Property Developers scurry to Complete Ventures before new law come into effect

The new real-estate regulatory bill has put property developers in frenzy, as they are speeding up construction work to avoid these new regulations. It may be a boost for the buyers who have invested in these projects though, especially if they had invested in a venture which had been delayed.

This new bill is said to put ease on the new buyers as it secures their rights as home buyers, as it mandates registration on ventures which includes those projects too that have not acquired a completion or right to occupancy certificate.

Real-estate experts claim that registration of these ventures may still take time of 15 to 18 months, as those ventures which are 60% to a 70% complete will have enough of time to register their properties. Registration means the developers will have keep aside the funds collected by the buyers and pay interest in case if there is any delay. Now according to the law a customer can easily launch FIR against a builder if the builder is fails to fulfill the legal norms.

According to reputed property Research Company, it says that in the top 27 cities of India there are close to 17,000 projects which are under construction and in that 56% to 60% are complete. An experienced real estate analyst of Mumbai based company has said the real-estate bill will be a boost to finish construction more quickly as registering existing projects might delay them further.

This real-estate regulatory bill has been passed by both houses of the parliament and is seeking approval from the President. Once everything is in place sections relating to registering of real-estate projects and agents and the responsibilities of the promoter will be informed. Completion of ventures will be dependent on many factors which includes a financier being lined up.

According to the real estate folks, many ventures all over India that are 60%-70% complete, and it will speed up its projects completion before the bill is in effect. When projects under construction register with the regulator, they need to comply with the same rules as new projects.

Builders are expected to deposit 70% of the amount collected from the buyers in a separate account to cover the cost of construction which includes land too. Property Developers will also have to pay the same interest rate for any delays on their end similar to when the buyers do when they fail to pay the builder.

The National President of the Confederation of Real Estate Developers association of India, Getamber Anand, said the desire of developers will be to complete existing projects in the frame-time available to them. Around 15 to 18 months should be perfectly fine for builders to complete ventures that are 60% complete. If the pace of construction is picked up it could see an increase in demand for raw-materials like cement and steel revitalizing economic growth, says Pankaj Kapoor, the Managing Director of Liases Foras. It all depends how wise the developers are with the money as many of the real-estate developers are strapped for cash.

TGS Layouts is a property developer of Bangalore it has many completed projects in the city you can read TGS Layouts Customer reviews to know about the company more closely. It develops residential layouts and sales plots of land for investors.

Emerging destinations with affordable property in Bangalore

Even though the sales volume of mid and high budget housing units of Bangalore are fluctuating according to the nature of the market segment, still affordable housing sector has shown a constant demand in the outer region of the city. The availability of large unit of land at a low price in Bangalore and the stretch of the city from every corner has stimulated its demand in real estate. The key factors for the rise of demand in land plots at outskirts are Metro Rail & the peripheral ring road.

The Commercial real estate market has shown significant changes and witnessed many new commercial spaces in the city. There is a rapid demand in  the commercial space in the city brings more income opportunity for realty investors and Bangalore holds the first position among all the cities in the first half of the year 2016.

The industrial growth in the peripheral districts of Bangalore has improved its connectivity with the city and since lands in those areas are very cheap so many land developers came with their affordable projects. These projects were made to meet with the demand of residential places by the employees of the industries located in the adjacent districts of Bangalore.

Localities like Anekal, Jigani and couple of other locations closer to NICE Road are very attractive destinations for real estate investors for the increasing demand of industrial areas near Bommasandra and jigani. Mysore Road is one among those places where one can find affordable residential land plots for sale in Bangalore from any land developer. The old madras Road connecting Bangalore and Chennai is famous for Japanese multinational companies also suitable for property investors as well.

Let’s check out other areas too where one can find an affordable property with high future prospects and return surplus opportunity.

Properties near Kanakapura road

Kanakapura Road represents as south Bangalore is blessed with its superb connectivity to the center of the city. The infrastructure and transport facility of Kanakapura Road made it as the most preferred suburb area of Bengaluru. The under construction Ring Road which will connect all the major highways of the city is just an added benefit for the investors who are buying plots near Kanakapura Road. The major infrastructural developments like educational institutions, Metro lines and Roads widening projects are certainly worked as a catalyst for the rise in the price of the property here. Considering the future developments, it is a reliable locality where investor as well as user can earn a handsome return.

