Indian Real Estate Sector

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Re: Indian Real Estate Sector

Post by asgkhan »

hgupta wrote:
asgkhan wrote:https://ibb.co/VHYNCg6

Architect sketch. House is 95% accurate.
Very nice. I like the design. Is it central ACed or do you use room AC units to cool each room individually? Have you ever done energy efficient design analysis for your house?
Sir,

Those are all western concepts. Energy concerns are first world problems. Here in Desh, avoiding getting r@ped from all the shady contractors will be the highest priority.

I do have a solar water heater, BESCOM is kind enough to give me 50 RS subsidy on the monthly bill.RWH is present but I don't have the space for a separate sump. So it is dummy.

I don't need a/c as I am in a heavy wooded area. Fan is sufficient.
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Re: Indian Real Estate Sector

Post by Sachin »

asgkhan wrote:Construction cost:60,00,000
...
Total: 92,00,000
You have omitted the land cost :). Did you have the land already in hand? An kind of "independent house"/villa is also a dream of mine; so just gathering as much as information I can.
I don't need a/c as I am in a heavy wooded area. Fan is sufficient.
Can you let me know the area where this would be? I am not asking for an exact address. And what would be your primary mode of commute? And worst case I guess, you can have some provisions for AC? Like high power plug points etc.?
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Re: Indian Real Estate Sector

Post by asgkhan »

Sachin wrote:
asgkhan wrote:Construction cost:60,00,000
...
Total: 92,00,000
You have omitted the land cost :). Did you have the land already in hand? An kind of "independent house"/villa is also a dream of mine; so just gathering as much as information I can.
I don't need a/c as I am in a heavy wooded area. Fan is sufficient.
Can you let me know the area where this would be? I am not asking for an exact address. And what would be your primary mode of commute? And worst case I guess, you can have some provisions for AC? Like high power plug points etc.?
Land cost me around 1.5 crores. Total sqft is around 3000 sq ft. Half for me and other half bifurcated to my sister.

House has 15 AMP switch in every switch board. 3.5 kVA with 4 batteries as backup. All cabling done for DTH, fibre optic cable, cctv and a/c points.

Even the tanker can supply water to my house via a external pipe.

Skylights in hall of both floors and all bathrooms.Sitouts with artificial grass and Sira stone benches. Cantilever steps and wooden flooring in first floor hall.

Those are some of the small features.
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Re: Indian Real Estate Sector

Post by asgkhan »

I am near a small layout in Bommanahalli. commute is not a problem as my office timings are 6 to 3. Many small internal roads to avoid traffic jams.
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Re: Indian Real Estate Sector

Post by srin »

asgkhan wrote: Those are all western concepts. Energy concerns are first world problems. Here in Desh, avoiding getting r@ped from all the shady contractors will be the highest priority.
Actually, wanted to ask about that. How much did the contractor exceed his initial estimate wrt time and money ?
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Re: Indian Real Estate Sector

Post by asgkhan »

srin wrote:
asgkhan wrote: Those are all western concepts. Energy concerns are first world problems. Here in Desh, avoiding getting r@ped from all the shady contractors will be the highest priority.
Actually, wanted to ask about that. How much did the contractor exceed his initial estimate wrt time and money ?
For my dumb luck I managed to get a contractor willing to work with the architect for the proposed budget. We 3xceeded the budget by 1 lakh. But we were on time. Our agreement was that he will provide the materials and execute the work as per the instructions of the architect.we followed the BOQ concept with 10 % fee for the contractor.

I interviewed around 6 to 8 contractors but chose him because of his willingness to work with the architect. We are good friends now. I thank the almighty that both architect and contractor were keeping my welfare in mind and were conscious of my budget.

I have nothing but gratitude and praise for them.
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Re: Indian Real Estate Sector

Post by disha »

srin wrote:Begs the question - why do houses in US indeed have sloped roofs ?
Most of the residential construction in US is wood (plywood, laminates, sheet board etc). Part of the reason is that wood is abundant coming from Canada and Pacific Northwest. Another is that there is an entire ecosystem of lumber producers to distributors to retailers and to the standard. You can go to any shop in any part of america (even to a remote shop) and can find either a supplier or a user given the item specification. In essence, building supplies are very very cheap compared to the cost of the contractor and architect.

All the residential housing architects can reuse their calculation models. Given an architecture diagram and photos, one can get a general contractor to give estimates electronically for example. So deviations from the architecture tend to get costly.

Also most of the US (90%) sees some form of snow or rain. Water and wood do not go together, hence it is always a risk to create a roof which is of wood! And only in very dense urban areas one would want to use the roof as an outdoor space.
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Re: Indian Real Estate Sector

Post by disha »

asgkhan wrote:https://ibb.co/VHYNCg6

Architect sketch. House is 95% accurate.
Congratulations on your new home. It is modern and chic and well designed.

