harpreetsg_delhi

Builders seek tax exemption for affordable housing
Dilasha Seth / New Delhi Jan 29, 2012, 00:14 IST

The real estate industry wants tax exemption for affordable housing in the 2012-13 Budget. It is also demanding infrastructure status for the housing sector, promotion of rental housing and raising of the home loan tax bar.

The previous year's Budget did not propose any significant step for the housing sector. But this time, the National Real Estate Development Council (Naredco), an association for the industry, is pinning its hopes on infrastructure status for housing. Confederation of Real Estate Developers' Associations of India (Credai), another industry lobby group, is pitching for affordable housing to become tax free.


“Nearly 36 per cent of saleable value goes in taxes, ranging from sales tax, value added tax, excise, stamp duty etc. If at Rs 3,000 per sq ft, Rs 1,000 goes as taxes, how can you expect affordable housing,” asked Lalit Jain, president, Credai.
Without the tax element, the rate can come down by one-third, an industry representative pointed out. If implemented, the housing requirement of 27 million units can be achieved, which will ensure contribution of seven-eight per cent to the gross domestic product (GDP) growth, according to Jain.

R R Singh, director general, Naredco, said World Bank considers housing under the infrastructure category, and so should the Indian government.

The industry also wants the home loan tax bar to be doubled to Rs 300,000, from Rs 150,000 now. “We base this on the grounds that cost inflation index has doubled, the house prices have gone up by 50 per cent on an average since 2002,” he argued.

Royal Institution of Chartered Surveyors (RICS) in its submission to the ministry of finance has recommended a subvention in interest rates for existing home loans in addition to new housing loans.

On affordable housing, RICS has recommended setting up of a dedicated affordable housing fund, similar to infrastructure funds with an initial corpus of Rs 5,000 - 10,000 crore, with the government contributing partial funding through public issuance of bonds and the rest raised through retail investments in lieu of tax benefits.

“These funds should then be made available to developers/NGOs/private intermediates at low interest rates for construction of EWS/LIG housing,” said Sachin Sandhir, MD, RICS, South Asia.

Another major demand from the real estate industry is for promotion of rental housing. “Every one cannot buy a house. Low rental income discourages developers to develop rental housing,” said Singh.

RICS has also suggested lowering the tax rate on rental income from 30 to 20 per cent, along with taxing only 50 per cent of the rental income as compared to the current 70 per cent. Also, income tax exception from rental income (under Section 24) should be increased from the current 30 per cent to 50 per cent.

“The low yields on rental housing remain a bottleneck for promoting a healthy rental market,” said Sandhir.

Narecdco also wants exemption of capital gains tax to be increased to buying two houses from the present one. “Often nuclear families sell ancestral property to buy two houses. This makes a case for capital gains tax exemption,” according to Singh.

RICS has also suggested that first time home buyers should be incentivised with tax credits up to 10 per cent of the value of a residential unit, where the credit can be reclaimed over a period of three financial assessment years.

Credai, which has sought a meeting with finance minister Pranab Mukherjee, is seeking voluntary disclosure schemes, to wipe out black money from the system, and boost liquidity. “High taxes to convert black money into white and stringent punishment such as life imprisonment for those found with black money will increase liquidity in the real estate market,” said Jain.

sublimation

Atikh Rashid
Posted:Saturday, Jan 28, 2012
While one can safely assume availability of basic services such as water, electricity, roads and sewage system when buying a new home in the fast-growing suburbs in any of the major Indian cities, ‘wired internet access’ is another service that has increasingly becoming inevitable, but is largely unavailable for residents.

