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Demonetisation hits real estate market in Mumbai and Thane

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Demonetisation hits real estate market in Mumbai and Thane

Industry observers said the sector has reached stagnation point with many players claiming to be unable to crack even a single deal in the last seven weeks.

MUMBAI/THANE: Real estate market in Mumbai and Thane has taken a severe hit since demonetization was announced on November 8.

Industry observers said the sector has reached stagnation point with many players claiming to be unable to crack even a single deal in the last seven weeks.

Property expert and owner of Praron Consultancy, Pranay Vakil, said transactions have come to a “standstill” in the last 50 days. “People did not have cash to give in deals where cash is component is prevalent. Others postponed buying hoping that interest rates would go down,” he said.

Vakil said another reason was the expectation that property prices will reduce. “There were several media reports that rates will go down. Potential buyers thought it would be prudent to delay buying property,” he added.

Market sources said the high value residential market has been the worst affected with poor to nil sales since last month. Pankaj Kapoor of Liases Foras, a real estate research firm, said the industry is now in a “reset mode”.

“I expect a price correction once interest rates are lowered,” he said. “People are waiting and watching right now. Builders who were building luxury properties are shifting their focus to affordable housing in the distant suburbs,” he said.

Property consultant Ashok Narang of L. Lachhmandas & Co said inquiries in the residential segment have slowed down, but genuine buyers are bargaining hard with developers in the luxury segment. “It is now a buyers’ market,” he said. However, residential leasing has not been affected. “Developers with big brand names will sustain in this market, but at the same time they should provide incentives to buyers to improve sales,” said Narang.

In Thane, the local real estate association claimed many of their members haven’t finalized any sales deal since November 8.

“Many of my clients have preferred to wait and watch for the impact of demonetization before taking any decision. There are many brokers in our association who have not done any business. Rental market that is usually buzzing has seen some activities but largely clients are now bargaining for reducing the rental amount,” says association president Rajesh Gadgil.

Ramesh Nair, COO – Business & International Director, Jones Lang Lasalle, India, said the secondary market and even those in the primary segment where cash component plays a significant role has seen a dive.

“We were looking for purchasing a flat in Thane but have now deferred our decision as we feel the rates could crash anytime in the near future. Any drop in prices could benefit us as we could end up saving lakhs,” said Swati Sharma, a home seeker from the suburbs who has been aspiring to relocate to Thane soon.

Developers said except for few urgent deals, nothing much has transpired and the situation is unlikely to ease till the next fiscal.

The secondary market transactions that comprise roughly 25% of all the real estate deals inked in Thane is also badly impacted as the possibility of cash component here is high, said a local realtor. Areas like Naupada, Panchpakhadi, Khopat, Kopri that are in high demand along with few in Vasant Vihar and even the GB road has seen inquiries plummeting.

Officials at the eleven registrar offices across Thane claim the footfalls seem less but the impact can be ascertained only by end of the fiscal when a comparison can be drawn. “People come for registrations as most of them might have already finalised their deals before November or during Diwali,” said a state revenue officer.

Experts say that while majority transactions might have frozen, distress sales or purchases is happening with either party reaching a consensus and ready to forsake the cash element or defer payments based on mutual understanding. “Those who want to urgently dispose their properties either to migrate or to meet any other personal financial requirements might be ready to sell at lesser than the market rates. We are getting few requests for such properties of late. A large segment will however wait and watch,” says a realty agent from the city.

Source: economictimes.

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NTR Housing Scheme In Full Swing: Chief Minister N. Chandrababu Naidu

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NTR Housing Scheme In Full Swing: Chief Minister N. Chandrababu Naidu

On Thursday, Andhra Pradesh Chief Minister N. Chandrababu Naidu said with the estimated expense of Rs. 5,556.74 crore, the construction of more than 2,44,164 houses, out of the proposed 3,03,044, has been commenced under the NTR Housing Scheme 2017.

While addressing the second day of the Collectors’ Conference he also said the construction of the remaining houses will begin soon. He mentioned that Prakasam and the Kurnool districts are ahead of the schedule in the urban housing scheme. Also, the works are in full swing in the Nellore and the Guntur districts under the rural housing scheme.

According to Naidu, the government will complete 2.5 lakh houses by January next year and another lot of two lakh houses by June.

By October 2, 2018, the state government intends to finish the construction of all the houses and plans to celebrate with massive house warming ceremony with local public representatives. This will help them set an example for housing schemes in other states.

Also Read: Raunak Group Presents Apna Pehla Ghar Campaign

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A Mumbai Suburbs’ Swift Transformation From Industrial To A Residential Zone: Wadala

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A Mumbai Suburbs’ swift transformation from industrial to a residential zone: Wadala

An industrial zone primarily, Wadala has undergone a drastic transformation in the past decade. Now an upcoming residential area, this Mumbai suburb is one of the seven islands to form the modern Mumbai. It is located on the Harbour line of Mumbai’s railway network.

