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Indian Real Estate Sector

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SaiK
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Re: Indian Real Estate Sector

Postby SaiK » 12 Nov 2014 19:35

kalam ji said, PURA! i stand by that 100%.

but it does not mean, urbanize villages.

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Re: Indian Real Estate Sector

Postby Aditya_V » 15 Nov 2014 10:55

Theo_Fidel wrote:
negi wrote:Basically laws in India aid artificial demand and in garb of promoting investment in real estate make buying a home a distant dream for the middle class.


Property, esp flats is an odd duck. Once the upfront investment is made, it is only worth what someone is willing to pay for it. Technically buying a flat from some one is actually counted as consumption not investment.

There are plenty of flats available in Chennai & Bangalore out in the deep suburbs. In Kundrathur I saw some well built units 2bhk-3bhk 1,500 sqft+/- with even a small park attached going for Rs 25-40 lakh. But Middle class are not clamoring for these units. In 20 years time when these units cost 1 Crore + the same cry will go out that apartments are again unaffordable due to those pestilential NRI types....

Middle class needs to move out of the cities and build its own infrastructure out in the suburbs... ..not everyone can live in Koramangala/Nungambakkam....
In fact I would say, Chennai inboard of 100 feet road/maybe even IRR, is so crowded it can not support any more people.


A former colleague of mine has had a flat in Kovur near Kundrathur since 2009, the lack of infrastructure, the roads he has to travel through means his flat od INR 23 lacs has not appreciated in 4 years, all other flat owners have bought for investment purpose and do not stay.

Based on his advise, unless a place has infrastructure like train stations/ highway connectivity or better still some large offices coming up, it is not good to venture to these suburbs considering the suffering your family has to endure. Truth is even in central Chennai land rates are artifically inflated. Nowhere other than India we have such a huge differential between land values and income. The real estate mafia make sure that your disposable income is sucked dry unlike places like the states where there is good connectivity with the suburbs.

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Re: Indian Real Estate Sector

Postby negi » 15 Nov 2014 11:16

Indian real estate is all about location and please in India location does not mean less crowd ; location means proximity to work . A 10 year old apartment on a standard two way 8 meter wide road might be over a crore as against a more spacious unit on a 4 lane highway far away from city center . The demand in India is not artificial it's just that it is only the creamy layer which is buying property and reason why empty apartments are high in number is investors are not buying homes they are buying property which they flip when it nears completion. Current trend is builder launches a project at a pre launch price now beautiful thing is prices of ready to move in apartments are jacked up so high that a pre launch price looks like a good deal , so investors put in the 20% of the cost and when the price increases by >20% in next 2 or more years they sell the unit and buy another one and chain continues .

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Re: Indian Real Estate Sector

Postby krishnan » 15 Nov 2014 15:23

forget connectivity , some new places dont even have sewage system and you have to depend on those cleaners

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 15 Nov 2014 21:30

Aditya_V wrote:the roads he has to travel through means his flat od INR 23 lacs has not appreciated in 4 years...


Wow! Expecting appreciation in 4 years! Its a little unrealistic.

Saars, it is hard to believe but my dads house in anna nagar had no sewer connection for 20 years. We had septic tank all through my child hood. Finally world bank funds was taken to lay the lines, then we had no road for 3 years till another world bank funds was taken for tar road. There were no streetlights, no schools, no hospital, yet people lived there and paid for the infrastructure to be built around them. 2nd main road was not even fully asphalted. There was a rutted 8 foot wide strip in the middle. No median or anything. I very much remember people refusing to visit him because he lived in the 'kaddu'...

I only mentioned kundrathur because it is very affordable and construction was relatively OK for the couple of units I saw. People are complaining things are not affordable in Nungambakkam type areas. With IRR now complete, good ground water, close to airport, metro coming, it has bright future, many such areas outside Chennai proper have a bright future, in 20 years these will be the heart of town.

Keep in mind folks Chennai will become a 30 million person city. In our lifetime. Can you imagine how big it will be geographically at that point.....
----------------------

We have been around this many times before. The reason for property hoarding in India is almost zero property tax. It is laughably cheap to hold on to property in India. In the rest of the world property tax is ~1% of property value. In India it is often less than 0.01%. If you raise property tax property cost spiral will reduce but you will also bankrupt many existing folks at this point. Maybe raise the tax for all new property deals?