In the absence of wired internet access, the only available alternative is wireless broadband service. Although wireless access is very useful and enables internet access on-the-move, it is not entirely dependable nor is it meant to replace the wireline broadband connections.
Wireless broadband is much more expensive, comparatively more prone to security threats, less reliable, and most importantly they can provide the user with only limited speeds. As the ‘spectrum’ which carries data is limited, the speed goes down with increase in the number of users.
WHY ARE HOUSES NOT WIRED?
For homes in the suburbs to get wireline or landline connections it is a prerequisite that a telecom operator lays the telephone cable, either copper or optical fibre, near the housing society and provides the service.
Another way would be if the developer of a society himself makes arrangements by dealing with service providers to make sure that his housing project is wired by a service provider. “Over the years the definition of basic infrastructure has changed. It is no longer water, road, sewage and electricity but it also includes reliable telephone and internet connectivity. Before getting the requisite go-ahead for a project the government authorities should make sure that the proposed project has all these basic infrastructure needs,” said Satish Khot a housing expert and president of the National Society of Clean Cities, a voluntary organisation working towards improving civic governance.
Presently that is not the case. While authorities are not very concerned about the connectivity issue, the telecom operators have their own reasons to promote wireless over wired connections.
HUGE OUTLAYS, NO IMMEDIATE RETURNS
Laying of cables in housing projects located in the farther reaches of the city requires large outlays that includes the cost of laying the cable and reinstatement charges to be paid to the concerned civic body that governs the area.
The immediate returns over this investment, given the current usage pattern and prevailing charges, are far from encouraging.
“The main factor that is preventing the telecom operators from laying the cables is dismal immediate returns over the investment. It would take at least three-four years for breaking even. BSNL’s landline broadband service is ten times better than its 3G service but we are unable to connect more homes because we simply cannot afford the costs. The huge investment and a long gestation period makes laying of wires an unattractive proposal with business point of view for the telecom operators,” said a highly placed source in the state operator BSNL.
On the other hand, for operators, wireless broadband services like 3G requires comparatively less investment and it pays quick dividends. For providing 3G service all it needs is an investment for upgradation of the equipment on the existing towers and an increase in backhaul capacity.
‘OBSTRUCTIONIST’ POLICIES OF MUNICIPALITIES
Even in locations where the operator is willing to lay the cables, such as areas where the number of customers have crossed the minimum threshold, the exorbitant reinstatement charges that the operators have to pay to the civic body for digging and placing the cable is another hindrance.
“The cost of the optical fibre cable is Rs 10,000-20,000 per kilometre but for laying that much cable (to cover a housing project) the reinstatement charges range from Rs 40-70 lakh per kilometre. This is ridiculous. But as there is no central policy to govern the the reinstatement charges, every municipal corporation is free to decide the charges,” said the BSNL official.
In light of the above consideration most of the residents have to depend on wireless connectivity even as they wish otherwise.
“Considering the unreliability of the wireless connection we had applied for about 30 connections for our society a few months ago. But BSNL officials expressed their inability to give us the connections saying that they would be able put the cable only if we could guarantee them more than a hundred connections,” said Rameshchandra Shivpuri, president of of Western Aundh Welfare Association which represents residents of about 28 housing societies situated Aundh locality in Pune.
The service provider argues that as the charge of laying the cable would be the same for connecting one home or a few hundred, and given the high costs they have to make sure that they get enough connections to make the project economically feasible for the company.
Contrary to this, the operators are eager to provide connections to townships that comprise several thousand housing units. But only a few such townships exist.
“In our township in Magarpatta we roped in a leading telecom company to provide broadband services for all the 10,000 flats. They were more than happy as they got captive customers,” said Prakash Deshmukh, a Pune-based real estate developer who said that they are replicating similar model in two other townships being developed elsewhere in that city.
According to Khot, the responsibility of providing wired telephone connectivity should rest with the developer, for an individual flat-owner neither has the financial resources nor the political clout to get this done.
“There have been instances where the municipality expresses its inability to provide a water connection. At such places the builder resolves the issue by finding alternate solutions. So in this case of laying telephone cables it should be the builder’s responsibility to make it sure that operators lay the cable. There’s lack of wired broadband connection in the outskirts of most of the cities in the country. Service providers, either private or public have to find the the system economically profitable, which is currently not the case. But as the demand for wired broadband is growing and it would become financially sustainable operators would would find out ways to reach their and provide connections,” said Shashi Prabhu, a Mumbai based housing expert.
WHAT IS NEEDED
Over the years as the demand for high speed internet will go up, the need to find ways to provide wired internet connections to a growing number of internet users in emerging suburban areas will assume urgency.
According to experts if the government is determined to solve the issue, several models could be worked out to provide incentive to the telecom operators to lay the cables.
The government can also make it mandatory for every telecom operator to have a certain percentage of its customers as landline users. Operators can also be encouraged to lay the cable by providing a subsidy.
“Another important step would be to formulate a law that would bring a uniformity in reinstatement charges across the country and stop bullying by the corporation,” said the
principal general manager of a telecom company.
Source:financial express

fritolay_ps

मेट्रो ने दी शहर को 'रफ्तार'


कौशांबी मेट्रो स्टेशन
कौशांबी में मेट्रो आने से इलाके की तस्वीर बिल्कुल बदल गई है। कौशांबी मेट्रो स्टेशन के पास जिन रोडों पर लोग पहले कम स्पीड से वाहन चलाते थे, आजकल वहां फर्राटे से गाड़ियां दौड़ती हैं। सड़क के बीच लगे सेंट्रल डिवाइडर्स पर लगी लाइट्स रात के समय यहां की शोभा बढ़ाती हैं।


