Tag Archives: Ravi Sinha

Why I am most hated journalist?

Posted on by Track2Realty
Diary of a real estate journalist

View Point: It is a matter of choice to live as the most hated journalist in Indian real estate where ethical journalism & expectations of professionalism ruffles many feathers.

Ravi Sinha, Real estate journalist, Real estate blogger, Real estate analyst, Real estate brand rating, Diary of a real estate journalist, Property journalist diary, Open letter to builders, Buyer writes to builders, Journalist writes to builders, Property journalists credibility, Credibility of real estate journalists, Media and real estate, Media and property market, Journalists in the property marketA journalist friend recently reminded me, “You know what! You are most hated journalist in Indian real estate.” Yes I know! Even the most corrupt real estate journalists in this country are not as much hated within the reporting beat/sector as me for the serial offence of dropping truth bomb with all ferocity.

I nevertheless sounded ignorance to ask her, “What do you mean by this? Have I ever been unethical or corrupt?” “No! But you are hated for being too straightforward with the habit of giving the offence back. This world does not like someone like you. Most of the PR and Corporate Communication professionals bitch about you.”

It is not that I don’t know about it; I don’t care about it. I have rather consciously developed this image over the years. I am never ashamed or apologetic about my identity or public perception. I very much enjoy the fact that not so professionals within the built environment, fellow corrupt journalists, shady builders and most stupid breed of PR and Corporate Communication specialists (sic) maintain a safe distance with a rude journalist like me.

Everyone is conscious of the fact that I practice ‘free, frank & fearless’ journalism. Any expectations of undue favour, any provocation to question my critical assessment of the business or any attempt to get negative stories dropped could only invite more critical evaluation and land them in trouble.

It is not that I don’t pay the price of practicing the now dying art of ethical journalism. Whenever there is any issue of revenue growth within the company, or rather lack of it, the marketing team looks at me with a gesture that suggests you are the culprit.

A senior colleague often reminds me, “You are the editorial face of the company. The responsibility of company’s acceptability rests upon you.” Probably what he resists saying is that he doesn’t interfere so long my style is earning revenue for the company.

Thankfully, the quality & ethical journalism that I practice has not defeated me so far, even though I constantly face resistance from many corners. Today, we are globally acknowledged for being most objective, comprehensive and ethical media group in this notoriously maligned world.

Does this ethical journalism earn me goodwill of stakeholders on the other side of the table? Well, I am equally on the hit list of a number of so-called homebuyers’ associations. Reason is pretty clear: I equally despise the kind of consumer blackmailing that is all pervasive in today’s property market.

Safeguarding self against vested interests and not to be used by the kind of buyers’ associations who function like de facto consumer courts and ask for money from gullible homebuyers is another challenge for me. And since I don’t mind exposing such rotten eggs, I am being hated by the homebuyers’ associations as well.

Tailor-made traits of most hated journalist 

An ethical journalist is a problematic element for a sector that has cultivated a number of ‘yes men’ in media

Labeling as ‘Negative Person’ is the most convenient option to a journalist who doesn’t fall into the trap of buying goody goody stories of the builders

Homebuyers’ association also dislike a journalist who question their locus standi for exceeding legal & ethical limits

Mediocrity in PR & Corporate Communication loves to have like-minded journalists than an ethical journalist who could catch them on the wrong foot 

When I first landed up accidentally into real estate journalism around a decade back, the first thing that hit me was the fact that there is a complete lack of professionalism in this space. Needless to add, most of the journalists in the sector lack respect. I am still not sure whether this lack of respect is more for their lack of integrity or lack of courage to take on what is not acceptable.

But the very fact that being a journalist with old school ethics and temperament, I am still not comfortable with the way real estate journalism is practiced in this country. Forget the builders’ culture of secrecy to share information, as it is a universal phenomenon within the businesses, there is a serious crisis of communication professionals. I am hated by this lot the most as I don’t want to compromise with my level of professional integrity.

Barring a few exceptions in Indian real estate, I maintain a professional distance with the PR and Corporate Communication of the developers. I don’t share my personal space with them; don’t go to parties as personal friends. These are the traits which would make any journalist being despised in a sector where a large share of the developers have the PR and Corporate Communication with MEA (Media Entertainment Allowance) to keep the journalists in good humour.

But wait! My distance beyond work is not why I am today the most hated journalist in Indian real estate. I am being hated because I have the bad habit of calling a spade as spade; calling unprofessional behavior as stupid; often blacklisting those who are not committed to deadline; and overtly mocking the lack of knowledge and/or substance in public forum.

Imagine a scenario where a young PR girl approaches me the first time to interview an international client (one of the largest global brands catering to Indian real estate). When I meet the CEO of the brand on his India visit I am appalled to find that he has not even been briefed about me. A person who doesn’t know anything about the Indian media is requesting me to brief about media before I could interview him. Is it my job or the job of the PR?

I nevertheless interview him as it is a global brand and I am the first Indian journalist to interview him. After the interview is published online, the next day the PR girl whom I met only once during the interview sends me a text message, “Hi Ravi! Lots of love for your column.” Excuse me! Lots of love? Are you sure about what you just texted me? Was it interview or column?

