I Earn ₹50,000 pm, Should I Buy A Budget Home Now?

Feb 26,2020 / By Commonfloor / No Comment

If you’re like most people, investing in a house is undeniably a dream. It is thus no doubt that owning a home from your hard-earned money is the most extraordinary asset that you can have. However, investing in a house is time-consuming and money consuming. Thus, buying a budget home can unquestionably do you good. Nonetheless, the most fundamental component of purchasing a budget home is to do extensive and in-depth research. Before you impulsively plan to sign on the house agreement documents, understanding your budget is quite indispensable. Buying a home based on your monthly salary, i.e., Rs.50,000 unquestionably depends on your overall fiscal health. The following are some tips that can help you understand if buying a house with your salary is the right decision for you.

Analyze the house-hold income after eliminating the tax

In India, tax undeniably takes away a fair amount of money from our income. Thus, ensure analyzing your overall income after eliminating the tax to get a vague idea of the amount you can invest for the house. There are several calculating apps online for understanding how much money you will be left with after paying the appropriate tax.

Analyze your monthly expenses.

Household, Personal loans, and bills are a few of the most vital aspects of your living. It is best advised to take out time to jot down your monthly expenses such as insurance, bills, utilities, etc. Moreover, if you’re a family man, there are several other necessities and expenses, such as tuition fees of your children and groceries for cooking. Therefore, eliminating these expenses will help you analyze your expendable income. Making use of financial tracking apps can give you the maximal benefit of making a reliable and money-conserving investment.

Understand your budget

Purchasing a house under your budget of Rs 50,000 pm is possible, provided, you understand all your expenses and necessities. Make the required adjustments and cut down your unnecessary expenses so that you can increase your savings. Thus, this way, you’ll be making an economically wise decision.

Analyze your debts

It is best advised to either pay off your entire debts from earlier or to minimize them to a potential extent. According to experts, getting approved for a home loan and handling your mortgage payments becomes much easier if you pay off your debts. What’s more beneficial, you ask? Well, the most appealing element about paying off your debts is that it can enhance your credit score. The credit score is unquestionably one of the determining factors of purchasing a house. Therefore, minimize your debts and other expenses to have the best chance of getting a personal loan.

Do not be impulsive

We all know how exciting and overwhelming it is to buy a house. However, it is not the right step to impulsively buy a house without doing the necessary research. It is best advised to save up some money so that your deposit can be paid conveniently. Although, a deposit might seem like a hefty amount of cash, saving up and planning your income usage strategically will help enhance your chances of getting a home loan, and paying the deposit.

Have a realistic plan

There is no doubt that a fancy, large, and comfortable house can have your attention in minutes. However, this does not mean that you can impulsively choose a home that will take away years and years of your life to pay back the debts. Thus, ensure choosing an affordable home. Analyze additional expenses such as the maintenance cost, homeowner association fees, tax, etc. Moreover, it is best advised to consult banks to understand if you’re eligible for a loan.

Have options

Most of us make the mistake of investing in the very first home that we see. How is this disadvantageous, you ask? Well, having options will give you the benefit of analyzing if you’ll be making a wise investment. Checking similar houses can help you potentially bargain your way of making a smart and reasonable investment for yourself. Therefore, take out some time to properly analyze and search for houses.

Make use of a home inspector

Hiring a home inspector is the most primary yet imperative element of understanding any potential threats that you might need to deal with in the future. Thus, make sure to hire a reliable home inspector to detect any potential damage and other issues that this house might cost you.

To sum up,

The journey of buying a house is unquestionably exciting and infuriating. Nonetheless, don’t rush into making such a big decision. Take your time to analyze your financial health and choose a home accordingly. CommonFloor is a leading online portal offering groundbreaking services in the real estate industry for simplifying your property decisions. They are a distinctive company offering a multitude of remarkable services for sellers, real estate professionals, and home seekers.