डाबर तिराहा
आजकल शहर के डाबर तिराहे का रुप भी बदला हुआ नजर आता है। सड़क के किनारे लगी घास और नए फुटपाथ पैदल चलने वालों का सफर सुहाना बना रहे हैं। फुट ओवर ब्रिज ने लोगों का रोड क्रॉस करना काफी सेफ बना दिया है। मेट्रो के आगमन से यहां की सड़कों की हालत में भी सुधार हुआ है। सड़क को दोनों ओर एक-एक लेन चौड़ा कर दिया गया है। इस वजह से यहां ट्रैफिक बहुत व्यवस्थित नजर आता है।


वैशाली मेट्रो स्टेशन
शहर के वैशाली मेट्रो स्टेशन को बहुत ही खूबसूरत तरीके से सजाया गया है। स्टेशन के आसपास उद्यान विभाग की ओर से हरियाली के लिए सबसे ज्यादा काम किया गया है। स्टेशन के पास उद्यान विभाग की जितनी भी जमीन खाली पड़ी थी, उस पर एक लाख पौधे लगाकर सौंदर्यीकरण किया गया है। इससे यहां काफी ग्रीनरी नजर आती है। वैशाली मेट्रो स्टेशन के पास ही चित्रगुप्त पार्क है, इस पार्क के आसपास अतिक्रमण था, इसे भी उद्यान विभाग ने हटवा दिया है और पौधे लगा दिए गए।


आंबेडकर पार्क
वैशाली मेट्रो स्टेशन के पास आंबेडकर पार्क भी डिवेलप किया गया है। जीडीए के उद्यान विभाग की ओर से यहां पौधे लगाए गए हैं। इसमें लोगों के बैठने की पूरी व्यवस्था की गई है साथ ही सफाई पर भी पूरा ध्यान दिया गया है। साथ ही फुट ओवर ब्रिज ने लोगों के लिए रोड क्रॉस करना आसान कर दिया है। इस ब्रिज की वजह से स्टेशन तक पहुंचना भी आसान हो गया है। इसके अलावा लिंक रोड पर सड़क की दूसरी तरफ जाने के लिए फुट ओवर ब्रिज बनाया गया है।

जगमगाते ब्लिंकर
रात के समय रोड के दोनों तरफ जगमगाते ब्लिंकर्स वर्ल्ड क्लास सिटी होने का अहसास कराते हैं। इनके जरिए शहर की सड़कों को विदेशी लुक देने की कोशिश की गई है। इसके अलावा महाराजपुर बॉर्डर से वैशाली तक लगी रेड लाइट्स सोलर सिस्टम से चलती हैं। इनमें टाइमर भी लगाया गया है। नई तकनीक के इस्तेमाल के साथ शहर का विकास तेजी से हो रहा है ।

-nbt

harpreetsg_delhi

Is it time to buy or invest in housing? Yes, say bankers


Source: DNA | Last Updated 05:08(29/01/12)


Ahmedabad: So, is it the right time to shed fears of slowdown in housing segment and go for the kill?

Bankers believe that housing loan rates which are hovering around 10.50% to 11.50% right now are expected to fall in the next three to six months, which may, in turn, lead to a jump in real estate prices.

Bankers estimate that the Reserve Bank of India (RBI) is likely to reduce its repo rate, which will further bring down rate of interest on housing loans. It will give a fillip to the economy and will fuel demand for housing in next six months.

So, bankers suggest that if the customer is getting property at a good valuation, he must not think twice before buying the property. “It is better to buy a property right now if available at right price. It seems that in next three to six months, interest rates will start to climb down,” said executive director of Bank of India (BoI), N Seshadri.

Yogesh Bhavsar, vice-president of Gujarat Institute of Housing and Estate Developers (GIHED) said, “Those who were sitting on fance will enter the market as lower EMIs will lure them. Once demand goes up, the theory of demand-supply will start ruling the market.”

-daily bhaskar

MANOJa

Noida: The sealing of banks and other establishments that are functioning in violation of land use clause by running commercial ventures out of residential and industrial plots, got off on the wrong foot on Friday with no sealing activity taking place. Noida Authority officials took rounds of the area in the morning and gave the banks “final” notices to vacate the plots. They were also told that the plot would be seized and the lease deed cancelled if operations did not stop at the earliest.
The Authority officials said that a key reason why no sealing took place was the lack of clarity on the directions of the Supreme Court.

