Monthly Archives: March 2012

Abu Dhabi Investment Authority (ADIA) targeting Indian Real Estate Sector.

March 15, 2012 – 5:01 pm

The Indian Real Estate Sector may expect direct investments from the Abu Dhabi Investment Authority (ADIA) very soon.

Although, ADIA has already invested money in India’s international property market through a variety of real estate and private equity funds with a total holdings in India to be worth between $400 million and $500 million.

Sovereign fund is looking to hire a fund manager from a private equity firm to look for direct real estate opportunities in India.

Many developers in India are seeking funds to begin new projects and to reduce their debts, which currently is around 1.8 trillion rupees approx.

Although, being Asia’s third largest economy, residential property developers in India is facing a major funding gap as home prices stay low and the country’s banks go on playing it safe when it comes to lending to the real estate sector.

An India-centric private equity fund, Red Fort Capital has recently accepted a $50 million investment from ADIA and has already raised $80 million of its planned $500 million for its second India dedicated property fund. Property accounts for 5% to 10% of ADIA’S global portfolio, whilst North America and Europe account for 60% to 85% and the emerging markets 15%.

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Realty sector demands affordability from the government.

March 14, 2012 – 6:52 pm

From the forthcoming Union Budget 2012, realty sector have much expectation that it will contain some pragmatic provisions which will lower effective price barriers for home-seekers.

Broader incentives for development of affordable housing are needed, to encourage more developers to become active in this important sector and increase the supply of budget homes in the city as the city continues to face problems including high lending rates and construction costs, insufficient infrastructure and lack of affordable housing, says real estate developers.

Anil Pharande, Vice-president of Credai (Confederation of Real Estate Developers Associations of India) Pune Metro, said that “The government can set clear guidelines on timely commencement and completion of projects and link disbursement of these funds with adherence to these guidelines.” Also a higher allocation of infrastructure funds for housing can be a favourable approach on a macro level,he said.

In addition he also said that removal of the 10 per cent service tax on residential real estate construction, that increases the cost of new homes by as much as 3 per cent, is critical for a cost-sensitive market like Pune, where mainly the lower mid-income segment resides.

Also the 1 per cent interest rate subsidy on home loans can also work as a good measure to bring affordability. Also the present eligibility limit of loan amount of Rs 20 lakh should be raised to Rs 30 lakh which will help people think about buying apartments of decent sizes. Reducing taxes such as excise VAT and stamp duty on real estate will also make home purchase attractive, Pharande said.

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From April 15, State Government to implement the Affordable Housing Policy.

March 12, 2012 – 5:57 pm

The affordable housing policy by the state government is set to be implemented from April 15. The policy will be implemented after the final notification within a month’s period with a preliminary notification already out.

The decision got finalised in a meeting between Additional Chief Secretary (Urban Development Department) TC Benjamin and representatives of Confederation of Real Estate Developers’ Associations of India (CREDAI) from Pune, Nagpur, Kolhapur, Nashik and Aurangabad.

The government in the notification has made it mandatory to reserve 20 per cent of the land or constructed space for small-sized housing for all projects on more than 2,000 sq m land.

Benjamin said that, “The state has a dearth of such housing and this initiative will help bring about more such houses in residential projects. It will have to be implemented by the builders after April.”

Builders expressed reservations about whether the 20 per cent of the land should be reserved in the same area. However, it was decided that they could have a little farther but in the same zone. To this Benjamin added that, “They have to provide the housing with almost the same kind of infrastructure.”

The rule clearly mentions that in case of sub-division of land measuring 2,000 sq m or more, a minimum of 20 per cent will be handed over to MHADA. This would be applicable to the 26 municipal corporations and all municipal councils in the state. In order to prevent any misuse of the policy, the notification states that developers will not be allowed to amalgamate the smaller flats or land under any circumstances.

Most of the builders had reservations about having the economical housing on the same campus but later agreed to have it a little farther away from their projects.

Satish Magar, Pune CREDAI representative, who attended the meeting, said, “We are open to the policy but had some issues, which we discussed.”

“In case of the built-up space, it will be bought at the construction cost. In order to compensate the developer for the land cost, the affordable housing will be included in the floor space index computation,” said a senior official.

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Indian Property Exhibition in Hong Kong.

March 2, 2012 – 4:07 pm

In this exhibition coming projects and infrastructural development in Mumbai, Pune, Jaipur and Bengaluru will be showcased.

The exhibition being a two day affair will give a proper overview of the real estate sector which will be helpful to those who want to own or invest in Indian real estate. In this exhibition around 300 projects will be exhibited by over 70 developers.

As we know that Indian real estate industry is growing tremendously in both commercial as well as residential sectors so buying property in India at this time will be an excellent investment.

Dubai-based company, Sumansa Exhibitions is organizing the Indian Property Show in Hong Kong . Here, Investors and homebuyers can get good information and knowledge about the real estate from experienced Indian builders.

Home loan Approvals for properties purchased at this exhibition will be given there itself. So now, Indian living abroad will no more have to just dream to own a house in India.

The venue given as:

Indian Property Show Hong Kong

Date March 3 and 4

Time 11am-9pm

Venue Hong Kong Convention and Exhibition Centre, Wan Chai

Website www.indianpropertyshow.com

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