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Real Estate expectations from Union Budget 2020

Jan 29,2020 / By Hozefa Sanwari / No Comment

Union Budget 2020 Expectations

The Union Budget 2020 will be presented on 1st February by the Finance Minister, Nirmala Sitharaman. Given the policy reforms undertaken by the government over the past couple of years, the real estate industry is hopeful that the upcoming budget will provide the much-needed impetus. The year 2019 saw the government take numerous steps to help improve market sentiment and revive real estate demand. Reforms such as capital gain benefit, tax exemption on notional rent, incentivizing Affordable Housing, the revised rental income limit for TDS, and thrust on infrastructure growth were highlights of the Union Budget 2019.

This time around, the sector expects the Budget 2020 to lower the GST rates on under-construction projects, increase the NBFC credit liquidity, implement single-window clearances for project approvals, redefine the Affordable Housing price bracket, allocate additional funds for PMAY scheme, and fuel investment in infrastructure.

In this backdrop, Commonfloor conducted a real estate survey on builders across India to capture their expectations from the Budget 2020. More than 300 builders participated in this survey to express their views and expectations.

The majority of the builders (31%) expect the Budget to lower the GST on under-construction projects. GST reduction clubbed with the revival of Input Tax Credit can provide relief to the builders and housing can be made available at lower prices. After the reduction in GST rates in 2019, the government had withdrawn Input Tax Credit. The next key expectation of real estate is to address the challenge of NBFC (Non-banking Financial Company) liquidity. Liquidity will ensure positive momentum with a steady supply of ready-to-move homes. Also, single-window clearances can aid in procuring quick approvals so that project delays can be avoided. In the past few years, Affordable Housing has been the major growth driver. Still, it needs some reforms as currently only those houses are awarded affordable status and subsequently reduced GST rate of 1% which has a carpet area less than 60 sq.m. and falls under the price cap of Rs 45 lakh (GST rate for under-construction house is 5%)

Around 50% of the builders surveyed feel that the increase in Home Loan tax exemption is the primary factor boosting real estate demand. A further extension to the existing 2-lakh tax rebate on home loan interest rates will push the fence-sitters to buy homes. It could result in a higher demand for housing, especially in the affordable and mid-segment categories. Interestingly, “Redefinition of Affordable Housing” and “Income Tax Removal on Notional Rent” got equal responses from the builder community. The abolition of income tax on notional rent from the second self-occupied house benefits those with two houses and encourages home buying.

One-third of the builders surveyed feel that the GST rates are the most vital component hurting homebuyers’ sentiment. Apart from GST, project delays and high property prices are the other factors that affect consumer sentiments. Builders feel that the initial aid of Rs 25000 cr last-mile funding for stalled projects is insufficient for the realty sector and that it needs to be executed on a larger level on a priority basis. Moreover, home loan interest rates and high government taxes such as stamp duty and registration could be reduced to propel demand in the market.

Foreign Direct Investment is a key driver of economic growth and a medium of non-debt finance for any country’s economic development. One-fourth of the builders surveyed responded that single-window clearance will streamline the approval process and can bring about a major boom in FDIs for the realty sector. The next two major factors that can drive FDI are ‘clarity on entry-exit norms’ and ‘stamp duty exemption on FDI transfer’. More FDI in real estate will provide the necessary thrust to the current slump in the market.

Builder Bytes

Ajith Alex George, Director of 42 Estates says, “The real estate category in India requires bold fiscal measures from the union budget. The sector is going through a liquidity crisis with stalled projects across India, an economic booster required for the industry as a whole. Ease of Funding both on the supply and demand side along with quicker processing can again make this one of the key growth sectors. Approvals of projects have gotten better however there could be better clarity on some of the norms and changes in regulations, especially around taxation. Single-window clearance and query handling can make the process easier for the sector.

