Elite Property Professionals

25/03/2018

For Arnawaz Khusru Sanjana
Khushnuma Burges Wania

03/11/2015

03/11/2015

Today's Times Of India
Elite Property Professionals

22/08/2015

Proud to be smart

11/05/2015

After the announcement of the Stamp Duty Amnesty 2008, there are some consultants and self designated specialists who are misguiding the people b strongly advising that full stamp duty will be charged on agreement for sale even prior to 10-12-1985. Not only that they are stressing that even the registered document will also attract stamp duty. Failing which 10 times the stamp duty amount will be levied as penalty at the time of conveyance. Most of the people are very much confused because at Stamp duty office they are not accepting documents prior to 10-12-1985 contrary to advise given by the consultants. Please note there is no denying the benefit of amnesty, because all such documents are duly stamped, hence they do not need further stamping, as such the benefit of amnesty does not arise.
Our office has been receiving several telephonic clarifications, since we are the publishers of the Ready Reckoner’s for all earlier years. To clarify this doubt GLOBUS spoke to Santosh Kumar, senior estate valuer and co-author of the Stamp Duty Ready Reckoner and Market Value of Flats in Mumbai / Thane, who clarifies the doubt as under.
The stamp duty on agreement for sale prior to 10-12-1985 is Rs. 5 only and no more stamp duty will be charged on all such documents. This point was also clarified by Dr Nitin Kareer, I.G.R. Maharashtra, during a public meeting held on 11-4-2004 at K.C. College, Mumbai. In this connection Law and Judiciary Department of the Government of Maharashtra, has also issued a clarification on 24-1-1995, the same is reproduced on backside, which is self explanatory. In view of this clarification all such documents can be annexed with the deed of confirmation on Rs. 100 stamp paper only and the deed of confirmation will be registered annexed with agreement for sale on Rs. 5 Stamp paper. There are several such documents already registered by the sub-registrar of assurance Mumbai, that can be inspected under the Right to Information Act. In case of difficulty one should not hesitate to contact I.G.R. Maharashtra, Pune.
The agreements for sale prior to 10-12-1985 are classified in two groups. One that is registered and another one not registered. As such these agreements will be treated differently at the time of conveyance in favor of the society. Here it is necessary to clarify that stamp duty was applicable even prior to 10-12-1985, but there was an option for payment at the time conveyance. However, for conveyance executed up-to 16-3-1988, residential flat up-to 650 sq ft carpet area was fully exempted from stamp duty and area up-to 1000 Sq ft was exempted up-to 60% of the stamp duty. Because of this provision there is a general notion that there was no stamp duty prior to 10-12-1985.
Now at the time of conveyance, stamp duty liability of all the present members must be cleared. For the liability of registered agreement on Rs. 5 Stamp paper, prior to 10-12-85, the market value (not agreement value) as on the date of agreement will be considered, as purchase price agreement value only, because market value concept was not there at that time. The document which is not registered will be valued as per present market value, subject to depreciation, and stamp duty will be charged, in all the cases, as applicable today.
Regarding Stamp Duty on documents executed on 10-12-1985 and there after, all such documents must be registered after paying the stamp duty, failing which penalty at the rate of two times (not 10 times) of the deficit stamp duty will be charged. During amnesty this penalty is maximum Rs. 1000 only. At the time of conveyance they will not be required to pay any duty again, against their respective flats.
Comparative chart of stamp duty liability on agreement dated 1981 is as per Table-B.
From this example it is clear that if the document is registered, stamp duty will be Rs. 2,200 only against Rs. 1,29,000 for non registered document.

04/05/2015

Realtors back to selling reality, not dreams
Sales pitches by real estate firms and property brokers are becoming more realistic as they learn from a slowdown and a consequent softening of returns.
NEW DELHI: Sales pitches by real estate firms and property brokers are becoming more realistic as they learn from a slowdown and a consequent softening of returns.

"Most buyers today understand that real estate as an asset class is a long-term play and short-term flipping can be a risky strategy," says Ashish Jerath, vice president-Sales, Emaar MGF, a Delhi-NCR based builder.

So pitches that indicated high returnsof 20-25% in eight to nine months around 2008-2009are more moderate, talking about a 50% return in 3-4 years now.

