A positive rise in the residential real estate sales

The implementation of RERA was initially met with skepticism and an accumulation of unsold inventory, which caused a gap in market growth. What added to the distress was the fact that demonetization had already weakened the purchasing power of home buyers and investors during that period. Moreover, reforms such as Goods and Service Tax (GST), Insolvency and Bankruptcy Code and Benami Properties (Prevention Act) did not help the situation either.
However, despite all the concerns, the third quarter of the financial year 2018 saw the Indian real estate market register a surprising change.
What was the change in numbers?
While advancing towards the last quarter of the financial year, the real estate market in India, especially in the residential sector was exposed towards a positive sign of recovery. As per recent reports by JLL India, the residential real estate market across several cities within the nation recorded a 40% surge in sales by the end of the 2018.
Major metropolises including Delhi NCR, Pune and Bangalore reflected a hike in the number of bookings. Hyderabad and Kolkata stood out in terms of growth performance, with 277% and 300% growth rates respectively.
How did it happen?
Despite facing some challenges initially, reforms like RERA and GST have helped to bring the stability in product pricing, timely delivery of products and more importantly alignment across the industry as a whole. All these factors in turn have boosted the confidence of buyers in the market, thus providing developers an improved confidence to launch new projects.
As per the reports, there is no dilly-dallying amongst buyers with regards to property buying decisions, a fact which spells a ‘big positive’. The Indian real estate has forecasted to exhibit further growth and gains in the coming years.
Interim Budget Gives Tax Benefits to Boost Real Estate Sector
During the Interim Budget 2019-20, Honorable Finance Minister stated that the foundation of India’s growth and developments had been laid. Some of the key highlights for real estate sector in the Interim Budget 2019-20, presented in Parliament, are as follows:
• Exemption from levy of tax on notional rent, on unsold inventories, from one year has now been extended to two years.
• Two houses can be purchased from sale of one house to save capital gains tax.
• Benefit of self-occupied property is now extended to two houses, if it is not let out.
• Threshold for TDS for rental income rose from Rs. 1.80 lakh to Rs 2.4 lakh.

Source: https://www.timesnownews.com/business-economy/economy/article/budget-highlights-for-defence-railway-infrastructure-real-estate-health-education-tax-slab-direct-tax-gst-housing/358054

A Major Contributor to Future Growth:How Office Markets in Indian Commercial Real Estate are Witnessing Increased Absorption in Key Cities

In 2018, a strong proliferation was seen in commercial office spaces in the Indian real estate market with over 33 million sq. ft. absorbed across DELHI-NCR, Mumbai, Bengaluru, Chennai, Hyderabad, Pune, and Kolkata, which are the top seven property markets in the country, resulting in 16% of on-year growth. It is forecasted that in 2019, these seven markets will record an all-time high in the transaction of commercial office spaces, with the a net absorption of 37 million sq. ft., which is similar to what was achieved in 2011, according to the latest report issued by JLL India.

These markets are further expected to witness a strong momentum with a net absorption of 76 million sq. ft. during the next two years. Based on the data of the current launch of new projects in several markets, a supply of around 126 million sq. ft. is expected over the next three years. Ramesh Nair, CEO & Country Head, JLL India, said in a statement that India’s position is improving considerably in the ease of doing business, and with the a growth rate of 8.2% in GDP in the 2nd (April-June) Quarter of the current fiscal year, the economy of our country is moving in an upward direction. This will further have a positive impact on the real estate sector, especially in the demand for commercial office spaces.

Nair further believes that it is going to be a very beneficial step for the developers to invest more in commercial office space to obtain the benefits that this sector has to offer. Net absorption for commercial spaces has grown by 18% year on year, which is 23.4 million sq. ft. during the first nine months, ending in Sep 2018. It is because of the demand for good quality, grade- A office spaces, strong economic fundamentals, institutional investments in the commercial office assets, along with the co-working office trend catching up in key markets, which are considered to be some of the key reasons,that this double digit growth has been achieved.

Colliers International India stated in the report that due to the advent of technology & automation,commercial office spaces, which have seen a robust and consistent growth in the last 4 to 5 years, are undergoing a major shift, which clearly reflects in the volume of office space transactions for the several key property markets in India. The report further suggests that Mumbai &Delhi NCR are contributing 70% of the absorption in the country with 4.2 million and 4 million sq. ft. respectively, including a demand for commercial shops for sale in Gurgaon and other cities; however, in absolute volume terms,Bengaluru has recorded the highest absorption for office spaces at 7.9 million sq. ft. in the first nine months of 2018.