From the home buyers’ perspective, interest rates on home loans have to be reduced, we have been hearing further reduction on personal tax rates and stamp duties, this can strengthen the buying power of the home buyers which will have a compounding impact on the industry as both residential and commercial projects would get a better demand-side environment. The government is already doing its bit with the PMAY showing good traction, a further increase in subsidy rates for affordable housing can further help percolate this initiative. These steps might give the much-needed boost to the confidence of the developers and buyers alike.”

Mr. Amarjit Bakshi, CMD at Central Park says “Initiatives have already been taken to aid the real estate sector, such as tax concessions and availability of low-cost loans for developers and buyers. Reforms were put into place to promote rental housing as well as boost affordable housing, empowering the middle class and first-time home buyers.

We expect policy changes to boost consumption in the economy and improved liquidity for the industry by easing fund availability for the real estate sector, enabling the sector to come back on track, since it generates more than 6.5% of the GDP. It is expected that to boost investor interest, the limit of home loan interest will be increased. Announcing an industry status to the sector will bring manifold benefits.

Conclusion:

The implementation of the above-mentioned measures will help revive real estate growth to a great extent and give a thrust to home buying sentiments, which in turn will revive the economy. To generate cash flows for struggling builders, it is quite evident that the stress fund will be a big boost, but it would address only a small portion of the stalled projects. The rest could only be addressed by NBFCs and banks.

The real estate sector has long needed an industry status that can help to procure finances at a lower cost, especially now, when credit availability is a major headwind. The momentum of infrastructure development should continue from last year so that growth is decentralized and migration to urban centers remain under check. The real estate sector is optimistic that the upcoming budget will usher fresh stimulus in terms of bold fiscal measures to outperform its growth from last year.

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Real Estate Round-up 2019: How India’s Real Estate Sector has Performed in Year 2019?

Jan 20,2020 / By Prahalad Singh / No Comment

Indian Real Estate 2019 Round Off

Real Estate is one of the key driving factors behind the growth of the Indian Economy and plays a pivotal role in the nation’s GDP growth. It is among the most recognized sectors globally. It creates millions of direct and indirect employment opportunities and supports the country’s development. It consists of 4 sub-sectors – Housing, Commercial, Retail, and Hospitality. The growth of this sector is well complemented by the growth of the corporate sector and the demand for office space as well as urban and semi-urban houses. The real estate sector of India ranks 3rd among the 14 major sectors that have a direct and indirect impact on all sectors of the economy.

The year 2019 has been a period of ups and downs for the Indian Real Estate Sector. There have been various policy and taxation related announcements in the last year. The market experienced the impact of the ongoing Non-Banking Financial Company (NBFC) crisis which resulted in a liquidity crisis and a slow pace of recovery in sales. On the other hand, the successful launch of India’s first Real Estate Investment Trust (REIT) opened new avenues for investments in real estate while multiple government SOPs provided much relief to the housing sector.

Post the policy reforms of 2017 such as demonetization, RERA, and GST, the residential market is absorbing the impact of these changes and is on the path to recovery. India continues to retain its position as the world’s fastest major growing economy on the back of improved investor confidence and better policy reforms.

The growth of the Indian Real Estate Market in 2019 has been driven by numerous factors including technology, improved ease of doing business, dust settling post the implementation of reforms such as GST and RERA, and demand-supply dynamics, among others.

It is also expected that the real estate sector will incur more and more NRI Investments in both the short and long term.

In the year 2019, the realty sector has experienced its highs and lows. Affordable Housing performed beyond expectations within the residential segment, while the luxury apartments continued to witness subdued sales. On the other hand, the commercial segment saw most of the investment flowing in as the year comes to an end. Whereas, other asset classes such as warehousing, Coworking, and Co-living gained momentum.

