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Aishwarya Raj Singh

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Developers in Delhi NCR to halt construction as raw material costs soar

On Tuesday realtors’ body CREDAI-NCR said developer may have to halt construction works due to a significant rise in cost of raw materials like cement and steel.

The construction cost has gone up by about Rs 500 per square feet and this could lead to an increase in housing prices, it pointed out.

In a statement, CREDAI-NCR said, “the cost of raw materials has gone up by a weighted average of about 30 to 40 per cent recently while the cost of few items has increased by more than 100 per cent in the last 2 years.”

“The sudden and rapid rise in costs has eaten into the thin margins of realty projects and rendered them unviable,” it said.

CREDAI-NCR said that the developers are considering to stop purchasing raw materials, fearing these elevated costs will ultimately result in projects getting stalled.

Pankaj Bajaj, President of CREDAI-NCR, said, “For steel particularly, the situation is so bad that suppliers are not willing to take orders even at elevated prices.”

“Steel suppliers are even cancelling contracted supplies citing force majeure and the war in Ukraine. However, builders, while free to increase prices of unsold inventory, are stuck where they have pre-sold the inventory.

“Perhaps this situation should be recognised as force majeure and prices allowed to be escalated even for sold inventory. Otherwise, we are looking at the next wave of stalled and unviable projects,” Bajaj added.

In the last two years, CREDAI (Confederation of Real Estate Developers’ Associations of India) said, cement prices have increased to Rs 360 per bag from Rs 270 per bag.

Provident Housing to infuse over Rs 3,500 crore to expand housing portfolio

Provident Housing (PHL), a fully owned subsidiary of Puravankara, plans to invest over Rs 3,500 crore to expand its housing portfolio and venture into new cities over the next five years.

Provident Housing (PHL) is in the process of entering Mumbai and Pune in a bid to double its residential portfolio to 20 million sq. ft. which currently has a portfolio of 12.07 million sq. ft.

Mallanna Sasalu, chief operating officer, PHL said, “The renewed buyers’ confidence has been instrumental in the recovery of the housing market in Q3 2021, which has recorded good sales and launches in the past few quarters. We are not only entering newer cities but will also be aggressive in our growth plans.”

After the pause in the second quarter of 2021 due to the Covid-19 pandemic and restrictions imposed by multiple state governments, sales gained momentum during the third quarter as the economy picked up, supported by aggressive vaccination drives.

Sasalu said, “Provident currently contributes over 50% of the group’s revenue and has seen its business grow by 14% y-o-y in Q3.”

In 2020, the IFC Emerging Asia Fund invested $76 million alongside Puravankara Group in its affordable housing projects in India.

PHL has ventured into the Kochi property market with a 3.4 million sq ft development that is expected to generate a sales value of ₹3,000 crore. The project was funded by IFC.

“In the coming quarter, we will enter the Pune market and are looking for more opportunities in existing cities like Hyderabad and Bengaluru,” Sasalu said.

Tips for buying commercial land in India

The demand for commercial real estate is rapidly increasing corresponding to the amassed population of our country. Investment in commercial property has a scope for higher returns as compared to residential investment. Albeit for a new investor it may be challenging to zero down on the type of property to invest in but there are many ways to counter that. We have put together a few important tips that an investor can follow while planning to invest in commercial spaces.

Proper Market research

It is important to study and understand the trends of the market well in order to gain profit. Before investing in commercial property you should always analyze the scope of future development in the area. Buying a property in a developing area is more beneficial because it provides you with high returns on your investment.

Selecting a good & developed location

Location is an important factor to be considered while investing in a commercial property. The location should be well developed and accessible from the other location. Property in the prime location will always double your investment.

Investing options

Commercial real estate includes industrial complexes, retail shops, large apartment buildings, office buildings and many more. It is important to determine which type of property you want to deal with.

Connect with an expert

Buying a commercial property can be confusing and difficult when you do not have any prior experience. In that situation, you should take advice from experts like lawyers, accountants, and property consultants. They can help you make the right decision and to get through the complex procedures of legal aspects finance and so on.