This is not a one off incident that really turns me off. It is a repetitive practice in a sector where even a large majority of the builders are clueless about the stupidity of their PR agency and often the Corporate Communication. The Press Releases are mailed to self with BCC to hundreds of journalists without even realizing that such mass mailing often lands up in the Spam folder of mailbox.

A PR girl calls me for a client meeting and once I agree to it, she asks me by the way whether I still work for Track2Realty. “No! I have been sacked for non-performance and misconduct,” I could not think of a better answer.

Well, I think the next time she should also ask my name and whether I am a journalist or into some other business. Damn it! If you don’t know where do I work then why the hell have you approached me? Isn’t it your job to have some homework about a journalist whom you have approached? But I feel I am really worth being hated as I end up being rude with such lot.

Another one who heads the Corporate Communication of a Mumbai-based builder with a fancy designation of ‘Brand Custodian and Customer Delight Officer’ challenges one of my feature story with a question mark as to how much is the sample size? I wondered whether the gentleman even bothered to read the story to realize it is feature story and not survey? Whether he thinks a feature story also has the sampling of audience?

On being told that it is not survey and provided with a number of supporting facts, the mediocre with questionable academic understanding changes track to preach me that I should be more positive on the sector. Poor me! I end up being rude and being hated.

I am yet to come to terms with this constant preaching of being positive on the sector. What is the definition of being positive? Accepting expensive gifts with builders and being their cheerleader? Ignoring the pains and plights of the hapless homebuyers? I think I am quite happy being a negative person to the extent of being vindictive to the builders who are sitting over scores of consumer complaints and trying best to manage the media.

Communication in general and PR in particular continues to be the weakest link of Indian real estate. And since I am a serial offender to expose it every now and then, in one platform or the other, and don’t even think before giving a piece of my mind, I am naturally the most hated journalist in the Indian real estate.

On exposing the shallow brand understanding by marketing communication of one builder, I am often offered pearls of wisdom by the Corporate Communication of the other ones, “You see! They might be working so hard under pressure. If you can’t encourage then at least you should not discourage them.” Excuse me! I am not here to encourage the lack of professionalism. The builder has not appointed me as the ‘Official Motivational Partner’.

Living in an apartment I am continuously exposing the builder since last three years for his poor quality and pathetic maintenance. The generous (sic) builder has tried best to buy me out and silence other homebuyers a number of times. And I am so rude that I have exposed it in front of other society residents that the builder tried to bribe me out.

Isn’t it enough to make me the most hated journalist? Of course, it is! The hatred for me is so profound that not only the said builder but also many other builders are today cautious to not sell the apartment to a problematic element like me. I wonder whether I would be able to buy an apartment in the same market.

Where would this hatred towards a rude journalist end? Well, there are only two options. Either I change myself and join the cosy club of this unprofessional lot who are anyway more in number, or they raise their level to be more professional. Unfortunately, none of the two options seem to be a probability in near future. And hence, I will continue to be most hated journalist in Indian real estate.

By: Ravi Sinha

 

Key differentiator needed for small developers: Nikhil Hawelia, Managing Director, Hawelia Group

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Bottom Line: In an interview with Ravi Sinha, Nikhil Hawelia, Managing Director of Hawelia Group maintains that the key differentiator is in understanding one’s capability to scale up.

Nikhil Hawelia, Managing Director, Hawelia GroupSome of the lesser-known & smaller developers have today better track record of delivery than larger players. The trend is more visible in the Delhi-NCR Region where many of the larger developers are today reeling under debt burden, over-leveraged balance sheets & challenged execution capabilities.

In an interview with Ravi Sinha, Nikhil Hawelia, Managing Director of Hawelia Group maintains that controlled launch to sales ratio and prudent fiscal management with focus on delivery is what is making some of the new entrants a promising brand in the Delhi-NCR region.

Ravi Sinha: Is it just the imbalance of scale to capacity ratio of larger developers or there are other inherent reasons for smaller developers to gain more ground in Delhi-NCR?

Nikhil Hawelia: In comparison to larger player, mid size developers have better stability in their ventures, with their funds and resources concentrating on their limited projects. Larger real estate developers especially in North India are mainly focusing on multiplying their work quantum just to grow their scale unreasonably. Whereas small & mid size developers are ensuring on-time and quality delivery with maximum customer satisfaction. In case of us, lesser management hierarchy results into direct involvement of higher management in key decision making which further enhances work efficiency.

Ravi Sinha: What is the ideal launch to sales ratio to keep fiscal management in control?

Nikhil Hawelia: Instead of calling it an “ideal launch to sales ratio”, I would rather name it “controlled launch to sales ratio”. Again, it cannot be generalized for all categories of the projects as cost of land varies which changes the break-even point in the financial planning of the project. In the affordable housing we are executing at Greater Noida West, the controlled launch to sales ratio can be put up as 45-50% as per our planning and experience. Having said that, one must not grow beyond capacity to compromise his reputation and future projects.

Ravi Sinha: What is controllable scaling up vis-à-vis execution capability ratio?

Nikhil Hawelia: Execution capability ratio is the capability of the company to execute the amount of work in controlled manner in all respect. The developers should define a fine line between controlled & over-limit work and should restrict the amount for a single business cycle. Working in such controlled atmosphere and leveraging rightly at every cycle of business will help scaling their business positively while achieving the progress in execution capabilities. Growth is not a bad word, but definitely there is a thin line between hunger for growth and greed for growth.

