The Securities Exchange Board of India (SEBI) has introduced amendments to the REIT Regulations 2014, which outlines provisions for the formation of Small and Medium Real Estate Investment Trusts (SM REITs). With this the built environment of the Indian real estate has gone euphoric with the underlying promise to witness windfall into fractional ownership. It is perceived to be more lucrative than the existing REITs since the SM REITs encompasses both commercial and residential properties under the guidelines. A Track2Realty report.
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Fractional Ownership is an evolving concept, on the lines of REIT but very different from REIT. Unlike REIT, which is a listed entity owning income producing real estate, Fractional Ownership is coming together of investors to pool their funds and jointly purchase real estate. Though in its very essence, the idea is to rent it out and earn the equitable rentals, many ‘office for a limited purpose’ investors are also getting into Fractional Ownership for convenience. A Track2Realty analysis.
Ever since the Securities and Exchange Board of India (SEBI) has cleared the fractional ownership framework for realty assets, there is an euphoria among the stakeholders. The built environment of Indian real estate that is always looking for new and exciting avenues to attract the investors. It has hence carried home the message that the “Next Big” investment basket has arrived. A Track2Realty report.
The meeting was Chaired by UP Infrastructure and Industrial Development Commissioner and Noida Authority Chairman Arvind Kumar in presence of Noida Authority Chief Executive Officer Ritu Maheshwari. In relation to structural audit of multi-storey buildings located in the authority area, the statement said that “the structural policy was prepared by the Noida Authority on the demand of flat buyers and AOA, in which the Structural Audit Policy has been approved by the Authority Board with partial modifications.”
India’s urban housing today could at best be described as a soda bottle syndrome where the constant rural push to the select few urban centers could explode at any given point of time. It is not that the policy makers are unaware with the growing population and its dependence over the metro cities. As a matter of fact, when the country’s first planned city, Chandigarh, came into existence as a horizontal city that could cater as the capital of both the Punjab and Haryana State, it seemed to be independent India’s first tryst with organized urban planning in general and its housing solution in particular.
The Union Budget 2022-23 lacked any fresh ideas as far as the real estate in general and the housing market in particular is concerned. Most of the announcements are more or less the extension of the old schemes and roadmaps. The euphoria of the industry stakeholders ahead of the budget turned into a deafening silence in the next few hours of budget speech.
The real estate market of Uttar Pradesh in general and Noida-Greater Noida in particular is hotbed of consumer grievances, ranging from delay to default and unmet promises to builder’s high handedness. As per the industry estimate nearly 40% home buyers’ grievances in India are reported to be from this market alone. It is hence no surprise that even when the Real Estate Regulatory Authority proposes to clean the market, the builders devise their own ways & means to dispose it.
The industry data of faster recovery and record home sales conceal more than it intends to reveal. The rosy outlook fails to address the fact that this is a K-shaped recovery where a handful of large developers with sound financials have grown at the cost of the large universe of the developers. More importantly, the sales registration data doesn’t differentiate between primary market sale and distress sale in the secondary market.
On the eve of every Union Budget the real estate stakeholders get into a huddle to set the narrative that could influence the fiscal policy. They are conscious of the fact that the business of real estate gets more affected by the fiscal policy than the recurring monetary policy that shapes the outcome of floating interest rates every now and then. A Track2Realty analysis.
A closer look at the way the sector operates indicates that the ground realities are different than what is being anticipated post this historic judgment. The Supreme Court order has hence raised more questions than settled the answers that could goad the sector to best practices in the business. The court order touches upon some of the grey areas like “long & expensive legal battle” that the buyers have to go through. It nevertheless doesn’t offer any solution for the same. The fact remains that the long & expensive legal battle is the primary cause of home buyers’ suffering in silence at the hands of the builders.