Condolences on your mother passing away. At least she knows that you will have your own home. I understand the feeling which one has have when one's parents do not get to see a home they can call their own.
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Re: Indian Real Estate Sector

Post by asgkhan »

Thanks Disha-sempai.

Yes, not a day goes by without remembering the conversations of her dreams to live in a modern house.
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Re: Indian Real Estate Sector

Post by Vips »

Mukesh Ambani sets out to change the face of Indian cities, first project already on.

The new ace up Mukesh Ambani's sleeves may be about to reveal itself. And it could well be the urban infra game changer India was waiting for.
Reliance Industries is tying up the last loose ends in its blueprint for setting up a megacity in the vicinity of Mumbai, a Business Standard story has revealed.

It is going to be Reliance Group's single biggest "projects within a project" initiative, where every component of a project will be a project in itself, BS quoted an inside source as saying.

Ambani's megacity will be developed on the lines of Singapore. It will have airport, port and sea link connectivity. Once completed, the city will accommodate over half a million inhabitants and thousands of businesses, the BS story said.

The project is expected to draw in as much as $75 billion in investments over the next decade.

Changing the urban infra game
Ambani is likely to roll out his new brainchild on a massive, never-before-seen scale. Analysts say it could be a Jio redux — the mega 2016 launch that had all India gasping in wonder in its wake. In terms of affordability and quality of product, Ambani's mega city could match the Jio phenomenon, experts have said.

By all measures, this new Reliance project is likely to script a new chapter for India, primarily because it could recast the whole urban infra scene.

Mumbai may be a changed place after this megacity comes, said the story. It will likely lead to reverse migration as property prices in the new city will be lower than in Mumbai, it added quoting a top real estate analyst. :shock:

The most significant aspect of this project is that Reliance will not only develop the project but also will run the administration after the city comes up, says the story. This will be possible due to the 'special planning authority' licence that Reliance has been handed for the landmark project.

This licence, apart from reducing red tape and transaction time, will enable Ambani to sharply — even dramatically — bring down the costs involved, says the report.

Project history: The Dhirubhai link
It was Dhirubhai Ambani, the legendary founder of the Reliance Group, who had first come up with the idea of setting up a world-class city in Navi Mumbai. He had thought of a project on these lines as early as the 80s — a project for linking South Mumbai and Navi Mumbai by road. The plan, had it succeeded, would have decongested Mumbai long back, BS quoted the source as saying.

Reliance had announced early last month about its leasing of 4,000 acres of land from Navi Mumbai SEZ (NMSEZ) for an initial payment of Rs 2,180 crore to develop an economic hub on a global scale. NMSEZ had been given this land in 2006 to develop a world class SEZ

NMSEZ is promoted by Mukesh Ambani, Jai Corp India, SKIL Infrastructure Ltd and City and Industrial Development Corp (CIDCO). According to a PTI story, CIDCO holds 26 per cent stake in NMSEZ, while the rest is held by Ambani, Jai Corp promoted by Anand Jain and Nikhil Gandhi's SKIL Infrastructure.

In 2005, Ambani joined forces with Nikhil Gandhi who had been buying land since 2000 with a view to setting up an SEZ on the lines of China's mega SEZs. According to the BS story, the Tata Group was also interested in joining hands with Gandhi but was eventually outwitted by Ambani.
Then, in 2018, under the Maharashtra Industrial Policy, the state government permitted SEZs to migrate to Integrated Industrial Area and make available the land for industrial units. NMSEZ later applied and received the consent to convert the SEZ into the Integrated industrail area (IIA)as per the policy


Incredible - Mukesh Ambani enters a new sector with aim to to dominate by first making sure that all the rules are re-written to favor him and thus ensure's a full proof success for his venture.
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Re: Indian Real Estate Sector

Post by Paul »

Tips on negotiating for an apartment with a builder

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Re: Indian Real Estate Sector

Post by UlanBatori »

I have a pooch. General terms first, then India vs. US answers.
Say Coujin A signs a Listing Agreement with Broker/Agent M. Property (in Yoo Ess) is listed on Multiple Listing Sarbhij in Yoo Ess. After some time, A decides that M is no good. Asks to terminate agreement and remove the listing.

It is understood that if A sells the property to anyone whom M showed the property, within the remaining listing period + 3 months, then A owes commishun to M on top of any other commishun paid to anyone else.
Pooch: How does A know who is on this list?

a) Doesn't M have to provide said list?
b) What about people who (M claims) to have "seen" the listing while posted on the 'Net but did not see in person, never been inside the property?
c) What about ppl who (M claims) to have seen the property while walking down the street when M's sign was on the property?
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Re: Indian Real Estate Sector

Post by Rishirishi »

UlanBatori wrote:I have a pooch. General terms first, then India vs. US answers.
Say Coujin A signs a Listing Agreement with Broker/Agent M. Property (in Yoo Ess) is listed on Multiple Listing Sarbhij in Yoo Ess. After some time, A decides that M is no good. Asks to terminate agreement and remove the listing.

