UAE's NRI dilemma: Buy India property or not?

Mid-November, an international real estate advisory firm said India’s real estate sector will continue to remain an attractive investment destination with the possibility of prices in residential areas appreciating by 91 to 145 per cent in select cities over the next five years.

Knight Frank pointed out that despite the slump in the real estate market, Mumbai will continue to be the most promising investment destination followed by Delhi-NCR, Chennai, Pune and Bengaluru, Knight Frank Executive Director (retail, advisory and hospitality).

But by early December, the apex body of Indian developers asked its members to seriously consider “selling off maximum inventories by reducing prices.”

“The developer community is willing to consider the suggestions made by the Finance Minister P Chidambaram to unlock the value of the unsold stock. We have asked our members across the country to seriously consider the proposal to sell (the unsold stock) in maximum numbers,” Confederation of Real Estate Developers' Association of India (CREDAI) national president Lalit Kumar Jain said.

Do the above two statements matter for UAE non-resident Indians (NRIs)?

Ashish Mehra, who works in Dubai as an accountant, says: “It puts me in a Catch 22 situation. I have been hearing a lot about an impending correction in Indian property market… but I haven’t seen any. My top priority is to save to buy a home in India. And that’s what I am doing and I will soon buy a property back home.”

Kamlesh Mehra, a Dubai-based businessman, says: “I have already bought properties in Mumbai and they have given me a good return. For me, as an investor, I believe this is not a good time to buy in India. Dubai properties are cheaper right now than in Mumbai. I would invest here than in India.”

But buy off plan or a ready unit?

Some Indian property developers taking part in the 11th edition of “Indian Property Show”, starting December 13 to 15 at the Dubai World Trade Centre, say NRIs are looking at buying “off-plan” or, at least, with a realtor who is offering them a deferred payment plan.

Jatin Patel, VP Business Development, Bhartiya City, Bangalore, states: “Off-plan purchases have for years returned solid yields for the astute investors in the Bangalore property market. They have benefited from the discounted prices from developers as well as capital gains from a growing market by buying early.”

He adds deferred payment plans are designed to give an opportunity to pay over an extended period of time for example construction-linked plan.

“In this plan, one has to pay the cost in the form of pre-determined installments to the builder in tandem with the development of the property. The advantage of this approach is that it gives you time to pay up, the developer does not end up charging too much at the outset itself and hence the buyer does not have to forego interest earned on their own money by paying up too much too early.”

KR Raghavan, Vice President - Sales & Marketing, Ozone Group, also opines that NRIs are considering buying off plan as it saves pre-equated monthly installment interest towards loan.

A survey conducted by Sumansa Exhibitions, organisers of the “Indian Property Show“, has revealed 26.7 per cent of NRIs are looking to buy property as an additional investment, which is a six per cent rise compared to last year. 89 per cent of them will invest in properties worth Rs1 crore (Dh700,000) and above.

The survey, conducted among 16,000 NRIs across the UAE, found Mumbai, Bengaluru and Delhi featuring in the top five destinations list, suggesting that the larger Indian cities offer higher returns.

For the original post visit: http://www.emirates247.com/uae-s-nri-dilemma-buy-india-property-or-not-2012-12-12-1.486891

Slash housing prices, sell off real estate inventory: CREDAI to builders

Leading realtors' body Confederation of Real Estate Developers' Association of India (CREDAI) has asked its members to seriously consider selling off maximum inventories by reducing prices.

"The developer community is willing to consider the suggestions made by the Finance Minister P Chidambaram to unlock the value of the unsold stock. We have asked our members across the country to seriously consider the proposal to sell (the unsold stock) in maximum numbers," Credai national president Lalit Kumar Jain said in a statement.

The governing council of Credai had met at Kochi over the weekend where it was decided to consider the suggestion to sell maximum number of housing units by reducing the prices to the extent possible, it said.

Earlier, the developers' apex body had refused to offload the inventories at discounted rates saying that realtors would not be able to reduce the prices as they have invested heavily in the projects.

Meanwhile, Credai has also appealed to the finance ministry to look into the suggestions made by it to revive the real estate industry to rejuvenate the economy slow down, Jain said.

"We are happy at the positive manner in which the ministry has mooted proposals to help the developer community.

We are confident that it will also positively respond to the various constructing suggestions made by us," he said.

