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Bhanu Sahu

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https://www.ipropunited.com
Bhanu has a passion for writing for various verticals, including real estate and finance. He approaches bringing about change and serving society through his writings. Besides this, he loves to travel in the mountains and explore new heights. He is an eternal optimist and worships nature.

Market Value of a Property and How Can It Be Determined?

By
Bhanu Sahu
-

The price agreed upon by a buyer and a seller is the asset’s fair market value (FMV). The asset’s current status should be known to both parties, and they should both have freely chosen to engage in the transaction. The price at which a piece of property would typically sell if it were put on the open market is known as its fair market value.

The estimated worth of the land-based on state government data is the market value of land, sometimes referred to as the guidance value of a property. The minimal price at which a property sale can be registered with the state government is known as the circle rate in various states. The Department of Stamps and Registration of each state keeps track of these records and annually publishes the market value of the land for each property or the guidance value for each property.

The guiding value acts as a calculator for land value. A market value that fluctuates from year to year and from area to area and is based on a number of criteria is published by the Department of Stamps and Registration. It may even vary across various buildings in the same neighborhood.

According to Indian Accounting Standard (AS) 113, the fair market value (FMV) is the price received when selling assets or the amount paid to transfer an existing obligation between the parties concerned on the day of assessment. The factors stated below determine the amount that the market value of a specific asset or piece of property is worth.

  • There is no excessive pressure to buy or sell, and potential buyers and sellers are aware of the asset and acting in their own best interests.
  • A suitable amount of time is granted for the transaction to be finished.

Considering these circumstances, the Fair Market Value (FMV) of an item should be a precise estimate as well as an assessment of its value. Municipal property taxes are typically computed using the property’s fair market value. The significance of the discrepancy will increase with the gap between the purchase price and the property’s FMV. Professionals use standards, criteria, as well as regional and national laws, to decide on a solution.

Factors affecting property’s fair market value

Location

The location of the property significantly affects its value. The initial estimate is given for the property if it is in a popular area. A residential neighborhood featuring luxury buildings and expansive apartments, such as MG Road in Bangalore or CP in Delhi, is referred to as being in an excellent location. On the other hand, properties that are far away or on the outskirts are worth less.

The site

The size of the property, whether it be a plot, a flat, or a standalone villa, has a significant impact on its worth. A larger piece of land will have more significant value than a smaller one.

Demand and supply

The demand-supply dynamics of the property have an effect on its FMV as well. Increased demand that isn’t satisfied by enough supply will unavoidably cause the FMV to increase, whilst an abundance of supply will impede capital growth. Real estate demand is also influenced by variables including easy access to mortgage loans, rising disposable income, and rural-to-urban migration. Hence, changes in the property’s FMV are brought on by the economy’s current situation.

Before moving forward with a property deal, both parties must make a vital estimate known as the FMV. As a result, you should always determine the worth of your property using the above-mentioned variables, or you can employ qualified property evaluators to streamline the process.

Ways to Determine a value of a house:

  • The cost at which land or other property can be purchased determines its market value. Property may be sold in a  particular area or neighborhood. The minimal price for which a property needs to be registered is set by the state government.
  • You have the authority to sell the house for whatever sum he desires. The property’s market value as assessed by the government cannot ever be induced by a buyer.
  • If you can purchase a property for less than its market worth, you may still register it at the government’s guiding value. The current market value of the property will be subject to taxes as a result.
  • If you purchase a home for a price above its market value, you must register it and pay taxes based on its full market value.

Key considerations while determining the market value of a property: 

When it comes to assessing the market value of a property, several factors come into play. Understanding these factors is crucial for both buyers and sellers in the real estate market. Here are the key considerations in determining a property’s market value:

Location: The location of a property is of utmost importance in determining its value. The size and growth potential of a community significantly impact its value. A large property in a developing neighborhood may have a lower price compared to a smaller plot in an established and mature neighborhood.

Construction Quality: The condition and quality of the building on the property also play a significant role in determining its value. A structure constructed with premium materials will generally command a higher price compared to one built with moderate quality materials in the same vicinity.

Property Age: The age of a property is another crucial factor influencing its value. Historic structures may have a lower price tag compared to new buildings located in the same area.

Different Terms for Land Market Value:

While “Guidance Value” is a commonly used term, there are other terms that refer to the same concept. These include “Market Value of Land,” “Guideline Value,” “Ready Reckoner Rate or RR Rate” (primarily used in Maharashtra), and “Circle Rate” (often used in North India, especially in cities like Delhi and Noida).

Differentiating Market Value and Market Price:

In real estate, it is essential to understand the distinction between market value and market price. Market value refers to the value as perceived by the seller, which may be higher than what a buyer is willing to pay or the property’s true market price. Demand plays a significant role in determining value, whereas value alone cannot affect the price without demand. The price fluctuates with changes in supply and demand, while the value remains constant. In a balanced market, market value and market price may align.

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The Surge in Demand for Expat Rentals: Rent Increases of 40-50% in Gurugram, Delhi, and Mumbai

By
Bhanu Sahu
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In Gurugram, Delhi, and Mumbai, the demand for “dollar homes,” or rented housing for expats, is on the rise. Since COVID-19, rents have increased by 40–50 percent, largely as a result of the increased demand for fewer homes with modern amenities.

Brokers claim that the market is just as fiercely competitive as Mayfair in London, where a home listed today on the market often sells within a day. Renters are increasingly bidding higher than one another, which is another trend. The monthly minimum rent is Rs 3 lakh, and the maximum rent is Rs 14 lakh.

It should be noted that these “dollar” homes, which assured landlords of receiving dollars in rent every month, lost their luster soon after the pandemic’s outbreak in 2020.

Expats returning in cities 

With the majority of expats returning home, COVID-19 changed the dynamic. However, it is unknown whether or when they will return. Though expats are now back in town as work-from-home is almost over.

Malcha Marg, Shanti Niketan, Jor Bagh, West End, and Vasant Vihar in Delhi are among the preferred neighborhoods, as they are all close to consulates and embassy schools.

According to brokers, rentals for newly redeveloped properties with all modern amenities, fittings, and appliances have increased by more than 40% in the last few months.

According to Sush Clays, Founding Partner of Welcome Home Luxury Real Estate Services, which has assisted expats in setting up residences in India, there is a dearth of newly constructed, modern apartments.

According to her, “expats generally demand modern apartments with high-end kitchen fittings, appliances, bathrooms with branded accessories, and standardized interiors, located close to embassy schools and, to the extent possible, close to the diplomatic zones.”

The fulfillment of these requirements affects apartment rent, she continues.

Lack of independent of bungalows 

For ambassadorial level staff, there is a lack of independent bungalows close to diplomatic areas because most of these bungalows have gradually made way for apartments.

“The demand for luxury rental housing has been hit by a supply shortage with more foreign companies opening up shop in the country, an increase in global business tie-ups, and an increase in embassy staff,” she explains.

Finding the best apartment is a race. Finding the ideal apartment with all modern amenities has become as competitive as Mayfair in London. A listing that is available to you today disappears tomorrow. Higher rents and units selling off the shelf in less than a day are the result of tenants outbidding each other, she claimed.

With too many people competing for fewer apartments, the sign-and-go syndrome has become widespread. Younger expats are also requesting smaller apartments (1,600–2,000 square feet) with modern appliances, which is a new trend. “These can cost up to Rs 2 lakh per month in rent,” she said. Additionally, a security deposit for 2-3 months is also required.

