Blogs - sreevatsa-realestate

Short-Term Rental Revolution Is Taking Over The Market

By venpep_dev,April 29, 2022January 20, 2023

SHORT-TERM RENTAL REVOLUTION IS TAKING OVER THE MARKET

Dear Readers,

Have you travelled on business or vacation and booked yourself into an Airbnb room instead of a hotel? Have you heard about how homeowners have significantly increased their monthly income by listing their homes on sites like Airbnb rather than traditional rentals? Have you wondered how HNIs are participating in investment properties across the most lucrative and glamorous cities of the world? These three growing trends encapsulate the short-term rental phenomenon that has transformed the hospitality sector over the last few years. What are short term rentals (STR) though? These are fully furnished homes or apartments that are rented out for short stays, offering travelers a spacious a nd convenient alternative to hotels. No company better represents this seismic shift in hospitality than Airbnb, which now has properties in over 65,000 cities across 191 countries. In 10 years, this tech startup has overtaken century-old competitors like Hilton and Marriott with a valuation of $31 billion. With CEO Brian Chesky’s revelation of the company’s vision to host 1 billion guests by 2028, adds further ambition to an already rosy forecast for the overall segment that is estimated to add $56 billion in the next three years alone. Therefore, it is the perfect time to do a deep dive into why this segment is changing the way we travel, rent out our homes, and profit from global real estate.

The Growth Of Experiences

Underlining this STR revolution is the changing nature of how people wish to spend money. World over, economies are growing, and more and more people are becoming at least moderately affluent. These newly affluent people value experiences over things and travel is one of their most desired experiences. The Travel & Tourism sector was accounted for a full tenth of the global GDP and amounted to $7.6 trillion in 2016. The current generation of travelers are prioritizing authentic experiences that allow them to live like a local in immersive settings over the standardized fare offered by hotels. Travelers are also starting to realize that renting an entire home allows families and friends travelling together to have a more enjoyable stay than being split in to separate hotel rooms with no shared space for social interaction. While a significant factor in the runaway success of this segment is the convenience of technology platforms that companies like Airbnb offer to both travelers and homeowners alike, there a host of drivers fueling the sustained growth of short-term rentals.

Sweeping Tailwinds In The STR Sails

Airbnb has created a hospitality marketplace of unprecedented scale, with more than 4 million properties currently. The internet is the critical enabler, bringing several solutions from listings, online bookings, payments, etc., without which this would not have been possible. More broadly, this is another man ifestation of the sharing economy, which is estimated to reach $335 billion by 2025 in just its five top sectors. What Uber has done for transportation, short term rental platforms have done for travel, democratizing asset ownership and hugely increasing the number of transactions that occur, to the benefit of all parties. For investors, this presents an exciting new asset class. Hospitality has traditionally been one of the asset classes that are most out of reach for an investor – buying a hotel is only possible for a select few or institutions. But short-term rental assets are typical homes, and therefore much more comfortable to participate. Besides, unlike a large hotel that does not allow one to create a diversified portfolio easily, short-term rental portfolios can easily be a diversified set of properties in different cities. The end-consumers – travelers, have gained hugely with this new model. The scale of the marketplace has vastly expanded the choice that travelers have while offering a rich variety of offerings catering to every segment of tourist or business traveler. What’s more, offerings in each segment represent tremendous value compared to hotels. An upscale 3-bed property may cost on average $500/night, which is less expensive than the cost of booking three separate rooms in an equivalent hotel. In terms of luxury, function, and space, short-term rental properties are often far superior to hotel rooms, with large living rooms, dining rooms, kitchens and, often, even games such as pool tables at the property.

Conclusion

As disposable income rises across the world, and society evolves in the things that it would most like to spend this disposable income on, the hospitality industry is rapidly adjusting to both the enormous opportunities as well as the new requirements. Real estate investors have only begun to scratch the surface of this asset class and its unique role in building high return portfolios. Today, an investor sitting in India can participate in the lucrative cash flows of real estate in Las Vegas through a portfolio of short-term rental properties. Across the most profitable travel destinations of the world, these portfolio opportuni ties are popping up and offering savvy investors an unrivalled chance to tap into hitherto inaccessible markets and enabling them to build highly profitable and diversified portfolios. Short term rentals have established their credentials now and are poised to become an essential part of the portfolio of HNIs. Author: Vikram Chari – Founder & CEO of SmartOwner Services India

Deciphering Real Estate Section 80eea From The Indian Financial Budget 2019-20.