Ravi Sinha: Can one say that smaller developers are better positioned to maintain best practices?

Nikhil Hawelia: The time has come that the Indian real estate developers need to adopt best practices which can be termed in as commanded fiscal management, timely execution, perception building, transparency, functional professionalism, consumer connect etc. It is also imperative that the government authorities should lay down unambiguous guidelines for development norms and ensure a transparent and timely approval process.

Ravi Sinha: When is a company fiscal risky?

Nikhil Hawelia: Lack of financial management discipline is the key reason to make any company fiscal risky. Over leveraged balance sheets, unreasonably high cost of acquisition of newer land parcels, too many launches of new projects and at the same time unforeseen challenges in the construction business is hurting the sentiments of real estate companies which in turn forces the developer to expand on funding even at high cost of finance.

Ravi Sinha: How much over leveraging is controllable?

Nikhil Hawelia: Controlled over leveraging has different basis and structure for different types of project; commercial projects on lease model have better security than outright sold projects. Similarly, low cost or affordable housing projects have frequent sales number than high-end projects; so low leveraging also meets the need of finance in case of affordable projects.

Difference is also noted in cost of land to cost of execution ratio in distinct projects as cost of land varies drastically in different regions which impacts the percentages of overall funding requirement for construction and execution of the project. So, defining and generalizing the percentage of over leveraging in real estate sector is not possible.

Ravi Sinha: Does the personal involvement of developer with only handful of projects make any difference?

Nikhil Hawelia: Involvement of higher management at all verticals is crucial to meet up the commitments and promises. So, foremost the developer should draw a limit to the quantum of work undertaken for a particular business cycle which is under their control. The major concerns like delay in possession, quality issues etc directly or indirectly occur because of over-limit & uncontrollable growth.

Ravi Sinha: At a time when some of the larger players in the Delhi-NCR are losing their brand equity and market share, do you feel new entrants have better chances of making presence felt?

Nikhil Hawelia: I have always felt that our customer base is different, expectations are different and market positioning is also different. But what remains common across the asset class and across the segment of developers is the customer experience and word of mouth in the market.

For example, my study in Delhi-NCR and even in other key Indian markets indicate that while consistently delivering one million square feet of delightful customer experience year on year can make a developer trustworthy brand, volume of delivery with poor customer experience can kill a bigger brand. The Indian housing market will hereafter be goaded by this professional dynamics. It is a different matter that the trend has first been noticed in the NCR market.

Price correction on Gudi Padwa?

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Bottom Line: Reports of price correction on eve of festivals like Gudi Padwa are often misleading.

Gudi Padwa, India real estate news, Indian realty news, Property new, Home, Policy Advocacy, Activism, Mall, Retail, Office space, SEZ, IT/ITeS, Residential, Commercial, Hospitality, Project, Location, Regulation, FDI, Taxation, Investment, Banking, Property Management, Ravi Sinha, Track2Media, Track2RealtyBacked by the media reports on inevitable price correction in the Mumbai market, Meenaxi Rohtagi, a textile engineer waited for long to buy an apartment in and around Andheri East. Though the prices have moderated in the last three quarters, the media reports, backed by the property consultants’ analysis, suggest some more significant price correction is on the cards. She now has made up her mind that she will book the flat on the day of auspicious Gudi Padwa.

“I have waited for long anticipating the substantial price cut in the housing market. Of course, there have been marginal price cut in the housing market but that is nowhere close to my expectations. It would not make any difference to my EMIs burden. I am actually expecting a good correction but going by the brokers’ feedback I am rather disappointed and even more confused,” confesses Meenaxi.

She is not the only one in the Mumbai housing market to feel confused about the housing trend and disappointed with the kind of price cut that the market has to offer. Everyone in the housing market across the city, whether the novices or the seasoned investors, have the same dilemma today. Whether there will be more price cut? Will the price cut be symbolic or substantive? Should I buy on the day of Gudi Padwa when more price correction is expected ahead?

Will I get the discounted price, as being reported? Will the festival be the beginning of the price correction this time around? Will the housing market of Mumbai ever be buyers’ market? There are many questions and hardly any answer that could convince, and not confuse, the prospective homebuyers across the length and breadth of Mumbai.

The fact of the matter is that the answer to these questions is not straight and simple and it can be answered as both yes and no. Analysts point out that it all depends upon which market one is talking about as within Mumbai market there rests many sub markets, each having its own distinct character. Then comes the question of segmentation, as all the housing segments in the city are not showing the same trend, whether in pricing or demand & supply cycle.

Quick bytes

  • Price trend has many variable across the MMR; no consistent price trend across the city
  • Price correction more in the luxury segment, less in mid segment and no correction in the affordable segment
  • South Mumbai prices correcting, Western Suburbs softening, and locations of Eastern Suburbs firm
  • Attractive deals available this Gudi Padwa with new launches

Prashant Nambiar, a broker operating out of Mahalaxmi area says there are various pockets of property in Mumbai and price correction depends upon the kind of inventory that is available in the market. According to him, it is much easier to say that Mumbai is sitting over a record number of inventory and with nearly four years of inventory the only way to move forward is to cut the prices. But the reality is that there is real scarcity of properties in certain price brackets.

