The markets took a breather for a couple of years, though the corporate growth was on track. BRIC report by Goldman Sachs broke the silence in Indian equity markets. From 2003 onwards, Indian stock markets primarily moved around infrastructure theme. Global investors on the back of low interest rates got into the carry trades. Borrowing in a weak currency such as the yen with very low interest rates and investing in a country such as India with a strong currency with potential to earn superior return turned out to be the most important strategy for foreign money.
Within the theme, capital goods were one of the most preferred destinations for many. The companies saw phenomenal growth in both business performance and stock prices. Rally till 2007, along with bull market in equities, encompassed many other sectors such as financials and real estate. Real estate stocks could fetch dizzy valuations on Indian bourses. Analysts found solace in businesses with land bank stories. There are instances where stocks of companies with almost no operating businesses saw multifold price rise on the back of land banks.
Along with real estate, energy played a key role. As crude neared $150 mark per barrel, the power starving economy searched for all power generation stories. Power turned out to be one of the sought-after sectors. Reliance Power hit new records in terms of valuations.
Courtesy ET Dtd: 14/06/2010
For more information about real estate, real estate india, Indian real estate, property, property in india, Indian property, property for rent, rented property, apartment for rent, rented apartment, flats for rent, rented flats in delhi, property for sale in delhi, apartments for sale in delhi, flats for sale in delhi homes for sale in noida, flats for sale in noida, real estate in noida, investment option in noida, real estate consultant in noida, realty firm houses in noida, residence in noida, residence in delhi, residence in gurgaon, flats for rent in gurgaon Log in to http://www.zameen-zaidad.com/ And http://www.propertycafeteria.com
Monday, June 21, 2010
Thursday, April 8, 2010
Proposed Service Tax On Under-Construction Homes May Exclude Circle Rate Of Land
THE FINANCE ministry may exclude land value from the ambit of a new tax on under-construction houses, potentially taking the sting out of the proposed levy after it ran into a storm of protests from the real estate sector and exposed fissures within the government.
The 2010-11 budget has proposed a 10% service tax on 33% of the total cost of under-construction houses, which could increase the price tag of such properties by 3.3%. The new tax will come into effect once the budget is approved by Parliament.
But protests from a real estate sector worried that the tax could harm its nascent recovery and a demand by the urban development ministry to review it has forced the ministry to consider a retreat and look at ways to ease the burden on potential homebuyers.
Finance ministry officials said they were examining ways to separate land costs from the overall cost equation and take it out of the purview of the proposed tax. “We are looking at the issue to see how this can be done,” an official told ET.
Any change will make the new service tax more acceptable to all stakeholders and also introduce greater transparency in the pricing of homes by providing a break-up of cost. Its impact could be especially felt in major cities where land costs account for a bulk of the cost of under-construction properties.
“The proposed reduction will bring in a huge relief to both consumers and realty companies,” said an executive with Delhi-based real estate developer Ansal API.
The change could take much of the sting away from the proposed tax, especially since 67% of the property cost is not covered by it because it is considered as the cost of material used in construction.
Excluding land costs, the effective rate of service tax will fall to 1.75%, added Pradeep Jain, chairman of Parsvnath Developers.
Experts say the ministry could use circle rates or floor prices for areas set by states for computing land costs. But stripping out the land costs could prove complicated even when floor prices are available because ascribing land value to a flat in an apartment complex may be difficult.
“Practices are not consistent in the whole of country so it will have to be seen how a mechanism can be worked out,” said Rajeev Dimri, leader of indirect tax practice at BMR Advisors & Co.
The precedent of excluding land value from tax already exists in some form. State governments, for instance, do not include the value of land while imposing tax on works contracts.
Tax experts have questioned the legality of the proposed service tax, arguing that land is a state subject. “Whether the centre can tax land or property is a challenge. Imposition of service tax on commercial renting has already been challenged and the appeal lies before the Supreme Court,” said Mr Dimri at BMR Advisors & Co.
The service tax proposal signals a movement towards a unified goods and services tax framework, which will allow the centre and states to tax items in their respective domains. The centre has indicated rolling out GST from next April.