A builder floor in Chanakyapuri’s Malcha Marg neighborhood can cost you Rs 3.5 lakh per month. Rental prices for larger plot sizes, which are uncommon, range from Rs 6 lakh to Rs 14 lakh per month (in the case of 1,200 square yard plots on Kautilya Marg).

Newly renovated apartments in the West End neighborhood can rent for as much as Rs 5 lakh per month, while older apartments with modern amenities, if properly maintained, can be equally expensive. 

The monthly rent for brand-new apartments in Vasant Vihar ranges from Rs 3 to 4 lakh. Depending on the quality of the property, rents in Shanti Niketan begin at Rs 3 lakh per month.

Depending on the amenities provided, the maintenance for these units can range from Rs 20,000 to Rs 30,000.

Rental costs in Gurugram 

The Golf Course Road has also seen a 40 percent increase in rental rates. Several Japanese, Chinese, American, and British nationals live in these opulent condos.

Today, luxury housing units in DLF Golf Links command monthly rents ranging from Rs 5 lakh to Rs 14 lakh.

Apartments in The Aralias, DLF Golf Links, are available for rent starting at Rs. 6 lakh per month, compared to Rs. 2.6–2.7 lakh before the pandemic. The Camellias offers monthly rents ranging from Rs 7.5 lakh to more than Rs 12 lakh. According to the local brokers, the Crest at DLF5, Golf Course Road, has rent starting at about Rs 3 lakh.

According to Mudassir Zaidi, Executive Director, North, Knight Frank India, rental values first rose by 40–50 percent as leasing picked up shortly after the pandemic, and capital values also escalated.

The luxury rental market has experienced exponential growth, according to him, as senior management, both domestic and foreign, has returned to work post pandemic.

According to him, the rent in a given area is determined by how far the apartment complex is from the workplace.

Broker in Gurugram Rishu Chopra notes that transaction values have also doubled. Today, a 16 crore rupee apartment in Magnolias is being sold for 32 crore rupees. Monthly rentals have escalated from Rs 4 lakh to Rs 6.5 lakh. Rentals for a 2,700 sq ft unit in The Crest have increased from Rs 1.25 lakh to Rs 2.75 lakh per month.

Fewer high-end homes are available, but many tenants are competing for them. A few foreigners who would have previously preferred South Delhi have also relocated to Gurugram, considering the services offered, he continued.

According to Akarsh Gujral of Domus Prime Properties, some ambassadors and top executives from around the world prefer to rent out farmhouses. A 2.5-acre farmhouse has five rooms, a tennis court, a pool, and all contemporary amenities. The majority of them are near the airport and Gurugram. 

Rental status in Mumbai 

In Mumbai, after the expats returned home during COVID-19, the rents of luxury apartments fell by almost 40%.

The same apartments in the BKC neighborhood now fetch a monthly rent of Rs 6.5 lakh. During the pandemic, rental prices reached up to Rs 4.5 lakh. Other apartments in the vicinity of BKC were priced at Rs 1.7 lakh per month (pre-COVID), for a 1,100 square foot (carpeted) apartment. During the pandemic, they had fallen to Rs 1.4 lakh per month. The monthly rent for these properties has reached Rs 2.25–Rs 2.3 lakh.

“Due to redevelopment, Mumbai’s rental housing options have shrunk significantly. Consequently, today’s market is owner-driven. This is one of the factors pushing up the price of luxury home rentals, according to Ritesh Mehta, Senior Director and Head of West and North, Residential Services & Developer Initiatives, JLL.

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Meaning of Comparative Market Analysis: The Key to Accurate Property Pricing in Real Estate

By
Bhanu Sahu
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The idea of comparing prices is known as comparative market analysis or CMA. Activities listed in a specific location will have genuine highs and lows. The concept of how these selling prices change is CMA, although other factors will also have an impact. Comparative market analysis, to put it simply, is the process of determining the prices of comparable sales of each property in a certain location based on its square footage, lot size, floor plans, and interior valuation.

If you’ve listed a property, your real estate agent will have established an asking price as well as a price at which you will sell the property. Numerous real estate agents utilize this phenomenon to acquire listings through comparative pricing strategies. The ideal course of action would be for you to additionally create a time-consuming and tedious comparative market analysis. If your realtor is committed, they will also offer realistic CMA reports based on an in-depth investigation.

While each property has a selling factor, comparing the two is a challenging endeavor. A set that is not completely equal in all of its measurable appeal must not be included in the comparison. a new house should not be compared to one that is ten years old even though they have similar square footage. Likewise, a furnished property with cutting-edge additions must also be evaluated against the current market value of similar homes, not an empty home. That’s how a fair market value is determined.

Sellers can determine the best listing prices for their property with the aid of a comparative market analysis. A CMA may help buyers determine whether a home is a fair value and determine a competitive offer that will be taken seriously—without going overboard. The location, size, and qualities of a given property are compared to those of other properties in a CMA. A CMA will also show previous sales of residences in the same subdivision as the subject property.

Methods to conduct a comparative market analysis

A CMA will also entail much more than only contrasting the selling prices of recently sold residences. Below is a list of the stages involved in creating an accurate CMA:

Evaluate the neighborhood: The general quality of the neighborhood must be taken into account in the CMA in order to determine the appropriate listing price or to ensure that a home you are interested in is a good deal.

Collect information about the property: If a real estate agent performs the CMA, they must also look through the current listing and make a personal visit to the subject property to gather details.

Evaluate the neighborhood: The general quality of the neighborhood must be taken into account in the CMA in order to determine the appropriate listing price or to ensure that a home you are interested in is a good deal.

Collect information about the property: If a real estate agent performs the CMA, they must also look through the current listing and make a personal visit to the subject property to gather details.

Adjust for differences: The final step is to account for any discrepancies between the subject property and each comparable property. For instance, it would be logical to presume that the buyer paid more to gain the extra bedroom if the comparable property had one (a superior feature).

Calculate the sold price per square foot after adjustments: After accounting for variances, you must additionally calculate the sold price per square foot by dividing the adjusted price of each comparable by its square footage. To calculate the average, add the sold prices per square foot of all the comparable sales and divide by the total number of comparable sales.

What is included in the comparative market analysis report?

Also, your real estate agent will generate a CMA report for your property based on the previously mentioned characteristics. They will consider comparable properties and competing offers before arriving at the home’s reasonable selling price based on nearby sales of similar properties.

Active listings of nearby properties: These are the properties currently listed for sale in the market. As each homeowner will set their asking price based on recommendations from their listing agents, the CMA is unaffected by the sales pricing. But because they can receive competitive offers on their purchase, homebuyers can benefit from it.

Pending similar property listings: Similar properties that are currently active but have not yet sold become pending listings after a set period of time. Homeowners need to decide if they need to lower the prices at this stage in order to avoid suffering a loss in their property’s value by consulting with their realtors.

Sold price listings: This includes any property that has recently sold within the last three months. Homebuyers and listing agents will compare these houses to your current home. A licensed appraiser can calculate the fair market value and listing price of your property based on these transactions and the active listings.

Off-market and canceled listings: The real estate listings that don’t generate a lot of sales are terminated. There could be a number of causes for the cancellation, which we’ll go through in a moment. The rising price in comparison to comparable residences in the area, however, makes the most sense. These listings are taken down because they don’t attract buyers and produce no outcomes. Examining the property listings on various housing market websites will give you an understanding of what each of these listings entails.