Layout plan of the project

The layout of any property has a major impact on operational efficiency. Make sure the property you are buying has received all the approvals from the authorities so that you do not end up making any wrong decisions.

Conclusion

Commercial real estate investment can be difficult if you do not have good knowledge regarding the properties. However, with the above-mentioned tips, you can buy a property that assures a good return on your investment. With a proper plan, it is not difficult to find ways to mitigate the risks.

Gurugram, Bengaluru, Hyderabad and Pune tops for favorable housing sales post Covid

The Coronavirus had posed severe challenges in front of the entire real estate industry. Like a lot of many other sectors, the real estate industry caught off guard by the wrath of the pandemic but following the second wave it showed remarkable resilience.  

Dr. Atul Goel, MD, Goel Ganga Group & President (Elect.), NAREDCO Pune said, “The new launches came to halt but the demand was higher. However, 2021 was a game-changer for the sectors. As the world & largest vaccination drive gained momentum, the confidence for the reality as a sector rose and the financial year 2022-23 is now seen as the turnaround year for the sector which will lead to a robust boom for the industry.”

He added, “As the world’s largest vaccination drive gained momentum, the confidence for the reality as a sector rose and financial year 2022-23 is now seen as the turnaround year for the sector which will lead to a robust boom for the industry.”

“For a long time, almost a decade, real estate was a speculated investment for many investors. However, the property market is back on the radar as the homebuyers are flocking for the shopping spree thanks to limited supply, ample liquidity and rock bottom interest rates. The pandemic has been a blessing in disguise for the industry as the low cost of lending has boosted the morale of developers to finish the pending projects, whereas the buyers have been able to hunch upon the low EMIs to buy new houses. Top cities in India including Gurugram, Greater Faridabad, Delhi, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad and Pune are poised for favorable housing sales, sowing the seed for the revival of commercial real estate as well,” said Suren Goyal, Partner, RPS Group

The pandemic has been a blessing in disguise for the industry as the low cost of lending has boosted the morale of developers to finish the pending projects, whereas the buyers have been able to hunch upon the low EMIs to buy new houses.

“The changing dynamics in favor of real estate, even amidst the unstable economy, could be credited to the changing consumer sentiments that underwent modification due to the uncertainties of rental accommodation. Even the millennials are adding to the demand. The new age generation, which relocated from Tier II and Tier III cities to Tier I and metros, is now in the favor of having their own house, instead of renting one. This is likewise now adding to more interest for the area. The new investors or the homebuyers demand spacious houses, with luxury and a large number of amenities, to showcase their lifestyle. Housing is now a style statement and the notorious pandemic instigated parties and gatherings at home only,” said Anurag Goel, Director of Goel Ganga Developments.

As per the experts, the low-interest rate is there to stay for a couple of years. Thus, the homebuyers can apply for higher amount loans, which broaden their choices to buy bigger homes complemented by enhanced amenities and better lifestyle. Considering the panoramic view of the industry, the future of the sector seems rather promising.

Andhra Pradesh housing minister said that the government aims to provide pakka houses

The State Housing department minister Sri Ranganatha Raju said,”The YSRCP government is aimed to provide pakka houses with all amenities to the poor people.”

Andhra Pradesh housing minister said that the government aims to provide pakka houses

Sri Ranganatha Raju on his 3-day visit to districts in North Andhra, visited the housing colonies which are under construction. On Saturday, the minister visited the layouts in Chodavaram and Yelamanchili constituencies in the Visakhapatnam district.

Interacting with media persons at Chodavaram, Minister Sriranganatha Raju said that the government has decided to construct 32 lakh houses in two phases in the state.

He said, in the first phase, the construction of 15.60 lakh houses would be completed. Nearly 17,000 Jagananna colonies are coming with all infrastructure facilities.

The minister further said that the government is spending nearly Rs. 2 lakh rupees on each house to create infrastructure facilities such as electricity, water, roads, underground drainage and others.

Apart from that, there would be a primary health center, school, anganwadi Kendra and other set ups.

The minister said, “The YSRCP government aims to provide better living conditions for the poor people. Around Rs. 4 lakh crore rupees assets will be created through this housing.”