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Re: Indian Real Estate Sector

Postby vera_k » 16 Nov 2014 10:29

^^^

If there is serious intent to build new smart cities, these new cities can start with higher property taxes. They will anyways need that money to stay "smart". Older cities can then be left to their own means to decay away or impose additional taxes depending on what local voters choose down the line.

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Re: Indian Real Estate Sector

Postby Singha » 16 Nov 2014 12:33

what will happen is unauthorized colonies and 'old type cities' will try to cluster closely around these smart cities and try to leech on their infra (roads, elec, schools) without paying anything extra.

on a micro scale we see it in blr itself whenever a big builder develops some roads and put up a huge complex, many small builder buy parcels of land next to it and try to bask in the reflected glory. they use agile and scrum and move fast..usually their basic apts are ready for occupation long before the anchor complex of the big builder. :oops:

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 18 Nov 2014 20:24

Smart cities was more about fiber/internet/communication type infrastructure IIRC.

It is not meant for roads/water/sewer etc. The only program meant for cities was JNNURM and that was shut down. The great thing about the program was that it demanded tax increases and local finance contributions before financial closure. Madurai city raised several taxes specific to infrastructure and had to improve collections to 90% to get JNNURM funds. But now it appears our cities have been abandoned to their own devices. The successful areas will prosper, the poorly run dark areas will wither on the vine. Time to cut your losses as a nation I guess…..

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Re: Indian Real Estate Sector

Postby SaiK » 18 Nov 2014 21:29

if we are not smart about land space, hygiene, sanitation, sewage, energy, water, air quality, roads, infrastructure, traffic, policing, regulations, structures, materials, engineering, technology, ... what good is having a smart data cable or smart IT system?

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 18 Nov 2014 21:33

While we are at it can I put in a plug for folks to use tempered glass in all their windows/glass doors/etc in desh. Family has had a second terrible tragedy where a child ran into a glass window and was cut to pieces. Brought dead at the hospital. Yes I understand it is more expensive but please reconsider....

SaiK
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Re: Indian Real Estate Sector

Postby SaiK » 18 Nov 2014 22:25

why not fiber glass? toxic?

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 18 Nov 2014 22:54

Fiberglass is not transparent. Best you can do is translucent sandwich panels, but that is quite heavy and a very different system. Poly-Carbonate is transparent but also very expensive, it also does not do well long term in heat & dust. It becomes soft and abrades quites rapidly. Tempered glass is the cheapest and works perfectly for this application.

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Re: Indian Real Estate Sector

Postby Aditya_V » 19 Nov 2014 09:41

Theo_Fidel wrote:While we are at it can I put in a plug for folks to use tempered glass in all their windows/glass doors/etc in desh. Family has had a second terrible tragedy where a child ran into a glass window and was cut to pieces. Brought dead at the hospital. Yes I understand it is more expensive but please reconsider....


Good point, reducing glass everywhere.

Condolences to your family, losing young children at such an age must be really painful.

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Re: Indian Real Estate Sector

Postby Javee » 19 Nov 2014 09:48

Double glazed toughened glass with uPVC (Fenesta) is what I used for my house, slightly expensive, but for our conditions, works better than wood. When I refurbished I wanted to retain the wooden french doors, but looking at the way the carpenters work these days, I figured Finesta is a better choice. I'm planning to change my windows to this combination, as it is easy to maintain and lasts longer.

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 19 Nov 2014 10:03

Javee that is good to hear. One wishes it were standard for all human level glass in India. Esp. if the premium is not so high. UPVC (Vinyl windows in USA) are excellent and will easily last 40-50 years even in Indian climate. Toughened glass needs to be standard.

Aditya, thanx for the condolence. It was sad tale and the parents are a wreck....

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Re: Indian Real Estate Sector

Postby Javee » 19 Nov 2014 12:04

I hear you TF. The day we installed a glass shower door (Sep last year), I was inside the bathroom, inspecting the fittings, the entire door crashed on me with a flash and a loud pop. It was toughened glass and I came with a small scratch on my back. Upon searching I found that I was indeed lucky because if it was not a toughened glass, I wouldn't been alive. It was amazing to watch glass break in to pieces, no sharp shards, just octagonal pieces.