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A guide to Market Value vs. Selling Price in Real Estate

By
Bhanu Sahu
-

A property’s market value is its estimated value in a market under normal circumstances. It is a crucial component of real estate deals and is not to be confused with the selling price. How does market value differ from the selling price, and what is it?

While looking for a home, buyers frequently encounter the term “market value.” Market value is the estimated price an asset is likely to attract when put up for sale. It is the price a buyer could consent to pay for a property or any other type of asset in a market. The market value is volatile and dependent on a number of variables, including the state of the economy, the performance of the property, and the demand and supply situation.

What is meant by a property’s market value?

Market value is the price that any asset is anticipated to get from a buyer. To put it another way, it also refers to the sum of money offered by investors to any company, equity, or asset. The term is most frequently used to describe the market capitalization of any publicly listed company, where the worth of its assets, shares, and stocks are assessed. It is also used for indicating the  the worth of assets like real estate .

How do you determine a property’s market value?

The price at which a property can be sold to buyers is its market value. This is what the property ought to sell for in the current market.

It can be computed by dividing the size of the property under review by the average selling price for comparable homes in the neighborhood.

The market value is influenced by internal and external factors, as well as the dynamics of supply and demand for comparable properties nearby.

Market value’s importance

Market value is a crucial element in the real estate industry since it provides a transparent system to determine the worth of a property. Yet, buyers might desire to pay less than this amount, while sellers might want to get more than the asking price. Importantly, a reasonable market value is always there and gives negotiations direction.

Is the selling price the same as the market value?

The selling price and market value might or might not match. The amount a buyer actually pays to purchase a property is known as the selling price. If the market value is determined incorrectly, the selling price would be different since it would be more difficult to sell the property and the seller could have to lower the total asking price. So, it is important to avoid overstating or exaggerating the market value of any asset since this may interfere with the sale of the property.

Market price vs. the government rate

The price that will be charged for the property when it is sold or bought is its market value. The lowest price below which a property in a specific location cannot be sold is known as the government rate or circle rate. The government rate is set by the relevant local authorities, contrary to the market value, which is established by buyers or sellers in the market.

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Land Evaluation Methods: A Comprehensive Guide to Determining Land Worth

By
Bhanu Sahu
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In order to determine the actual worth of land, a number of land evaluation techniques have been established around the world. A few approaches to determining the value of land and setting its price have gained significant traction on a global scale based on their efficacy. They are also used pretty frequently in India. Some significant ones are covered in this article. 

Comparative valuation method for land valuation 

This method is frequently used to determine the value of apartments in a time when apartment-based projects have become an essential component of urban living. This technique, also known as the sales comparison approach, aids in determining the worth of your property by comparing the prices of nearby properties that are similar to yours.

Let’s imagine that two apartments in your housing community recently sold for Rs. 1 crore each. The same sum would serve as the asking price for your home if you were to sell it soon.

This approach of property valuation works because you live in a bustling market with access to comparable data. When you finally list your flat for sale, though, you might discover that potential buyers are only ready to offer you Rs 90 lakh for it. There may be a number of causes for this.

Location: Even inside a housing society, location is crucial in determining a property’s worth. For instance, apartments at the main entry point will sell for less money because occupants might experience constant disturbance. Similarly, a flat facing a park is more attractive for a buyer and, therefore, will cost more than a property surrounded by other flats.

Shape: While no one prefers a house with an odd shape, the likelihood that such homes will fetch the full asking price is further reduced with Vastu making a significant comeback in India. According to principles, apartments with oddly shaped rooms restrict their owners’ chances of succeeding both personally and professionally. 

Size: if your home is even smaller than that of your neighbor, it will never be worth as much money. 

Level: The level of your flat will determine the value of your property, depending on the city where you live. Due to recurrent flooding during the monsoon season, apartments in housing societies on the upper floors in Mumbai are more expensive than those on the lower floors. On the other hand, the National Capital Region (NCR), sets a high price on apartments on the first floor.

Frontage: Compared to other properties, a corner flat or plot would command a higher price due to the simpler entry and exit locations.

Legal issues: Let’s say your sibling owns your property in a joint ownership arrangement and is unwilling to sell his half. Such a situation could cause value depreciation in addition to delaying the sale.

Land valuation development method

The value of the plots and the flats that are constructed on such plots are mostly determined using this method. This widely acknowledged method, also known as the residual land value method, aids in determining a land parcel’s potential. 

The plot’s value formerly was insignificant, but impeding infrastructural development might multiply that value many times over.

For instance, a bigha (27,000 sq ft) of land in Jewar was once sold for around Rs 4-5 lakhs. Land prices have reached Rs 20-25 lakh per bigha after Jewar was chosen as the site for the second airport to serve the NCR. As a result, the prices and rental values of apartments in housing societies in surrounding Greater Noida areas have also gone up.

Land valuation using the land and building method

This approach to land valuation assesses the value of the land individually before adding the value of the building to the result to determine the total cost. This approach could be used to arrive at both a land valuation and a property valuation.

Reconstruction costs are calculated first, and then depreciation adjustments are made to arrive at the building’s value. Due to the building’s age, construction method, present state, quality depreciation, etc., a depreciation of Rs 5 lakhs from its value could be applied if the structure could be rebuilt for Rs 25 lakhs, for example. By using this method, the building in this instance only costs Rs 20 lakh. To calculate the capitalized value of any comparable property, multiply the net annual revenue by its rental potential (let us assume this is Rs 55 lakh). The land’s worth is determined by the difference between the two numbers, i.e., Rs 35 lakhs.

Belting method of valuing land

The belting approach is the most useful and popular way to value a large piece of land in a city. The entire piece of land is divided into three belts for this purpose, with the portion nearest to the main road receiving the most value. Usually, the front belt can extend up to 10 feet, while the second belt can go as far as 50 feet. The third belt would be the component that comes next. Whereas the second belt may receive 75% of the value of the first belt, the third belt could receive 50% of that value. Areas up to 150 feet would be valued at Rs 7.50 lakhs if belt 1 is worth Rs 10 lakhs. Depending on how large it is, areas beyond this would be valued Rs 5 lakhs.

Property valuation using the guidance value method

A precise guidance value, also known as a circle rate, ready reckoner rate, etc., has been assigned to land by authorities, making the job easier for some of us. States take this action in order to collect stamp duty and registration fees on property transfers. For instance, Gurugram’s district government has announced an increase in the circle rate that is likely to increase the cost of purchasing land parcels. The government-specified rates, however, can be greater or lower than the property’s current market value. Find out the going market rate if you intend to sell your plot or flat.

Land’s market value

There is a difference between the market price of land and its market value. The amount the landowner is willing to ask for when selling it on the open market is the market price of the property. The amount that this land is worth, particularly in the eyes of potential buyers, in relation to its price reflects the market value of the property.

A property owner usually assigns a value to it based on a variety of considerations. Yet, when a potential buyer begins to examine this same land, he might not think it is as valuable as the owner believes. This demonstrates that both buyers and sellers engage in negotiation. This illustrates how different buyers and sellers place different values on land.

The difference between a land’s market value and its market price

It is possible to calculate the market price of a land using a few crucial details, without even personally visiting the site. The market price of land or property is determined by supply and demand, the property’s condition, and previous deals on similar properties.

Simply perform some data analysis to determine the price at which comparable land parcels in the same location are currently being sold. In this case, if a similar land plot sale yielded the owners, let’s say, Rs 2,000 per sq ft, an agent would anticipate getting the same price for his client.