He laid the foundation stone of mega housing at B.Ed. college layout at Chodavaram and appealed to the beneficiaries to complete the construction at the earliest.

Anakapalli MP Dr Satyavathi, Housing Corporation Chairman D Dorababu, Chodavaram MLA Karanam Dharmasri, joint collector Kalpana, Housing PD Srinivas, Navaratnalu Vice-Chairman Narayanamurthy, and others participated.

Renting a Furnished vs Unfurnished Property

Renting a Furnished vs Unfurnished Property

Today, with endless choices available in the real estate market from an unfurnished unit to a fully furnish serviced apartment it is difficult to make a choice between the two. With the exponential growth in the market of real estate, fully furnished homes have become a norm in the last few years. Builders have been redefining luxury with homes replete with furniture, modular kitchens, upholstery, bathroom fittings etc. due to which these apartments are always in demand. Even landlords have started letting out furnished units due to its increased demand.

Furnished property

From the dining table, sofa sets to a modular kitchen, the furnished home has everything which is required for perfect living. Though it is an attractive bargain, one must keep both advantages as well as disadvantages in the mind while making the investment decision.

Advantage of a furnished apartment

  • No extra shopping is required: One of the biggest advantages of moving into a furnished home is that it spares you the endless shopping trips you would have made in order to buy furniture and other durables. Furnished homes are equipped with all modern amenities for a comfort living. This also even save the cost of hiring an interior designer.
  • Shifting to a furnished property is stress-free as it does not require you to pack and unpack the entire furniture. It saves cost as well as the effort.
  • Another big advantage of picking up a furnished property is that one gets everything of daily use right there from day one of moving into the house. It is especially useful for those who are left with limited time after their work.

Disadvantages of furnished apartments

  • Expensive: A well-furnished apartment is more expensive as it already has everything you need. From wooden floorings to modular kitchens a furnished apartment is equipped with all the amenities you look for in a house, but these amenities come at a price.
  • Not many options available: In the case of furnished properties, your options are limited in terms of design, furniture, locations etc. You might have to compromise upon the choice of area or sometimes except the items placed inside and definitely one ends up paying a higher amount as compared to the unfurnished accommodation.
  • Limited freedom to decorate your home: A furnished apartment will restrict you from customizing your home because the furniture pieces and other accessories are already in the right place.

Unfurnished property

An unfurnished house may not be equipped with furnishings, electrical gadgets, couches or beds but you get the freedom to customize and decorate your home according to your style.

Let us have a look into the advantages and drawbacks of an unfurnished property.

Advantages of unfurnished apartments

  • Freedom to customize your home: With the unfurnished apartment you get the liberty to decorate your entire home exactly the way you want it. You can make necessary modifications as per your family requirements, buy your favourite dining set, maybe the top end microwave for your kitchen, paint the walls with the colour of your choice and you have the opportunity to customize your room in your own style.
  • Affordable/Less expensive: The price of an unfurnished property is always lower than a furnished property. Similarly the rentals will be lower in case of an unfurnished house. It is much more economical and gives you option to put up things and furniture of your choice in your home.

 Disadvantages of unfurnished apartments

  • Moving in might be costly: Shifting to an unfurnished apartment requires you to invest your money in buying household essentials and other accessories for the new house. This might cost you a lot. Moreover, you also need to spend money on hiring the shifting agencies.
  • Shifting is time-consuming: Moving furniture from one place to another requires a lot of planning and you need to be extra cautious especially with the breakables. Be it expensive furniture, a china dish or a gifted antique you want every item to be fully packed so that they remain unharmed. This requires a lot of time for packing and unpacking which makes shifting a difficult task.

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Uttar Pradesh RERA slaps Rs 1.40 crore penalty on nine promoters

A total penalty of Rs 1.40 crore has been imposed on 9 real estate developers by the Uttar Pradesh Real Estate Regulatory Authority because they failed to comply with its orders despite RERA granting them sufficient time to do so.

Uttar Pradesh RERA slaps Rs 1.40 crore penalty on nine promoters

RERA has ordered the promoters to submit the compliance report of its orders within 15 days and deposit the penalty amount within 30 days, otherwise the sum shall be recovered as arrears of land revenue.