On January 23, the court had given one week to the Authority to prepare a scheme for the rehabilitation of bank branches to commercial plots. It had also given a six week deadline for the entire relocation process to be completed. While the Noida Authority believes that the six week period does not mean that banks can continue operating during that time, bank officials said that according to the court they are under no obligation to shut shop immediately.

Captain S K Dwivedi, CEO of Noida Authority said, “Our legal team is trying to clarify the issue. But, we have sent notices. In the notice issued on January 25, there was a four week period for all establishments to be sealed. The needful will be done in that period.”

An official said now that a notice has been sent to all banks concerned, if they continue to operate then they could face contempt of court charges.

“The first Supreme Court order on December 4 wanted immediate closure and relocation to alternate plots. So, if they continue to function, they could be seen as disobeying court orders,” the official said.

He said that the notices were sent to small establishments like grocery stores as well time to wind up their operations. “We don’t want to destroy their businesses, and want to give them time to collect their belongings,” the Authority official said.

Despite no sealing taking place, shopkeepers and one bank began winding up on their own. A branch of the HDFC bank in sector 19, put up posters announcing the shifting of the branch to sector 16, with the lockers in the branch moving its sector 18 branch.



False start to Noida banks sealing drive, no action on ground

djvjain

Raheja's new project, OMA at Dharuhera- Bhiwadi road. Website says premium project, so wondering what the rates would be for this location?

harpreetsg_delhi

Ashiana enters Gujarat housing mkt; ties up 11 acre for project
StoryComments



NEW DELHI: Realty firm Ashiana Housing, which focuses on developing homes for elderly people, has entered into an agreement with a land owner to develop a housing project in Gujarat.

The Delhi-based company plans to develop up to 500 housing units under the project at Halol in Gujarat at an estimated cost of about Rs 60 crore.

"We have entered into the Gujarat real estate market through a revenue share agreement with land owner for 10.65 acres of land. We will develop a group housing project on the land," Ashiana Housing Director (Finance) Varun Gupta said.

The company expects to get all approvals to develop this project within the next six months, he said.

Gupta noted that there is a good demand for housing at Halol where many big companies, such as General Motors, Siemens and Sun Pharma are already located.

In September, Ashiana entered Kolkata property market by acquiring about 10 acres of land from Bengal Shriram Hitech, a subsidiary of Shriram Properties.

The company plans to develop a housing complex, comprising 600 flats, for senior citizens in Kolkata.

Ashiana had posted a net profit of Rs 43.86 crore over a total revenue of Rs 154.12 crore in 2010-11. It sold 1.35 million sq ft of area last fiscal and is targeting to sell 1.6 million square feet of area this fiscal.

At present, the company is developing seven projects, out of which three are in Jaipur and one each in Bhiwadi, Jodhpur, Jamshedpur and Pune. It is building a retirement resort at the Lavasa township in Pune.

harpreetsg_delhi

Supertech inaugurates North India's tallest tower project
StoryComments



NOIDA: Real-estate major Supertech today performed ground-breaking ceremony for North India's tallest mixed-use development project here.

"The project (at Sector-94 here) has five towers, amongst which 'Spira' would be North India's tallest mixed-use development project with 80 floors and height of 300 meters," the company's Chairman and Managing Director Supertech R K Arora said, after performing the ceremony with Joint Managing Director Sangita Arora and Director Mohit Arora.

He claimed that the project is a unique combination of residences, service apartments, hotels, shopping malls, office spaces and recreation centres which will have five state-of- -the-art towers.

Economic times

harpreetsg_delhi

Sahara's Subrata Roy makes Rs5,808 crore bid for Marriott hotels: Report
Published: Sunday, Jan 29, 2012, 19:51 IST
By HS Rao | Place: London | Agency: PTI


Indian billionaire entrepreneur and owner of London's prestigious Grosvenor House hotel Subrata Roy has made a bid for Marriott hotels in the city, being sold by Royal Bank of Scotland for about 750 million pound (Rs5,808 crore), according to media reports.

According to a report in The Sunday Times, the 42 four-and five-star properties have attracted interest from a range of potential buyers.

Roy's Sahara Group, which acquired the Grosvenor House a year ago for 470 million pound (Rs3,275 crore), is vying with the Abu Dhabi Investment Authority and another Indian investor, Blue Post Group, among others.

Jones Lang La Salle, the property agent, and Hawkpoint, a corporate finance firm, are handling the sale, the report said.