“If you are talking about affordable housing, then I feel Gudi Padwa onwards the prices will rather firm up as there is hardly any inventory and the demand is huge. Added to this, the market sentiments are improving and the economy shows the signs of revival. In mid segment, some sort of correction in the form of discounts and freebies will be available during the festivals and even beyond. But in luxury not just correction but some sort of crash can also not be ruled out,” says the broker.

Geeta Shukla, another homebuyer is on the property hunt, having been shifted to Mumbai recently from Bangalore. Being new to Mumbai tradition, but a spiritual person at heart, she decided to book the apartment on the festival spirit of Gudi Padwa as well. Her property search led her to an altogether new finding; something that in a way confirms the assessment of the property broker Rajesh.

“Across South Mumbai I am finding that substantial price correction has happened and some attractive properties are available at very attractive price points. What is a reality in Colaba, Cuffe Parade or Fort is not a Mumbai reality though. In Western Suburbs locations like Bandra, Khar or Santacruz the prices might have corrected in the last one year but not as much as in South Mumbai. However, as I move to Eastern Suburbs locations like Kurla, Chmbur or Ghatkopar, I did not find any signs of price correction. It is like travelling rom one different city to an altogether different city in Mumbai,” says Geeta.

In a nutshell, the Mumbai Metropolitan Region (MMR) is not a linear property market where the price trends would be consistent. Each pockets of growth have their own price trend and demand & supply dynamics. It also depends upon the segment of housing and the price correction has mostly happened in the upper segment of housing. On Gudi Padwa too the expected price correction would be more in the upper end of property pyramid.

Does it mean that the affordable homebuyers have no hope of getting reasonable property on this Gudi Padwa? Not really! Analysts suggest that the affordable homebuyers too have their options and they need to keep a close reality check on the market. With a number of new launches expected on the festive occasion there are chances of some attractive deals being offered. It is just a question of finding the right property at the right time and at the right price point.

Many developers are strategizing their marketing channels to make the best of festive spirit. This sounds good for the prospective homebuyers who wish to book their dream home on the day of festivals. Call it due to price correction or strategy or the emerging market reality, but this Gudi Padwa promises to offer everyone a decent deal in the housing market.

 

 

Gudi Padwa spirit may not land you in fancy trap

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Bottom Line: Discounts & freebies on Gudi Padwa are often fancy trap by the developers.

Gudi Padwa-1, India real estate news, Indian realty news, Property new, Home, Policy Advocacy, Activism, Mall, Retail, Office space, SEZ, IT/ITeS, Residential, Commercial, Hospitality, Project, Location, Regulation, FDI, Taxation, Investment, Banking, Property Management, Ravi Sinha, Track2Media, Track2RealtyWhen Navneet Khandelwal bought her first apartment five years back on the day of Gudi Padwa, she thought she had made a killing deal. After all, the kind of freebies that she got with the apartment was something that tempted her to book it on the day of the festival known for the acquisition of new properties. She got an air conditioner and a discount coupon that rewarded her further with some furniture. Isn’t it a grand prize when buying an apartment on the auspicious festive day? It sounds so!

Why then is Navneet apprehensive today when she wants to buy her next house in Vashi? It is true that she religiously believes in the Gudi Padwa and is sure to book the apartment on the day of the festivals only. But then this second time is more matured to understand the value of house hunt and at the same time not get tempted by the freebies. More importantly, she understands the difference between wants and needs; something that can save her from fancy trap in the housing market.

“Though I was happy with the kind of freebies that I got. But it was a few months later that I came to know that some other properties in the same market were offering a better deal with the cash discount as well. My temptation to grab the freebies immediately on offer was something that completely misled me. The value of the stuff that I got in freebies was much lesser than the high price that I paid for the apartment,” says Navneet.

Prabhu Parekh is another homebuyer who was tempted with the marketing offer has a very basic question to ask today. The builder has offered him freebies over and above subvention offer. He nevertheless questions that if the developer can offer him so much of discount and freebies, why can’t the same developer straightaway reduce the Basic Sale Price (BSP) of the project. “These dicey discounts and unwanted freebies clearly suggest there is scope for price deduction,” he points out.

In Parekh’s question is hidden the stark reality of the marketing gimmick of real estate. The developer will continue to bombard with the offers of discounts; giving amenities that a new homebuyer might already be in possession of and even holiday tours but will never reduce his BSP.

Reasons: it hurts his brand reputation (read ego) to have scaled down on pricing due to failure to sell and, equally importantly if not more, is his sales channel of brokers and under-writers who force the developers to do so as they do not want to lose on their commission that is calculated on the BSP.

Added to this market reality lies the fact that the real estate is today groping in dark as far as the new ideas and marketing strategies are concerned. They are hence often going off track to lure the homebuyers with discounts and freebies.

Quick bytes

  • There is nothing free in discounts & freebies and the homebuyer has to pay the hidden charges
  • Always ask for direct price cut than discount on car parking or club etc
  • Evaluate whether the freebies on offer is what you actually need
  • Discounts should be cash discounts in flat cost and not add on amenities being discounted

Developers on their part maintain that discounts & freebies are offered to add to the festive spirit. It has been a tried & tested marketing methodology since ages. However, the fact remains that the homebuyers today are more informed and aware about the cost & benefit of the discounts & freebies.