Unlike the boom time when people treated real estate as a trading commodity and invested money blindly, investors these days check a developer's track record, construction speed, land use, among other aspects before finalising an investment.

The period of 2008-09 witnessed a sharp drop in real estate pricing due to global economic concerns, which was followed by a sharp recovery in prices. In this volatile period, those who decided to purchase real estate assets made handsome gains.

But slow economic growth and high home loan rates hampered growth in the real estate sector since 2010. Home sales plunged 17% in top six markets last year and unsold inventory level rose to 647,484 units, according to property consultant Knight Frank India.

"Earlier investors used to put their money right at the conceptualisation stage of a project but after the market downturn, they are now a cautious lot and are investing in the middle or at handing over stage of a project," said Sam Chopra, chairman of real estate brokerage firm RE/MAX India.

Pawan Jasuja, director of Noida-based brokerage firm Finlace Consulting said they do all necessary checks before pitching products of a particular developer to their clients just to be safe. "Pure investors are finding very less opportunity in this market but the semi investors are focusing on value for money projects," he said.

However, with all the macroeconomic indicators showing recovery, upsurge in the job market and reduction in home loan rates, experts see a probable recovery in the sector sooner than later.

Rating agency Fitch Ratings also recently said the property market will recover by end-2016 as the country's investment climate improves.

"Those who will take the bold decisions today will be the winners of this cycle, and maybe in 2018, we will be writing about them and the gains they made," Jerath of Emaar MGF said.

03/05/2015

Property market to improve by March 2016

A global rating agency on April 20 said the likely upturn in the country's investment climate and reduction in interest rates will improve the property market by the end of March 2016 and provide relief to the debt-ridden developers.

"The property development sector (will) be a key beneficiary of reductions in housing loan interest rates by several domestic banks in April 2015," the agency said, adding that they would also boost credit growth.

Besides, the Reserve Bank has reduced the key policy rate by 0.50 per cent since January, prompting commercial banks to cut interest rates for home loan and other borrowers.

"We expect property developers with a greater exposure to the middle and lower income segments to benefit more from lower domestic interest rates," it said, adding that developers with a greater mix of high-income customers, such as Lodha Developers and Indiabulls, will be less impacted because their customers are less sensitive to market interest rates.

Both the companies, it said, would meaningfully reduce the portion of debts by end-2016.

The rating agency observed that "the process of reducing leverage (debts) stalled in 2014 due to weak sales and slower cash collections on properties that were sold towards the end of 2014 and in early 2015, as developers introduced easy payment schemes to stoke demand."

Earlier in the month, Fitch raised its forecasts for India's GDP growth to 8 per cent for the current fiscal, up from 7.4 in per cent in 2014-15, and 8.3 per cent for 2016-17.

Domestic property purchases remained weak in 2014 due to high interest rates and some political and policy uncertainty in an election year, it said, adding that several buyers postponed their purchases, which drove up inventory levels steadily during the last 12 months.

Most developers, Fitch said, responded by introducing easy payment plans for certain products. These payment plans typically require 20 per cent of the property price to be paid upfront and the remainder at the end of construction, usually several years later. This has lengthened cash collection cycles and contributed to higher leverage.

Fitch estimates that around 20 per cent of the sector's sales over the last two fiscal quarters were financed by easy payment plans and observed " longer cash collection cycle will continue to weigh on developers' balance sheets in the near term."