Due to its proximity to BKC, large scale land development was inevitable, thus fueling the real estate market. Wadala is bordered by Dadar on the West, Matunga on the Northwest and Sewri on the South. Nestled between south Mumbai and the suburbs, Wadala enjoys strong connectivity by road and rail to most parts of Mumbai.

It has a number of flyovers like the Anik Panjrapol Link Road, Elevated road and Santacruz flyover. Thane, CST and Chembur are connected via the Eastern Highway while the Western Highway connects the locality to Bandra and Borivali. Wadala has the biggest bus depot in Mumbai. Furthermore, the multiple infrastructure initiatives like the monorail, Truck Terminal and the expansion of Highway are in various stages of development.

All this has given rise to residential demand and pushed the property value over the last few years. One of the most populated areas in Mumbai, Wadala has a large number of old temples, churches and dargahs, university campuses, schools, reputed hospitals and is also home to a former world’s largest IMAX dome theater. There are many stores, showrooms and malls around Wadala like the R Mall, High Street Phoenix and Palladium Mall.

Ramesh Nair, COO – business and international director, JLL India says, “A decade ago, property prices at Wadala were as low as Rs 2,800 per sq. ft. and it rose to Rs 14,000 a few years ago.”  As the infrastructure plans are on their way, so are the renowned developers like Ajmera, Dosti Group and Lodha Group among others.

Wadala at present offers one of the highest returns on real estate investments in the region. All the above-mentioned developers have their luxury projects in the area.

Ajmera I-Land introduces Aeon, Zeon and Treon towers with 2, 3 and 4 BHK plush homes. Conceptualized by renowned Singapore based Architects Space Matrix, these spaces with top-of-the-line lifestyle amenities exude exemplary class and finesse. The first residential floor begins at 110 feet from the ground level and offers several modern lifestyle amenities like kid’s pool, swimming pool, gymnasium, club house, open space and landscaped gardens, yoga room, kid’s play area and senior citizen corner.

Dosti Ambrosia is a 36-storey tower nestled in the 18 Acre Township of Dosti Acres. The architecture of the project was undertaken by renowned Hafeez Contractor in the 2 and 3 BHK apartments. It offers an exclusive rooftop swimming pool with 40,000 sq. ft. of landscaped gardens. You will find all modern conveniences like Gymnasium, Tennis Court, Indoor Badminton Court, Yoga and Meditation Room, Elderly Corner, Banquet Hall, Indoor Games, Indoor Badminton Court, Guest Rooms, Restaurant, Grand Entrance Lobby, Kids Play Area, 2 Club Houses and an Amphitheatre.

New Cuffe Parade by Lodha Group offers its residents all the comforts of a world-class lifestyle. The 2 and 3 BHK homes are spread in over 23 acres of land with 15 acres of stunning landscape and 75,000 sq. ft. of the club house. It includes 11 swimming pools, an organic farm, cricket pitch and multiple themed gardens. The buildings are designed by the world renowned WOHA in Singapore and the landscape was planned by Sitetectonix in Singapore.

Also Read: Mumbai to get Building Taller than Burj Khalifa, Road Bigger than Marine Drive

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Rajasthan Government May Hike The Affordable Housing Prices

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Rajasthan Government May Hike The Affordable Housing Prices

The prices of homes under the ambitious Mukhyamantri Jan Awas Yojana are expected to be increased by the state government.

According to the sources in the empowered committee meeting to be held on Monday, a proposal to increase the cost of a low-income group (LIG) and economic weaker section (EWS) houses will be proposed. Urban development and housing (UDH) minister Srichand Kriplani will chair the meeting. The LIG and EWS houses, presently are being constructed on government lands by private builders. These homes are sold at a fixed rate of Rs 1,250 per sq feet; out of which 1000 rupees per sq ft is given by Urban Improvement Trust (UIT), development authorities and local bodies to the builders.

According to provision 4(A) and 4(B), the developers are supposed to build EWS and LIG houses on government land. Seventy-five percent of such government land can be used in building EWS and LIG houses, while the remaining 25% can be sold by the developers. However, since the rates provided by the government are less the developers are not showing interest to construct houses under these categories. Sources said, “In Jaipur, not a single developer has shown interest in constructing houses under this model. The JDA has invited expression of interest (EOI) several times.”

The UDH is leaving no stone unturned to attract the builders in order to achieve the target of constructing 10 lakh houses by 2019. The sources mentioned, “As per the new proposal, the department has proposed to provide Rs 1,600 per sq feet rate to the developers. The land rates have increased subsequently over the period of time; this is why increasing rates has become a need of the hour.”

Sources further added, “The developers are constructing G+3 buildings at present. However, it is not cost-effective. It has been proposed to construct G+2 buildings for LIG and EWS category.”

Also Read: The Impact Of Regulations On The Real Estate Market

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