INDIAN REAL ESTATE THE BIRTH OF A NEW ORDER
  FROM THE FOUNDER'S DESK
 
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Winter has paved the way for a bright new spring in the Indian Real estate sector. Demonetisation has hit India hard. Opinion is divided across the length and breadth of the country. Some opine that it is for the greater good, while some say things could have been planned in a better way and that demonetisation is not going to solve any problem in the long run. Whatever the outcome, we cannot deny that this sweeping move by Prime Minister Narendra Modi will surely have a lasting impact on one sector in India and that is Real Estate. Luxury Market and Plotted Development are likely to be affected the most in terms of transactions. On the other hand, reduction in land cost and development cost should improve the margins of developers. This is likely to lead to reduction in prices and bring about economic efficiency in the sector.

Up next on the radar is the Benami Act. After demonetisation, the Government has already started tracing Benami transactions. The Benami Transaction (Prohibition) Bill aims at curbing the generation of domestic black money. Apart from confiscation of property, the Bill provides for prosecution and aims to act as a major facilitator to block the generation and holding of black money in the form of benami property, especially in real estate. This will also usher in fair market practices. The prices of the property will tend to be close to what they would ordinarily fetch on sale in the open market. In cases where the price is not ascertainable, a different procedure will be prescribed. The government is at least making certain concrete efforts on this front and this bill will instill a sense of fear and accountability among the market players.

Amidst this crusade against black money, the Government’s focus on Housing for All remains firm. Prime Minister Narendra Modi, officially launched a rural housing scheme, whereby the Centre intends to provide an environmentally-safe and secure pucca house to every rural household by 2022. The scheme aims to complete the construction of 1 crore houses by March 2019.

It is indeed interesting to see that digitisation of land records has already caught momentum in a few Indian cities. Land records in Mumbai and some villages in Delhi have already gone online. Once records are digitised and there are proper linkages established between registration, property taxes and titular records, chances of fraud and scams related to property will be much less. This will enhance accountability and transparency.

Pankaj Kapoor
Founder and MD, Liases Foras Real Estate Ratings and Research Pvt Ltd
 
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ON THE SMART CITY FRONT

Less than 10% of smart city projects will be of a large-scale by 2020: Gartner
A study by Gartner shows a less than flattering statistic about Smart City progress in India. The study said the lack of a holistic, framework-based approach and a viable revenue model are major hindrances to large-scale smart city projects in India. Though many Indian cities have announced smart city projects, a structured approach in selecting these projects is missing. A senior official of Gartner opines that in order to succeed, technology product management leaders of smart city products and services must focus on a long-term, consultative approach and innovative revenue model.

Whether or not the Smart City project will yield the desired results by 2020 still remains to be seen. Meanwhile, the progress on Smart Cities in India is as follows:

Ideck to prepare Thiruvananthapuram smart city plan

iDeCK, a joint venture between the Government of Karnataka (GoK), Infrastructure Development Finance Company Ltd (IDFC) and Housing Development Finance Corporation Ltd (HDFC) has been chosen as a consultant for preparing the Smart City Proposal (SCP) for Thiruvananthpuram. iDeck will prepare the smart city proposal to be submitted to the Central government over the next three months.
ON THE SMART CITY FRONT
 
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Special vehicles set up for Ajmer, Kota The Government has formed Special Purpose Vehicles (SPV) that will lead the enormous task of transforming Ajmer and Kota into smart cities. The SPVs (in Kota and Ajmer) are slated to plan, evaluate, approve, disburse funds, execute, manage, operate and review the smart city development projects.

12-15 Smart City projects in Nashik in 2017
Special vehicles set up for Ajmer, Kota
The Nashik Municipal Corporation (NMC) is working in full swing to realise the Smart City dream. The body anticipates 12-15 Smart City projects to go on floor by 2017. ICT based traffic management is one of the key pillars of Smart City conception, as the body has prioritized traffic management and parking through smartphone applications. Some of the other initiatives include an e-blood bank to check availability in the city’s blood banks, a river pollution monitoring system, an e-school app for virtual learning and an e-flood system to alert people in low-lying areas.
Varanasi’s Smart City dream moves a step ahead

Varanasi registered its special purpose vehicle (SPV), under the Smart City scheme. Varanasi Municipal Corporation (VMC) has registered the company under the name Varanasi Smart City Limited.
The SPV will decide on the appointment of engineers, employees, experts and committees and the organisational chart. After the registration process is completed, the state and urban local bodies would release Rs 200 crore for the project out of which Rs. 194 crore is slated to be from the Central Government. New Launches dropped 20% annually in Q2 FY16-17
 
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HAPPENINGS DOWN SOUTH

Hyderabad
The Telangana government cancels plan for revision in market value of land


The Telangana government has dropped the idea of revising market value for property registrations this year amid fears of a decline in revenue from the property registrations stream as well as legal glitches. Demonetisation has brought in a sense of uncertainty and the entire sector, including the buyers as well as authorities and builders, are in a state of ‘wait and watch’. In such a situation, civic bodies don’t think it advisable to revise the market value for property registration.