Senior Executive Director, Occupier Services at Colliers International India, Ritesh Sachdev, said in a statement that IT-ITES, Banking & Insurance, Manufacturing & Consultancy services are the key sectors that drive the demand for office spaces in these cities. Co-working space providers & Ee-commerce are also the important players contributing to this demand of office spaces. Chennai witnessed a 92% increase in office absorption at 2.3 million sq. ft., followed by Pune with 50% on year growth at 2.1 million sq. ft. in terms of percentage growth. As per the data, Hyderabad and Kolkata witnessed the absorption of 2.2 million sq. ft. and 0.7 million sq. ft. respectively. The past decade has witnessed a structural shift in the commercial office sector on the back of technology revolution, boosted further because of the e-commerce boom in the past 3-years, which further has contributed in increasing supply & demand dynamics. The demand for office space has also increased by the Cco -working service providers, which in the past nine months ending 30th Sep, has further contributed to over 10% of total office space taken -up in these 7 markets.

According to latest report from the International Property Consultant, Cushman & Wakefield, in addition to all this, the demand and supply in the commercial office sector has also thrived due to a lot of traction from fintech and proptech companies as well as data center providers. This impact is visible in the increasing-supply for quality office space and commercial property in Amritsar and other Tier II cities as well. On the rentals front, the a stable and realistic growth has been seen in the Mumbai and Delhi-NCR markets. Rentals in Bengaluru, Pune, Chennai, and Hyderabad have also crossed the peak levels they had attained in the third quarter of 2008, just before the beginning of the economic slowdown. The uUnoccupied grade-A office spaces in cities like Bengaluru, Hyderabad, Pune, and Chennai are all in single digits. This demand, which was initially created by IT and IT-SEZ occupiers, has now seen the a rise from the non IT Players as well, that too from the cities which have been traditional
IT hubs.

IBC ordinance gives another reason to Home Buyers to invest in Real Estate

We are euphoric to announce this welcoming change where in the home buyers will now get the status of “Financial Creditors” as per the recent amendment in the Insolvency and Bankruptcy Code (IBC) 2016 by the Government of India. In the month of August this year the President of India has also granted his nod of approval to the IBC (Amendment) Ordinance. Like any other stake holder participating in Real Estate Project, home buyers will also be granted with the exact same benefit which grants them the representation in the creditors committee. The IBC amendment was made after acknowledging the fact that money which is raised from the home buyers is used as a mean to finance construction and thus they should be treated as any other financial creditor.

Approximately 20 to 30 percent of the Real Estate Projects face delay because of the various reasons from the developer. With the delay in the project, it becomes very difficult for them to manage their financials, as home buyers in India invest most of their savings in making the down payments of the property, pay EMI’s on the loan and in the current place of their stay they also continue to pay the rent at the same time. That turns out to be a triple whammy for most of them but with the new IBC Amendment, this scenario will change once and for all.

The Amendment in the IBC ordinance will bring a great level of transparency in the deals and curb the fly-by-night developers. By the virtue of IBC (Amendment) Ordnance, reputed developers offering ready to move apartments or apartments nearing possession will now come to fore which will automatically boost the sales numbers. Real Estate will see an increase in the pricing despite the increased borrowing costs, this is because 20 to 30 percent of the total value comes from institutional lending and rest comes from the construction linked payments which are made by home buyers. It is only under extreme financial stress that the lending institute can go for IBC Ordinance because most of the times, stressed Real Estate assets are taken over by sponsors by refinancing them.

It was only last year when Real Estate (Regulation and Development) Act (RERA) was implemented to bring transparency in the system and protect the interests of home buyers. The IBC Amendment added another cherry to the cake by adding an extra layer of security to the potential home buyers by giving them the status of financial creditors. These major reforms in the system of Real Estate Industry make it very evident that the Government intends to empower home buyers and how.

Why Should You Buy Commercial Property in Gurgaon?