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Re: Indian Real Estate Sector

Postby member_22733 » 07 Feb 2015 03:20

From here: viewtopic.php?p=1792170#p1792170

negi wrote:This was in response to my letter to the PM about
1. Forcing all jewelry shops to use card/cheque for transactions above 20k INR.
2. Removing transaction/service charges on use of ATM cards.
3. Making cheque as a mode of payment for all real estate transactions mandatory .

Unless above are done all talk about black money is just lip service.


How does (3) solve the problem? Part of the deal will go through cheque, part will go through cash in a suitcase.

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Re: Indian Real Estate Sector

Postby negi » 07 Feb 2015 10:34

^ Sir beauty of Indian system is everything is before the gobmint but they do not want to add up the various pieces and find out the golmal.

1. Paying in cash is virtually impossible unless the gobmint pandu turns a blind eye which is the case today , reason being if you pay cash your property value on paper goes down so let's say property was 80 lakhs and you pay 30 lakhs in cash you still need to get 50 lakhs , if you take loan from bank bank will ask for proof of rest of the payment being made, so how will you show the payment proof of rest of the money ? Only way it might work is builder now undervalues the sale and shows that it sold the flat to you at 50 lakhs . Now this is where open daylight robbery happens if a builder has say 100 units to sell and he has to pay ST and VAT to gobermund on all 100 of them the gobmint can easily catch a golmal if all 100 are being sold at different rates not everyone is going to buy a 80 lakh apartment by paying 30 l in cash , some might pay in white too. The transactions are being captured against the builder's TIN so everything is in the system.

2. Now let's say builder has found a way to still fudge the books and manage to collect cash and yet keep records clean by maintaining required funds in bank to show to the gobmint , question is what will the builder do with the black money stockpile if the market itself was forced to use white ? I personally know how hawala in India and Bangalore works, go to any jewelry shop the locker which they have backdoors has a truckload of cash , now what they do is use it to generate more money , how ? Builder A in Blore has say 10 crore in cash stockpile and he now wants to dispose that money , a part will be done in form of cash payments to workers and staff but remaining has to be moved somewhere else this is where jewelry shops come into picture they charge 1000-4000 INR per lakh for moving money within India, you give them a crore and their contact in other city will deliver 1 crore to your destination , there is no physical movement of money and it's fast and reliable. Now if you force jewelry shops to use cards or cheques their cash stockpile and ability to move money will dwindle.
Currently if you go to your home branch and wish to deposit say INR 10 lakhs in cash they happily oblige after you give a letter saying that you sold your car/property with a PAN and money becomes white. Banks should start levying a charge of about INR 5000 per lakh of cash being deposited in their banks under an individual's name , corporate accounts can be handled separately . Bangalore's landlords are collecting their rents in cash , deposit the same in banks under their wife's or mother's name and refuse to share their PAN with the hapless tenant , they are not only evading tax but also injecting cash into the black money market.

If banks stop accepting large cash deposits or start levying a meaty fine on those we will make a decent dent on source of black money.

I have dropped an email to RBI chaps and suggested that they should evaluate a directive about levying INR 10000 as maintenance fees for every lakh being deposited in cash, this will discourage people from asking for payments in cash the chain will be broken, today a builder with a 10 crore cash stockpile disposes of it in form of payments to workers, hawala via jewelry shops if the smaller fish are penalized for taking cash they will force bigger fish to issue cheques instead.

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Re: Indian Real Estate Sector

Postby arshyam » 09 Feb 2015 10:00

^^Excellent post Negi saar, didn't know about the jewellery store connection. Personally, I think the black money stashed abroad is a bogey, the problem is within the country - land and jewel sales accounting for a bulk.

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Re: Indian Real Estate Sector

Postby a_bharat » 09 Feb 2015 10:40

Why can't govt simply replace/ban Rs. 500 & 1000 notes and give a time of say 1-2 months for citizens to deposit old notes in banks -- Aadhar-linked accounts? Deposits greater than Rs. 50,000/- will have to be accounted for in IT returns, or, some flat tax of 20% can be levied, no questions asked. Brings in a lot of money into the banking system.

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Re: Indian Real Estate Sector

Postby negi » 09 Feb 2015 15:08

^ 500/1000 is not a big amount banning them is an extreme step and will work only in an ideal system. Unorganized sector and daily wage workers are paid in cash only and they are about 30-40% of India's workforce or even more .