By venpep_dev,April 29, 2022January 20, 2023

DECIPHERING REAL ESTATE SECTION 80EEA FROM THE INDIAN FINANCIAL BUDGET 2019-20.

Section 80EEA for the Real Estate segment in the Indian Budget FY2019-20. “Interest deduction up to Rs 3.5 Lakh. Right time to buy affordable houses.”

“A person purchasing an affordable house will now get an enhanced interest deduction up to Rs. 3.5 lakh,” Finance Minister Nirmala Sitharaman said while presenting her first Budget on July 5, 2019.

What does that mean?

If you wish to buy a house for your own purpose and the house is less than Rs. 45 Lakh and you’re borrowing using a bank loan for the house before March 31, 2020, and that being the only house in your name during the time of loan application, you can avail up to Rs.3.5 Lakh from the taxable income as deduction. Earlier before this announcement the deductions were up to Rs.2 Lakhs under Section 24 of Income tax act, 1961. This additional incentive of Rs.1.5 Lakhs under Section 80EEA will help the common man to take the next step towards purchasing the affordable homes. This will inturn relax the burden on the interest payables bringing the monthly EMI lower than what it was in the previous years.

Properties such as Sreevatsa Urban Village start from Rs.22.4 lakhs making it the perfect time to avail such schemes. You can avail an additional Rs.1.5 Lakhs of investment for a stylish yet affordable class of an apartment just close to the Saravanampatti tech park.

How I will benefit in simple English?

Let’s get to the basics: There is a list of qualification criteria that will evaluate whether you can avail this benefit. The criteria are spread between the buyer of the house and the property itself. So, it’s a team work. We shall find out if Sreevatsa’s Urban Village and you as a team, will qualify these criteria?

S.No	Qualification Criteria	Personal or Property	Tips
1.	The loan you’re applying for the house should be applied and sanctioned between April 01, 2019 and March 31, 2020.	Personal	At Sreevatsa we have tied up with major bankers to help you avail the loan on time. If your documents are clear, then we will take care of the papers. Just sit back and relax, while your home is getting ready with all specialty, love and care.
2.	The stamp duty for the value of the house should not exceed Rs.45 Lakhs.	Property	Sreevatsa’s Urban Village – compact luxury home starts from Rs.22.4 Lakhs. Criteria passed.
3.	The new property should be covered under the affordable housing category.	Property	The project falls within the criteria.
4.	The owner or the buyer of the property on whose name the house will be registered, should not own any residential property on the date of the application and sanction of the loan.	Personal	Only one house at a time and should be used only for personal use.
5.	Property shall be self-occupying only.	Personal	The purchased property shall be occupied only by the person who got the loan sanctioned

A quick tip if you qualify in all the above criteria: Pick up your phone and set a reminder to include this benefit while filing the tax returns for the FY 2019-20.

Summary

The Section 80EEA, is proposed keeping in mind the demand and supply of the country’s housing market. These schemes are helping the aspirations of people to afford, purchase, own and live in a dream house of their own. At Sreevatsa, we take pride in building homes at the IT hub of Coimbatore and provide a uber-luxury class amenities and life style for the mix of people with uncompromised quality and encompassing our value of trust.

For further queries, you can contact us at: 94430 21990 / 94433 41901

Top 15 Banks That Offer The Lowest Home Loan Interest

By venpep_dev,April 29, 2022January 20, 2023

TOP 15 BANKS THAT OFFER THE LOWEST HOME LOAN INTEREST

HA home loan is called a ‘good’ loan because it helps you acquire a tangible asset that can appreciate over the long term

A look at the latest home loan interest rates of some leading banks. A home loan is probably the biggest loan that most people ever take. Not only in terms of the loan amount, but also tenures, which can easily be of 15 years or more. And the total final amount that one ends up paying by the time the loan ends, can be double of what was borrowed. But, a home loan is among the cheapest loans available, and most often, it is the only way a person can buy a house. A home loan is called a ‘good’ loan because it helps you acquire a tangible asset that appreciates over the long term. A point that many to-be borrowers ask is should I rent or should I buy, especially when the amount being paid as rent seems heavy. One of the factors to consider here is whether you want to live in that house or it’s for investment. It makes sense to buy a house if you plan to live in it. This is also the reason, apart from the fact that many housing projects in India continue to be delayed by many years, why financial advisers say that one should buy a ready-to-move-in house. If you are looking at it as an investment, then one must look at the compounded annual returns the asset can give, and the risk involved, just as you would with any other asset class. Read more here. But if the reason is to live in the house, then any time is a good time to buy. Here’s a look at the latest home loan interest rates.