02/05/2015

Govt. Cuts TDR Along Narrow Roads
The State Government has issued orders mandating that Transfer of Development Rights (TDR), loaded on to a certain plot, can no longer be constant but has to be proportionate to the width of adjoining roads.
Developers have criticized the notice issued by the state urban development department on April 30.
They say it will impact redevelopment of a majority of buildings in Mumbai as most flank narrow roads.
TDR is a kind of floating FSI (Floor Space Index) that determines the extent of construction allowed on a plot. It is generated when the owner of a plot, which is reserved for a certain public amenity such as roads, hands it over to the BMC. He is compensated for the loss of his plot by way of TDR that is equivalent to the plot handed over.
TDR is also generated in case of slum redevelopment projects. It can be sold in the realty market and developers buying it can use it to construct more built-up area.
The concept was introduced in the 1991 Development Control Rules (DCR) which allowed for a TDR of 1 to be used in the suburbs, irrespective of the road width, over and above the base FSI of 1.
The new rules mandate that those who purchase TDR cannot load it on plots adjoining roads that are less than 9 meters in width while a TDR of 1 is applicable for only larger plots adjoining roads having 18 meters to 24 meters of width.
TDR has been slashed to 0.50 for plots lining roads that are between 9 meters and 12 meters in width and to 0.75 in case of plots lining roads 12 meters to 18 meters in width.
On the upside, developers who have projects bordering wide roads, having width of more than 24 meters, will now get a much higher TDR of 1.25 to 1.50.
Sunil Mantri, builder and president of the National Real Estate Development Council, said that about 70 to 80 per cent of buildings in Mumbai are along narrow roads.
“Especially in case of old and dilapidated buildings of South Mumbai, plots are adjoining roads less than 9 meters in width. These projects will be unable to use TDR at all now. This will render the projects unviable as there would not be enough built-up area for rehabilitation of tenants as well as for the developers’ sale area,” he said.
State government officials said the move was aimed at easing congestion along narrow roads by allowing less construction.
However, the upper limit on total FSI is not applicable in case of special projects such as redevelopment of slums, cased structures, housing board colonies, and several others. These projects can continue to use a high FSI of up to 4 or above.
On the other hand, those who generate TDR and sell them stand to gain with the new rules in place.
Those handing over their plots, reserved for any public amenities, to the BMC, will now get double the TDR that they were eligible for before.

30/04/2015

Why Mumbai is truly a city of riches

The verdict is here! ’ PropIndex (India Apartment Index) report has termed Mumbai to have an exorbitantly expensive real estate. The report states that Mumbaikars have made it so. Don’t believe it? Here is the proof.

According to the latest report, the demand for properties priced above Rs 1 crore is the highest across all budget range, almost synonymous to its supply which is also at the peak.

What has pushed the demand of residential units in the higher budget range?

Property pundits are of the view that the increasing population of young and rich people has resulted in this trend. Moreover, the base value of properties in Mumbai and close suburbs is also high where per sq ft value is not less than Rs 10,000 per sq ft.

For instance, areas such as Chembur and Ghatkopar which have usual second-hand properties on sale boasts property values close to Rs 16,000 per sq ft, as per the Magicbricks data whereas areas in extended Western suburbs such as Borivali and Kandivali have properties in the budget range of
Rs 12,000-14,000 per sq ft.

“There is hardly any first home buyer in Mumbai market, majority of the queries are from those who are looking for an upgrade, hence bigger property is a pre-requisite. This is the reason why demand for bigger and expensive properties had gone up,” says Trilok Chavan, senior advisor- Triumph Real Estate Solutions.

Where can you find such properties in Mumbai?

Properties priced above Rs 1 crore is concentrated on Western Suburbs. This is the time when several redeveloped as well as new projects, which were initiated 3-4 years ago are approaching their possession stage now. As South Mumbai properties are already over-priced and the plush pockets of the region have hardly any properties in budget range of below Rs 5 crore, which not even an upper-middle class buyer can think of buying.

29/04/2015

Scrapping DP 2034: What Mumbai really needs?

The Maharashtra Government has recently scrapped the Mumbai Development Plan (DP) 2015-2034. There are some queries that are doing rounds in minds of those who have already invested in the Mumbai real estate market or have plans to do so. How will the decision impact Mumbai’s real estate market and the developers who have projects in the city. And, how would the decision benefit the residents of Mumbai who were out in open opposing the plan?

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The scrapping of Mumbai's DP 2034

Experts say that the plan had some major drawbacks in terms of mapping of the existing land use and its proposals related to densification, infrastructure, and open spaces.

Looking for the right property? Your search ends here!

The objective behind drawing the DP was to guide development with differential Floor Space Index (FSI) as an instrument with densification of transit oriented corridors. Experts say that this concept was acceptable; however, the plan did not explain the working of FSI slabs it proposed.

“It lacked a balanced link with the current infrastructure conditions of city," says Prabhat Ranjan, CMD Olympeo Infrastructure Pvt Ltd.

Also, considering the high property prices in Mumbai, the city is in a desperate need of affordable housing. The DP was unclear about whether the densification measures would do any good for housing of low income groups and middle income groups in the city.