Investment in commercial property has always been considered as an impeccable avenue for diversifying your investment portfolio and for getting back substantial returns. And since we are talking about Commercial property in Gurgaon, you can be sure that your investment will exponentially appreciate in the coming time.

As a city, Gurgaon has developed significantly in the last couple of decades, so much so that it is almost unrecognizable from what it used to be. Also known as the Millennium City, when it comes to Gurgaon commercial property the infrastructure development is on a constant upward path. The establishment of several IT parks, MNCs, and SEZs has led to an unprecedented development in the city, attracting people from all over the country and overseas. This rise in the number of people migrating to the city has also given impetus to the demands of not just residential areas, but also ample commercial establishments to help meet the needs of this increasing populace. In such a scenario, it makes increasing sense to invest in upcoming and new commercial projects in Gurgaon. Moreover, it is not hard to find a commercial property for lease or sale, as per your investment budget.

The Best Commercial Property in Gurgaon is here

When it comes to commercial property for sale, AIPL is where you get worthwhile lucrative returns on your investment. With us, you can find a substantial number of upcoming commercial projects in Gurgaon, built not just in prime localities, but also with a conscious thought to green development and environmental conservation. Advance India Projects Limited (AIPL) multi-dimensional commercial portfolio ranges from commercial office space in Gurgaon to retail spaces, along with an innovative product mix of retail, offices, living & entertainment. A great track record of quality, innovation, transparency, and timely delivery has helped build a trustworthy family for our investors. Besides six upcoming commercial projects in Gurgaon, AIPL also has a 26 years old legacy of successfully completed projects that have helped our customers, partners, employees, and investors create worth.

About Advance India Projects Limited

AIPL has a diverse portfolio in property investment, ranging from residential to retail projects across Delhi NCR and Punjab. In the last three decades, since its inception, AIPL has grown significantly, offering new heights in quality developments through excellence and innovation. AIPL has successfully developed and pioneered several residential & new commercial projects in Gurgaon, which are endorsed by more than 70 multi-national companies as well as Indian corporates that are housed in 35 commercial projects by AIPL in the National Capital Region.

AIPL is headquartered in New Delhi and has six regional offices across the country. The company portfolio has 50 landmark projects, making us the developer of choice to buy commercial property in Gurgaon and other regions like Gurgaon, Delhi, Noida, Amritsar, Khanna.

Why you should be investing in real estate now

2017 was a topsy-turvy ride for the Indian Real Estate Sector, but the year 2018 brings a favorable time for Property Buyers. Let us share with you few reasons as to why you should be investing in real estate right now:

Regulatory Reforms

The real estate market in India has been going through a transformative phase due to a spate of regulatory reforms. The introduction of reforms under the RERA and the Goods and Services Tax (GST) are the catalyst behind this transformative phase. The introduction of RERA has particularly boosted the confidence of consumers, as it is mandatory for the real estate projects to comply with the provisions provided under it. This will ensure that projects are delivered on time, and the money collected from the buyers isn’t diverted for other purposes. The adherence to compliances under RERA will also ensure that only the most-committed real estate developers are able to function in the market.

Large unsold inventory

A combination of high prices, excess supply and low consumption has resulted in huge inventories of real estate remaining unsold across the country. The slump in the market caused by demonetisation coupled with the introduction of RERA has prompted the real estate developers to focus on completing the existing projects and clearing-up the unsold inventories. This can be gauged from the fact that new home launches across top 14 cities India during the first half of 2017 fell to about 58,000 units as per the National Real Estate Development Council (NAREDCO), which is the lowest in the past 5 years (Source). This environment greatly favours the buyers, as there is an excess supply of properties, leaving the home buyers in a better position to negotiate.

Low home loan interest

To curb the presence of excess liquidity in the banking system, the RBI changed the key lending rates. This has resulted in home loan interest to fall to between the ranges of 8.3 to 8.4 percent (Source). This allows people to access low-cost home finance, offering considerable savings on EMIs.

Revival of interest from global investors

The introduction of RERA has instilled a level of confidence in the global investors that wasn’t present before. The real estate sector is expected to receive Private Equity (PE) investments of up to US $4 billion during the fiscal year (Source). This will ensure that the revival of real estate market is on track, which is surely good news for the consumers.

The year 2018 presents an excellent opportunity for those looking to invest in real estate, and the time to make a move is now.