RBS took control of the properties after the failure of talks to restructure loans it extended to the previous owner, a consortium that included Quinlan private, the Irish real estate fund, and Delek, an Israeli property investor.

Sahara Group, the Lucknow-based financial services-to-real estate conglomerate acquired the iconic Grosvenor House hotel from the Royal Bank of Scotland.

The 494-room luxury property on London's Park Lane, was once home to the Duke of Westminster.

harpreetsg_delhi

Realty firms start mega asset sales



Bangalore: Real estate companies across cities, pushed into a corner, have kicked off plans on an unprecedented scale to sell assets so they can trim their bulging debt and generate cash flows.

Sale strategy: A file photo of a DLF residential society in Gurgaon. The realty firm’s plan is to raise about Rs. 10,000 crore by selling non-core assets over the next few years. By Mint
About a dozen large developers, including the country’s top realty firm, DLF Ltd, are raising about Rs. 15,000 crore by monetizing their assets,according to estimates by Mint.
Real estate analysts say that while the rush to sell assets resembles what transpired after the slowdown of 2008, this time it is more widespread. Earlier, it was mostly DLF and Unitech Ltd that wanted to exit largely non-core assets in non-prime markets, but now even mid-size builders are trying to sell assets they don’t want to develop immediately.

“Developers looking at asset monetization today require capital for paying off bank liabilities in a scenario where sales are slow. And secondly, many are in a consolidatory mode where they don’t want to keep futuristic land parcels,” said Rajiv Sahni, partner (real estate practice), Ernst and Young India, a consultancy. “The good part is that there are buyers such as private equity (PE) funds and developers, too, for such assets today, unlike then.”

In December, US PE firm Blackstone Group bought a Pune special economic zone from DLF and Hubtown Ltd (formerly Ackruti City Ltd) for Rs. 810 crore. In January, property firm M3M India Ltd bought 28 acres of land in Gurgaon from DLF for Rs. 440 crore.

A spokesperson for Blackstone said that with “equity markets virtually closed and banks becoming increasingly choosy about debt financing, many developers are facing tight liquidity conditions. This is putting pressure on them to liquidate some of their non-core assets and land and focus on executing current projects under development”.

Many small- and medium-size developers that are not leveraged are scouting for such deals as these assets come at a bargain, said Kunal Banerji, president, marketing, M3M India. “While M3M already has a 600-acre landbank in and around Delhi, if we find opportunities, the strategy would be to acquire them for future growth because the company is cash-rich,” he said.

DLF, which had a debt of Rs. 22,519 crore at the end of September, raised Rs. 3,480 crore by selling non-core assets in the first two quarters of this financial year. DLF’s plan is to raise about Rs. 10,000 crore through this route over the next few years, Mint reported in January.

DLF and Hubtown didn’t respond to Mint’s queries on their asset sale strategies.

While “non-core” remains a debatable and subjective term, analysts argue that not all assets that are on the block are non-core.

Parsvnath Developers Ltd, for example, has put up for sale a 1.5-acre plot in the heart of Delhi, in Connaught Place, to raise Rs. 700-800 crore to cut debt. It had bought the plot three years ago. Parsvnath had a debt of Rs. 1,200 crore as at end-September.

Parsvnath chairman Pradeep Jain said the firm has so far monetized assets worth Rs. 400-500 crore and will continue to do so, even as it plans new projects. “Going forward, we intend to monetize some of our assets in southern and western India and the capital will all be used for debt repayment,” said Jain.

With the next six-nine months expected to remain difficult for the realty sector and a significant portion of debt due for repayment, defaults by some unlisted companies are unavoidable, say analysts.

“Lack of demand and slow sales, coupled with a liquidity crunch and a debt pile-up, make it look like the slowdown will last longer this time” for real estate developers, said Ambar Maheshwari, managing director, corporate finance, at Jones Lang LaSalle, a property advisory,

Housing Development and Infrastructure Ltd (HDIL) and Emaar MGF Land Ltd, which have debt of Rs. 3,900 crore (at end-September) and Rs. 4,217 crore (at end-December), respectively, too, are negotiating the sales of some assets, including land meant for township projects, according to property analysts.

HDIL is not only looking to monetize assets in places such as Kochi, far from its comfort zone Mumbai, but also in suburban Mumbai, where it has land, said an HDIL official who didn’t want to be identified. “We already have land and have sold FSI (floor space index, or development rights) as a business model, and there are several unlisted developers who want to acquire landbank to grow,” he said.

An Emaar MGF spokesperson declined to comment on the sale strategy.

madhurima.n@livemint.com