Apart from this, the city is already facing lack of enough open spaces. The DP proposed the development of areas which are in no-development zones, environmentally sensitive zones and recreation zones. “This not only reduces the per capita open space in the city but also poses questions about sustainability,” says Ashutosh Limaye, head – research & real estate intelligence service, JLL India.

The DP also had some errors related to mapping the existing land use. The heritage structures were missing or their use was erroneously captured, the roads that do not exist also appeared on the map. Such errors led to the confusion and failed to win people’s trust and garner support.

Impact of the decision

With the city having no master DP currently, the uncertainly will continue to loom the Mumbai’s real estate market. “Developers will wait to study the proposals and their implications before launching new projects,” says Limaye.

“In the meantime, supply of new units may drop, and this will help in clearing the existing unsold inventory to some extent. Buyers should assess their needs well to decide if they should buy from the projects available now, or if they can wait until clarity emerges via. the new DP,” Limaye adds.

What next?

Dharmesh Jain, president elect of Maharashtra Chamber of Housing Industry (MCHI), says" We will urge the civic body to respond to this as quickly as possible as the proposed development plan being in abeyance for long will hurt the long-term development of the city".

First and foremost, the existing errors related to land use map requires to be rectified. “Ironing out the errors on this front will ensure that the basis for the DP is accurate and reliable, and that it indeed gives a viable road-map for developing Mumbai for next 20 years,” says Limaye.

The upcoming plan is now expected to concentrate more on open spaces, housing requirements, transport infrastructure and affordable housing.

The decision of scrapping the Mumbai DP 2015-2034, gives an indication of positivity in the Mumbai real estate market, but until the revised development plan is tabled, developers, investors and buyers will have to wait. Does this mean a further delay in the delivery of new projects? Will the plan deliver a better and planned Mumbai? We’ll have to wait and watch!

28/04/2015

Can city buildings withstand tremors?
Mumbai

If one goes by a Geological Survey of India (GSI) report and what experts say, the city could face major devastation in case of an earthquake. It is prone to seismic activity that can reach 6.5 on the Richter Scale. Most of the city's buildings and infrastructure either have little capacity to handle tremors or have not been certified as earthquake-resistant. Besides, no survey has been done on the seismic resistance of the city's structures.

On Saturday, several Mumbaikars who live in highrises and Air Traffic Control (ATC) tower staffers felt tremors of the Nepal quake.

Experts want the government to carry out a survey to ensure that all buildings, both existing and those that are to come up, adopt earthquake-resistant technology. They say installing it would only amount to 5% to 10% of the total construction cost. Mumbai falls in Seismic Zone-III, which can experience a quake measuring up to 6.5 on the Richter Scale. A stretch between Panvel and Shreewardhan along Konkan coast, right from Thane creek to Amba creek down south, falls in Zone IV, and can get quakes upwards of 7, said retired IIT-B professor V Subrahmaniam.

"We are close to the Panvel flexure, the fault line that extends along thane creek down south. Our state plateau is safe but the coastal zone is seismically sensitive," said Subrahmaniam.

"It will be difficult to assess how many buildings are seismic-proof but a lot of them are trying to follow the norms. I think the government should undertake a survey to check if they are seismically weak and whether they need further treatments. As you know if one building collapses, it damages adjacent ones and therefore precaution is always better," he said. "Earthquake design is a special building code. Spending just 5% of the building budget will be enough to meet any seismic challenge. It could be made mandatory," he added.

A GSI study done in 2009 has warned that if a deep-sea earthquake above 5 on the Richter Scale hits Mumbai, only the seven original islands of the city would probably remain unscathed. The rest of the city, built on tidal flats or reclaimed land, may face a major devastation. GSI said a quake in the city's peninsular region will cause intensive damage in all areas, barring the seven islands from where Mumbai has expanded over the ages into Arabian Sea. Saturday's quake in Nepal measured around 7.9 on the scale. The five-year study showed that areas at the maximum risk include those in Central Mumbai such as Prabhadevi, Dadar, Sion and Mahalaxmi. Others at risk are CST, Churchgate station, Bandra, Vashi, Mira Road, Borivli and Malad (West), Kalina and Kurla.

03/02/2015

What a relief