However, since the market price of land is attached without taking the value component into account, the agent would need to physically visit the site in order to completely comprehend the value of this land piece.

For instance, the plot is worth more than comparable land parcels in the neighbourhood if it is close to the main road. If the plot, for example, is close to a cemetery, its value would be significantly lower than that of other nearby plots of equal size.

An owner should set a market price for his land parcel or other property only after considering all of these variables. The buyer should be willing to pay this amount, and the seller should be open to accepting it.

The final rate of sale would be the market price of the land, which would have an effect on the market value of nearby properties. So, both of these things continue to have a significant impact on each other.

Important things to keep in mind when valuing land

Property Location: The most important factor in determining a piece of land’s value is its location. A locality’s value, or lack thereof, is based on the level of development there. Because of this, a large tract of property in a developing neighborhood would sell for much less than a small plot in a prosperous neighborhood. One excellent illustration of this is the rise in land prices in Noida near the Jewar Airport.

Construction quality: The quality of the building built on the site comes in second when considering its value. Even if there is no age difference between two buildings in the same neighborhood, a structure constructed with premium materials will cost significantly more than a building constructed with average quality materials. Keep in mind that you must use technical professionals because you might not have the knowledge to evaluate the construction quality on your own.

Age of the property: An additional aspect that affects a property’s value is age. An older building would be considerably less expensive than a new one in the same spot.

Builder brand: In the case of a building, the developer’s brand will also affect pricing. For example, a project from a well-known developer will cost more than one from a developer who is somewhat less well-known.

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Embracing Sustainability in Real Estate: Shaping a Greener Future

By
Bhanu Sahu
-

In a world grappling with the impending climate crisis, the term “sustainability” often loses its true essence despite being widely discussed and shared online. However, the urgency of climate change calls for immediate action. On this World Environment Day, it is crucial to rally together and prioritize sustainable practices to halt and reverse the damage inflicted upon our ecosystem.

This year’s World Environment Day urges us to reimagine our relationship with the environment, recreate sustainable practices, and restore the balance within nature. We recognize the significance of environmental sustainability in the real estate sector and aim to generate awareness regarding its importance.

Real Estate’s Environmental Impact: The real estate sector, known for its substantial resource consumption and contribution to global climate change, must make sustainability an integral part of its business plans. With natural resources being exploited beyond their regenerative capacity, the pressing need to construct sustainable housing has become undeniable. To address the demand for housing and combat climate change, it is essential for real estate developers and homeowners to pledge their commitment to green housing on this World Environment Day.

The Importance of Sustainable Properties: The ongoing COVID-19 pandemic has underscored the necessity for sustainable properties that prioritize sustainable construction and design. Lockdowns and remote work arrangements have made us realize the dire need for green homes. By embracing sustainable design, construction, and operations, we can significantly reduce carbon emissions, conserve water, and mitigate our exposure to toxins.

Homebuyers Driving Sustainable Living: Driven by a growing awareness and a shift in mindset, environmentally conscious millennials are increasingly demanding green homes. Homebuyers now seek projects equipped with solar panels, green surroundings, rainwater harvesting systems, and effective waste management. While this trend is encouraging, it is essential to extend it to affordable residential housing by making these projects more cost-effective.

Actionable Measures for Realty Developers: To combat the challenges posed by climate change, real estate developers must adopt sustainable practices and minimize their impact on the environment by consuming fewer resources. This includes supporting initiatives to reduce CO2 emissions, utilizing cutting-edge technologies to minimize energy consumption and waste, and integrating energy-efficient features such as rooftop solar panels, LED lighting, and improved insulation.

Government Initiatives and Tax Incentives: Governments at various levels are also taking steps to promote green agendas and sustainable practices in the real estate sector. Local governments are offering tax incentives to incentivize developers to construct more environmentally friendly buildings and houses. These initiatives foster collaboration between the public and private sectors to address the climate crisis collectively.

Zero-Energy Buildings: A Sustainable Future: Zero-energy buildings, which consume only as much energy as they generate from renewable sources, hold immense potential for the real estate sector. Indian developers should focus on constructing zero-energy buildings as they help preserve energy resources, mitigate environmental deterioration, and reduce greenhouse gas emissions. Utilizing solar panels, heat pumps, high-efficiency windows, and insulation are among the effective measures to achieve this goal.

Adopting Green Building Materials and Water Conservation: Builders should prioritize the use of green materials such as fly ash bricks, highly recyclable building materials, high-reflectance terrace tiles, and renewable bamboo jute composites for door frames. To address the water crisis, developers should implement rainwater harvesting systems, employ low-discharge water fixtures, use curing compounds during construction, adopt geothermal cooling techniques, and recycle wastewater through sewage treatment plants.

A Pledge for a Sustainable Future: On this World Environment Day, let us take a firm pledge to protect mother nature by reducing our carbon footprints and embracing renewable resources. Our actions today will shape the world of tomorrow, and it is our moral duty to fight the battle against climate change. We wish you a Happy World Environment Day! Together, let us embark on a transformative journey toward a sustainable future.

Importance of Individual Contributions: While real estate developers play a pivotal role in promoting sustainability, individual actions also have a significant impact. As responsible citizens, we must strive to make sustainable choices in our daily lives. Simple actions like conserving energy, reducing water consumption, practicing waste segregation, and opting for eco-friendly transportation can contribute to a greener environment.

Educating the masses: Creating awareness about sustainability in the real estate sector is crucial. Educational campaigns, workshops, and community outreach programs can enlighten people about the benefits of green housing and inspire them to make environmentally conscious choices. By fostering a culture of sustainability, we can ensure a brighter future for generations to come.

Collaboration for a Greener Tomorrow: Achieving sustainability goals requires collaboration between stakeholders across the real estate industry. Collaboration between developers, architects, engineers, and policymakers can drive innovation, promote sustainable practices, and create a collective vision for a greener future. By sharing best practices, knowledge, and resources, we can accelerate the transition toward sustainable real estate.

Investment in Research and Development: To make substantial progress in sustainable real estate, investment in research and development is vital. Embracing new technologies, materials, and construction techniques can lead to more energy-efficient and environmentally friendly buildings. Governments, institutions, and private entities should allocate resources to support research that advances sustainable practices in the real estate sector.

Building Resilient Communities: Sustainability goes beyond just constructing green buildings. It involves building resilient communities that prioritize social, economic, and environmental well-being. Designing sustainable neighborhoods with green spaces, promoting public transportation, and incorporating community facilities can enhance the quality of life while minimizing the ecological footprint.

A Call to Action: As we celebrate World Environment Day, let us remember that sustainability is not an option; it is an imperative. Each one of us has a role to play in preserving our planet and securing a sustainable future. By embracing sustainability in the real estate sector, we can create a positive impact on the environment, enhance the quality of life, and leave a legacy for future generations.

Bottom Line 

Sustainability in the real estate sector is not just a buzzword; it is a necessity. By reimagining our approach, recreating sustainable practices, and restoring the balance within nature, we can shape a greener future. Let us pledge to make sustainability an integral part of our lives and work towards a world where real estate and the environment coexist harmoniously. Happy World Environment Day!

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Elevate Your Living Space: Design Ideas for a Stylish Living Room with Stairs

By
Bhanu Sahu
-

In modern homes, a living room with stairs is a distinctive and stylish design. By fusing functionality and aesthetics, it creates a room that is pleasing to the eye and makes it easy to access the different levels of the house.

This form of living room arrangement is particularly well-liked in homes with limited floor area because it makes excellent use of vertical space. Several living room with stairs design concepts are covered in this blog post.