Affordable Housing To Gain From Rera Registered Brokers

By venpep_dev,April 29, 2022January 20, 2023

AFFORDABLE HOUSING TO GAIN FROM RERA REGISTERED BROKERS

Housing in India is also sold by real estate brokers and these brokers may act as marketing personnel for certain developers.

Indian real estate sector is a very different segment from what it was five years back. With Prime Minister Narendra Modi getting a second term, the emphasis on promoting affordable housing in India with partnering with the private sector is at an all time high.

The Center’s Housing for All policy by 2022 is largely dependent on providing affordable housing pan-India by incentivising developers and homebuyers with several schemes and benefits.

But an extremely important and in fact a critical bridge to achieve any success for affordable housing in India is how real estate brokers and channel partners embrace RERA and make it a success in their way of dealing with the customers.

Housing in India is also sold by real estate brokers and these brokers may market for developers. Sales of any projects, and especially in the price sensitive affordable housing segment, is also dependent on brokers interaction with potential customers.

Before RERA kicked in, there were many complaints by customers of wrong commitments by brokers who directed their hard earned savings to fly-by-night brokers who never delivered on their committed deadlines.

What we have also witnessed in the last five years of policies including RERA, GST and demonetization implementations, has definitely helped the segment to have a stronger foundation and to weather any storm in its way.

This has led to affordable and mid income housing witnessing consistent growth in new launches and absorption of housing units over the last five years with all market indicators showing an upward trend.

This has largely been possible by RERA registered brokers who have gone all the way to explain all the benefits and the risks associated with any projects.

This beginning has actually helped the housing sector to get the much-deserved respect as a legitimate, organized and ethically driven investment segment.

RERA makes brokers punishable if they do not comply and abide with the regulator’s strictures ruling. Earlier, smaller brokers used to fleece customers by selling housing units, which were on high risk as they used to give larger commission.

But with RERA, brokers who made their money out of the ignorance or unwitting trust of clients have been removed from the system.

In fact, today developers only work with RERA registered brokers and have seen that customer complaints have gone down to a large extent as homebuyers are now better informed.

It is not surprising that Housing sector’s contribution to the Indian GDP is expected to reach 11% by 2020 as several ancillary industries are co-dependent on growth of housing sector in India.

Going ahead, we will experience a cohesive approach by the central and state government to make housing a reality for common Indian with faster delivery by the developers.

This will also be driven by the new breed of RERA registered brokers who will ensure customer have all the details to make an informed decision. Author: Prasoon Chauhan, Business World

Understanding Maintenance Charges In Gated Communities

By venpep_dev,April 29, 2022January 20, 2023

Understanding Maintenance Charges in Gated Communities

The latest RICS – Knight Frank report revealed that almost 50% people had apprehensions regarding maintenance of property while selecting a home.

What makes someone decide to live in a high-rise gated community?

Renuka Sharma always cherished the dream of living in a gated community. A swimming pool, lavish club house, kids’ play area and other facilities attracted her, which were lacking in her builder floor apartment.

One day she decided to sell her builder floor unit and buy a flat in a gated society. She was happy shifting into a place with all modern amenities. After two years she noticed seepage of water through her bathroom wall, destroying cabinets in her kitchen. She dialed her maintenance office and told them to address the problem. Despite repeated follow-ups things remained unchanged. Such stories are common across many housing societies where maintenance remains a key concern for residents who despite paying for it are not able to enjoy good services.

In fact the latest RICS – Knight Frank report revealed that almost 50% people had apprehensions regarding maintenance of property while selecting an affordable home.

What should people like Sharma do in such cases where the Resident Welfare Association(RWA) is not maintaining the society properly?

What does RERA say?