Besides above will hurt the people at the lowest base of the pyramid and will be counterproductive, we need to put in measures to hit the top of the food chain i.e. jewelers , builders , businessmen, petrol bunk owners and raw material dealers who deal in cash.

If you book a railway ticket or even a movie ticket chootiy@s ask you to pay a convenience charge of INR 50 or more on online transaction but if you go to the platform or to cinema hall and pay in cash or card they do not levy that charge , I for one don't know who is the mofo who came up with such an absurd rule.

In every jewelry store be it Bhimas , Abaran or PC they will say saar x% charge on card transactions, not only cash transactions are free of charge but they will reduce the making charges for you if you pay in cash . Fat kats walking into jewelry stores with suitcases and paying in cash is a normal thing .

It is the big and powerful ones who encourage use of cash since they deal in huge volumes a small time grocery shop owner cannot afford to give anyone a discount if you pay by cash instead of card .

Some small clinics and Doctors in Bangalore also ask for payments in cash for obvious reasons, landlords take payment in cash and do not give their PAN card to tenant so latter gets screwed from two sides and former makes an additional income and does not even declare it . All these can be stopped only when banks stop taking huge amount of cash deposits from individuals or levy a hefty charge to discourage them from doing so.

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Re: Indian Real Estate Sector

Postby Vikas » 09 Feb 2015 15:35

Negi, Most of the Black money never enters into the Banking system. It stays behind iron gates and lockers. I know upteen number of people who sold off their properties and then kept the 'Black' cash component in bank lockers till they bought next set of property and paid this cash as black money.

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Re: Indian Real Estate Sector

Postby negi » 09 Feb 2015 16:09

^ Well point is at some point in time it gets back into the system , which is mostly via big volume dealers i.e. jewelers and builders you go after them you force people to move to cheque/card .

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Re: Indian Real Estate Sector

Postby putnanja » 11 Feb 2015 00:40

In places like Bangalore, you can't undervalue a property too much. The government fixes base prices for property on a per sqft basis for each area. That is typically around 10-20% less than market value (at least it was 10 years back, not sure now). So you need to show that much amount at least as value when registering. The government did this so that people won't undervalue property and pay less property tax. But yes, that 10-20% margin is still there.

The problem with cheques is that it is not real time like credit card. The store needs to wait for it to be cleared before they will give you the goods. Like negi said, many shops charge you 2-2.5% as transaction costs as that is what the credit card companies charge them (thats how credit card companies/banks/visa/mastercard/amex etc make money). Government doesnt want to pay that, thats why in railways, you need to pay extra charge. But along with it, many shops will offer you more discounts if you pay in cash, and this happens in even big electronics stores etc, not just neighbourhood shops.

If govt wants to bring in cashless transactions, they need to change cheque system to that like debit cards, where it is real time. And also reduce the credit card transaction fees. Visa/Mastercard won't reduce it, but since RuPay is supposed to be cheaper, they should offer less transaction fee to merchants.

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Re: Indian Real Estate Sector

Postby a_bharat » 11 Feb 2015 10:39

^^
Credit Cards usage should be distinguished from that of debit cards. Debit card payments should have zero or very small transaction fee as there is no credit risk associated with debit card payment.

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Re: Indian Real Estate Sector

Postby negi » 11 Feb 2015 17:23

Putnanja I am not talking about 1.5-2 % charge that is hardly a big component and most of the merchants eat that, I am talking about additional charge on top of that for example if you buy a ticket for movie on internet you pay a convenience charge of about INR 50 now that is a huge amount for 2 tickets worth 550 INR.

Coming to guidance value of a property that is again a big joke , so this November Govt. revised guidance rates but the market rates are still at least 50% more than that figure.

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Re: Indian Real Estate Sector

Postby Sachin » 12 Feb 2015 09:52

A quick question to the real-estate experts here. I have a flat (purchased on a loan from a bank), in which at the moment I am the sole owner. The original sale deed, is off course kept in the bank custody. I now want to include my wife also as the co-owner, for all legal purposes.
1. How can this be done? I don't know if a sale deed can be modified as the sale has already been completed years back.
2. What would be the other document, which can be used to clearly state that in the flat, my wife is also a co-owner.
3. In the land revenue records, it is shown that I own "partial and inseparable" (??) share on the land. Should I make a correction there, to make it "I & my wife"? And in doing this, should I get any approvals from the bank which has given me the loan.