Telangana signs agreement with 32 cement companies for 2-BHK housing schemes

The Telengana government is taking some serious steps towards the Housing for All scheme - Rural and Urban. The state government signed an agreement with 32 cement companies for procuring 27.31 lakh metric tonnes of cement for constructing 2 BHK houses for poor. This is also part of the one of the ambitious schemes of Telangana Rashtra Samithi (TRS) government. It plans to build 2.6 lakh houses for the poor in rural and urban areas.

Two stretches of Hyderabad Metro likely to open next year
Hyderabad Metro Rail Limited (HMRL) stated that the 8 km long stretch between Nagole and Mettuguda and 12 km between Miyapur and SR Nagar may commence commercial operations either on 'Ugadi' or June 2, Telangana State Formation Day. 70% of the 72 km elevated project has been completed. While there were many questions raised on the delay, the officials clarified that opening two small stretches in two different corridors had not been not considered advisable. Transit-oriented development has been a catalyst in real estate progress for many cities and we can be hopeful for the same with two more stretches of Hyderabad metro opening up. Two stretches of Hyderabad Metro likely to open next year
 
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Vizag bets high on independent houses
Many realtors now believe that individuals find it more attractive to buy plots and build houses. Hence, instead of building apartments, they are offering more of independent houses and duplex structures in plots close to the city. About 25,000 acres of farm land in the outskirts of the city had already been converted into housing plots or apartments a couple of years back. Many layouts have come up on those lands. Sites where such developments have come up include Vizag bets high on independent houses
Anandapuram, Boyapalem, Bakkanapalem, Tagarapuvalasa, Rushikonda and Bheemili.
Kerala

Kerala government to offer apartments for landless people
Kerala government to offer apartments for landless people
In a move to provide affordable housing, the Kerala government has classified the beneficiaries into two - those who own land and those who do not. Due to scarcity of land, the government, Instead of allotting land, wants to provide apartments to the landless. The government has goals to construct 4,27,032 housing units by the end of 2021. The date for finalising the master plan for Thiruvananthapuram city is December 2017.
 
 
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MMR

Navi Mumbai: Rs 12,000 crore project to develop 23 Panvel villages cleared
Navi Mumbai: Rs 12,000 crore project to develop 23 Panvel villages cleared The long-awaited project of NAINA (Navi Mumbai Airport Influence Notified Area) has finally been cleared by the state urban development department (UDD). Realtors in Navi Mumbai and Mumbai are looking forward to it since it will open up a huge parcel of land for development. CIDCO has planned an expenditure outlay of Rs 12,600 crore over the next 10 years on infrastructural development within NAINA.
Initially builders were opposing higher development charges. This issue has now been resolved. As land ready-reckoner rates will now be referred to for building projects, which are on the lower side, the development charges have been reduced. Navi Mumbai civic body signs 60-year lease with Cidco for 202 plots, gets 98 more

Navi Mumbai civic body signs 60-year lease with Cidco for 202 plots, gets 98 more
Navi Mumbai civic body signs 60-year lease with Cidco for 202 plots, gets 98 more
The civic estate department has managed to extend the lease of 202 plots, acquired almost 10 years back from CIDCO for various utility purposes. The lease period is for 60 years. The civic body is now planning to acquire some more plots from CIDCO and MIDC. The 98 plots will be used to develop facilities such as parking lots, fire stations, taxi and auto stands, school playgrounds and daycare centres. One of the MIDC plots is meant for tree plantation.

Old land lease records in Mumbai to go online for public to verify

Digitising land records is one of the main aims of the Digital Indian campaign, and Mumbai is striding in the right direction. The Mumbai city collectorate has begun the process of digitising old lease documents. This will bring about transparency in land dealings to a great extent. All the necessary details like the area of the plot, ownership, rent outstanding, etc. has been integrated in the digitised records. This will also make it easier for buyers to scan through complex ownership details while making land purchases.
 
 
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More sops to acquire Mumbai-Nagpur Expressway land?

In a move to encourage farmers to give up land, the State government is considering adding several more sops to the land acquisition deal for the Mumbai-Nagpur Expressway. The proposals under consideration may give farmers an option to reject it altogether and sit across the table to negotiate a fixed price for their land. The moves include increasing the rates of the proposed yearly payout and providing agricultural land elsewhere in exchange for holdings.

Navi Mumbai: SEZ Township planned in JNPT influence area
A township has been planned in India’s first port-based multi-product special economic zone (SEZ). The township will be spread across 77 hectares for a population potential of 8,000-10,000 as part of walk-to-work culture. JNPT has planned to spend around Rs. 500 crore for the work under the EPC (Engineering, Procurement and Construction) model. Navi Mumbai: Rs 12,000 crore project to develop 23 Panvel villages cleared
The proposed township will be close to the proposed international airport and enjoy connectivity to other areas through the proposed CST-Panvel elevated rail corridor and a dedicated freight corridor for cargo.