Home ownership has long been a valued tradition across most societies and cultures. Indians traditionally aspire to possess their own homes. The festive occasion like the Gudi Padwa adds zing to the aspiration since it is considered to be auspicious and lucky. And it is here that the gullible homebuyers are prone to make emotional mistakes.

Considering the overall health of an economy is largely influenced by the functioning of its housing market, there is definitely a need to reform the property buying and selling process which allows consumers to be more involved. This is all the more relevant in the present market conditions where, the cost of capital and loans are high and not expected to decrease in the near future – affecting the affordability and availability of homes. Resultantly, the decision to purchase a house is taking place in a highly constrained environment.

Therefore, analysts suggest that as prospective consumers knowing the right questions to ask and engaging expert advice can definitely help one make a sound investment for your future. Whether you are buying a home to live in with family or for investment purposes, understanding your wants and needs is the way to avoid emotional mistakes.

There is no point in getting lured by the discounted freebies like refrigerator or air conditioner. These consumer durables should not be a criterion when you already have it. A gold coin or home furnishing may not be a sound advice when the price of the apartment is too high against the competing projects in the neighbourhood.

Sachin Sandhir, Global Managing Director of RICS says ‘buyer beware’ may sound like a cliché, but it is absolutely essential that homebuyers protect their interests. Therefore, knowing the right questions to ask can definitely help you make a sound investment for your future. It is critical to understand that the decision to buy any property requires a long term financial commitment.

“For all properties, regardless of age and design, basic checks should include the structural condition of the property; electrical wiring; plumbing; insulation; alterations which have been made to the original floor plan and if the same have been approved and assessed by the local development authority. It is also advisable to consider what the immediate and future maintenance requirements of a house might be,” says Sandhir.

The ‘urgency’ factor of moving into one’s home will largely depend on one’s disposable income and the decision to invest either in an under construction or resale property. However, prior to making any such decision, it is always wise for the buyer to consider the associated risks that are involved in buying property and evaluate the same, before making a financial commitment.

Today, when the inventory level is high in Mumbai market, it is advisable to go for a ready to move property than book an under-construction or new launch project in exchange of discount. In the final cost & benefit such discounts & freebies are often more costly.

Rate cut multiplier effect on homebuyers’ psychology

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Bottom Line: After regulator, rate cut is another confidence booster for homebuyers. 

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news,Track2Media, Track2Realty, ravi sinhaIt may have been a very marginal rate cut by the Reserve Bank of India (RBI) and definitely not anywhere close to what the RBI has done in the past, but yet this rate cut promises to have substantive impact than mere symbolic discussion for both the homebuyers as well as the real estate sector. As a matter of fact, this rate cut promises to have multiplier effect on the fortunes of the sector, along with the goodwill generated with the decks being cleared now for a real estate regulator in the sector.

For the records, the RBI Governor Raghuram Rajan in his bi-monthly monetary policy review has cut the repo rate by 25 basis points to 6.5 per cent; thus clearing the decks for home and auto loans, among other loans, to become cheaper. The policy interest rate has been now lowered to more than five-year low, while indicating the prospect of another cut later this year if inflation trends stay benign.

From the standpoint of homebuyers, this definitely has a multiplier effect on the psychology which had been subdued for quite some time due to high interest rates and trust deficit with the sector. The industry has hence given its thumbs up to the RBI’s gesture.

Anshuman Magazine, CMD, CBRE South Asia feels that on the back of moderating inflation levels, controlled fiscal deficit and cautious economic sentiments, the RBI’s decision to pare key interest rates in its latest monetary policy review was largely expected by the industry.

“The rate cut is likely to help lower borrowing costs and support growth further in 2016. For the real estate sector this is particularly critical. It is expected that this benefit will be completely transferred to the borrowers, which will result in lower lending rates, thus helping to revive housing sales,” says Magazine.

Ashish Raheja, MD, Raheja Universal calls it a welcome step. He believes the move will surely have a positive impact on the economy as well as across sectors at large. “More specifically from the real estate sector perspective, we believe that there will be some renewed interest from prospective homebuyers who were hit recently by the ready reckoner rate hike across Maharashtra. While this move is positive it is left to be seen whether banks will pass on these benefits to their customers.”

Deepak Joshi, President and Chief Business Officer, Religare Housing Development Finance Corporation says this coupled with Marginal Cost of funds based Lending Rate – (MCLR) on which SBI has already taken a lead, will further reduce the lending rates in the market and increase credit off take. “Also, EMIs on retail consumer loans will further soften which will increase demand for auto and home loans.”

However, it would be pertinent here to note that though the RBI Governor sounds optimistic with the direction of the economy and signals more rate cuts in near future, the move will only have its affect when the banks pass on the benefits to the consumers. Failing this, it would be another symbolic gesture on part of the policy makers that will have no impact on the fortunes of the sector or the pocket of the homebuyer.