According to Section 11 (4) (d) the promoter is responsible for providing and maintaining essential services at reasonable charges, till the taking over of the maintenance of the project by the association of allottees.

This provision clearly lays down the rule for developers to provide essential services at reasonable charges. On the other hand, residents can often be seen protesting against builders for poor maintenance services. Some builders have their own maintenance companies which take care of the society till the time it is handed over to the residents. However, there are complaints that some builders never allow residents to take over the societies due to vested interests.

In fact, many RWAs and association of allotees have taken over the societies but are not able to maintain the society and provide good services. Residents first have to fight with the resident bodies for essential services like cleanliness, repairing work, lift maintenance and other services.

As soon as you move into a society, you should form an RWA and take over the affairs of the society in your hands. Where builder is managing the society, we can ask him to furnish details of accounts to residents so there is transparency with regard to funds.

Maintenance Charges

Every society decides their own maintenance charges, depending on the facilities and requirements available to residents. On an average, one pays between Rs 1.5 to 3 per sq ft or higher as maintenance charges in a gated society.

For example, if you pay Rs 2 per sq ft as maintenance charge and live in a 1000 sq ft flat then you have to pay Rs 2,000 per month. Similarly, the amount decreases or increases as per the size of the flat and the per sq ft rate levied by the RWA. Often in new societies, a builder takes advance maintenance for 1 or 2 years.

Maintenance charges primarily includes charges towards upkeep and maintenance of common areas and facilities, security services including CCTV, etc. Common facilities include elevators, club house and generators. The buyer should keep in mind and check that in the name of maintenance charges developers do not pad up charges which relates to developers’ overhead and administrative costs.

The Ministry of Finance issued a direction that in case the maintenance charges exceed Rs 7,500 per month per member, the entire amount is subject to 18% GST. Prior to 25th Jan 2018, GST exemption was available if the charges or share of contribution did not exceed Rs 5,000/- per month per member.

Maintenance Agreement

All residents are legally bound to pay maintenance charges as this is required for the upkeep of the society. It is not only mentioned in the maintenance agreement with the builder but also incorporated in the society bylaws. Once residents take over a society, they can decide the maintenance charges in general body meetings. Residents can always check the accounts of the society to ensure funds are being used properly. They can also seek clarification from the builder or the resident’s body.

Where to file a complaint?

If the RWA is not maintaining the society despite receiving maintenance charges or not listening to your complaints then you can file a complaint with the district consumer forum. If the claim exceeds more than Rs 1 crore then the case can be directly filed in the National Consumer Disputes Redressal Commission (NCDRC). However, the consumer can also approach NCDRC where he is not happy with the decision of the district consumer forum. You can also go to the RERA of your state and file your complaint.

In the case of Renuka Sharma, if the problem is identified to originate from within her apartment she must seek the help of the Association Maintenance or Builder Maintenance to address the issue. If the problem is identified to originate in an adjacent apartment, the owner of the apartment must be asked to address the same. In most RWAs, the charges collected will not address the individual issues inside the apartment unless this is specified in the agreement

In any case the support system that exists in a gated community is far superior to the builder floor apartment under any given circumstance

. Source: ETRealty

Sreevatsa Real Estate Projects has delivered over 25 projects that have defined community living while providing best quality and ergonomic design for each apartment

Sreevatsa Viswa & Vedh and Sreevatsa Urban Village give you a sophisticated atmosphere with all future benefits. Book now & design your family’s future in a way that helps you grow & live peacefully. All documents are ready with the necessary approvals and RERA certified. Both projects are cleared by major banks enabling ease of transaction.

67% Of Indians Ready To Take Loans: Home Credit Survey

By venpep_dev,April 29, 2022January 20, 2023

67% of Indians ready to take loans: Home Credit survey

Two out of three Indians are open to taking loans, a new survey by consumer finance provider Home Credit India has revealed.

Interestingly, fulfilling family needs and their wishes constitute the single top-most reason for people wanting to take a new loan, reveals the report, which has released a new perspective on India’s borrowing habits.