Properties Near Sarjapur Road

The diversified price for the properties located in different small sized micro places has attracted every real estate buyer to think for lands near Sarjapura road. This area has a stabilized demand of low, mid-sized properties and luxurious buyers looking villa properties. The easy access to all large IT hubs in the city like Electronic City, Whitefield and the Outer Ring Road are keys to influence the demand of the properties in this area. The presence of many reputed schools, hospitals and general infrastructure pointing sarjapur road is a good locality among all for a better return on investment.

Properties Near Nallurhalli

As an upcoming location of whitefield; Nallurhalli is known for its greenery and lakes. The presence of Sigma Tech Park, couple of Malls and closeness of ITPL are the reason why Sites in Whitefield near Nallurhalli is demanded. This location has seen its development through Villas and Bungalow projects, although it is near to many IT projects but still it provides apparently low price residential properties compared to other places of Whitefield. With a yearly appreciation of ~8% buyers can invest here for a marginal profit from rental income.

Properties Near Kengeri

Kengeri is well settled, as a satellite township of Bangalore where land is in demand for industrial as residential developments. The requirement of residential lands by the IT professionals working near the IT tech parks of Mysore Road are fulfilled by the residential lands in Kengeri. The excellent connectivity to Outer Ring Road, NICE Road, Mysore Road and the expansion of Namma Metro project transform it to an excellent choice to live here. Kengeri is well developed with adequate social infrastructure and commercial space. Comparing to other outskirt areas it is very affordable and has a steady growth of value appreciation.

Properties Near Budigere

Budigere once a village of Karnataka is now becoming a developing residential location with the stimulus of IT/ITes of nearby areas. The residential requirement of industrial units has been fulfilled by Budigere as it is close to Brookfield and Whitefield. This place has a surplus of demand as it offers residential units comparatively at a low price than its neighbors. Many real estate builders and developers are coming with big residential projects here and within few more years may be the price of this area will be skyrocket. It has a good infrastructure and depending on the amenities the property value appreciation of this place is in between 2 to 3 percent per year.

Properties Near Magadi Road

Magadi Road comes under the western part of Bangalore and can be reached easily from the center of the city. Since most of the developments in terms of residential as well as the commercial area are concentrated on east and south Bangalore so western part of Bangalore remains relatively greener. The connective roads like Nice Road and outer ring road give Magadi a good access from every part of the city. There are many land and layouts developers who are eyeing on these locations to target buyers who are looking to live in greenery and out of city pollution. Since these area doesn’t offer many residential or commercial properties so the micro-market offers land plots in Magadi road at a very cheap price.

Properties Near Hosur Road

Once considered as a village in Bangalore has now witnessed highest appreciation value in the last year. Hosur Road falls under south Bangalore along with the top locations of the city like Begur, Singasandra, EC and Kudlu gate together. There are many well-known builders and land developers are having their ongoing projects here and one can buy land in an affordable price at Hosur Road.

Properties Near Yelahanka & Doddaballapur Road

Yelahanka a satellite town grown in the suburban areas of Bangalore was once completely dependent on the manufacturing units till the inauguration of International Airport. The surplus of land and big government projects opened many gates of opportunity to this locality for offices and malls. With its super connectivity and easy access to railway and the airport, Yelahanka became one of the measuredly developed localities of Bangalore. Still, there are residential lands available for development and it can buy a marginal yearly profit for investors.

Properties Near Horamavu

Horamavu located in the eastern zone of Bangalore can be accessed by the airport or outer ring road of Bangalore. It has a good number of residential layouts developed by numerous land developers and localities like Banaswadi and KR Puram are closer to it. The measure drawback of this area is traffic near railway crossing however the government has organized an underpass railway project to overcome from this situation. Couple of lake encroachments has disturbed partial life of the locals still the focus of infrastructural development on the northern region of Bangalore will definitely going to bring residential demand in this area.

Properties Near Mysore Road

State highway 17 which connects Bangalore and Mysore, this 62 kilometers long distanced road between both the states of Karnataka is named as Mysore Road. Now the scenario has completely changed and it has developed to a 6 lane road named NH-275. With this development of connectivity, the price of the peripheral lands near Mysore Road has shown a good hike in the past year. Also, the Namma Metro project was another factor why Mysore Road is on demand for every real estate investor now. Here one can find mid-budget as well as ultra-luxurious projects developed by land developers and builders.