Ideas for a Living Room with Stairs 

When your living room has stairs, there are numerous creative storage choices accessible. Here are some ideas for making the most of the space under your stairs.

Under stair fridge

To make the most of your kitchen space, think about installing a small refrigerator under the stairs in your living room. This is an excellent method to keep refreshments close at hand while entertaining guests, and makes room in your kitchen for other requirements. 

Make storage space under stairs 

Under the stairs, a chic and practical storage can be built. Build a storage solution that is especially suited to your needs by installing cabinets, drawers, and shelves. Everything from shoes and coats to cleaning supplies and recreational equipment can be kept in this space.

Utilize the area for television

The space beneath the stairs is where you can mount your television. If you want to conserve space in your living room but just have a small space, this works really well. Add some throw pillows and a nice couch or chairs to create a cosy viewing area.

Try installing an aquarium under the staircase

Another way to utilize the area beneath your steps is to install an aquarium. This particular element could provide color and liveliness to your living area. There are several aquarium sizes and varieties to choose from, depending on your preferences in design.

Utilize the space and adore it using picture frame

By displaying your favorite photographs, works of art, and other adornments, you may make a gallery wall beneath the steps. Use picture frames symmetrically or asymmetrically for a contemporary or eclectic look.

Build a wine rack under the stair

If you like wine, installing a wine rack there can be the best option for you. For a stylish and practical addition to your living space, choose from a variety of styles and sizes to fit your collection. Even some wine glasses and other accoutrements are an option.

Decorate staircase by displaying objects

The steps in your living room themselves could be used as decor. Employ showpieces like artwork, sculptures, or lovely plants to give the steps or landing more texture and visual interest. To make the steps feel cozy and elegant, add a runner or carpet.

Shoe storage under the stairs

Make a shoe storage area under the stairs if you’re tired of tripping over shoes. To store shoes and other footwear, install shelves, cubbies, or drawers. To make putting your shoes on and taking them off easier, add hooks or a small seat.

Try creating a library beneath the stairs

If you’re an avid reader, the space under the stairs can be transformed into a cozy library. Include bookshelves, a plush chair, and artistic lighting to create a reading corner. It is possible to include a small table or desk for a workspace or for displaying decorations.

Mudroom under the stairs

To store coats, hats, and other outdoor accessories, the space under the stairs can also be used as a mudroom. Add hooks, shelves, and cabinets to keep items organized and within reach. A bench or seating area might be added to make it easier to put on and take off shoes.

Bonus tips 

Creating living rooms with stairs may be challenging, but with a little creativity, you can make the most of the space and create a chic and useful layout. You can find some design ideas here.

Furniture placement to utilize available space

One of the main challenges in planning a living room with stairs is making sure there is enough space for furnishings and that the layout is functional. While placing furniture, it’s also essential to take the room’s flow and how people will move about into account.

Creating living rooms with stairs may be challenging, but with a little creativity, you can make the most of the space and create a chic and useful layout. You can find some design ideas here.

Place the heaviest pieces of furniture, such as the sofa, against a wall to create an anchor point. After that, arrange chairs or other seating alternatives in a conversation area across the room.

If your space is limited, think about buying furniture with many purposes, such as an ottoman that can be used as extra seating or a coffee table that doubles as storage.

Making Advantage of Tucked away Places

Another issue with designing a living room with stairs is dealing with uneasy crevices and corners. Nonetheless, these spaces can be made into appealing and practical elements.

To create a cozy reading nook, for instance, you might place a chair and a small table in a corner. You could also install shelves or an integrated bookcase to create more space for storage and display. A corner can also be used as a small office or desk.

Choose furniture that complements the architecture overall and the stairs

It’s important to consider both the overall design of the space and how the furniture will fit with the stairs when choosing furniture for a living room that has stairs.

If the stairs are constructed of wood, for example, think about using furniture with similar wood tones or materials to create a cohesive design. To tie everything together, you may also add decorative touches like a rug or a piece of art.

Consider the viewpoints

It’s important to take the view into account while designing the layout of your living area. Set up seats or a chaise lounge adjacent to a window, for example, so that visitors can enjoy the view. For a better perspective and more natural light, you can also add window coverings like sheer curtains or blinds.

Identify Zones

A large living room can be divided into different areas to feel cozier and more productive. A reading nook in a corner, a seating area next to the TV or fireplace, and a desk next to the stairs are a few examples of areas you may designate. To separate each area and give it a distinctive feel, use carpeting, lighting, and furniture placement.

Color and texture ideas for staircase in living room 

The right color and texture choices can have a big effect on the overall feel and design of a living room with stairs. Take into account the following ideas for texture and color.

Light and neutral colors

If your living room with stairs is on the smaller side, using light, neutral colors may make it appear bigger and more spacious. Light colors can make a room appear brighter in addition to reflecting more natural light. Consider using white, cream, beige, or light grey paint on the walls. Finally, add color to the room with decorative things like pillows, carpets, and artwork.

Dark colors

On the other hand, a huge living room with high ceilings might feel cozy and private by using dark, somber colors. Dark colors can provide depth and drama to the space, such as navy, emerald green, or charcoal grey. Think about using these colors as an accent wall or in furniture like sofas or chairs.

Texture 

Your living area may gain texture via texturing stairs, which also give depth and visual intrigue. Think about utilizing different textures in your furniture, such as a velvet couch or a leather chair. Some options to create texture are a shag rug, braided throw blankets, or textured wallpaper. Texture can also be created by decorative items like pillows, draperies, and artwork. 

Accent colors

You might use accent colors to match the living room and staircase. If the stairs have a specific color, think about using them in the living room. Using the same color as an accent wall or in accessories like cushions or drapes is an option. To add visual interest and contrast, think about using complementary colors from the color wheel. For instance, if the stairs are warm wood, use cool blue or green accents in the living room.


Modern homes are increasingly featuring this stylish and useful design element: a living room with stairs. It offers a distinctive and beautiful room that efficiently utilizes vertical space for homes with limited floor space.

Whether it is a simple arrangement with a single set of steps or a more complex structure with several levels and platforms, a living room with stairs can serve as the focal point of the house and create an inviting atmosphere perfect for entertaining guests and spending time with family.

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A comprehensive overview of PF withdrawal laws in India for hassle-free home buying

By
Bhanu Sahu
-

It is common knowledge that a down payment and other lump sum payments are necessary for the purchase of a home. Even though many homebuyers depend on Provident Funds (PF) for their retirement, they are sometimes unaware of the requirements to use PF to purchase a home. For a hassle-free home purchase, we have outlined the complete procedure, including the PF withdrawal laws in India.

For salaried professionals, the government manages the Provident Fund (PF), which is a mandatory retirement savings program. It is handled by the Indian Ministry of Labour and Employment’s Employees Provident Fund Organization (EPFO). Specifically, PF is a monthly program in which both the employee and the employer make equal contributions to the PF account (12 percent of the basic income plus Dearness Allowance) (DA).

The Employee Provident Fund (EPF) scheme’s objective is to give employees a lump sum payment when they retire. But, under certain terms and conditions, employees may also withdraw the money prior to their professional retirement. An employee might use PF withdrawals to build a house, acquire land, or acquire other types of property. To withdraw PF for a property, a homebuyer must, however, meet a number of requirements.

What are the requirements for a PF withdrawal in 2023 for a property purchase?