A large section of economic analysts are hence giving a word of caution on this. They are conscious of the fact that now is the right time to revive the fortunes of the sector. While the confidence on the part of the fence sitting homebuyers is somewhat back to the market with seriousness of the policy makers to clean the functioning of the sector and assure the delivery process, this rate cut can have a multiplier effect if the benefits are immediately passed on to the buyers.

Growth slow but steady revival of Mumbai realty in 2016

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Brotin Banerjee, MD & CEO at Tata Housing, India real estate news, Indian realty news, Property new, Home, Policy Advocacy, Activism, Mall, Retail, Office space, SEZ, IT/ITeS, Residential, Commercial, Hospitality, Project, Location, Regulation, FDI, Taxation, Investment, Banking, Property Management, Ravi Sinha, Track2Media, Track2RealtyBrotin Banerjee, MD & CEO of Tata Housing believes more optimistic environment for homebuyers is likely in Mumbai. According to him, there is inherent demand for housing in city and the market is also getting realistic. In an exclusive interview with Ravi Sinha he accepts that the growth may be slow but the mid segment and affordable housing in the fast developing locations will be the major demand drivers.    

RS: Do you think Mumbai real estate has become more realistic for homebuyers due to slow down? 

BB: Pricing of housing will continue to increase over a long period of time because there is an inherent scarcity of housing in the city coupled with high demand. The challenge over the longer term will continue to be creation of capacity. In spite of slow absorption rates in the market, new project launches across segments coupled with innovative marketing initiatives has helped spur demand in Mumbai.

This, along with focused efforts by both, the government and developers alike, for steady growth is likely to create a more optimistic environment for end users in Mumbai, especially first-time buyers. The proposed decongestion will also aid in better rearrangement helping Mumbaikars to meet their housing needs.

RS: How would you define affordability in context to Mumbai housing market?

BB: With rapid urbanization and rising incomes, Mumbai has witnessed a thrust in the demand for middle income housing over the last few years. While affordability is categorized by income groups and ticket prices, livability in terms of amenities, comfort and functionality is also a crucial parameter while defining affordability in the Mumbai housing market.

I believe that suburban Mumbai like Thane, Kalyan, etc. and its regions supported by rapidly developing civil and social infrastructure will emerge as the new hubs for affordable housing.

RS: To what extent less launches and focus on inventory sale has brought fence-sitting buyers into the market?

BB: With the Indian economy getting back on track, real estate sector is expected to stabilize in the next two to three quarters. We would anticipate this sector to grow, albeit at a slightly lower pace, as the demand for housing still appears to exceed supply, and the weakening rupee makes India an attractive real estate investment destination for non-resident Indians.

Today, the emerging affluent classes are aware of the different cultures and lifestyles being adopted abroad and are ready to spend on homes that reflect their lifestyle and status.

RS: When do you see the revival of city real estate market?

BB: The real estate market is headed for a steady revival in 2016. Stability in property prices across major locations including Mumbai, along with reduced interest rates has led to an increase in consumer confidence and I strongly believe markets will only improve henceforth. 

RS: Historically Mumbai property market has been known to recover ahead of other cities. Do you see this trend to continue? 

BB: The city of Mumbai is growing at an exponential pace due to the constant influx of working population. Currently, major developing suburbs in Mumbai are witnessing projects that not only fit the budget of end consumers but are well connect in terms of both social and physical infrastructure. These locations basically offer better infrastructure, good connectivity, and accessibility to healthcare facilities, educational institutes and entertainment facilities which makes these locations apt for residential housing.

As these locations are developing at a rapid pace owning to which there is a possibility of higher return on investment. Simply put, the outskirt you choose to invest today is likely to become a prime location within a few years. In addition to this, the price range of properties in the outskirts of Mumbai would be lesser as compared to the main city and the consumer also gets ample green spaces. 

RS: Which are the pockets of growth for Mumbai in the year 2016?

BB: Thane has emerged as an attractive location for residential purchase/investment owing to rapid infrastructural and residential development on par with global standards. The region shows potential for tremendous growth, with several projects in the pipeline like the metro, monorail project and underpass that connects Thane to Borivali. Thane enjoys a central location along good railway connectivity and is steadily moving towards a self-sufficiency model which makes it a place of choice for all buyer segments. Moreover, the region offers quality housing options across the spectrum for an increasing urban population.

Similarly, Kalyan-Dombivli’s has recently witnessed growth, primarily due to increasing connectivity to Mumbai and also the growing demand for affordable housing in Mumbai. A proposal for extending the Navi Mumbai metro rail to Kalyan too has fueled growth for housing in Kalyan-Dombivli. The improving road connectivity and upcoming infrastructure in and around Kalyan, is making the region a preferred location for people looking at affordable housing options. As the region grows and commercial activity increases owing to the nearby Badlapur industrial region, property prices are sure to appreciate. 

RS: Do you expect Mumbai real estate to attract more investment this year? 

BB: Mumbai has seen immense growth in the real estate segment in the past few decades. However, in recent years the island city is witnessing land crunch, which has caused the city to grow far into the mainland in the north and east.

Besides inward migration there is a refurbishment of old housing and infrastructure which is resulting in huge demand for residential properties, which has given birth to areas like Thane, Kalyan-Dombivali belt making them the new real estate destinations of the city.  Additionally, with rapid urbanization, a large section of population being in the working age group, high savings rate and increasing purchasing power at the hands of the consumer, this segment is bound to get a major fillip and see strong growth in the coming years.