Bangalore grows every day by its size and populations from the mutants, the above mentioned demanded localities for its affordability today may not fall under the top 10 emerging locations of Bangalore tomorrow. Land developers of Bangalore may create more affordable corridors for the city but among all the cities Bangalore still own the title of being a leading real estate destination of affordability.

TGS Layouts is one among such residential real estate land developer who believes in making housing segment affordable for all. Check TGS Layouts Reviews to know what their customers are saying about their services and amenities in their developed layouts.

Can Gram Panchayat approve building plans or layout plans?

Karnataka Gram Panchyat Approval for Land Layouts

It was in December 2012 when Department of Rural India and Panchyati Raj issued the circular saying that no Gram Panchayat has the right to approve either the plans of buildings or layouts in the DC converted lands. This naturally implies that any denizen of Bangalore who is planning to buy land and property under the jurisdiction of BBMP and rural areas surrounding the various municipal towns like Kanakapura, Neelamangala, etc. should keep in mind that any layout plans can’t in any way be approved by any Gram Panchayats. This circular thus confirms that all the building plans can only be approved by either  BMICAPA, BDA, BIAPPA or other municipal authorities of that specific area.

This rule was there prior to the circulation of the notice that Gram panchayats could approve the plans of buildings and layouts. This was going on from 1994. Taking this as an advantage many builders especially in areas like Peenya, Jigni, Hoskote, Tumkur Road, Rammurthynagar, K R Puram and few other places have been taking approvals and started their marketing programmes. The gram Panchayats also started providing approvals to the buildings in spite of the fact that they do not have any powers after the circular of 2012.

This circular of 2012 further states that not only the Panchayats but the City Municipal Corporation and the Mandal Panchayats also do not have the rights to approve the development of any land, plots or layouts. It has been observed that banks also provided loans on such properties being approved by such agencies but even then this is considered as illegal. 

Read what are the regulatory plan for illegal approvals of land.

Indian Real Estate at a glance; Should I Invest Now?

What are key points to take before investing on real estate in 2016

At the onset of the year 2016 everyone seems to be eying on the real estate sector thinking that there will be some revival with so many efforts from the government’s end. The realtors have also being expectant and many efforts were seen in in the last couple of years to push up the sales. There were similar efforts to keep the inventory levels low and in reality also this happened to a great extent as well. The inventory went down in many cities like Bangalore where the unsold stock was registered to be low at 2.2 percent but in cities like Mumbai, NCR and Delhi the unsold stock was noted to be high. In few other cities again the unsold stock was low.

If you think of the end users and the buyers there was a cautious approach noted in them in the last few years followed by a controlled supply quotient. This was augmented by the sales efforts and the promotional measures of the government but in many instances the real estate developers failed to deliver the expected results. This resulted in a lull and subdued enthusiasm levels from the buyers. But setting aside all of these in retrospective let us see what the situation of the Indian realty sector is, at the present moment.

At present what’s the realty sector like?

The realty sector being the largest sector generating the second most employment after agriculture is expected to grow by 30 percent in the coming decade. At the same time it is also expected that it will attract even more investment from the Non Resident Indians in both short and long terms.

The sector has surely gone through a metamorphic change in the last decade and a half with the face of the industry changing. The global industry players, be it in the IT, ITeS, retail or commercial sector has increased fourfold. The economy is also noted to shift from un-organization to organization in sectors like the retail, IT, etc. with increased interest of the multinationals and global brands to open outlets and offices in India. The mindset of the people has also changed with all trying to own houses rather than living in rented houses.

In the ensuing times the experts predict that more growth is expected in the Tier II and III cities like Indore, Lucknow, Patna, etc. and the metros like Kolkata, Bengaluru and Chennai will witness comparatively lesser growth.  

Telangana Govt. on the process of digitization of land records

The Telangana government has pledged on an ambitious plan of digitalizing the land record system with its entire history. Land records were not properly maintained by the revenue authorities as per the government sources. That is the reason the state government has embarked on the plans of digitization of the land records in Hyderabad, Nizamabad and the Warangal districts. The sources say that this will be done as a pilot project and if successful the whole of the state’s land records will be taken up for digitization.

The district administration of Hyderabad has asked the tehsildars of 16 mandals to verify and check the available land records which they have at their disposal.  In few of the mandals the revenue officers reported to have land records pertaining to or even before the independence.  

The tehsildars were directed to collect and compile all the records and take corresponding images of the land records so available. He should also collect and compile information like present owners, original owner, year of purchase and number of transactions, etc.  After this exercise the tehsildars can file a report on the land availability from the data compiled.  

