside the country for such options.

This explains why even with the hardening interest rate stand taken by the RBI, the developers in the NCR region, apart from some other regions like Bangalore, increased the supply of luxury housing projects in the latest third quarter.

The demand for luxury housing is again increasing and not without reasons. Today, at a growth rate of more than 20%, India has the fastest growing number of high net worth individuals in the world and real estate comprises approximately 40% of their investment portfolio.

Demand is also rising from NRIs, fuelled by the depreciation of the rupee value. The luxury housing market is currently seeing a greater influx of end-user demand, in contrast to the previous trend of the investment-driven purchases. This has further been helped by the construction-linked payment plans on offer by most developers.

With the rapid pace of urbanization, the new urban families are craving for luxury homes that are fully loaded with global amenities enjoyed by the NRIs and citizens worldwide. Luxury housing is primarily catering to the high-end investors and consumers and is gaining a huge momentum as luxury has become a necessity for the urban households today.

The real estate market in Mumbai for big ticket projects haven’t been moving forward. As per estimates Rs 7,800-crore (Rs 78 billion) of property deals sought to be put through by the real estate companies and government bodies are on a standstill owing to slowing of the property market and liquidity issues.

Some of the developers whose projects are languishing include DLF, Hindustan Unilever (HUL) and Alok industries. DLF earlier was planning to sell its land in Worli after the sale of Aman Resorts, but nothing of sort has been announced yet. As per the company spokesperson, the developer is yet waiting for the right buyers. While the company wants to sell the land for Rs 4,000 crore (Rs 40 billion), prospective buyers are offering around Rs 3,000 crore (Rs 30 billion).

In a similar development, NTC plans to sell a prime piece of land for Rs 2,000 crore (Rs 20 billion). While the firm also had plans to develop the land but hasn’t received approval for the same. Textile major Alok Industries is in the market to sell 650,000 sq ft of commercial space, too has to sell 650,000 sq ft of commercial space in Peninsula Business Park at Lower Parel but the talks for the same haven’t materialized.

HUL also was in talks to sell properties, including its sea-facing Gulita property in Worli but deal couldn’t materialize. According to the industry experts, the slowing of sale of the property and tight liquidity conditions do have an impact on the big-ticket property sales and brings a slowdown.

Last one year has seen an increased demand in home despite the fact that banks hiked the interest rates. The RBI has hiked the repo rate 13 times since March 2011, forcing banks to increase rates on home loans. Lending to the housing sector has increased by 14% to Rs 369,900 crore at the end of October 2011 from Rs324,748 crore at the end of 2010. A data released by Reserve Bank of India (RBI) says that the home loan risen by 12% in October 2010 over the previous year.

Bankers believe that the demand for home loans will remain strong in the year ahead because of the simple reason that a lot of people in India do not have their own houses. In fact, banks are witnessing good demand from smaller cities.

Demand from smaller cities is increasing because the prices in these cities are still affordable. To top it all the earnings in smaller cities are at par with that of metros, so a person in tier II and tier III cities has more disposable income at hand and thus can buy a home easily. Developers, who are facing inventory increase in tier I cities, have seen their sales go up in tier II and tier III cities.