Credai has made certain suggestions including single window system of clearances to speed up the process, asking banks to reduce rates of interest for projects and buyers as well and create a congenial atmosphere to encourage affordable and mass housing, the release said.

Besides, the realtors' body has also suggested declaring housing sector as infrastructure or industry, provide certain tax exemptions, setting up of a comprehensive realty regulator and to provide special incentives for skill development, among others.

For the original post visit: http://www.indianexpress.com/news/slash-housing-prices-sell-off-real-estate-inventory-credai-to-builders/1039837/0

Medavakkam among 13 growing realty markets

CHENNAI: Medavakkam in south Chennai is expected to outscore all other residential hubs in the state in terms of real estate appreciation in the next five years, according to a report released by realty consultant Knight Frank.

It is among the 13 most happening places across the country that would appreciate more than 90% in the next five years, the report said. Ulwe in Navi Mumbai and Wadala and Chembur in Mumbai figure on the list.

Seven of the top nine spots on this list are in Mumbai and Pune. While rates in Ulwe are expected to rise 145% in five years, in Wadala and Chembur the hike is likely to be 133% and 125%, the report said. The report seeks to identify areas that will develop because of factors such as job creation, infrastructure development and lifestyle change.

"We identified 100 cities using banking penetration, hotel room demand, and air passenger traffic as surrogates for business activities. For infrastructure development, the current and proposed investment in infrastructure was taken as proxies," said Samantak Das, director, Knight Frank.

Taking a number of factors into consideration, the firm identified Mumbai, Delhi, Bangalore, Chennai and Pune as the top five cities to identify investment opportunities.

Of the 13, the top three areas are in Mumbai. They are followed by Noida Extension and Dwarka Expressway in the National Capital Region (NCR), Medavakkam in Chennai and Hinjewadi in Pune. The cheapest areas identified by the study are Noida Extension in NCR and K R Puram in Bangalore, where prices range from 3,200 to 3,245 per sq ft. At the other end are Wadala and Chembur, where market prices reign in the region of 12,000 to 15,000 per sq ft.

Confederation of Real Estate Developers' Association of India (CREDAI) Tamil Nadu chapter president Sandeep Mehta said, "Medavakkam is an emerging location, no doubt. But it is tough to say whether it will have the maximum appreciation in the near future. It has some advantages like wide interior roads, good connectivity to the Old Mahabalipuram Road, Velachery, Pallavaram and Tambaram. It is close to many residential hubs, IT parks, schools, entertainment facilities and commercial establishments. These are factors that drive the real estate growth in any city."

CREDAI Tamil Nadu secretary Suresh Krishn had launched a residential apartment project in Medavakkam two years ago at 2,800 per sq ft. "We have completed the project and today it is going at 4,200 per sq ft," he said. The Planning Commission's projection of a housing shortage of 26 million units does not reflect the demand for housing but the need, said Das. Employment generation will translate that need into demand by increasing affordability, he said, adding, "Our research is targeted at the end-user market".

Source: http://timesofindia.indiatimes.com/city/chennai/Medavakkam-among-13-growing-realty-markets/articleshow/17316452.cms

CREDAI property fair to be held from Feb 17 to19

CHENNAI: FAIRPRO, the annual property exhibition of the Confederation of Real Estate Developers' Association of India, Tamil Nadu chapter, will be held in the city from February 17 to 19. Sixty-five builders will showcase 250 projects at prices ranging from Rs 10 lakh to Rs 10 crore at the Chennai Trade Centre, said Suresh Krishn, convenor, FAIRPRO.

Only projects approved by the regulatory agencies and vetted by CREDAI's legal wing will be listed for sale, he said. With a view to minimizing inconvenience to prospective home buyers, the FAIRPRO team has introduced e-service for issuing entry tickets and registration.

So far, about 20,000 people have hit the FAIRPRO website and 600 people have booked tickets, he said. CREDAI Tamil Nadu president T Chitty Babu called upon the central and state governments to be considerate towards the real estate sector.

The growth of the sector will be affected if tax benefits are not extended to realtors and tax exemption on home loan interest component is not increased from Rs 1.5 lakh to Rs 3 lakh, he said. Ajit Kumar Chordia, MD of Khivraj group, called upon the state government to slash stamp duty for registration of properties before it announces a revision in the guideline values.

Source: http://timesofindia.indiatimes.com/articleshow/11891636.cms