Courtesy:-ET dt:- 07-April-2010
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The 2010-11 budget has proposed a 10% service tax on 33% of the total cost of under-construction houses, which could increase the price tag of such properties by 3.3%. The new tax will come into effect once the budget is approved by Parliament.
But protests from a real estate sector worried that the tax could harm its nascent recovery and a demand by the urban development ministry to review it has forced the ministry to consider a retreat and look at ways to ease the burden on potential homebuyers.
Finance ministry officials said they were examining ways to separate land costs from the overall cost equation and take it out of the purview of the proposed tax. “We are looking at the issue to see how this can be done,” an official told ET.
Any change will make the new service tax more acceptable to all stakeholders and also introduce greater transparency in the pricing of homes by providing a break-up of cost. Its impact could be especially felt in major cities where land costs account for a bulk of the cost of under-construction properties.
“The proposed reduction will bring in a huge relief to both consumers and realty companies,” said an executive with Delhi-based real estate developer Ansal API.
The change could take much of the sting away from the proposed tax, especially since 67% of the property cost is not covered by it because it is considered as the cost of material used in construction.
Excluding land costs, the effective rate of service tax will fall to 1.75%, added Pradeep Jain, chairman of Parsvnath Developers.
Experts say the ministry could use circle rates or floor prices for areas set by states for computing land costs. But stripping out the land costs could prove complicated even when floor prices are available because ascribing land value to a flat in an apartment complex may be difficult.
“Practices are not consistent in the whole of country so it will have to be seen how a mechanism can be worked out,” said Rajeev Dimri, leader of indirect tax practice at BMR Advisors & Co.
The precedent of excluding land value from tax already exists in some form. State governments, for instance, do not include the value of land while imposing tax on works contracts.
Tax experts have questioned the legality of the proposed service tax, arguing that land is a state subject. “Whether the centre can tax land or property is a challenge. Imposition of service tax on commercial renting has already been challenged and the appeal lies before the Supreme Court,” said Mr Dimri at BMR Advisors & Co.
The service tax proposal signals a movement towards a unified goods and services tax framework, which will allow the centre and states to tax items in their respective domains. The centre has indicated rolling out GST from next April.
Courtesy:-ET dt:- 07-April-2010
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Unitech forms panel to push demerger
UNITECH has formed a panel of five board members to push the demerger of its non-core businesses into a separate entity as the country’s second-largest real estate developer looks to focus on its mainstay, realty.
The company plans to hive off its investments in telecom, hotel and special economic zones into a new offshoot, said a senior executive, requesting anonymity. Unitech owns a 33% stake in Uninor, a telecom joint venture with Norway’s firm Telenor.
All Unitech shareholders will get proportionate shares in the new entity after listing, he said, adding that the restructuring will help unlock value for them.
Unitech shares closed marginally higher at Rs 76.55 on the BSE on Tuesday. At this price, the company’s market capitalisation is a little more than Rs 18,000 crore.
Consultants Ernst & Young and SR Batliboi & Co as well as legal firm Amarchand & Mangaldas will advise the panel about the restructuring.
Courtesy:-ET dt:- 07-April-2010
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The company plans to hive off its investments in telecom, hotel and special economic zones into a new offshoot, said a senior executive, requesting anonymity. Unitech owns a 33% stake in Uninor, a telecom joint venture with Norway’s firm Telenor.
All Unitech shareholders will get proportionate shares in the new entity after listing, he said, adding that the restructuring will help unlock value for them.
Unitech shares closed marginally higher at Rs 76.55 on the BSE on Tuesday. At this price, the company’s market capitalisation is a little more than Rs 18,000 crore.
Consultants Ernst & Young and SR Batliboi & Co as well as legal firm Amarchand & Mangaldas will advise the panel about the restructuring.
Courtesy:-ET dt:- 07-April-2010
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Saturday, April 3, 2010
Mapsko Group has launched Mapsko Casa Bella, a Group Housing Project
Mapsko Group has launched Mapsko Casa Bella, a Group Housing Project spread on an area of around 18 acres at Sector 82, Gurgaon. The group housing has 3, 3(+1), 4(+1) bedrooms of 1690 sq. ft, 1960 sq. ft., 2535 sq.
ft. respectively. The price ranges between Rs. 2,500-2,600 per sq. ft.
