Residential property builders have something to cheer if the result of a poll of property brokers conducted by Edelweiss Capital is any indication. The pan-India poll shows that property brokers expect prices of residential property, especially i n the Mumbai and NCR region, to increase around the Budget, Edelweiss said in a press release issued here.
Throughout India, property brokers have turned positive on the Indian residential realty market, in the last three months, the poll said. There has already been an increase in the number of transactions in the past one month against nil in the preceding five months, it said.
The poll was conducted amongst 100 odd property brokers in the first-half of June in the four cities of Mumbai, NCR, Bengaluru and Chennai and 20 micro-markets. A significant change in sentiment post-elections and preceded by strong stimulus measures have contributed to a strong recovery in volumes and prices, the release said.
According to the poll, nearly 87 per cent of the brokers surveyed endorsed that transactions had indeed increased in the last one month.
Source : sify.com
Experts at odds on world commercial property recovery
Real estate industry experts are at loggerheads on which commercial property market they expect to bounce back first from the downturn first, after the global financial crisis shredded property values in most countries.
Global real estate investors – roused by prospects of snapping up bargain assets – were still wary of getting caught in a false rally and have been keenly watching for signs of a sustainable recovery.
The turmoil that was sparked by a collapse in risky U.S. home loans has devastated the banking system and pushed most major economies into recession, causing commercial real estate markets to suffer as values and occupancy rates fell.
More : reuters.com
Residential property poised to lead India rebound
Residential real estate will lead the recovery of India’s wounded property market in 2010 thanks to accelerating economic growth, lower interest rates and improved liquidity, Indian ratings and research agency CRISIL said Wednesday.
Prices for commercial and retail space will likely remain weak through 2010 because of oversupply and slack demand, CRISIL said in a new study of 10 cities across India.
Residential real estate is where we think by 2010 we can look for some kind of recovery,” head of research Sudhir Nair said in a conference call with reporters. “There is a significant overhang of supply in commercial projects. … You can’t see a lease rental increase for a couple of years in this market.”
India’s property market, like many around the globe, boomed from 2005 to mid-2008. Average prices of both commercial and residential space more than doubled during that period, according to CRISIL.
More : forbes.com
Affordable housing is a misnomer
Suddenly, affordable housing is the buzzword in Indias real estate sector. Almost every developer who got hit badly in last years market meltdown is talking of getting into this segment that involves putting up houses for the masses.
Not everyone, however, is impressed. Deepak Parekh, chairman of HDFC, the company credited with setting up the housing finance market in India from the scratch, feels that in its present form, affordable housing is a `misnomer.
In his letter to HDFC shareholders, Parekh said that although developers are now reintroducing one-bedroom apartments and, in the current falling interest rate scenario, buyers are making a comeback, the real issues are not being addressed.
More : timesofindia.indiatimes.com
10,000 houses for urban poor
The Uttar Pradesh Housing and Development Board (UPHDB) will construct 10,000 houses for the economically weaker section (EWS) in urban areas. The decision comes in response to the state governments directive to provide affordable accommodation to them on a priority basis.
The UPHDB has been asked to construct these houses in the current fiscal. Each house will cost approximately Rs 3 lakh. The scheme, under which these houses will come up in Ghaziabad, Lucknow, Kanpur and Moradabad, will be announced within a week.
In the first phase, the board will construct 6,000 houses. It has already identified land in the four cities. The remaining 4,000 will be built in the next phase, said Laxman Prasad, Deputy Housing Commissioner. Out of 6,000 houses, 3,000 houses will be construct in Lucknow, 2,000 in Ghaziabad and 500 each in Kanpur and Moradabad. The area of each dwelling unit will be 30 sq m, comprising two small rooms, kitchen, toilet and one small veranda, said a UPHDB official. He added that the design of the units will be similar to those developed under the Kanshiram Shahri Gareeb Awas Yojna.
Cost of these EWS houses are much higher than others developed so far in the state. The value of land is increasing everywhere. A 30-sq m area costs over Rs 1.5 lakh, said the official. Besides, the cost of construction material has also increased in the last few months.
More : indianexpress.com
The great SEZ rush skids on slowdown, land issues
When the Board of Approval for special economic zones (SEZs) meets on Friday, liaison and corporate affairs executives will jostle for space in the narrow corridors on the ground floor of Udyog Bhavan, which houses the commerce department.
In stark contrast to last year, however, few of them will be pushing proposals for new zones. Demand dynamics brought on by the global slowdown and persistent land acquisition problems are forcing developers to alter their plans.