It is understood that if A sells the property to anyone whom M showed the property, within the remaining listing period + 3 months, then A owes commishun to M on top of any other commishun paid to anyone else.
Pooch: How does A know who is on this list?

a) Doesn't M have to provide said list?
b) What about people who (M claims) to have "seen" the listing while posted on the 'Net but did not see in person, never been inside the property?
c) What about ppl who (M claims) to have seen the property while walking down the street when M's sign was on the property?
It is a trust issue. If you pull the property off the market or sack the agent, there is not much he can do. He wont take you to court in India (thanks for the lousy legal system). In the US I do not know. I guess, it depends on the type of agreament. If you did find a buyer, you could simply ask him to wait for 3 months.
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Re: Indian Real Estate Sector

Post by Sachin »

Karnataka RERA tightens rules for property developers
Some points:-
1. Developers need to register with RERA and also prominently show the registration # of the project.
2. No gimmick like "information is likely to change" in advertisements.
3. Names of land owners/developers details and their share details also to be recorded with RERA
4. A copy of the written agreement or arrangement between landowner/promoter which clearly specifies and details the rights and shares of each promoter should be uploaded on the KRERA website
5. Land owner, promoter & co will have to fight cases over the title of the land (if that arises; and that is fairly common in Bengaluru)

In overall some thing for the betterment in real estate sector.
URL: www.rera.karnataka.gov.in
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Re: Indian Real Estate Sector

Post by asgkhan »

Sachin wrote:Karnataka RERA tightens rules for property developers
Some points:-
1. Developers need to register with RERA and also prominently show the registration # of the project.
2. No gimmick like "information is likely to change" in advertisements.
3. Names of land owners/developers details and their share details also to be recorded with RERA
4. A copy of the written agreement or arrangement between landowner/promoter which clearly specifies and details the rights and shares of each promoter should be uploaded on the KRERA website
5. Land owner, promoter & co will have to fight cases over the title of the land (if that arises; and that is fairly common in Bengaluru)

In overall some thing for the betterment in real estate sector.
URL: http://www.rera.karnataka.gov.in

So many apartments in 30%-40% completed stage. The real estate scene is dead. In my area, hardly any buyers for the apartments. 7/8 years old apartments going for 70 lakh plus.

15 year old apartment going for 50 lakhs plus. Crazy.....

RERA is killing the fly by night operators, some of these guys who got into the scene 20 years back, planning their pump and dump schemes, have retired after suffering huge losses.

RERA and demonetisation has been like chemotherapy to the industry.

:)

Land values keep rising astronomically, immune to anything btw.
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Re: Indian Real Estate Sector

Post by tandav »

Vips wrote:Mukesh Ambani sets out to change the face of Indian cities, first project already on.

The new ace up Mukesh Ambani's sleeves may be about to reveal itself. And it could well be the urban infra game changer India was waiting for.
Reliance Industries is tying up the last loose ends in its blueprint for setting up a megacity in the vicinity of Mumbai, a Business Standard story has revealed.

It is going to be Reliance Group's single biggest "projects within a project" initiative, where every component of a project will be a project in itself, BS quoted an inside source as saying.

Ambani's megacity will be developed on the lines of Singapore. It will have airport, port and sea link connectivity. Once completed, the city will accommodate over half a million inhabitants and thousands of businesses, the BS story said.

The project is expected to draw in as much as $75 billion in investments over the next decade.

Changing the urban infra game
Ambani is likely to roll out his new brainchild on a massive, never-before-seen scale. Analysts say it could be a Jio redux — the mega 2016 launch that had all India gasping in wonder in its wake. In terms of affordability and quality of product, Ambani's mega city could match the Jio phenomenon, experts have said.

By all measures, this new Reliance project is likely to script a new chapter for India, primarily because it could recast the whole urban infra scene.

Mumbai may be a changed place after this megacity comes, said the story. It will likely lead to reverse migration as property prices in the new city will be lower than in Mumbai, it added quoting a top real estate analyst. :shock:

The most significant aspect of this project is that Reliance will not only develop the project but also will run the administration after the city comes up, says the story. This will be possible due to the 'special planning authority' licence that Reliance has been handed for the landmark project.

This licence, apart from reducing red tape and transaction time, will enable Ambani to sharply — even dramatically — bring down the costs involved, says the report.

Project history: The Dhirubhai link
It was Dhirubhai Ambani, the legendary founder of the Reliance Group, who had first come up with the idea of setting up a world-class city in Navi Mumbai. He had thought of a project on these lines as early as the 80s — a project for linking South Mumbai and Navi Mumbai by road. The plan, had it succeeded, would have decongested Mumbai long back, BS quoted the source as saying.