Courtesy:- HT Estates dt:- 03-April-2010
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ft. respectively. The price ranges between Rs. 2,500-2,600 per sq. ft.
Courtesy:- HT Estates dt:- 03-April-2010
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Costs may force builders to give up green buildings
It may become difficult for builders to construct green buildings as they are 25-35 per cent more expensive than normal housing structures, reveal findings of Grant Thornton and ASSOCHAM.
Releasing the findings of the White Paper, ASSOCHAM presi- dent, Dr Swati Piramal pointed out that despite the benefits, construct- ing a green building remained a challenge when it came to the initial capital outlay and immediate returns on investment.
The Paper also points out that considering the changes in global climate, rising population, pollution, related regulations and also com- mercial concerns vis-à-vis power crisis, running cost and pressure on urban infrastructure, green practice will become a necessity rather than a matter of choice in the next 10 years.
Along with environmental con- cerns, the most obvious objective of constructing green buildings will be to bring in energy efficient practices, thus reducing consumption of power and water. However, in the short term, real estate developers find the s initial cost of deploying energy effi- cient systems a major hindrance.
This is inspite of the fact that real estate and its ancillary industries account for more than half of the world's energy consumption.
Courtesy:- HT Estates dt:- 03-April-2010
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Releasing the findings of the White Paper, ASSOCHAM presi- dent, Dr Swati Piramal pointed out that despite the benefits, construct- ing a green building remained a challenge when it came to the initial capital outlay and immediate returns on investment.
The Paper also points out that considering the changes in global climate, rising population, pollution, related regulations and also com- mercial concerns vis-à-vis power crisis, running cost and pressure on urban infrastructure, green practice will become a necessity rather than a matter of choice in the next 10 years.
Along with environmental con- cerns, the most obvious objective of constructing green buildings will be to bring in energy efficient practices, thus reducing consumption of power and water. However, in the short term, real estate developers find the s initial cost of deploying energy effi- cient systems a major hindrance.
This is inspite of the fact that real estate and its ancillary industries account for more than half of the world's energy consumption.
Courtesy:- HT Estates dt:- 03-April-2010
For more information about real estate, real estate india, Indian real estate, property, property in india, Indian property, property for rent, rented property, apartment for rent, rented apartment, flats for rent, rented flats in delhi, property for sale in delhi, apartments for sale in delhi, flats for sale in delhi homes for sale in noida, flats for sale in noida, real estate in noida, investment option in noida, real estate consultant in noida, realty firm houses in noida, residence in noida, residence in delhi, residence in gurgaon, flats for rent in gurgaon Log in to http://www.zameen-zaidad.com/
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Saturday, March 20, 2010
MAKE SURE YOU HAVE A STEADY CASH FLOW WHEN YOU RETIRE
Our Personal Finance Expert Will Guide You on Saving, Spending and Investing In This Weekly Column
Retirement is the time when you hang up your boots from the hustle-bustle of daily life, relax, do your own thing. As we say, it’s time to say: “Goodbye tension, hello pension!” Suddenly, from the risk of dying too young, you have transformed yourself to the category where the risk of living too long exists. The last thing you want to do is to have your money run out before you do. Risks have to be taken in a controlled manner, and post-retirement returns are thus assumed at 1% or maximum 2% p.a. over inflation. During one’s retirement days, the key requirement is safety, liquidity and tax-free returns. It is important to analyse the pros and cons of some of the avenues available to generate cash flow.
RENTAL INCOME
Apart from a self-occupied property, all other real estate investments are made with the objective of either capital appreciation — like the purchase of land — or to generate return on investment, as in the case of rental property. 2008 has been a rude awakening, and we must prepare for the time when rentals may drop, and the property may remain vacant for a few months. Depending on rental income for 100% of one’s needs may be a risk that needs to be mitigated before heading into the retirement days.
DIVIDEND INCOME
A few weeks ago, a client approached me to plan some additional investments for his mother who was a retired senior citizen. He did not want to take risks with the investment and during the course of our conversation, we realised that nearly a third of her income was being received by way of dividends. So, while she was averse to risk investing, she was equally reluctant to reduce her shareholding because she was thrilled with the quantum of dividend that she would receive year on year. In this case, there is a need to reduce the risks that this client carries in her portfolio.