Initiatives are taken By The Government

If we look back at 2019, we can not deny that the government did not make sincere efforts to strengthen the sector. A series of reforms and policy changes were adopted. Some of them are:

Reducing GST rates to 1% for affordable homes and 5% for under-construction flats/apartments
The announcements about NHB raising liquidity to the housing finance companies
Relaxation of External Commercial Borrowing (ECB) funds
Creation of Alternative Investment Fund of Rs 25,000 crore for Stalled Housing Projects
Successive Repo Rate cut coming to 9-years low (total 135 basis points in 2019)
Tax holiday to first time home buyers
Relaxation in FDI norms for a single brand retail
The government slashed the corporate tax rate to 25.17% from 30% for existing companies, and to 15% from 25% for new manufacturing companies.
In 2019, consolidation continued in the residential segment. Those developers who are either on the verge of insolvency or have their project stalled continued to re-enter the market through joint development, or mergers.
Technological advancement in real estate too increased in the last year.

Post-2017 reforms such as Real Estate (Development & Regulation) Act (RERA), the inventory pile-up kept increasing across markets. New launches had taken a hit. Increasing unsold inventory became a cause of concern as liquidity challenges coupled with RERA deadlines made it tougher to deliver the project. In spite of the odds, those with deep pockets or leading names in the realty sector continued to outperform in 2019.

Since the start of this calendar year, there is a decrease in unsold inventory, which is a positive sign for the industry’s revival. In 2020, this is likely to reduce further to healthy levels. Another crucial factor for improved sales was largely stagnant property prices. Going forward, we may witness investors, funds, and lenders showing confidence to finance future projects. If employment levels improve and inflation kept under check, the revival of the sector isn’t distant. The year 2020 may well be the turnaround year.

Market Size

The real estate sector in India is expected to reach a market size of US$ 1 trillion by 2030 from US$ 120 billion in 2017 and contribute 13% of the country’s GDP by 2025. Retail, hospitality and commercial real estate are also growing significantly, providing the much-needed infrastructure for India’s growing needs.

Housing Sector

As per the CBRE report, it is expected that out of the 2.3 lakh new unit launches in 2019 in the top 7 cities, nearly 40% or approximately 92,000 units were in the affordable segment, followed by mid-segment with a 33% share. The luxury and ultra-luxury segments amounted to the least share with 10% (approximately 23,000 new units). Apart from that, Center Approves 3.31 Lakh More Houses Under PMAY(U) to fulfill the housing needs of the Urban poorer.

Housing sales in 2019 saw a modest 4-5% annual growth with over 2.58 lakh homes sold during the year.
New housing launches in 2019 saw an 18-20% annual growth with over 2.3 lakh units.

Commercial Sector

As per the CBRE report, office leasing increased by more than 30% annually to cross 47 million sq.ft. during the first three quarters of 2019, exceeding its previous high of 2018. The leasing exercise reached about 15.4 million sq.ft. during Q3 2019, rising by nearly 23% on an annual basis.

Commercial office space continued to be the most sought-after asset class.

Forecast

Since the start of the year 2020, there is a drop in unsold inventory, which is a positive sign for the industry’s recovery. And it will probably see a growing trend in 2020. We expect the hurdles in the real estate sector to get resolved. Stagnant property prices was another factor for improved sales. Going ahead, we may clearly see investors, funds, and lending houses showing confidence to finance future projects. If employment levels improve and inflation remained under control, the recovery of the sector is not very far.

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CommonFloor – IndiaProperty Realty Awards 2020

Jan 10,2020 / By Prahalad Singh / No Comment

The Annual Realty Awards 2020 hosted by CommonFloor and IndiaProperty was conducted in grand style on the 4th of January 2020 at Shangri-La Hotel, Bengaluru. It was a flamboyant evening where India’s leading builders and developers came together to recognize their hard work and celebrate success.

The event witnessed 300+ guests including eminent personalities such as the Chief Guest, the Mayor of Bengaluru – Mr. M Goutham Kumar, Guest of Honor, Vice President of CREDAI – Mr. R. Nagaraj Reddy, CMO of Quikr – Mr. Vineet Sehgal and many other CXOs and Founders of leading real estate companies.