Reliance had announced early last month about its leasing of 4,000 acres of land from Navi Mumbai SEZ (NMSEZ) for an initial payment of Rs 2,180 crore to develop an economic hub on a global scale. NMSEZ had been given this land in 2006 to develop a world class SEZ

NMSEZ is promoted by Mukesh Ambani, Jai Corp India, SKIL Infrastructure Ltd and City and Industrial Development Corp (CIDCO). According to a PTI story, CIDCO holds 26 per cent stake in NMSEZ, while the rest is held by Ambani, Jai Corp promoted by Anand Jain and Nikhil Gandhi's SKIL Infrastructure.

In 2005, Ambani joined forces with Nikhil Gandhi who had been buying land since 2000 with a view to setting up an SEZ on the lines of China's mega SEZs. According to the BS story, the Tata Group was also interested in joining hands with Gandhi but was eventually outwitted by Ambani.
Then, in 2018, under the Maharashtra Industrial Policy, the state government permitted SEZs to migrate to Integrated Industrial Area and make available the land for industrial units. NMSEZ later applied and received the consent to convert the SEZ into the Integrated industrail area (IIA)as per the policy


Incredible - Mukesh Ambani enters a new sector with aim to to dominate by first making sure that all the rules are re-written to favor him and thus ensure's a full proof success for his venture.
Didn't JayPee group try this in NOIDA and now the company is bankrupt. Trying to do anything quality oriented in Indian Govt Sector (policy/land/property) is a proven path to wealth destruction. So far many politicians and bureaucrats have made money in real estate / govt is by allowing encroaching on public property, creating legal issues, providing piss poor infra, corruption and creating slums vote banks. This has increased the cost of land acquisition and the cost to legal property owners. Its not a surprise that at the level of development India has the worst public infra and systems.
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Re: Indian Real Estate Sector

Post by tandav »

UlanBatori wrote:I have a pooch. General terms first, then India vs. US answers.
Say Coujin A signs a Listing Agreement with Broker/Agent M. Property (in Yoo Ess) is listed on Multiple Listing Sarbhij in Yoo Ess. After some time, A decides that M is no good. Asks to terminate agreement and remove the listing.

It is understood that if A sells the property to anyone whom M showed the property, within the remaining listing period + 3 months, then A owes commishun to M on top of any other commishun paid to anyone else.
Pooch: How does A know who is on this list?

a) Doesn't M have to provide said list?
b) What about people who (M claims) to have "seen" the listing while posted on the 'Net but did not see in person, never been inside the property?
c) What about ppl who (M claims) to have seen the property while walking down the street when M's sign was on the property?

Email and Call records, signup sheets during open house should be sufficient for M to prove his case. Contract enforcement in US is generally stronger than in India, where the agreement is not worth the paper it is signed on, people work on trust and assume that if agreements are broken then there is payback via karma NOT the law.
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Re: Indian Real Estate Sector

Post by Vayutuvan »

tandav wrote: Didn't JayPee group try this in NOIDA and now the company is bankrupt.
Lavasa is another failed project. It seems that was due to a political fight between Pawar and S. Gandhi.
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Re: Indian Real Estate Sector

Post by Sachin »

A case from South East Bangalore. Looks like the unplanned real estate growth on the eastern part of the city has now started opening up problems. At least 5 years back there were opinions by experts that areas like Outer Ring Road, Sarjapur Road are going to have water problems as the water bed even deep below the surface would dry up.
Water tanker strike in east Bengaluru till March 20 has citizens worried
Tech corridors to face heat as water tankers call strike
Elangovan Kulandaivelu, a resident of Whitefield, said the water scarcity in east Bengaluru was the direct result of an unplanned and unregulated development. “Officials give building permissions though they can’t provide water. They will collect property tax but won’t provide basic amenities. These are people contributing to the economy of the state but their needs are not met,” he said, adding that higher awareness and enforcement were needed to ensure the implementation of sustainable measures like rainwater harvesting.
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Re: Indian Real Estate Sector

Post by sum »

What a pathetic situation with zero solutions in sight.

Literal sub-Saharan situation with even zero level basic needs being absent in the "IT belt" of India
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Re: Indian Real Estate Sector

Post by asgkhan »

Sachin wrote:A case from South East Bangalore. Looks like the unplanned real estate growth on the eastern part of the city has now started opening up problems. At least 5 years back there were opinions by experts that areas like Outer Ring Road, Sarjapur Road are going to have water problems as the water bed even deep below the surface would dry up.
Water tanker strike in east Bengaluru till March 20 has citizens worried
Tech corridors to face heat as water tankers call strike
Elangovan Kulandaivelu, a resident of Whitefield, said the water scarcity in east Bengaluru was the direct result of an unplanned and unregulated development. “Officials give building permissions though they can’t provide water. They will collect property tax but won’t provide basic amenities. These are people contributing to the economy of the state but their needs are not met,” he said, adding that higher awareness and enforcement were needed to ensure the implementation of sustainable measures like rainwater harvesting.
Around a decade back, survey was done in East Bangalore and was decided that 110 villages will be adopted by BWSSB and Kaveri water will be provided to the heathens.