ANNUITIES
In all our retirement planning calculations, we assume a life expectancy of 85 years for males and 90 years for females. However, no one can say today whether that is an underestimation or overkill. To do away with this risk, one can consider purchasing of annuities which are paid for your lifetime, and on your expiry, to your spouse. Obviously, if one was to use this as the only source of retirement income, the quantum required to be invested would be large, so it’s best that about a third of one’s retirement requirement is met through this route.
FIXED INCOME INVESTMENTS
Returns on fixed income investments are normally taxable. For the purpose of planning, it may be best to consider these — like senior citizen bonds, post office schemes, fixed deposits — first so that the income is within tax exempt limit for senior citizens — Rs 2.40 lakh per year as per the latest Budget proposals. Practical examples abound which ensure income that is tax-free and carries minimalistic risk for the senior citizen.
The author is the Managing Director and Chief Financial Planner of International Money Matters Pvt Ltd
Courtesy:- ET dt:- 19-03-2010
For information about real estate, real estate india, Indian real estate property, property in india, Indian property, apartments, apartments for sale, apartments for buy, apartments for sale in delhi, apartments for sale in gurgaon, apartments for sale in indirapuram, flats for sale in delhi, homes, homes for sale, houses for sale, homes for sale in delhi, homes for sale in gurgaon, houses for sale in delhi, houses for sale in gurgaon, property investment options in delhi, investment option in real estate, real estate consultant, real estate agents, real estate developers and many more log on to http://www.zameen-zaidad.com and http://propertycafeteria.com/
Retirement is the time when you hang up your boots from the hustle-bustle of daily life, relax, do your own thing. As we say, it’s time to say: “Goodbye tension, hello pension!” Suddenly, from the risk of dying too young, you have transformed yourself to the category where the risk of living too long exists. The last thing you want to do is to have your money run out before you do. Risks have to be taken in a controlled manner, and post-retirement returns are thus assumed at 1% or maximum 2% p.a. over inflation. During one’s retirement days, the key requirement is safety, liquidity and tax-free returns. It is important to analyse the pros and cons of some of the avenues available to generate cash flow.
RENTAL INCOME
Apart from a self-occupied property, all other real estate investments are made with the objective of either capital appreciation — like the purchase of land — or to generate return on investment, as in the case of rental property. 2008 has been a rude awakening, and we must prepare for the time when rentals may drop, and the property may remain vacant for a few months. Depending on rental income for 100% of one’s needs may be a risk that needs to be mitigated before heading into the retirement days.
DIVIDEND INCOME
A few weeks ago, a client approached me to plan some additional investments for his mother who was a retired senior citizen. He did not want to take risks with the investment and during the course of our conversation, we realised that nearly a third of her income was being received by way of dividends. So, while she was averse to risk investing, she was equally reluctant to reduce her shareholding because she was thrilled with the quantum of dividend that she would receive year on year. In this case, there is a need to reduce the risks that this client carries in her portfolio.
ANNUITIES
In all our retirement planning calculations, we assume a life expectancy of 85 years for males and 90 years for females. However, no one can say today whether that is an underestimation or overkill. To do away with this risk, one can consider purchasing of annuities which are paid for your lifetime, and on your expiry, to your spouse. Obviously, if one was to use this as the only source of retirement income, the quantum required to be invested would be large, so it’s best that about a third of one’s retirement requirement is met through this route.
FIXED INCOME INVESTMENTS
Returns on fixed income investments are normally taxable. For the purpose of planning, it may be best to consider these — like senior citizen bonds, post office schemes, fixed deposits — first so that the income is within tax exempt limit for senior citizens — Rs 2.40 lakh per year as per the latest Budget proposals. Practical examples abound which ensure income that is tax-free and carries minimalistic risk for the senior citizen.