I do have motive for doing this. If I do this, my wife can avail a bank loan and much cheaper interest rates, which the current bank cannot any way give. The current bank (where I have the loan) also knows this. So they may try to scuttle my plans.

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Re: Indian Real Estate Sector

Postby disha » 12 Feb 2015 10:19

Sachin wrote:A quick question to the real-estate experts here. I have a flat (purchased on a loan from a bank), in which at the moment I am the sole owner. The original sale deed, is off course kept in the bank custody. I now want to include my wife also as the co-owner, for all legal purposes.
1. How can this be done? I don't know if a sale deed can be modified as the sale has already been completed years back.
2. What would be the other document, which can be used to clearly state that in the flat, my wife is also a co-owner.
3. In the land revenue records, it is shown that I own "partial and inseparable" (??) share on the land. Should I make a correction there, to make it "I & my wife"? And in doing this, should I get any approvals from the bank which has given me the loan.

I do have motive for doing this. If I do this, my wife can avail a bank loan and much cheaper interest rates, which the current bank cannot any way give. The current bank (where I have the loan) also knows this. So they may try to scuttle my plans.


More pooch for you., yes the bank has the sale deed - but how come they force you from not shopping around for a better mortgage and while you refinance you can always add your wife as a co-borrower and hence as a co-owner in the new mortgage.

And what has sale deed to do with co-owning the property?

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Re: Indian Real Estate Sector

Postby Sachin » 12 Feb 2015 13:16

disha wrote:More pooch for you., yes the bank has the sale deed - but how come they force you from not shopping around for a better mortgage and while you refinance you can always add your wife as a co-borrower and hence as a co-owner in the new mortgage.

The bank may not really use open force, but this bank is noted for delaying the process of handing over any thing, if it comes to pre-closure of loans. I don't think legally, they can stop me from doing that, but they can kind of delay things by going on go-slow mode.

And what has sale deed to do with co-owning the property?

I don't have that answer, and hence I asked for the experts :). The actual procedure I wanted to know is:-
1. Can I make my SHQ the co-owner of the flat, which is currently in mortgage with the bank.
2. Do I require any approvals from the bank, if I wish to modify any other official documents (Katha, or Land records etc.) maintained at the Registrar office etc.
3. The procedure to get my wife the co-owner in the flat in all aspects. I understand each state would have subtle variations in how this can be done, so that is okay.

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Re: Indian Real Estate Sector

Postby Rupesh » 12 Feb 2015 14:22

Sachin wrote:
I don't have that answer, and hence I asked for the experts :). The actual procedure I wanted to know is:-
1. Can I make my SHQ the co-owner of the flat, which is currently in mortgage with the bank.
2. Do I require any approvals from the bank, if I wish to modify any other official documents (Katha, or Land records etc.) maintained at the Registrar office etc.
3. The procedure to get my wife the co-owner in the flat in all aspects. I understand each state would have subtle variations in how this can be done, so that is okay.


1.Yes. Approval from bank will be required.
3. By a Gift or Sale Deed. You may have to pay stamp duty.

Try asking in http://www.magicbricks.com/Real-Estate-Forum

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Re: Indian Real Estate Sector

Postby A_Gupta » 29 Aug 2015 07:24

http://www.livemint.com/Politics/NL7EbL ... ergen.html
A three-letter word is standing in the way of India and China opening up their real estate investment trust markets, which together could generate as much as an estimated $55 billion of listings: Tax.

Penghua Fund Management is putting the finishing touches to a trust with REIT-like characteristics, which will be the first of its kind to list in China as early as September. Indian Prime Minister Narendra Modi’s government in February announced tax changes in its budget to allow developers to set up REITs (Real estate investment trust) and help boost construction.
...
...
Removal of double taxation and a waiver of duties while injecting assets into the trust are needed for REITs to attract investors, Singapore-based Tiong said.

Property-broker Cushman and Wakefield Inc. estimates that India could reap as much as $20 billion of potential listings and China as much as $35 billion.