With improving connectivity, expanding cities and rising property prices, more and more homebuyers are looking at places close to metro cities, but Mumbai will always remain to be the most favorable real estate destinations. In fact, the outskirts of the city are the best locales with abundance of open and green spaces. The area boasts of good connectivity and transportation facilities as well as amenities like malls, schools, hospitals, and residential houses.

RS: How do you see the future of Mumbai once the other Smart Cities surface and economic activity shifting to many of these places?  

BB: Mumbai is the largest metropolis as well as the financial hub of the country. Currently, the city has reached its expansion limit and hence, it is important that new areas are developed that can act as satellite to the financial hub. The upcoming Smart Cities will help take off the load from Mumbai bringing in better infrastructure and facilities. However, Mumbai is expected to continue to rule as the major financial hub.

Upper House approves long awaited RERA Bill

Posted on by Track2Realty

Far reaching implications anticipated for the real estate and construction sector in India.

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news,Track2Media, Track2Realty, ravi sinhaThe long awaited passage of the Real Estate (Regulation and Development) or RERA Bill in the upper house of the Parliament is a significant announcement that will have far reaching implications for the real estate and construction sector in India.

It is expected to help regulate the realty sector and promote transparency. If implemented in the right spirit, it could facilitate greater volumes of domestic as well as overseas investment flows into the country. Homebuyer confidence in the property market is also likely to revive, invigorating India’s property market.

Since the preparation of the draft Bill in June 2013, the Union Cabinet had approved amendments proposed to it in December 2014, following which it had been sent forward to a Joint Parliamentary Committee for reviews. In December 2015, the Cabinet had approved further amendments to the Bill on the recommendations of a Rajya Sabha committee; and finally the Bill was passed through the Upper House on 10th March, 2016.

The RERA Bill is among the key measures that the Government has been trying to implement for the development and regulation of the realty sector in India. The amendments spell encouraging news for the sector, and is the first step in the right direction. It seeks to provide a regulatory authority to review construction of residential and commercial projects.

On the other hand, however, the Bill does not effectively address the concerns of the developer community. The problems faced in getting sanctions and approvals before the launch of any project, and the absence of a single-window clearance mechanism, among others, are some of the concerns that still remain unaddressed.

Once ready to be implemented on ground, the RERA Bill could go a long way in regulating the sector and offering protection to consumers in the real estate market. In its current form it is applicable to residential and commercial projects above 500 sq. m. or eight apartments. This proposal had been accepted in December last year, since the earlier provisions had stood for projects with a minimum 1,000 sq. m. area for primarily housing projects.

Another change carried through from the December amendments has been reverting to the original June 2013 provision of the need for developers to deposit 70% of the amount realized for a real estate project, including land cost, in an escrow account to meet construction costs. Provisions such as submission of project details—approved layout plan, timelines, costs, sale agreements to the regulator before launching any projects—are all expected to reduce information asymmetries between developers and property buyers.

The Bill also proposes the establishment of regulatory authority and appellate tribunals in states and Union Territories, while announcing the registration of projects as well as real estate agents. A major step has been taken in allowing aggrieved home buyers to approach consumer courts at the district level, instead of the regulatory bodies alone. This will provide end-users with proper grievance redressal systems to take recourse to. Meanwhile, punitive action is to be expected, including cancelling registration of projects, in case of contravention of the authority.

Homebuyer interests have also been protected with the Government laying down that development firms will have to pay interest for any default or delays at the same rate that home buyers are charged. Instead of the earlier two years, under the present Bill, builders will be liable for structural defects for five years.

Interests of the developer community too need to be addressed, however, with the need for regulatory authorities promoting a single-window system of clearances for real estate projects, and the digitization of land records. Overall, the RERA Bill is a policy measure aimed at ushering transparency and regulation into the real estate and construction sector, a much-awaited development for the sector in the country.

Supertech to invest Rs. 5,706 crore in Haryana

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Signed a MOU with Government of Haryana at ‘Happening Haryana Global Summit 2016.

Supertech-Disney, India real estate news, Indian realty news, Property new, Home, Policy Advocacy, Activism, Mall, Retail, Office space, SEZ, IT/ITeS, Residential, Commercial, Hospitality, Project, Location, Regulation, FDI, Taxation, Investment, Banking, Property Management, Ravi Sinha, Track2Media, Track2RealtySupertech signed a Memorandum of Understanding (MoU) with Government of Haryana that promises to generate 5,000 employment opportunities in the state. Under the Government’s initiative of Housing For All by 2022’, Supertech is developing affordable housing and township projects in Gurgaon and will be investing Rs. 5706 crores in the State.

Under the terms of the agreement, Supertech will develop affordable housing and township projects, encouraged by the Government of India’s objective of ‘Housing for All by 2022’ which will further help improving the infrastructure of the State.

The Scheme while ensuring fast development will benefit land owners, developers and buyers as well and would provide over 5000 employment opportunities in addition to huge revenue generation to the Government to execute welfare programmes in the State.