The author is the Managing Director and Chief Financial Planner of International Money Matters Pvt Ltd
Courtesy:- ET dt:- 19-03-2010
For information about real estate, real estate india, Indian real estate property, property in india, Indian property, apartments, apartments for sale, apartments for buy, apartments for sale in delhi, apartments for sale in gurgaon, apartments for sale in indirapuram, flats for sale in delhi, homes, homes for sale, houses for sale, homes for sale in delhi, homes for sale in gurgaon, houses for sale in delhi, houses for sale in gurgaon, property investment options in delhi, investment option in real estate, real estate consultant, real estate agents, real estate developers and many more log on to http://www.zameen-zaidad.com and http://propertycafeteria.com/
HNI INVESTING IN COMMERCIAL PROPERTIES
Unlike in the past, the New Age Indians are not confined to investing in residential properties. They are now setting their sights on commercial property as well. Read on to know what attracts them to commercial properties
If you imagine that commercial properties are only purchased by companies to expand their business prospects, think again! Now high net worth individuals (HNI) too invests in commercial properties. As recently as a few years ago, commercial property was an investment option for select individuals. Apart from the issue of a large investment, it required a different mindset from the investment point of view as well. But, over the years, a large number of Indians have begun to earn huge salaries while many others are also making a lot of money through freelance jobs, which they are investing in commercial properties.
Unlike in the past, the New Age Indians are not confined to investing in residential properties. This trend is picking up fast. "If banks do not show reluctance to give loans to individuals in order to buy commercial properties, more and more HNI will come forward to buy commercial properties. It is now no secret that banks hardly show any positive attitude to sanction loans to individuals in order to buy commercial properties. This happens all over the world. That is why you cannot blame only our banks," says Samir Jasuja, CMD of PropEquity.
An official of PNB Housing Finance Ltd also admitted that while banks happily give loans for residential properties, they are not that forthcoming when it comes to loans for the purchase of commercial properties. Reason? He said that compared to residential properties, the rate of default is very high in this segment. That is precisely the reason banks avoid disbursing loans to individuals in buying commercial properties.
"As far as Ansal API is concerned, we have got bookings from a sizable number of such individuals (HNI) in our malls (Ansal Plaza in various locations), as also in small to medium office spaces in our commercial projects in Delhi NCR, Punjab, Lucknow, Kundli (near Sonipat in Haryana), among other projects," says the company's official spokesman.
Anu Gupta, director of Century 21 India, says that HNIs should make investments in commercial properties as these investments could maximize their return. The reason being, while they could go for bank loans up to 75-80% for such investments, the repayment of such loans could be set off against the rental incomes from such commercial properties. Thus, by investing a portion of the total price (say 25%), an investor can acquire a high-value asset, which will not only give maximum return (thanks to the set off provision in IT against rentals), but could see a significant appreciation over a period as the retail/commercial industry grows.
Giving his own example as to how he is earning less because he has invested in residential property while his friend is earning far more than him for investing in commercial property, a Delhi based financial professional, Narinder Gambhir, says that both he and his friend invested in residential and commercial properties in 2004 in East Delhi. Both invested close to Rs 30 lakh each. "While I am getting a rent of Rs 15,000 per month, my friend is earning Rs 25,000 from his property. This is a huge difference," Gambhir rues.
Discussing about the factors which are crucial for HNI to look buy commercial properties, a realty expert says that they should not invest where there is a deluge of supply. In that case before, the investment would not fetch good returns. HNI also invest in commercial property, as they are not restricted to a dingy market area. Today, swanky malls enable an individual to look at commercial property as a viable investment option. Moreover, the emergence of semi-commercial property in residential locations has made the investment financially viable.
RK Arora, CMD of Supertech group, says that there is nothing wrong if you invest in commercial property, but one must invest after taking all the pros and cons into consideration. "I feel that if you invest in some commercial space in NCR, then you have to wait for a long period before earning anything as there is a massive supply of such commercial property in NCR, unlike in Delhi. If you can invest in Delhi, then it is great."
However, Alimuddin Rafi Ahmed, CMD of ILD realty group, feels that as our economy is improving after tiding over a really tough time during the market slum of 2008-09, corporates are looking for commercial spaces on lease, hence it is a perfect time to invest in commercial properties. "This is just the right time to invest as the property is available at rockbottom prices. The crash in property prices led to downward revision of prices by developers. The reduction was to the tune of 30% or so. Hope things go better in the times to come and everyone benefits from the property," Ahmed concludes.