Maharashtra government eases slum rehab guidelines, offers developers more FSI as sop

In a boost to lure developers to take up larger areas for redevelopment, the Maharashtra government has decided to allow “densification” under the slum rehabilitation scheme. Under the draft notification, if the tenement density is more than 800 per hectare (2.5 acres) then the government will grant FSI of 4. If the tenement density is in the range of 650-800 per hectare, then the FSI for in-situ redevelopment will be 3, but if the eligible tenements are more than 650, then FSI of 4 will be applicable.

Metro Line 2 cleared for Mumbai
The Metro Line II (Dahisar-Charkop-Bandra-Mandala corridor) has been put forward for Coastal Regulation Zone (CRZ) clearance. The Maharashtra Coastal Zone Management Authority approved the proposal subject to various conditions including no reclamation of coastal water bodies and ensuring the free flow of tidal water. The corridor which is supposed to connect North-South and East-West suburban areas stretches 40 kms. and is expected to ferry 21 lakh passengers every day by 2031. Metro Line 2 cleared for Mumbai
 
 
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OTHER DEVELOPMENTS IN WESTERN INDIA

Old city landowners ready to vacate land for DP implementation in Aurangabad

Many property owners across the city have ready to vacate their land to facilitate Development Plan (DP) roads passing through their localities. Local corporators have also encouraged property owners to vacate their land. In the DP prepared in 2001, authorities have proposed 100-feet wide roads, for which the AMC will have to acquire over 350 properties. It’s a welcome gesture that property owners are doing their bit for execution of the DP and not putting unnecessary obstructions to delay the process.

Nashik to grow more vertical buildings to accommodate increasing population

The Maharashtra town planning department is in discussion over the draft Development Plan (DP) of the city to Regional Plans for rural areas in the division. The proposed draft DP of Nashik has already been submitted to the Maharashtra government. Some of the key features of the draft DP revolve around accommodating increased population upto 34 lakh by the year 2034 and providing them all the amenities. The new residential zone of 12,835 hectares has been proposed in the draft DP to accommodate the rising population. The basic floor space index (FSI) has also been hiked from 1 FSI to 1.20 FSI.

Pending TDRs in Nashik to be processed as per new policy
Pending TDRs in Nashik to be processed as per new policy
The 250 pending transfer of development right (TDRs) that were scheduled to be cleared as per the old policy is now required to be processed as per the new one of January 29. The government resolution on January 29 for the new system of awarding TDR in lieu of land has left the builders unhappy. Sudden change in policies or systems of evaluations always create issues for the builder. Lesser ambiguity in policy implementation and faster execution is the key to minimize hassles in real estate.
 
 
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NORTH AT A GLANCE

DDA removes roadblock for third Ring Road in Delhi

Delhi Development Authority approved the road alignment of a small section, which has been stuck for years. The authority can now start work on the last leg of the route that will de-congest the city, once completed. The 79km semi-circular stretch will provide a direct link to NH-10 (towards Rohtak) and NH-8 (towards Gurgaon) for vehicles entering the city from Karnal. It is expected that this Ring Road will help decongest the city. The vehicles that are not Delhi bound can cross the city without entering. The project is part of three urban extension roads proposed in the Master Plan of Delhi-2021.

Rural Delhi to have online land records
Rural Delhi to have online land records
Land records of all villages across Delhi, except for the villages of North District, have been digitised as part of the Digital Campaign. The National Capital has about 356 villages. Transparency seeps in to rural affairs as well. The digitisation of land records will ensure that there is no meddling in records by revenue field functionaries. The digitally signed records of rights will be available throughout the day in the public domain and can be accessed by citizens anytime.
 
 
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Chandigarh sets up realty regulatory body
Rural Delhi to have online land records
Chandigarh has become one of the first in the country to set up a provisional Real Estate Regulatory and Development Authority (RERA) to resolve homebuyers’ grievances regarding delay in possession of flats and plots or other issues related to the execution of real estate projects.
 
 
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FROM THE EAST

Kolkata's New Town development authority aims at better construction progress
Kolkata's New Town development authority aims at better construction progress
The New Town Kolkata Development Authority (NKDA) increase awareness on adopting better design and construction management process. Recent amendment of NKDA Rules states that dumping of construction materials and demolition waste on the roads is discouraged. NKDA had also decided to provide service for removing of construction and demolition waste from a particular spot at a given cost for removing per tonne of waste.
 
 
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Authors:

Mr. Pankaj Kapoor


Founder and MD-Liases Foras Real Estate Ratings and Research Pvt. Ltd

Email id: pankaj@liasesforas.com

Ms. Namrata Sen Chanda

Content Manager


Email id: namrata@liasesforas.com

Mr. Murali Raman

Editor & Director - Communication


Email id: murali@liasesforas.com
 
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