The second reason why most Indians take a loan is to upgrade their lifestyle. The survey, commissioned across 12 cities and 2,571 respondents, also revealed that 33 per cent of Indians are willing to take a loan for a consumer durable item such as homes, mobile phone, television, and refrigerator, among others. The other vastly popular loan categories are: two-wheelers (23.3 per cent) and personal expenses (20.3 per cent). This is followed by purchase of cars (12.5 per cent), house (12 per cent), and gold (10.5 per cent).“In recent years, there has been a shift in the behaviour and approach of Indians to taking loans. Nearly 67 per cent are now open to taking loans,” Marko Carevic, Chief Marketing Officer, Home Credit India, told BusinessLine here.
“This survey is yet another attempt to understand our customers, so that we can customise our product offerings to the need.”

For nearly 46 per cent of Indians, the desire to fulfil the needs and wishes of the family tops the list of reasons for taking a loan. Family-orientation and need are highest among people in Patna (61 per cent), followed by Lucknow (58 per cent), Nagpur (56 per cent), and Jaipur (54 per cent).

Mumbai tops in people taking advice from friends (65.1 per cent), Lucknow tops in advice from family (72.2 per cent), and Chandigarh tops in advice from colleagues (54.9 per cent). People in Mumbai and Delhi are the most evolved in terms of consulting a financial advisor before taking a loan at 44.2 per cent and 38.8 per cent, respectively.

While a major part of the population is open to taking loans, there is a substantial group that is loan-averse, according to the survey commissioned by Home Credit India and conducted by research agency Absolutdata.

The lack of procedural (paperwork) information and payment options is a major reason why people are loan-averse. Tier 2 towns still rely on personal experiences against professional advice for seeking a loan.

Family and friends

Friends and family not only feature at the top of the survey for fulfilling needs, but they also play the most important role in the decision-making process of the loan. Thirty four per cent of Indians rely on friends for advice while taking loans, followed by family at 31.8 per cent and colleagues at 25.4 per cent.

A financial advisor comes second at 22.4 per cent as the source of advice, followed by sales representative of a loan provider at 21.8 per cent. About 20.9 per cent people take a self-decision while availing a loan and do not consult anyone.

Source: Hindu Businessline

Sreevatsa Real Estate Projects has delivered over 25 projects that have defined community living while providing best quality and ergonomic design for each apartment.

Sreevatsa Viswa & Vedh and Sreevatsa Urban Village give you a sophisticated atmosphere with all future benefits. Book now & design your family’s future in a way that helps you grow & live peacefully. All documents are ready with the necessary approvals and RERA certified. Both projects are cleared by major banks enabling ease of transaction.

Proposed Changes In Rental Laws Is Expected To Boost Investor Sentiment

By venpep_dev,April 29, 2022January 20, 2023

Proposed changes in Rental Laws is expected to boost Investor sentiment

The current housing shortage in urban areas is around 10 million units and proposed changes in Rental Laws is expected to boost Investor sentiment

Over 40% of the Indian population is expected to live in urban areas as against current figure of 34% and this is likely to create a demand for 25 million additional affordable units, estimated a RICS – Knight Frank report.

The current housing shortage in urban areas is around 10 million units

According to the report, as of July 2019, 8.36 million houses have been sanctioned under the government’s “Housing for All by 2022” initiative. Construction for 4.9 million units has begun and 2.6 million units of which have been completed. Given the past trend, additional 1.64 million houses are likely to be sanctioned by December 2019, making it highly possible to achieve the 10 million houses target by 2022.

However, the report, noted that a subsidy-based approach may not be enough for maintaining sustained growth in the affordable housing segment and to address the huge demand.

“Affordable housing is a high potential segment that the private development companies are yet to explore to its potential. Unlike other segments of housing, affordable housing poses an interesting challenge involving strategies at all levels,” said Shishir Baijal, Chairman and Managing Director of Knight Frank India.

He believes that given the requisite volume, the category may need to look at innovative solutions right across the stages of development including statutory clearance, design, building and construction management along with marketing and sale.

Financing for affordable housing can be broadly classified into- debt, equity and subsidy.

With the proposed changes to the Rental Laws investment is expected to boost sales in the Affordable Segments since huge demand is remains untapped

Source: ETRealty

Is Your Money Really Safe In Fixed Maturity Plans?

By venpep_dev,April 29, 2022January 20, 2023

IS YOUR MONEY REALLY SAFE IN FIXED MATURITY PLANS?

Mutual fund houses have been aggressively pushing these plans to layman investors promising safety of capital and predictable returns. What can go wrong with these supposedly AA or AAA rated entities?