Courtesy:- ET Realty dt:- 19-03-2010
For information about real estate, real estate india, Indian real estate property, property in india, Indian property, apartments, apartments for sale, apartments for buy, apartments for sale in delhi, apartments for sale in gurgaon, apartments for sale in indirapuram, flats for sale in delhi, homes, homes for sale, houses for sale, homes for sale in delhi, homes for sale in gurgaon, houses for sale in delhi, houses for sale in gurgaon, property investment options in delhi, investment option in real estate, real estate consultant, real estate agents, real estate developers and many more log on to http://www.zameen-zaidad.com and http://propertycafeteria.com/
If you imagine that commercial properties are only purchased by companies to expand their business prospects, think again! Now high net worth individuals (HNI) too invests in commercial properties. As recently as a few years ago, commercial property was an investment option for select individuals. Apart from the issue of a large investment, it required a different mindset from the investment point of view as well. But, over the years, a large number of Indians have begun to earn huge salaries while many others are also making a lot of money through freelance jobs, which they are investing in commercial properties.
Unlike in the past, the New Age Indians are not confined to investing in residential properties. This trend is picking up fast. "If banks do not show reluctance to give loans to individuals in order to buy commercial properties, more and more HNI will come forward to buy commercial properties. It is now no secret that banks hardly show any positive attitude to sanction loans to individuals in order to buy commercial properties. This happens all over the world. That is why you cannot blame only our banks," says Samir Jasuja, CMD of PropEquity.
An official of PNB Housing Finance Ltd also admitted that while banks happily give loans for residential properties, they are not that forthcoming when it comes to loans for the purchase of commercial properties. Reason? He said that compared to residential properties, the rate of default is very high in this segment. That is precisely the reason banks avoid disbursing loans to individuals in buying commercial properties.
"As far as Ansal API is concerned, we have got bookings from a sizable number of such individuals (HNI) in our malls (Ansal Plaza in various locations), as also in small to medium office spaces in our commercial projects in Delhi NCR, Punjab, Lucknow, Kundli (near Sonipat in Haryana), among other projects," says the company's official spokesman.
Anu Gupta, director of Century 21 India, says that HNIs should make investments in commercial properties as these investments could maximize their return. The reason being, while they could go for bank loans up to 75-80% for such investments, the repayment of such loans could be set off against the rental incomes from such commercial properties. Thus, by investing a portion of the total price (say 25%), an investor can acquire a high-value asset, which will not only give maximum return (thanks to the set off provision in IT against rentals), but could see a significant appreciation over a period as the retail/commercial industry grows.
Giving his own example as to how he is earning less because he has invested in residential property while his friend is earning far more than him for investing in commercial property, a Delhi based financial professional, Narinder Gambhir, says that both he and his friend invested in residential and commercial properties in 2004 in East Delhi. Both invested close to Rs 30 lakh each. "While I am getting a rent of Rs 15,000 per month, my friend is earning Rs 25,000 from his property. This is a huge difference," Gambhir rues.
Discussing about the factors which are crucial for HNI to look buy commercial properties, a realty expert says that they should not invest where there is a deluge of supply. In that case before, the investment would not fetch good returns. HNI also invest in commercial property, as they are not restricted to a dingy market area. Today, swanky malls enable an individual to look at commercial property as a viable investment option. Moreover, the emergence of semi-commercial property in residential locations has made the investment financially viable.
RK Arora, CMD of Supertech group, says that there is nothing wrong if you invest in commercial property, but one must invest after taking all the pros and cons into consideration. "I feel that if you invest in some commercial space in NCR, then you have to wait for a long period before earning anything as there is a massive supply of such commercial property in NCR, unlike in Delhi. If you can invest in Delhi, then it is great."
However, Alimuddin Rafi Ahmed, CMD of ILD realty group, feels that as our economy is improving after tiding over a really tough time during the market slum of 2008-09, corporates are looking for commercial spaces on lease, hence it is a perfect time to invest in commercial properties. "This is just the right time to invest as the property is available at rockbottom prices. The crash in property prices led to downward revision of prices by developers. The reduction was to the tune of 30% or so. Hope things go better in the times to come and everyone benefits from the property," Ahmed concludes.
Courtesy:- ET Realty dt:- 19-03-2010
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