Rahul Bojja, present collector of Hyderabad has already issued instructions to the 16 tehsildars to start the verifying process and the digitization also. The process of digitization started a couple of months ago but was facing lot of bottlenecks. Now it is required that every land is counted and the details thereof collected. Six months of time have been allotted to the tehsildars to complete the date compilation. After the due collation of the data the digitization of the land records will start as per the sources. 

On completion of the digitization process the data will be linked to the website of the Telangana Government for the public to access it. The estimated time given by the Hyderabad government is six months.  

Illegal constructions on agricultural land to be regularized.

The Maharashtra government has finally decided to regularize the illegal constructions on agricultural land on the fringes and the outskirts of the city within the corporation limits. This is perhaps a step in regularizing the land acquisition and the land laws of the country which has to be following the order of the day. Places like Karjat, Kasara and Kalyan among others are dotted with land bought by the denizens of Mumbai for building farmhouses and holiday homes. There are many such cases which are estimated to be about 2.5 lakhs in which constructions have come up on the land plots but the status of the land is still agricultural. 

The state government has decided to dilute the regulations which is the Maharashtra Gunthewari Development Act which had till now restricted the splitting of the land and the owner couldn’t sell such property which was considered illegal as per the legislation. The amendments in the act will enable the common consumers to purchase land at outskirt of the city and the fringes of the corporation limits and built a house on it. 

This decision will impact the Pimpri-Chinchwad regions where lakhs of residential constructions were being done on land even before the formation of the well planned Pimpri-Chinchwad Pradhikaran in the year 1978. The Land Revenue Minister Mr. Eknath Khadse remarked that as the matter of Pimpri-Chinchwad is not yet decided and is sub judice the decision will ultimately be taken by the court. The government had been since then collecting revenue from the illegal constructions and thus it is now required to regularize them. Such proposals from the land owners have come to the government in lakhs which will be scrutinized and studied by the state urban development department and efforts would be made to regularize them on an official basis.
Know more about khata of your property before buying any residential land, it will help you protect from falling in any trap of buying agricultural land,

Eased FDI norms may hike realty prices instead says experts

Last week the central government in a directive eased the norms of the Foreign Direct Investment in the real estate sector. The directive removed the restrictions regarding the size and the volume of investment. The realtors say that earlier the foreign direct investment used to come to the real estate sector in the way of debt capital or at the entity level. So many experts have pointed out that earlier the FDI was utilized in very large projects and as from now on the restrictions on the size of investment has been removed there will be investment on the affordable sector too which will boost the segment. But another section of the experts very ably argue that it is not the case at all. They opine that FDI in the affordable sector will further fuel the prices instead. According to them the cost of the FDI capital is not cheap. It comes tagged with an interest rate of 20 to 25 percent. It is quite natural that if the builders and the developers buy land and property at this rate of interest, they have to raise the price of the apartments in order to recover the amount.  This seems as explains the experts that the market is driven by the investors.

This section of the realtors and the experts argue that there can be an imbalance in the urban economy because of the FDI pouring in and creating a vicious cycle from which it will be difficult to get out. Rather than that they argue that the government should urge the banks to lend capital to the developers at a cheaper rate of interest.  There should be a condition that they start the construction of the houses immediately and should not be allowed to sit on the land plot for an unlimited period.
This creates the accumulation of unproductive assets and also shortage of houses.

Other experts like the top officials of the renowned realty consultant Knight Frank India Pvt. Ltd. said that from the last three consecutive festive seasons the realty sector is going through a bad time. It is not able to generate or raise funds and thus the fund raising is of highest priority for them. In these circumstances Foreign Direct Investment (FDI) seems to be the only option of infusing capital in the business.  Thus the relaxation of the size of the project in terms of FDI will not have an impact on the short run.  But a section of the experts still feels that in this phase of lull where the sector is gasping for capital and urge for a renewed interest from the buyers, extra liquidity will surely help the sector in a big way.

Different other veterans and the experts from various associations of the realty sector like the experts from the Builder’s Association of India said the flow of FDI will have a positive impact on the residential real estate.  Easy flow of money at a cheaper interest rate will help projects in places like Mumbai where the land prices are about 70 percent of the total outlay.  He opined that property prices are bound to reduce if the developers are able to buy land with easy money available.  But he also reiterated that one year of time on the ground is required to see the outcome. Let’s wait and watch.