As it turns out, many!

The past week, Essel Group of companies (Zee) defaulted on the repayment of principal on its debt that had been subscribed by many FMPs including Kotak MF, HDFC MF, Aditya Birla and ICICI Prudential. The FMPs were in turn palmed off to layman investors whose capital is now at risk. They will either not be repaid or repaid with a delay, which will significantly impact IRRs on the investment.

As per reports, close to Rs. 1,400 crores of such instruments are in default risk. As an investor how does one avoid such a risk?

Invest only in debt issued by the Government of India or at worst AAA rated blue chip companies, which form part of the index like Nifty50 or Sensex 30. The difference in yield between these securities and FMPs are in the tune of 150-200 bps, which is not commensurate with the risks involved. Avoid getting swayed by “sales speak” of the fund houses who will use all manner of past performance to get you to invest in them.

Invest in Fixed Deposits. While they are often seen as “boring”, fixed deposits are relatively secure investments especially when done with Tier I banks. Avoid cooperatives and Tier II banks.

Invest in hard assets like real estate where capital protection is afforded by the real estate underneath. A property will not go bankrupt like a company. There will always be a buyer for it. Yes, the value may fluctuate and sale may take time, but capital is not entirely at risk.

Author: Kunal Moktan – Property Share – Apr 12 2019

How Nicely Done Lighting Affects Your Mood?

By venpep_dev,April 29, 2022January 20, 2023

HOW NICELY DONE LIGHTING AFFECTS YOUR MOOD?

We all are fully aware that poor lighting can damage our eyesight especially when we are reading or watching, but apart from that lighting can affect us multiple ways.

It has been scientifically proven that lighting has a deep impact on our lives. Various studies suggest that the level of lighting we have around affects our mood, emotions and mental health very intensively. Lighting has a direct effect on our biological system and our mood alters according to the change in the level of lighting; for example on a sunny day you automatically feel happy and relaxed.

Effects of Lighting on your Mood

We all are fully aware that poor lighting can damage our eyesight especially when we are reading or watching, but apart from that lighting can affect us multiple ways such as

Insufficient lighting can cause depression
Deficiency of Vitamin D
Impacts appetite
Effects on circadian rhythms

All these lighting effects eventually disturb your emotional health and ruin your mood. However, by adjusting the correct level of lighting in your home or office, you can easily avoid all these mood-related problems. But, for that, you have to understand the how and what kind of lighting affects your mood.

Here are three different lighting levels mentioned that can affect your mood:

1. Bright Light

In bright light, you may experience both positive and negative emotions. A study was conducted by researchers in 2014 to assess the level of emotional intensity under the influence of bright light and it is concluded that reactions are usually more intense under bright lights.

2. Blue Light

In a recent study, it is found that people under the influence of high energy blue light are highly productive. It is found that blue lighting affects your mood positively and brings extra energy in your life.

However, blue light is your friend during the day time only as the exposure to this light during the night can make harder for you to fall asleep. The exposure to blue light coming from smartphones or laptops screen can delay the sleep-inducing hormone melatonin in your body, which may eventually increase your blood pressure and affect your mood negatively.

3. Natural Light

The benefits of natural light are many. Exposure to natural light for a few minutes daily can have a very positive impact on your day. According to a study, it is found that people who have airy and well-ventilated windows in their homes or offices – exercise more, sleep better and have overall better health. It is also found that natural light keeps your circadian rhythms under control which makes you feel energetic all day long.

This light is your best mood booster as it helps in reducing the symptoms of depression. Deficiency of Vitamin D is a major cause of depression and it can be completely treated by exposing yourself to sunlight for regularly. Some doctors have found that the combination of light therapy and antidepressants makes the ideal treatment for depression.

Intense Lighting Affect on Your Mood

Lighting undoubtedly has an intense impact on your mind – from your eating habits to your hormonal cycle everything is affected by the lighting in some way. It is highly advised to keep your level of lighting moderate in your life which leads to a healthy and happy mindset. You should always remember that natural lighting affects your mood positively and that’s why it is recommended to spend a few minutes daily under natural light and close to nature.
Author: ET Realty

What Makes A Real Estate Investment Yield Returns!

By venpep_dev,April 29, 2022January 20, 2023

WHAT MAKES A REAL ESTATE INVESTMENT YIELD RETURNS!