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Re: Indian Real Estate Sector

Postby negi » 29 Aug 2015 11:51

Sachin is this property under construction or you already have taken possession and also registered the property in your name ? If it is the former then it is very easy , get a NOC from builder that states that it is ok to add your wife's name to the assignment letter , give that to the loan issuing bank and ask them to add her as a co-owner. They should agree to this with additional processing fees. Once this is done you can use new agreement to get a better loan rate from another bank in your wife's name . However if the property is already registered then it might be tricky as it involves the gobermund.

Btw if I am not wrong isn't the difference a bit too small ? My current loan rate is 10% however if I would have taken it in wife's name it would have been 9.9 % so only a 0.1% difference , so financially alone this is probably not worth all the hassle.

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Re: Indian Real Estate Sector

Postby kenop » 14 Sep 2015 20:28

Case:
A x sqft row house (plot area 2x) built 20yrs ago is being sold at the market rate (P) for a new flat for same area (x sqft)
Additional info:
1. Good locality
2. The price of a plot of same area will be available in the market at P/2. No guarantee that a plot IS available in the same locality.
3. That makes the construction cost = P which is exorbitant by any standards (definitely considering it is 20yrs old)
Doesn't look like a good case to purse.
Correct ?

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Re: Indian Real Estate Sector

Postby negi » 15 Sep 2015 08:45

^ Depends on multiple factors

1. Is the per square feet rate at par with the current trend for the city ? The real estate mkt has slumped in last 6 months.
2. You said row house so is it the corner one and specially the one which does not meet the main road but is at end towards the boundary wall of a gated complex (I assume this is a row house within a gated complex) ? Does it have extra open spaces adjacent to it as against the other houses in the same complex ?
3. 5 years down the line will a high rise come up within 30-40 meters from this house and block the sunlight on your terrace/balcony ?
4. The current house can it be re-innovated and used again or you wish to bulldoze the entire structure and make a new one from scratch ? If it is the latter factor in the real cost of breaking it down and disposing the junk. Add that to your construction cost 'P'.

Lastly for your point '2' "The price of a plot of same area will be available in the market at P/2. No guarantee that a plot IS available in the same locality."

Do you see this place retaining it's central or good location in next 15-20 years ? I mean if you are in a metro then chances are that in next 10-20 years a lot of new areas will become equally well connected if not better are high so if you are getting a plot of same area at 'P/2' you might want to actually buy either a bigger plot for P or buy the same sized one for P/2 and keep the money for construction or investment . Again it all depends on the locality say if the choice was between say Vasant Vihar in Dilli vs some place in Noida or say Jayanagar first 4 blocks or HSR 2nd block vs some place in Sarjapur or E city then you would want to stick to your first choice .

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Re: Indian Real Estate Sector

Postby Sachin » 15 Sep 2015 09:32

negi wrote:Sachin is this property under construction or you already have taken possession and also registered the property in your name ?

It is already got completed, and I have taken possession.

give that to the loan issuing bank and ask them to add her as a co-owner. They should agree to this with additional processing fees
....
Btw if I am not wrong isn't the difference a bit too small ? My current loan rate is 10% however if I would have taken it in wife's name it would have been 9.9 % so only a 0.1% difference

Unfortunately my gambit failed. My SHQ works in a public sector bank. And for employees they have a lesser rate of interest, and that too simple interest. So I tried to get my wife also as the co-owner. For that, the original documents from the current bank had to be received and re-registration done. The current bank by then knew what I was up to. That I would close the loan with them, and then move the loan to SHQ's bank. And when they knew that I had to make my wife the co-owner, they flatly refused. SHQ's manager then sheepishly tells that she assumed that the flat had both of us as co-owners. After burning my fingers, I used my own channels to get more information. The bank does gives out loan to its employees at lesser interest rates and simple interest, but even the house/land purchased cannot be that of a close relative.

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Re: Indian Real Estate Sector

Postby kenop » 15 Sep 2015 10:02

negi wrote:^ Depends on multiple factors

1. Is the per square feet rate at par with the current trend for the city ? The real estate mkt has slumped in last 6 months.


Current trends

negi wrote:2. You said row house so is it the corner one and specially the one which does not meet the main road but is at end towards the boundary wall of a gated complex (I assume this is a row house within a gated complex) ? Does it have extra open spaces adjacent to it as against the other houses in the same complex ?