The decision was taken at the 84th meeting of UP RERA held recently under the chairmanship of Rajive Kumar. The meeting was attended by UP RERA’s members Balvinder Kumar, Kalpana Misra, Bhanu Pratap Singh, Secretary Rajesh Kumar and senior officers.

The authority said in a statement that the imposition of penalty is an important step towards compelling developers to comply with the orders.

Section 38/63 of the RERA Act empowers the authority to penalize the non-compliant promoters with up to 5% of the cost of the project.

Chairman said, “UP RERA is continuously taking strict decisions against the insensitive promoters for protection of the interests of the home buyers. The authority is fully committed to protecting the interests of home buyers and, for this, is taking all possible steps to regulate the real estate sector of the state according to the RERA Act.”

HUA Ministry gives nod for construction of 60k houses under PMAY

The construction of over 60,000 houses in five states under the Pradhan Mantri Awas Yojana (PMAY) has been approved by the Union Housing and Urban Affairs Ministry, a statement said on Tuesday.

HUA Ministry gives nod for construction of 60k houses under PMAY

The decision was taken at a meeting of the Central Sanctioning and Monitoring Committee (CSMC) chaired by Secretary Manoj Joshi.

According to the statement, proposals is to approve for construction of more than 60,000 houses in Andhra Pradesh, Chhattisgarh, Himachal Pradesh, Karnataka, and Rajasthan.

The ministry said, “The total number of sanctioned houses under the PMAY (U) is now 114.04 lakh; of which around 93.25 lakh have been grounded for construction and around 54.78 lakh have been completed and delivered to the beneficiaries.”

Joshi reviewed the pace of completion of houses, directing officials to expedite the process and meanwhile, also evaluate the beneficiary allotment and completion of the Affordable Housing in Partnership (AHP) projects in their areas.

As per the statement, the secretary said that the work should be done in a processed manner so that maximum benefits of the scheme reach the beneficiaries without any delay.

HONG KONG- Grandjoy a Chinese developer gets $1.6 billion facility to fund M&A

State-owned Chinese developer Grandjoy Holdings Group Co. Ltd. said that it has signed a 10 billion yuan ($1.57 billion) financing facility with China Merchants Bank to fund acquisitions in the country’s real estate sector.

Grandjoy a Chinese developer gets $1.6 billion facility to fund

More assets are expected to be acquired by the State-owned property firms from cash-strapped private developers, as Beijing steps up efforts to stabilize and tighten control over a crisis-hit sector that accounts for a quarter of its economy.

Grandjoy said on its official account” on WeChat late on Monday the facility would support its acquisitions and come in the form of loans, funds, securitisation and other financing products.”

The firm said, “As a state-owned enterprise, Grandjoy firmly implements the policy to ‘support a housing market that better meets buyers’ rational needs and enhances the healthy development and virtuous cycle of the real estate market”

The government has taken various measures in last 2 months to restore stability in the sector as developers confront defaults on offshore debt obligations, credit rating downgrades and a selloff in their bonds and stocks.

Those measures included urging banks to provide appropriate lending to developers, simplifying the process for issuance of interbank notes and asset-backed securities, and not including M&A-related loans in the debt ratio caps for state-owned enterprises.

Jaypee Infratech posts Rs 540 crore loss in Dec’21 quarter

As per the Monday report, Jaypee Infratech hits the crisis and the consolidated net loss is of Rs 540.03 crore for the quarter ended in December 2021. Its net loss stood at Rs 472.14 crore in the year-ago period.

Jaypee Infratech posts Rs 540 crore loss in Dec’21 quarter

In the 3rd quarter of this fiscal year its total income rose to Rs 294.76 crore from Rs 248.57 crore in the corresponding period of the previous year.

Last year in June, Suraksha group received the approval of financial creditors and homebuyers to takeover Jaypee Infratech Ltd. through insolvency process, raising hopes for homebuyers of getting possession of their dream flats.

Mumbai-based Suraksha group has promised to complete around 20,000 flats and handover to homebuyers over the next 3-4 years.

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