R.K. Arora, Chairman of Supertech Limited said, “We are extremely happy to be a part of this development programme of the state of Haryana. The state has a lot of potential in terms of infrastructure and industrial development and has become a hub for affordable housing and infrastructural facility after the launch of Affordable Housing Scheme by the Govt. of Haryana. Following the vision of Government Of India of Housing For All by 2022, we are developing projects worth Rs. 5706 crores which will further boost the economy of the state resulting in overall development.”

Budget impact: REIT listing likely to be game changer

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The real estate sector’s expectations of exemption for Real Estate Investment Trusts (REITs) from taxation on distribution of dividends were addressed by the Finance Minister in his Budget statement earlier this week.

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news,Track2Media, Track2Realty, ravi sinhaThis exemption of Dividend Distribution Tax (DDT) for implementing investor-friendly REITs has been the most encouraging announcement for the sector in the country in recent times.

Any distribution made out of the income of a Special Purpose Vehicle (SPV) to the REIT will now not be subjected to any Dividend Distribution Tax. While the fine print on the announcement needs to be reviewed, it is hoped that having cleared this hurdle, companies will now come forward to set up REITs in India, which is expected to be a game changer for the industry.

The previous Union Budget had also attempted to clear taxation impediments for India REITs, but had fallen short of industry expectations. Consequently, the industry had not seen the establishment of any REITs in India since the Securities and Exchange Board of India (SEBI) announced the final notification on them in October 2014.

In the previous budget announcements of February 2015, the Government had rationalized the capital gains tax for sponsors of REITs and accorded pass-through status to rental income.

Later during the year, it had allowed REITs to be treated as eligible financial instruments under the Foreign Exchange Management Act (FEMA); and had also clarified on capital gains and Minimum Alternate Tax (MAT), but clarity was awaited on DDT.

The latest proposal, however, is likely to lead to the establishment of the first REIT structure in India. Essentially, the pricing and quality of assets will be crucial for the successful launch of the India REIT market. They also need to be made attractive for investors, particularly for foreign investor groups.

At a time when the realty sector is struggling for alternate avenues of funding—other than traditional banks and financial institutions—and private players are sourcing institutional capital, enabling REITs to operate with ease is expected to act as a key enabler for capital markets in the country.

A successful India REIT market will require strong support from existing landlords and investors, as well as favorable market conditions. All in all, the successful implementation and development of the REIT market in India will rest on a number of factors related to the regulatory environment, market conditions and issuers/investors.

By: Anshuman Magazine, CMD, CBRE South Asia 

Tax rebates for individual taxpayers could revive the residential property market

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Anshuman Magazine, CMD of CBRE South Asia writes how tax rebates to homebuyers could revive the housing market.

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India Property, Delhi NCR real estate, Mumbai Real Estate, Bangalore Real Estate, Pune Real Estate news,Track2Media, Track2Realty, ravi sinhaAs the Union Budget 2016 draws closer, India’s real estate sector hopes for its key expectations to be addressed in the Budget announcements. Much hope rides on rebates for homebuyers in the form of relaxed individual tax slabs that might result in more disposable income and subsequently improve demand in the housing sector.

Direction is also sought from the Government on the way forward for related regulatory changes, including the pending Land Acquisition and Real Estate (Regulation and Development) Bills. We hope that the year 2016 will be one of implementation and direction for the nation and its economy.

Considering the current lull in the Indian housing market, it is hoped that the Government will take initiatives to encourage homebuyers to make a return. To incentivize property buyers, especially first time homebuyers, rebates and relaxations on taxable income would be steps in the right direction for inducing home purchase decisions. Individual taxpayers are hoping for an increase in personal income tax exemption limits along with higher deduction limits on home loan interests from the Budget.

With the relaxation made last year in the minimum Provident Fund amount to be deducted for salaried taxpayers, individuals employed in the private sector have also been enabled to save greater amounts from their salaries. A further increase of the deduction limit for the home loan interest component in the current personal taxation structure would go a long way in helping buyers cope with the prevailing high property prices in our leading cities.

Relaxing the rules related to home loan interest exemptions would also bring relief to buyers of delayed housing projects. Although the Central Bank has already reduced key interest rates to 6.75% (repo rate) through several rate cuts last year, these are yet to be passed on to homebuyers by banks. Directives are sought from the Government for the banking sector to implement these rate cuts on ground at the earliest.

Increasing the house rent deduction limit, especially for the self-employed and those without a HRA component in their pays, would also help individual tax payers to claim reasonable tax deduction. There are expectations of incentives and adjustments being announced in the Budget for reverse mortgage as well, which is a useful tool for senior citizens to unlock the value of their real estate assets. All these considerations could help make a positive tax impact on individual taxpayers, spurring sales activity in the housing sector in many cases.

Moreover, despite the property market attracting sluggish demand, and prices having largely remained stagnant across most residential neighborhoods, input prices in the real estate and construction sector continue to be high. In an effort to revitalize the market, tax rebates are also sought for construction material sectors, such as cement.

Streamlining of the land acquisition process is an important move, long awaited by the realty sector. The Land Acquisition Bill in question is still pending in Parliament, and further development in the housing market is directly dependent on the passage of this Bill. Greater clarity is also sought on the pending Real Estate (Regulation and Development) Bill. It is hoped that it will be balanced between end-user as well as developer interests and concerns.

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