What went wrong:

1. Population density has increased 10x.
2. Original allotment of 5MPLD is not sufficient.
3. The allotted water was diverted to other areas in need due to delays in starting the project. Now when the water is re-allocated back, influential goons are creating nuisance.
4. BWSSB is flush with money, they have given the contract in L&T, the engineers are fcuking lazy. I have attended multiple meetings with RWAS and BWSSB. The chalta hai attitude nearly caused a lynching of a BWSSB engineer, because of the delays and nuisance he caused by his lethargy.
5. The apartments have too many violations. They are unable to produce the documents required by BWSSB.
6. Corruption. BWSSB assigned plumbers are minting money, charging 1 lakh per connection.
7. On ORR, they have to build reservoirs and STPs, where is the land ? That project is planned for the next 5 years.


Lot more stories. I will share some down the line.
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Re: Indian Real Estate Sector

Post by CalvinH »

Vayutuvan wrote:
tandav wrote: Didn't JayPee group try this in NOIDA and now the company is bankrupt.
Lavasa is another failed project. It seems that was due to a political fight between Pawar and S. Gandhi.
We have too much political interference and politicians (big and small) and bureaucrats trying to claim the part of the pie when the project starts to look successful. That tanks large scale projects when the builder lose political patronage (due to change in government or other reasons). In Pakistan projects like DHA and builder like Baharia have developed successful large scale projects with comprehensive plans because they have backing of the establishment (that provide them first use of resources too). Check some videos of their mini-cities and developments.We lack similar projects. Self contained mini-cities run by private corporations.

Jaypee had a great chance in Noida as they got the land cheap but they floundered it because of their greed....their story is sad.
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Re: Indian Real Estate Sector

Post by tandav »

A very large amount of problems can be resolved by simply making legislation that Land is not owned by anyone (this was historically the case in India)... everyone pays 1-2% of circle rate /year as property tax. People of India owns the land and can by a democratic exercise acquire the land for any public purpose after a carefully defined process that will have prior judicial approval. What people paid as Land Acquisition cost in *white* will be available as a input credit for Property Tax. Any Capital investment that a leaser made on that land (in terms of setting up house/factory etc) will be paid back with interest of 18% if it cannot be moved. Or better all capital investments have to be movable / dis-assemblable structures made of recyclable materials (Steel, Wood, Glass, Earth, Stone) or prefab RCC structures that can be assembled elsewhere
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Re: Indian Real Estate Sector

Post by Vayutuvan »

CalvinH wrote:We lack similar projects. Self contained mini-cities run by private corporations.
...
Jaypee had a great chance in Noida as they got the land cheap but they floundered it because of their greed....their story is sad.
In case of Lavasa, INC held up the project saying there are some environmental issues to be resolved. We all know 'Jayanthi Natarajan' fiasco under MP Rahul Gandhi.
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Re: Indian Real Estate Sector

Post by Vayutuvan »

tandav wrote:A very large amount of problems can be resolved by simply making legislation that Land is not owned by anyone (this was historically the case in India)...
AFAIK, most coop housing societies in Mumbai, especially Navi Mumbai are given the land on a 99 year lease basis.
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Re: Indian Real Estate Sector

Post by Rishirishi »

tandav wrote:A very large amount of problems can be resolved by simply making legislation that Land is not owned by anyone (this was historically the case in India)... everyone pays 1-2% of circle rate /year as property tax. People of India owns the land and can by a democratic exercise acquire the land for any public purpose after a carefully defined process that will have prior judicial approval. What people paid as Land Acquisition cost in *white* will be available as a input credit for Property Tax. Any Capital investment that a leaser made on that land (in terms of setting up house/factory etc) will be paid back with interest of 18% if it cannot be moved. Or better all capital investments have to be movable / dis-assemblable structures made of recyclable materials (Steel, Wood, Glass, Earth, Stone) or prefab RCC structures that can be assembled elsewhere
Owning land is one of the greatest wealth creators. Property is used as collateral and also help in expanding businesses.
Normally the land cost reflects the earnings on it. But in India, with all that black wealth, land is used as bank to park money. This way land becomes a major cost factor in starting up businesses. Getting rid of black money is a challenge by itself. But perhaps digital land registries can make it more transparent. Also mandatory auctions of land can help. Basically the people would have to make bids on an open system, and the property would go to the highest bidder. This will eliminate the possibility to park black money in land.
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Re: Indian Real Estate Sector

Post by vimal »