It is in the middle of its row. Some space in front and rear. Parking space can take a sedan and a scooter.
All the plot are in the range of ~1200 sqft with built-up area ~1200 leaving 600 odd sqft area on the front and back.

negi wrote:3. 5 years down the line will a high rise come up within 30-40 meters from this house and block the sunlight on your terrace/balcony ?

No

negi wrote:4. The current house can it be re-innovated and used again or you wish to bulldoze the entire structure and make a new one from scratch ? If it is the latter factor in the real cost of breaking it down and disposing the junk. Add that to your construction cost 'P'.

If it was a plot with each house having space around, one could have done whatever one fancied.
There are common walls as the complex was constructed by the builder (houses were sold not plots)
Theoretically, buying same size plot in the same area at current market rates and building would be cheaper than the price of this built unit.

negi wrote:Lastly for your point '2' "The price of a plot of same area will be available in the market at P/2. No guarantee that a plot IS available in the same locality."

Do you see this place retaining it's central or good location in next 15-20 years ? I mean if you are in a metro then chances are that in next 10-20 years a lot of new areas will become equally well connected if not better are high so if you are getting a plot of same area at 'P/2' you might want to actually buy either a bigger plot for P or buy the same sized one for P/2 and keep the money for construction or investment . Again it all depends on the locality say if the choice was between say Vasant Vihar in Dilli vs some place in Noida or say Jayanagar first 4 blocks or HSR 2nd block vs some place in Sarjapur or E city then you would want to stick to your first choice .


It will remain central for long time.
The idea was to fund this transaction by selling a flat in the same locality for A and taking a loan of A/2.
A friend says it is better to buy a plot/row house 5+ km away from this location and still get a better (new) house built on bigger plot. He is in the process of selling his 25y old house on a ~5000 sqft plot for a price that seems to discount his construction (effectively getting paid for the land at market rate).

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Re: Indian Real Estate Sector

Postby Bade » 18 Sep 2015 23:44

305 cities and towns identified for building homes under ‘Housing for All by 2022’ mission
Read more at:
http://economictimes.indiatimes.com/art ... aign=cppst

Of the cities and towns identified, 74 are in Madhya Pradesh, 42 in Odisha, 40 in Rajasthan, 36 in Chhattisgarh, 30 in Gujarat, 34 in Telangana, 19 in Jammu & Kashmir and 15 each in Kerala and Jharkhand. The other states that have signed the MoA include Andhra Pradesh, Bihar, Manipur, Mizoram, Nagaland, Uttarakhand.

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Re: Indian Real Estate Sector

Postby Bade » 21 Sep 2015 03:49

Virupaksha wrote:
There should be low wealth tax (0.5-2% at most) and moderate inheritance tax, with minimal loop holes.


vera_k wrote:
Wealth tax is on the books. But it is not enforced very well.

As a technical matter of implementation, all property owners could be served notices to pay wealth tax based on circle rates, unless they can show the property is self-occupied or rented out. But given the corrupt bureaucracy, that will simply enrich government officers.

It would be better to invest in IT systems to detect who has property that is not being productively used by correlating utility bills and rent receipts. Over time that will start bringing more revenue and also make more homes available to rent.


^^^ The cost to rent is more than leaving the units empty in India. When compared with the US rental market, the returns are nowhere close to 5% ROI to enable a tax rate of 1%. In most tier-2 towns the rents are low more like 1% of unit cost to own.

Some form of inheritance tax can be imposed to check RE hoarding perhaps.

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Re: Indian Real Estate Sector

Postby Theo_Fidel » 21 Sep 2015 04:26

Not to mention the cost to repair when the renters damage your house. Home insurance refuses to pay as the law does not require them to. I had lakhs worth of damage done and took months to get the damge repaired, since then one more unit in chennai has been off the market.. :(

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Re: Indian Real Estate Sector

Postby Bade » 21 Sep 2015 04:32

That too and the time taken to get repairs done. In my limited experience renting my old home in the US, the turn around time was 2 weeks only. The old tenants (UG students) even fixed the minor repairs themselves to get their security deposit back and found for me tenants at no cost for the next year :-) since no one wants to rent to UGs for fear of partying. As long it pays my mortgage fine for me.

Renting in India otoh is a pain in the rear.


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