As a result, almost half the proposals that the inter-ministerial panel headed by Commerce Secretary Rahul Khullar will consider have to do with extensions to acquire land or cancellations of these tax-free enclaves that were supposed to catapult Indias exports into the big league.
More : business-standard.com
After DLF, Rahejas want to surrender SEZ
Real estate developer K Raheja Universal Private Ltd wants to scrap one of their notified special economic zones (SEZs) and also surrender a part of another zone, citing lack of demand from the information technology sector.
The Mumbai-based developer has approached the Board of Approval (BoA) regarding this, which will decide on the matter on June 17. This is the second realtor after DLF Ltd, which too sought cancellation of notified SEZs. Notification is the final clearance for a SEZ, after which it starts enjoying the direct and indirect tax benefits prescribed under the SEZ Act.
K Raheja has asked for denotification of its 13 hectares IT zone based in Navi Mumbai. In addition, the company also wants to surrender about half of the 20.65 hectares of another infotech SEZ in the same area. These are the only two notified SEZs for the Mumbai-based realtor.
More : business-standard.com
Indias special estate zones
The governments policy on special economic zones (SEZs) has come under fire many a time this decade. Its again back in the media spotlight, with the Supreme Courts refusal last week to grant Mukesh Ambanis Maha Mumbai SEZ more time to acquire land. Botched land acquisition is a central problem, but thats not the only one: Theres a good case to be made that the government isnt achieving what it set out to do.
When India started on the SEZ track earlier this decade, it meant to imitate China. There, SEZs—free-trade areas with a liberalized environment that help form business clusters focusing on particular activities—have provoked the envy of the world. But instead of getting manufacturing clusters, India seems to be getting real-estate developers masquerading as SEZs.
First, too many SEZs have been granted approval. With 568 proposals okayed since 2005, India has lost a lot of potential tax revenue, which the government claims is offset by higher employment. If thats the case, then its doing poorly: Since 2006, SEZs have seen investment worth Rs77,058 crore, but have employed only an extra 214,499 persons—thats Rs35 lakh for every person hired.
More : livemint.com
Companies take advantage of falling real estate costs
Adversity opens up opportunities. The adage is now ringing trye for the real estate sector. With lower rentals and lower costs of buying office space, many companies have shifted offices to take advantage of the lower costs and to gear up for future expansion.
Companies such as Swan Telecom-Etisalat and Tecpro Systems have leased and bought office space at much lower costs, in the range of 25-50%. A number of other examples too exist. According to industry sources in the know, Inox Cinemas in Mumbai has moved their corporate office from Tardeo to Andheri, Symphony Services in Chennai has moved from the central business district (CBD) to the Outer Ring Road and Standard Chartered Bank has consolidated its operations and moved to newer locations in Bangalore, Delhi and Mumbai.
Various locations in the country have seen a rental and capital value correction. Office space can be bought or rented for at least 25-30% lower value across the top 8 cities of India. According to a recent Cushman & Wakefield report some of the top micro markets in the country have seen a drastic rental correction. In Mumbai, Worli is down 38%, Lower Parel is down 39% and Andheri is down 33%; In the National Capital Region, Gurgaon is down 26%, Noida is down 20% and Jasola is down 24%.
More : economictimes.indiatimes.com
Mahindra Lifespace to focus on SEZ, real estate
The Mahindra group has decided to intensify its focus on special economic zones (SEZs) and real estate to take advantage of the improved sentiments witnessed in the sector across the country.
The group is going ahead with its planned SEZ in Rajasthan, besides increasing focus on residential developments and integrated mega cities in southern and western India.
Mahindra Lifespace Developers, which leads the groups foray in this business, recently achieved a milestone of almost 5.8 million sq ft, comprising business cities and green homes spread over 2,000 acres.
At Mahindra World City New Chennai, the industrial area has been completely leased out. We are now looking to acquire land for the next phase here, said Arun Nanda, president of infrastructure development, Mahindra and Mahindra (M&).
The industrial areas of the Mahindra World city comprises an infotech/IT enabled services special economic zone (SEZ), an automobile SEZ and an apparel SEZ, in addition to an earmarked domestic tariff area. Tamil Nadu Industrial Development Corporation holds 11 per cent stake in Mahindra World City Developers, Chennai, while the balance is split between M&M and Mahindra Lifespace Developers.
More : mydigitalfc.com
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