Rishirishi wrote:
tandav wrote:...
Any Capital investment that a leaser made on that land (in terms of setting up house/factory etc) will be paid back with interest of 18% if it cannot be moved. Or better all capital investments have to be movable / dis-assemblable structures made of recyclable materials (Steel, Wood, Glass, Earth, Stone) or prefab RCC structures that can be assembled elsewhere
Owning land is one of the greatest wealth creators. Property is used as collateral and also help in expanding businesses.
Normally the land cost reflects the earnings on it. But in India, with all that black wealth, land is used as bank to park money. This way land becomes a major cost factor in starting up businesses. Getting rid of black money is a challenge by itself. But perhaps digital land registries can make it more transparent. Also mandatory auctions of land can help. Basically the people would have to make bids on an open system, and the property would go to the highest bidder. This will eliminate the possibility to park black money in land.
In my state all the land records are digitised. I can go to the government website and see any record.
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Re: Indian Real Estate Sector

Post by tandav »

The issue is how to acquire land for public purposes?
Second I feel property tax must be collected at a higher rate to ensure land is used productively
Mollick.R
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Re: Indian Real Estate Sector

Post by Mollick.R »

Alpha Invesco, i like their in depth industry and sector specific analysis quite much.

recently i found this one in same site.

Why is Real Estate in India So Expensive?
By Zain Iqbal / Articles, Industry & Sector Reports, Real Estate / Indian Real Estate Market

When you benchmark an asset as being expensive, we have to ask relative to what? Indian real estate is expensive and it is only getting costlier despite demonetization and RERA.

The metric which indicates if real estate in a nation is expensive is PRICE to INCOME ratio. Price in the numerator is price of a dwelling and Income is national average income of the nation.

To understand the PRICE to INCOME ratio, please read the definition-

Price to Income Ratio is the basic measure for apartment purchase affordability (lower is better). It is generally calculated as the ratio of median apartment prices to median familial disposable income, expressed as years of income (although variations are used also elsewhere). Our formula assumes and uses:

Net disposable family income, as defined as 1.5 * the average net salary (50% is assumed percentage of women in the workforce)
Median apartment size is 90 square meters or 968 sq ft.
Price per square meter (the formula uses) is the average price of square meter in the city center and outside of the city center.

Price to Income Ratio in India [ IMAGE ]

India had price to income ratio of 7.69 in 2009 and since then it has inched up and it has already touched 11.38 in 2020. 2018 onwards the price to income ratio has rapidly risen from 9.73 to 11.38.

In simple worlds, if a person wants to buy a house today in 2020, he will spent 11.38 lacs on the purchase when his median disposable family income is 1 lac only or it will take the person 11.38 years at current median disposable family income to buy the house.

Let’s look at other countries and try to gauge housing affordability................

the article have embedded images, read full article here.............

https://www.alphainvesco.com/blog/real- ... expensive/
isubodh
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Re: Indian Real Estate Sector

Post by isubodh »

tandav wrote:The issue is how to acquire land for public purposes?
Second I feel property tax must be collected at a higher rate to ensure land is used productively
There are practical issues with high property tax rates :
- recovery is difficult, can't throw out people out for not paying property tax (inhumane )
- high property tax makes houses un-affordable for tenants, as all cost + margin is passed on to them.
- optimum use means more commercial use, putting lot of pressure on supporting infra.
Rishirishi
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Re: Indian Real Estate Sector

Post by Rishirishi »

How to make every Indian a house owner.

Example of a scheme.
Preconditions:
-Each adult is only entitled to enter the scheme once.
-The RBI interest rate is 4,4% (currently)
-Construction cost is Rs 3000 per sq meter.
-Each flat unit pays 5 lacks towards development of infrastructure.
-Individual is required to have 2 lacs of capital.

A flat size of 800Ssq ft will cost rs 29 lacs.

The public use the flat as collateral and get the rest as a loan at RBI rate+0.25% admin fee. Total interest rate is 4,69% . The loan is 7 years down payment free. after that 25 years with down payment (with 7 years inflation, the down payment will be easy)

For the first 7 years to cost to the purchaser will only be Rs 126 630 per year or Rs 10 500 per month.

With such a scheme millions of Indians, who could never dream of a house, will get to own one.
vinamr_s
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Re: Indian Real Estate Sector

Post by vinamr_s »

Rahul Mehta wrote:Now in India, if all urban cities' area is doubled by including land around city and giving permission of construction on that agricultural or fallow land around cities , then the prices of land across Indian cities would crash royally. Cities are mere 3% of existing and and agricultural land is 46% . So even all land added is agricultural land, then also loss of agricultural land will be at most = 3/46 = at most 6.6%. This is NOT a significant loss of agricultural land. Further, the resultant development will increase irrigation and add more land to agricultural land. So IMO, thats what we should do to promote development of housing, industry, trade, commerce etc.
If they gave permission of construction on agricultural & fallow land around cities, then how will they extract all the bribes they are extracting right now?