The event was conducted to celebrate the key players in various fields of the real estate sector and provide a platform for stakeholders to examine the future of the real estate industry in the presence of key CREDAI members and the Mayor of Karnataka. Recognition was given to builders and developers along with promoters and brokers across categories who attended the events from various parts of the country. Top builders and developers were seen engaging in constructive conversations, networking and addressing market trends for 2020.

The awards were categorized into 40+ categories such as top developers – Residential & Commercial, Top Residential Projects, and Project Design & Excellence amongst others. The winners were selected based on an in-depth evaluation of several parameters including analysis of key data points over a period of one year gathered on Quikr’s real estate platform. The data point included projects, popularity, search trends, responses for specific builders or projects, and other traffic metrics.

Below are the honored winners of Bengaluru in their respective categories

Aparna Construction has been awarded for the most trusted developer of South India 2019-2020

Assetz Property has been awarded for the most trusted developer of Karnataka 2019-2020

Brigade Group has been awarded for the best developer of the year for Integrated Enclaves, South India, 2019-2020

Century Real Estate has been awarded for the most trusted builder for plotted development, Karnataka, 2019-2020

Guru Punvaani has been awarded for the best emerging developer of the year for plotted development, Bengaluru – 2019-2020

K.V.G Builders and Developers has been awarded for the best developer for construction quality, Karnataka – 2019-2020

Narya Constructions and Developer has been awarded for the best-trusted builder of Karnata – 2019-2020

Ramky Estates & Farms Ltd. has been awarded for the best developer in professional excellence for Ramky One North- 2019-20

Salarpuriya Sattva Group has been awarded for the best developer of the year, Karnataka – 2019-20

Vaishnavi Group has been awarded for the best developer in the commercial segment, Karnataka – 2019-2020

Vaishnavi Group has been awarded for the most trusted developer in the residential segment, Karnataka – 2019-2020

Godrej Properties has been awarded for the iconic project of the year for the luxury apartment – 2019-2020

JRC Projects has been awarded for the iconic project of the year, villa – JRC Palladio, Karnataka – 2019-2020

Mana Projects has been awarded for the iconic project of the year for the luxury apartment – Mana Foresta, Karnataka – 2019-2020

Provident Housing has been awarded for the best residential property for Adora De Goa, Bengaluru – 2019-2020

Puravankara Limited has been awarded for the most innovative project for the luxury apartment – Purva Atmosphere, Karnataka – 2019-2020

SNN Builders has been awarded for the best luxury project of the year for SNN Clermont, Bengaluru – 2019-2020

SRK Infra Projects has been awarded for the best luxury plotting project, The Estate, Karnataka - 2019-2020

Corporate Leisure and Property Development (CLPD) Bangalore has been awarded for the best sustainable project of the year for CLPD Arcadia, Karnataka – 2019-2020

Durga Projects & Infra. Pvt. Ltd. has been awarded for the best-conceptualized project of the year for Durga Petals, Karnataka – 2019-2020

Reddy Housing Pvt. Ltd. has been awarded for the best emerging project of the year for Mahaveer Celesse, Bengaluru – 2019-20

Spectra Constructions has been awarded for the best apartment, Karnataka – 20219-20

Valmark Group has been awarded for the best project Valmark Orchard Square, mid-range apartment, Karnataka 2019-20

Design Cafe has been awarded for the best interior design company, Karnataka 2019-20

Metro Prop Solutions has been awarded for the best channel partner, Karnataka – 2019-20

Puravankara Limited has been awarded for the most innovative marketing campaign of the year, Bengaluru – 2019-20

Splendid Properties has been awarded for excellence in project delivery, Splendid Sree Durga, Karnataka – 2019-2020

Vibez Club has been awarded for the best co-farming project, Vibez Pomegranate Farms, Karnataka – 2019-20