The PF balance can only be withdrawn by salaried professionals after five years of service, according to Amit Goenka, managing director of Nisus Financial. The withdrawal cap is additionally determined by the purchase’s intended use. For instance, if an employee wants to buy land, they can withdraw either the amount needed for the plot or the lesser of 24 months’ basic pay plus Dearness Allowance (DA). As opposed to this, the amount withdrawn for purchasing or building a home will be equal to the lesser of 36 months of basic income plus DA, the actual cost of the property, or the amount necessary for construction.

The amount withdrawn for a home purchase or building a house can be up to 90% of the PF balance, according to the recently introduced para-68BD in the EPF Plan, 1952. Home loan EMIs may also be paid with the PF withdrawal.

Condition for withdrawing PF to buy a house in 2023

  • If you withdraw your PF five years before opening the account, it is subject to taxation as “Income from Other Sources” if you do so. The amount withdrawn will be subject to a 10% Tax Deducted at Source (TDS) fee.
  • Except for your spouse, the PF amount cannot be used to jointly acquire a property.
  • Only new properties may be purchased with PF funds. It cannot be utilized to purchase a home on the secondary market.
  • 90 percent of your PF can only be withdrawn once you are 54.
  • If you switch jobs, you are not required to withdraw your PF because you can keep using the same account while working for the same employer.
  • You can obtain a loan on your PF, but only up to a certain amount.
  • A person may take 75% of their PF balance after a month of unemployment or quitting their job, and the remaining 25% the following month.

Also, if PF money is taken out to build or renovate a home, the development work must start within six months and end within a year of the final PF installment being taken out. When buying a house, the transaction must be completed within six months of the money being withdrawn. The PF amount may be withdrawn in one or more installments at the employee’s discretion.

What are the documents required for a PF withdrawal?

The following documentation must be provided by EPF members in order to make a PF withdrawal:

  • Forms like Form 19, Form 10C, Form 10D, and Form 31
  • a pair of revenue stamps
  • current bank statement photo identification evidence
  • A canceled cheque from the bank account where you are the only account holder as proof of address, such as an Aadhar card (The cheque must contain IFSC code and account number)

How do I withdraw PF to buy a house?

Buyers who wish to withdraw their PF funds in order to purchase a home must do the following steps:

  • Section 68BC of the EPF Scheme permits buyers who are part of a cooperative housing society or registered housing society (with at least 10 members) to withdraw the EPF sum.
  • Non-member salaried staff may also withdraw cash for personal use to purchase the property.
  • The commissioner’s certificate of PF contributions and composite claim forms must be submitted by potential buyers. A letter of authorization for paying Equated Monthly Instalments (EMI) from PF in the case of a home loan. 
  • Visit the official EPFO website and attach your Aadhaar number and UAN number for online PF withdrawal.
  • Complete the PF withdrawal form and attach any supporting paperwork and bank account information.
  • The cash will be credited to the associated bank account in 15 days after careful review and consideration of eligibility.

Online withdrawal of Provident Funds using the New Form

  • Use the official UAN portal to update your Aadhaar number. Link the employer’s authentication of the Aadhaar to the UAN.
  • Visit the EPF member portal and complete the online withdrawal form.
  • Mention your bank account in accordance with your EPF account.
  • Once the form is submitted and properly filled out, it will take 15 days for the money to be credited to your bank account.

Online withdrawal of Provident Fund using an Old Form

  • Get Form 19 by visiting the EPFO website. Also, your former employer may provide you with this.
  • Provide the IFSC code and any necessary information, such as the PF account number, employment information, and bank account information.
  • Provide a bank account’s canceled cheque as proof of your account.
  • Send the properly completed form with your employer.
  • The form will be attested by your employer and sent to the regional PF office for processing.
  • Your bank account will immediately receive credit for the amount you withdrew.

Note: Compared to using the online process, this approach might take longer. Also, you may quickly track the application process using the online PF facility.

How to withdraw PF for a home loan in 2023?

The PF balance may also be used to pay off a mortgage in accordance with the PF withdrawal regulations. Members and their spouses may withdraw their PF balances to pay off their outstanding loans under Section 68-BB of the EPF plan. Nevertheless, these withdrawals are only permitted for the equivalent of 36 months’ worth of basic pay and dearness allowances (DA). Employees who have served 10 years are likewise eligible for this choice.

In this situation, it is essential that the mortgages be obtained from licensed lenders, such as the state government, any public financial institutions, a non-bank housing financing firm, state housing boards, or municipal corporations.

How to withdraw PF balance for home renovation?

  • The employee is permitted to withdraw money from his EPF account for the purpose of renovating and rebuilding his home.
  • The home must be owned solely by him or her, or jointly with a spouse.
  • The employee must serve for at least five years.
  • The member’s withdrawal limit is 12 times his monthly basic wage and DA.

How to withdraw PF for home construction?

Employees must adhere to these procedures for home construction through PF withdrawal:

  • Although an employee can get up to 90% of their EPF contribution, they must have worked for at least five years before they can do so.
  • The amount will be taxed at a 10 percent Tax Deducted at Source  (TDS) if PF is taken before the completion of five years
  • This PF withdrawal can be used for joint purchases with a spouse, whether the owner is an EPFO member, their spouse, or both. 
  • Such withdrawal can be made in installments, and the home building must start within six months of the first installment and twelve months of the last installment 

Early PF withdrawal in 2023: Tax implications

“If an account holder withdraws the PF money in a lump sum, the same will be exempt under Section 10(12) of the Income Tax Act, 1961, provided the employee has completed five years of service,” says Pramod Kathuria, CEO of Easiloan. Any sum beyond Rs 2.5 lakh in interest on EPF will be taxable as “income from other sources” and be subject to tax. If only the employee and not the employer contribute to the PF, the barrier will rise to Rs. 5 lakh.

Also, Kathuria advises that rather than depleting the corpus by taking a larger sum out of the PF, it would be prudent to merely fund the down payment on a new property or remove a little amount from it. Also, if you are over 45, you should steer clear of PF withdrawals because you should be concentrating on building up your retirement funds during your last 15 years of employment.

Finally, if you decide to proceed with the withdrawal, make sure that you receive ancillary benefits like tax exemption (if you have held a PF account for more than five years) and select a property that has the potential to grow faster than your PF amount.

Is it a good idea to withdraw PF amount to purchase a house?

It might be conceivable to withdraw PF funds in order to buy a home, but experts advise against it. It is recommended to use this fund solely for its primary objective, which is to provide some cushion during retirement. If you continue to make contributions to this corpus and do not take any cash out during the interim time, compounding will work in your favor during your working years. As a result, you will have a sizable corpus that many salaried people might find challenging to accumulate.

Can you use your entire PF balance to buy a home?

When it comes to withdrawing PF money for a property purchase, the EPF program has several limitations. An employee may withdraw either 24 months of basic pay plus DA or the actual cost of the plot, whichever is lower, for the purchase of land. The employee may withdraw 36 months of base pay plus DA, the actual cost of the property, or the necessary funds for development in order to purchase or construct a concrete structure.

Homebuyers should be aware of the terms, circumstances, and ramifications of the procedure before choosing it, even though PF could seem like one of the finest options to obtain cash for a home purchase.

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Bollywood Celebrities’ Luxurious Real Estate Investments Defy COVID-19 Challenges

By
Bhanu Sahu
-

For decades, Bollywood superstars have preferred real estate as a form of investment. These powerful people wisely put their money into real estate, from sea-facing luxury bungalows to spectacular multi-story penthouses, to benefit from the constant increase in property values. Here’s a look at some of the recent multi-million dollar celebrity home sales that have been documented. 