I live in Delhi and a lot of houses (in Vasant Kunj, Chattarpur, etc) are built on agricultural land, which is illegal. One guy told me that he paid bribes in single digit lakh rupees every month to the police and municipal corporation during the 6-7 months when his house was being constructed on agricultural land !!

I was wondering why he (and many like him) took this route and didn’t get their land-use changed. Maybe they had to pay more in fee+bribes for getting their land-use changed? Or maybe because the authorities aren’t allowing change of land-use? After all, it is very profitable for them (= authorities) to do so because it gives them a lot of grounds to extract more bribes later by giving threats of sealing your house etc.

Besides, I agree that what you’re proposing needs to be done. I also had the same opinion on how we should use the agricultural-onlee-on-paper-empty-in-reality, fallow land around cities since I came to know about their existence around my city.
Last edited by vinamr_s on 07 Jun 2021 16:16, edited 8 times in total.
sankum
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Re: Indian Real Estate Sector

Post by sankum »

How powerful is land mafia that they changed FAR from 4 to 2 under land pooling plan so that a 2 bedroom flat which would have costed Rs 45 lakh goes upto Rs 75 lakh and 3 bedroom which would have costed Rs 60 lakh goes upto Rs 1 Cr.
For redevelopment of old built up area they kept FAR at 3 so that in 30 years entire delhi will be redeveloped into modern city. Such is their impractical dreamland planning.
No wonder 90% of colonies are irregular which is money eating service for everyone.
They could not even keep the FAR at 3 for land pooling for fear of property prices crashing. Such is their sway on policy matters to take such retrograde step as compared to developed nations.
Ambar
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Re: Indian Real Estate Sector

Post by Ambar »

Which metro has FAR of 2.0 ? Delhi has a FAR of 3.5 and redevelopment FAR is 4.0, Mumbai has 5.0 for commercial and 3.0 for residential, Bangalore has FAR of 3.0 to 5.0. Today the land mafia and the builder lobby are one and the same, so they pile as many floors as possible and have a vested interest in increasing the FAR. Not that we needed a deadly pandemic to prove it but from a cost to quality of life ratio, Indian metros make for some of the most overpriced real estate in the world . The goal should not be to increase the FAR but to create new cities to reduce the load on our incredibly over crowded and polluted metros. Also, wishful thinking it may be but we need a lot stricter zoning and redevelopment rules if we are to improve the quality of life and pollution in our cities. During the boom years of late 90s to early 2010s we saw entire residential areas get demolished and commercialized with zero consideration for zoning, and now we are seeing buildings less than 20 years old get demolished again and replaced with bigger ones. This endless construction not only results in greater and greater density especially in more desirable areas but also contributes to the choking construction pollution . Is it any wonder that 20% of our kids show signs of lung damage before the age of 15 in our large cities ?
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Re: Indian Real Estate Sector

Post by sankum »

The pollution problem is also for the municipality sweeper which costs Rs10 lakh / year of taxpayer money regularly burns garbage through out the city in night to release the toxic gases which our politicos are unable to check.

As for FAR debate 90 percent of colonies are illegal and building 5 stories with basement openly so that the FAR in these are already 5 or more.

Every few year the municipality will raise floors on plot sold by DDA from 2.5 to 3.5 to 4 to 5. This is the joke so that the owner has to rebuild after every few years.

The result less than 10% of houses are planned and property prices are minimum 4 times per sq feet than illegal. So that 90 % is illegal.

If you have to remove a tree on your plot for redevelopment lakhs of rupees in bribe have to be paid.

In short it is economics of scarcity for those in power to become rich since independence.
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Re: Indian Real Estate Sector

Post by Ambar »

Not quite following why would the builders shoot themselves in the foot by lobbying to keep FAR low ? I understand the artificial scarcity part but every builder tries to stuff as many floors as possible in every project, doesn't that negate any reduction in profit they may make because of a higher FAR ?
Besides, atleast in many of the metros the builders just pay off babus and politicians so they look the other way on FAR. This is why we have a near 60-40 ratio of 'A katha' and 'B katha' properties in Karnataka. The 'A' properties are legal and 'B' properties are not entirely legal but yet the local govt allows you to buy or sell or improve.

The rebuilding/redevelopment is pure greed in most cases. In Bangalore in many neighborhoods which were once 80% residential, after rampant commercialization in the last 20-22 years the trend now is to demolish newish commercial buildings to construct even bigger commercial buildings on the same piece of land, resulting in more traffic and parking woes, more density and even more choking construction dust. I for one dont have any hopes of things changing anytime soon, we continue to see new developments coming up on encroached lake beds or agricultural lands, these projects are approved but sewer, road and water connectivity lags behind 10 to 12 yrs after completion of the project leading to more water tankers, open sewage and poor roads.
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Re: Indian Real Estate Sector

Post by nithish »

Bhai log, any recommendations for a reliable builder in BLR area? Need to build a house but non resident so won't be there 24/7 to check...
Thanks in advance
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Re: Indian Real Estate Sector