While buying a property, investors have high aspirations in terms of returns but the same turns into anxiety when returns don’t come. Be it residential or commercial, one must consider a long-term horizon for good returns.

NEW DELHI: Investors have made the most out of Indian markets thanks to economic growth and rising demand for real estate assets in the country. Over the years, real estate market dynamics have changed due to policy reforms. RERA has not only consolidated the real estate sector but has also brought transparency. It has infused confidence in investors to enter the market.

While buying a property, investors have high aspirations in terms of returns but the same turns into anxiety when returns don’t come. Be it residential or commercial, one must consider a long-term horizon for good returns.

Real estate is certainly a wealth creation tool but to get the expected returns depends on many factors such as property, location, market trends etc. Indian buyers are more informed today than they were a few years back. However, they still need more information to fulfill their investment aspirations.

Investment Prospects

Real estate has been the engine of growth and employment in most emerging markets. India is an emerging market and the overall real estate trends appear favourable today. It is important to know about change in policies and follow market trends so you know what may impact your investment in the long term. One must choose the right builder, good quality property, good project, location and adapt changes as per the circumstances. Buyers need to ask relevant questions.

One significant change has been highlighted in an Anarock report – Between 2015 and 2018, Indian real estate witnessed a total inflow of USD 14 Bn worth Private Equity (PE) investments. While 2015 and 2016 together saw investments of USD 5.4 Bn. Momentum was seen in the last two years when investments grew to USD 8.6 Bn collectively. This growth can be attributed to the various reformatory changes in Indian real estate that helped increase transparency and thereby boosted investor confidence.

The real estate sector keeps opening new avenues for investors and they can earn returns if they read the market well. Currently, rising demand offer high potential for returns in the future.

Shobhit Agarwal, MD and CEO, Anarock Capital says, “FDI policy relaxation coupled with landmark reforms (such as RERA, GST, Insolvency and Bankruptcy Code, adoption of REITs, etc) are altering the sector from being an unorganised one-man driven family business to an organised, structured and corporatised with financial discipline.”

Long-term V/s short-term investment

Historic trends suggest that long-term real estate investments have yielded good returns as compared to short-term schemes where uncertainty is high. Due diligence is a must when you are investing your hard-earned money in a property.

RERA and Builder-Buyer Agreement

The Real Estate Regulation (and Development) Act, 2016 (RERA) came into effect on May 1, 2017. If you have invested in a property in the pre-RERA era, it is recommended that you get your Builder-Buyer Agreement RERA compliant as it will protect your investment. You must speak to your developer to stay updated on RERA registration and other changes he makes in the project.

“A builder buyer agreement has to be as per RERA. Existing buyers must also ensure that their agreement of sale is as per RERA regulations. It will help them address their issues in case of violations by the developers. Builders also need to inform buyers about RERA registration,” says Kalpana Misra, member, UP RERA.

RERA defines the builder-buyer agreement as ‘agreement for sale’ and section 4 lays down that the builder is responsible for all obligations, responsibilities and functions as per the agreement for sale. If you have invested long back, get your old builder-buyer agreements RERA compliant.

Choosing the right forum

Choose the right authority to file your complaint depending on the hierarchy instead of going to large forums where you may not find solutions for minor disputes with your builder.

Firstly, speak to your builder and try to get a solution from him. Accordingly approach the higher authority, depending on the response you get on your complaint. Filing complaints at wrong forums may delay and complicate your case.

Protect Property Reputation

Often it is seen that social media platforms or other channels are used to vent your anger. This way the reputation of your property is at risk. Remember, that the property and rental values generally depend on the reputation of your property. One must use the right forum to address a grievance avoiding tarnishing the reputation of your property which otherwise could give you good returns and rentals in future. A project with a tarnished image is unlikely to draw good returns and rentals.

“There are some developers who have not kept the promises they made to buyers so buyers go to various forums including social media, to badmouth such a developer and his project. It not only harms the interest of the developer but also impacts their own future prospects in the form of lower resale and rental value,” explains Deepak Kapoor, Former President, CREDAI Western UP & Director.

There are many factors which work in favour of real estate investments. However, buyers need to be informed, aware and take the right steps to protect their investment and get the most out of the market.

Author: Ravi Kumar Diwaker – ET Realty