Despite COVID making the last two years the most difficult, Bollywood celebs have increased their spending on expensive real estate. Actors like Ranveer Singh, Hrithik Roshan, Shahid Kapoor, Ajay Devgn, and Janhvi Kapoor are among the top competitors for the most expensive home purchases in India over the past five years, with property values ranging from roughly Rs 40 crore to approximately Rs 120 crore. These celebrities have done all possible to have a home that genuinely stands out, from magnificent homes to architectural wonders. The reasons behind these homes’ excessive pricing and the rising trend of celebrity real estate investing are listed below. 

Owner of Sushil Enterprises, Sushil Dabrai “Buying such opulent homes has always been a popular habit in India, especially in Mumbai. But, during the epidemic, it accelerated since a home office was now absolutely necessary. Celebrities made purchases because they wanted a portion of their home office. They desired a better, more sustainable workplace environment, which required additional room, rather than simply duplicating the current one. Even many from the upper middle class feel influenced by their homes. As a result, 3 and 4 BHK apartments with carpet areas of 1,000 to 2,000 square feet have been selling like hotcakes. They range in price from Rs 3.5 crore to Rs 8 crore, with a price per square foot of between Rs 40,000 and Rs 60,000. All of the celebrity residences cost more than Rs 60,000 per square foot.

India’s most expensive celebrity homes

Couple Deepika Padukone-Ranveer Singh

Ranveer Singh and Deepika Padukone, a Bollywood power couple, recently bought a sea-view quadruplex property in Mumbai’s Sagar Resham Co-Operative Housing Society. The extravagant home, which is located next to superstar Salman Khan’s flat and Mannat’s in Galaxy, costs a whopping Rs 119 crore. The opulent building spans four levels, from 16 to 19 stories, and is around 11,266 square feet in size. It also has a 1,300 sq ft private terrace and 19 parking spaces. Around Rs 7 crore in stamp duty was paid for the property. According to reports, premium properties in Juhu and Bandra’s top locations may be purchased for between Rs 50,000 and Rs 90,000 per square foot.

The pair has previously invested in a four-bedroom flat in Prabhadevi, South Bombay, valued at Rs 20 crore, and a lavish villa in Satirje, Alibaug, valued at Rs 22 crore.

Khan, Shah Rukh

Mannat, the residence of Bollywood’s King Khan, requires no introduction. At Bandra, Mumbai, Shah Rukh Khan’s home, “Mannat,” has a view of the Arabian Sea. The opulent bungalow has many bedrooms, a library, a gym, a private auditorium, and other amenities. It is 27,000 square feet in size. Thousands of tourists congregate outside the cottage every day to take selfies and meet celebrities, making it a popular tourist destination.

The Mannat home was created in partnership between Kaif Faquih and Gauri Khan, Shah Rukh Khan’s wife and a well-known interior designer. Two living rooms in the six-story estate are furnished with M.F. Husain paintings and antiques. Elevators provide excellent connectivity throughout. A private bar, entertainment areas, and a kids’ playroom are all located on the floor of the house that is devoted to entertainment. Due to its neo-classical architecture, it consistently ranks among the most costly celebrity homes in India, with an estimated cost of Rs 200 crore.

Hrithik Roshan

Hrithik Roshan, known as the ‘Greek God of Bollywood’, spent Rs 97.5 crore and about Rs 2 crore in stamp duty in October 2020 to buy an apartment and a penthouse with a panoramic view of the Arabian Sea on the Juhu-Versova Link Road in Mumbai. At Andheri West’s Mannat Apartments, the building’s three stories contain the 38,000 square foot property. According to sources, the property’s 15th and 16th floors are a duplex with more than 27,500 square feet and a value of Rs 67.5 crore. The actor also paid Rs 30 crore for a second property on the 14th floor, measuring more than 11,000 square feet. There are 10 parking spaces available at the property, as well as a 6,500-square-foot patio.

In addition to this, the Roshans also possess opulent homes in Juhu, a Paras bungalow, and a five- to seven-acre farm in Lonavala.

Shahid Kapoor-Mira Kapoor

In June 2018, Bollywood star Shahid Kapoor made a lavish flat purchase on the 42nd and 43rd floors of the Tower B of the opulent Three Sixty West in Worli, Mumbai, which is just across from the Bandra-Worli Sea Link. The actor spent close to Rs 56 crore on the house, plus the State received around Rs 3 crore in stamp duty. Almost 8,600 square feet of space have been developed by Oasis Realty, a partnership between Oberoi Realty and Sahana Development Company. It consists of two blocks, one of which is inhabited by individual houses and the other by the Ritz-Carlton Hotel, a partner in hospitality. The actor also has another seafront home, valued Rs 30 crore, in the Praneta Building on Juhu Tara Road.

Janhvi Kapoor 

Janhvi Kapoor, a fresh face in Bollywood, paid Rs 39 crore for an opulent flat that spans three stories, from the 14th to the 16th, in Juhu Vile Parle Development (JVDP) Project in Juhu, Mumbai. The actress will be neighbours with luminaries from the industry including Amitabh Bachchan, Ajay Devgn, and her uncle Anil Kapoor. The triplex building is more than 4,000 square feet in size and has six private parking spaces. Previously, the actress spent the majority of her formative years in the Lokhandwala home of her parents.

The actor signed the contract in December 2020, paying 78 lakh rupees in stamp duty for the flat and taking out a 23 crore rupee home loan. The reduction in stamp duty from 5% to 2% from September 2020 to March 2021, according to Dabrai, “combined with historically low loan rates, encouraged homebuyers from all walks of life to conclude the purchases.”

Ajay Devgan 

Ajay Devgn has one of the most costly celebrity mansions in India.

Ajay Devgn, another star on the list, purchased a second residence in the same neighborhood as his bungalow, Shiv Shakti, in Juhu’s Kapole Co-Operative Housing Society. Devgn paid Rs 60 crore for the property and Rs 2.37 crore in stamp duty in December 2020. According to reports, a house loan of almost Rs 19 crore was used to purchase the property, which measures over 6,500 square feet.

 

Now valued at around Rs 30 crore, the actor’s principal mansion is well-known among visitors to the city who come to see the homes of famous people.

Mumbai’s real estate market is diverse since it serves a variety of homebuyers. In the wake of the consistently increasing real estate demand and capital returns, additional celebrities, including Alia Bhatt, Amitabh Bachchan, Arjun Kapoor, and Rashmika Mandanna, to name a few, signed multi-crore deals in the posh micro-markets of Mumbai and Goa. These actors made some of the most jaw-dropping real estate investments.

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Shop-cum-Offices (SCOs): The Perfect Blend of Retail and Office Space

By
Bhanu Sahu
-

Shop-cum-offices (SCOs) are commercial buildings that combine office and retail space into a single structure. SCOs offer a flexible and adaptable area for many types of organizations because they are made to support companies that need a mix of retail and office capabilities. Continue reading to learn more about this class of business property!

SCOs frequently have a ground floor space devoted to retail, enabling firms to interact with customers and showcase their goods or services. Storefronts, showrooms, or spaces for customer service are frequently placed in this section. Office spaces are located on the upper floors of the SCO building, offering a separate place for administrative work, meetings, and other office-related activities.

Businesses looking for a balance between office functionality and retail visibility will benefit from the SCOs idea. This includes companies like startups, small retail outlets, service-based enterprises, consulting firms, and professional offices that need office space for both internal operations and client contacts.