Post by Ambar »

Depends on the neighborhood but most big brand builders are the same and pretty much in the same price band. Just make sure it is a A katha property, nothing wrong with a "B katha" just that later on when you attempt to do a conversion the BBMP sub registrars office people will squeeze the last rupee even from your bone marrow.
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Re: Indian Real Estate Sector

Post by Sachin »

vinamr_s wrote:One guy told me that he paid bribes in single digit lakh rupees every month to the police and municipal corporation during the 6-7 months when his house was being constructed on agricultural land !!
Don't know about the local laws at Delhi, but police is generally not an agency involved in the building approval process. They may get involved only if the Town/City Planning authorities, Municipal Corporations ask them to provide bandobust in eviction & demolition.
I was wondering why he (and many like him) took this route and didn’t get their land-use changed. Maybe they had to pay more in fee+bribes for getting their land-use changed? Or maybe because the authorities aren’t allowing change of land-use?
From what I have observed. People who do not get the documents in order are folks who plan to sell the property pretty soon after it is ready. The idea being that the gullible fellow who buys the flats/home will have to then take up the fight with municipal authorities. Also getting a land-use changed involves bribe as well providing a very sensible justification for the same. In Karntaka there are for example land which cannot be converted for home building at all. A person can buy the land, but should be kept as open land etc.
Ambar wrote: This is why we have a near 60-40 ratio of 'A katha' and 'B katha' properties in Karnataka. The 'A' properties are legal and 'B' properties are not entirely legal but yet the local govt allows you to buy or sell or improve.
A Katha listed properties are those for which the land tax has been paid by the right ful owner, and building is not violating any Municipal Act byelaws. B Katha listed properties are those for which land tax has been paid, but there is question on ownership. Government is happy if any body pays land tax, but it keeps it on a separate list if there is any discrepancy. The moot point is that Khatas are not the sole document which establishes ownership of the land. The ownership is determined by using other documents such as past sale deeds, Akarbands/മുന്നാധാരം (land title deeds) which will shows how the possession of land/property has reached the current owner.
nithish wrote:Bhai log, any recommendations for a reliable builder in BLR area? Need to build a house..
Ambar wrote: Just make sure it is a A katha property, nothing wrong with a "B katha"
In case you are planning to build a house (not buy a flat), please check:-
1. BMRDA and BBMP approvals for the layout. This approval ensures that civic authorities recognize the layout, and will be okay to give power connections, water supply etc.
2. Release Order - this is a document which authorises the builder to start selling the sites/plots in the layout. This is done after checking the sanitation facility, roads, street lighting etc is already put in place.
3. RERA registration number - this is more like a confidence giving step. It means that the builder has registered the project as per RERA act and approvals have been taken.
4. A Khatas - in an approved lay out, each site/plot will be eligible for a A Khata. It will be initially with the builder but after sale, he would be able to transfer the A Khata to you. Once A Khata is done it is easy to approach Municipal authorities for building plan approvals (for your house). If they cannot give A Khata then some thing is fishy.
5. Past records. Check relevant records like latest encumbrance certificates, previous ownership records and land sale agreements. Check for any pending court cases. Check for village/town records to check the type of land, DC Conversion certificates etc. These documents will be in Kannada, so if you cannot understand legal Kannada approach a lawyer. Good builders generally will have all these documents already with them. Using these documents a proper traceability has to be established till the builder who is the sole owner for the site.
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Re: Indian Real Estate Sector

Post by Sachin »

A common occurance observed in Bengaluru suburbs, many of which were farm lands around 20-30 years back.
1. Once upon a time (in 1960s) there would be a farmer who had big chunk of land, and more than one wife. Marriages are not registered any ways. At that time of the death of the farmer, no will is written (farmer may not even have been to a school).
2. One of the son's of the farmer will be seen to be 'owning' the land. No one is bothered as income is not that great any ways. All live in harmony.
3. The land shark/real estate baron approaches the 'owner' of the land and plans to buy the land. The money now visible is not pittance. It is often about crores and fancy cars & jewellery. Once the transaction is in process, the other's step in. They will site the inheritance laws applicable to Hindu religion, which talks about equal share of landed property amongst all children if a will is not found. A civil 'original suit' is filed at the local munsiff court.
4. The appearance of children from the second wife who demand their pound of flesh is also seen very commonly. But how they manage to prove the second wife as legal wife (as bigamy is not allowed for Hindus), I am not too sure.
5. The bonus will be the married off daughters (and their husband and children) also entering the scene. As per Hindu inheritance law, unless a will is not written all children (including girls) have equal share in their father's property. That right does not go away with marriage.
6. For best effect; these shenanigans are generally taken out when a building (most often large to medium sized flats) is nearing completion or 1-2 families have already started living there. This is when on the walls around the building words like "OS 1991/2022" etc starts appearing.
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