Below are the honored winners of Hyderabad in their respective categories

Accurate Developer has been awarded for the best developer of the year, Telangana – 2019-2020

Harshith Infra & Developers has been awarded for the best emerging developer for Springfield Villas, Telangana – 2019-2020

Mak Projects has been awarded for the most trusted developer of the year for Villa, Telangana – 2019-2020

Praneeth Group has been awarded for the most innovative developer of the year, Telangana – 2019-20

Sumadhura Infracon has been awarded for the developer of the year for professional excellence, Telangana – 2019-2020

The Cria International has been awarded for the best emerging plotted developer for Willow Way, Telangana – 2019-20

Trishala Infrastructure has been awarded for the sustainable developer of the year, Telangana – 2019-2020

Greenmark Developers has been awarded for the best project, Villa, Telangana – 2019-2020

Vedic Constructions has been awarded for the best boutique apartment, United Avenues, Telangana – 2019-2020

Vertex Homes has been awarded for the iconic project of the year, Luxury apartment, Telangana – 2019-2020

2Getherments Infra has been awarded for the best emerging project, KSR Togetherments, Telangana – 2019-2020

2Getherments Infra has been awarded for the most innovative project of the year for KSR Togetherments, Telangana -2019-2020

BSCPL Infrastructure has been awarded for the consumer’s choice project of the year, Telangana, 2019-2020

Muppa Projects India Pvt Ltd has been awarded for the best project, product, and design villa, Muppa’s Indraprastha Villas, Telangana – 2019-2020

My Home Constructions has been awarded for the excellence in project delivery for My Home Avatar, Hyderabad – 2019-2020

Below are the honored winners of Chennai in their respective categories

Casa Grande has been awarded for the best developer of the year, residential apartment, Tamil Nadu

Samridhi Unique Spaces has been awarded for the best emerging developer of the year, villa, Samridhi The Envelope, Coimbatore – 2019-2020

Ganesh Moorthy has been awarded for the best real estate consultant of the year, Coimbatore, Tamil Nadu – 2019-2020

Samridhi Uniquespaces has been awarded for excellence in design, Coimbatore, Tamil Nadu – 2019-2020

CommonFloor and IndiaProperty thanks and appreciates the enthusiasm shown by the key real estate players for making the event grand – successful and encourages us to organize many more events like this in the years to come.

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Affordable Housing In Visakhapatnam To Get A Boost Due To Construction Of Metro Project

Oct 7,2019 / By Prahalad Singh / No Comment

Affordable Housing in Visakhapatnam to get boost

The Andhra Pradesh government proposal to extend the suggested metro rail project into the city’s outskirts. This decision has made the real estate developers in the city excited. Many real estate developers are now scheming to build housing societies in these areas to benefit low and middle-income groups.

Developers in the city feel that the cost of the property would increase once the time limit for the metro rail project gets closer. So, they now plan to address the working groups who they think will be using the metro on a regular basis but unable to afford the high-value property.

Former president of the Visakhapatnam chapter of Confederation of Real Estate Developers Association of India (Credai), Koteswara Rao told that a large number of the middle and lower-middle-class live in rental flats in Gajuwaka and Southern outskirts of the city as well as in Kommadi and Madhurawada. They might prefer to buy a property in Visakhapatnam and settle there permanently.

He further added that they might be able to afford homes in areas where the metro network is planned to go realizing the appreciation rate. So, they have decided to develop such Middle-income Group (MIG) and Low-income Group (LIG) projects.

As per the developer, since these projects will come under the Pradhan Mantri Awas Yojana, the cost of these flats would be less than Rs 25 lakh so that, buyers will get a discount on interest on home loans and other benefits.

The current property rate in the interiors of Gajuwaka and Kommadi is around Rs 3,000/sq.ft. On the other hand, the rate of property located on or around the highways hangs around Rs 3,500 – 4,000/sq.ft. Developers are expecting that the property rate will increase by at least 35 to 40% as soon as construction work begins.

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