Factors to consider before choosing the shop-cum-office option

A shop-cum-office (SCO) property investment can be a profitable prospect, but you should think about a number of essential criteria before you commit. The following points should be remembered:

Location: The SCO property’s location is essential to its success. Select areas with a lot of foot traffic, are easily accessible and are close to business areas, neighborhoods, transportation hubs, and other attractions. The likelihood of rental revenue or property appreciation can increase when a superior location attracts more clients and companies.

Market demand: Evaluate the local market’s appetite for SCO properties. Think about the possibilities for rental or resale demand, target tenants or buyers, and the regional business environment. To make sure that the SCO property is in line with market trends and has a promising future, analyze supply and demand dynamics.

Property condition and building quality: Take a close look at the SCO property’s condition and quality of construction. Do a thorough check to find any potential structural problems, upkeep needs, or required repairs. To guarantee that the investment stays financially sustainable, take the cost of repairs or improvements into account.

Legal and regulatory compliance: Understand the local SCO properties’ regulatory and legal framework. Ascertain that the property possesses all relevant licenses, permits, and certifications for commercial use. Examine zoning rules, construction requirements, and any restrictions that might affect how the land is used or its potential for future development.

Potential for rental income: If you intend to rent out the SCO property, consider what kind of rental income it could be able to produce. Look into the rental costs for nearby properties that are similar to yours and the need for commercial space among local firms. To guarantee a consistent source of rental income, evaluate potential tenants’ stability and creditworthiness.

Maintenance and management: Take into account the SCO property’s ongoing maintenance and management obligations. Think about whether you want to handle property management yourself or contract with a professional organization. Calculate the associated expenditures, including any shared expenses with other tenants or owners as well as repairs, maintenance fees, utilities, and insurance.

Money-related factors: Analyze the investment’s viability from a financial standpoint. Determine the upfront cost of the purchase, prospective rental revenue, ongoing costs, available financing alternatives, and the anticipated return on investment. Think about the possible hazards, market alterations, and the amount of time it might take to generate the desired profits.

Exit plan: Have a well-defined exit plan in mind. Think on the SCO property’s potential for capital growth and resale value. If you decide to sell the investment in the future, consider the market circumstances, potential purchasers, and the time it might take to sell the property.

How to choose between a short-term and long-term investment in SCO?

There are various considerations when choosing between short-term and long-term investments in shop-cum-office (SCO) assets. To assist you in making a wise choice, take into account the following:

Determine your investment objectives and timeframe: Are you looking for short-term gains or long-term capital gains? While long-term investments seek sustained growth and potentially better returns, short-term investments often concentrate on producing rapid income.

Market analysis: To comprehend the dynamics of supply and demand for SCO properties in a particular place, conduct a complete market analysis. Consider elements including vacancy rates, market trends, and economic indicators, as well as the demand for rentals. You can use this study to determine whether both short-term and long-term investing strategies are viable.

Potential for rental revenue: identify the SCO property’s prospective rental income. Take into account elements including rent prices, tenant demand, lease stipulations, and market conditions. Short-term investments could entail flexible leasing of the property to accommodate companies looking for pop-up or temporary locations. Long-term investments emphasize finding dependable tenants with long lease agreements who will generate steady rental income.

Considerations for cash flow: Assess your cash flow needs and risk tolerance. Due to their faster turnover and shorter lease durations, short-term investments may generate more immediate cash flow. Although long-term investments may take longer to provide significant cash flow, they can offer the possibility of appreciation and steady rental income over time.

SCO property management: Determine your readiness and capacity to do so. Property upkeep and tenant turnover may be more frequent with short-term investments. The management of tenants and property maintenance for long-term investments frequently calls for a more active approach.

Economic considerations: Keep in mind the state of the economy and the interest rate environment. While long-term investments offer the chance to ride out market cycles and profit from prospective market upswings, short-term investments may be more susceptible to economic volatility.

Exit plan: Make your exit strategy and the timeline you want to use to sell the SCO property. Investments made over the short term offer greater flexibility and swift exit strategies. Long-term investments entail keeping the asset for a considerable amount of time in order to potentially reap the rewards of capital growth and steady rental income.

Risk reduction: Examine the dangers involved in both short- and long-term investments. Investments made in the short term may be more vulnerable to alterations in the market, tenant churn, and economic concerns. While providing stability, long-term investments can also come with longer-term obligations, possible dangers related to property maintenance, and market changes.

Ultimately, your specific investment objectives, financial status, market conditions, and risk tolerance will determine whether you should make short-term or long-term investments in SCO properties. It is recommended to speak with real estate experts, financial consultants, and legal professionals who can offer personalized advice for your particular situation and goals.

How to avoid getting into legal trouble

To protect your investment and reduce potential hazards, it is essential to take legal precautions before purchasing shop-cum-office (SCO) buildings. You can take the following actions to assure legal protection:

Employ legal advice: Look for advice from seasoned real estate attorneys or attorneys with expertise in dealing with commercial real estate transactions. They can help you navigate the legal system, evaluate contracts, perform due diligence, and guarantee adherence to all pertinent rules and laws.

Conduct due diligence: Before committing to any investments, do extensive research on the SCO property. This includes looking into real estate paperwork, title deeds, liens, land use permits, zoning laws, and building permits. Check the property’s ownership and legal standing, and evaluate any potential legal issues or obligations that may be connected to it.

Check zoning and land use restrictions: Verify that the SCO property complies with local zoning laws and is legitimately allowed for commercial use. Examine the master plan, the building codes, and any particular requirements or limitations set by the local government. Zoning laws must be followed in order to avoid legal problems and restrictions on the use of the land.

Examine leasing agreements: Carefully review the current lease agreements if the SCO property is already leased. Identify the requirements for tenants as well as the terms, conditions, rental costs, and renewal possibilities. Verify that the leases are binding, enforceable, and compliant with any applicable local tenancy regulations. If required, seek legal advice to negotiate or alter the conditions of the lease.

Seek legal assistance: When it comes to crucial SCO property issues like property ownership, encumbrances, leasing agreements, and regulatory compliance, you should think about getting legal advice. These assessments of the property’s status and any ensuing dangers are made by qualified lawyers.

Check all the property documents: Check all papers pertaining to the property, including sale contracts, deeds, contracts, and any related licenses or permits, in detail. Make sure the documents are true and accurate, and that they have been properly executed, and are in accordance with the law.

Check the property title: Make sure that the SCO property has a marketable and clear title. To find any liens, mortgages, or other legal claims against the property, conduct a title search. Before making the investment, resolve any pending problems or encumbrances.

Insurance: Take into account acquiring sufficient insurance protection for the SCO property. In the event of unanticipated legal challenges, protection, and financial security may be provided through property insurance, liability insurance, and coverage against potential legal conflicts.

Comply with tax obligations: Understand the tax requirements related to owning and operating a commercial property. Learn about local tax regulations, such as those pertaining to income taxes, commercial property taxes, and the goods and services tax (GST). To prevent legal issues or penalties, be sure that all tax regulations are followed.

Consult a professional: Engage with experts who can offer knowledgeable advice on the financial and legal elements of the venture, such as real estate brokers, financial advisors, and accountants. Their knowledge can assist you in avoiding any legal problems and making wise choices.

Keep in mind that purchasing SCO properties requires large financial investments. Legal protection must be given top priority as a result. You can reduce legal risks and increase the likelihood of profitable investment in shop-cum-office assets by taking these proactive steps and seeking professional guidance.

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