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10-Oct-2019 25-Nov-2019

CREDAI Bengal Daily News Update | 25.11.19

Despite slowdown, housing sales see steady growth in tier-II cities

Government's push for affordable housing is ensuring tier-II cities are having a

larger piece of the housing sales, says real estate advisory firm Liases Foras

Smaller towns and cities offer a 'more conducive land' to develop low cost housing,

says Liases Foras MD

Amid the slump in residential sales across India, particularly in the metros, housing demand

in smaller towns and cities have seen a steady growth in the last five years driven by the

government's push for affordable housing.

Share of over 20 tier-II cities, including Jaipur, Vadodara, Nashik and Nagpur, in the total

housing sales has increased to 25% till the end of last financial year 2018-2019 as compared

to 16% five years ago, according to data compiled by real estate advisory firm Liases Foras.

In the second quarter of this fiscal year, these smaller cities accounted 26% to the overall

sales, a marginal jump from 25% recorded in the year-ago period.

However, overall housing sales across the country including major cities like Mumbai

Metropolitan Region (MMR), Delhi-National Capital Region (NCR), Bengaluru, Chennai,

Hyderabad and Pune declined by 2% to 91,115 units in the September quarter, as per Liases

Foras.

"If you look from 2014, sales of tier-II cities have jumped by 112% while tier-I cities have

grown by 28%. Contribution of these smaller cities to the overall housing market is

increasing. The push for affordable housing is driving this growth," said Pankaj Kapoor,

manager director, Liases Foras.

Apart from the government's initiatives like Pradhan Mantri Awas Yojana (PMAY), which

has helped push demand in the affordable housing segment to certain extent, smaller towns

and cities offer a "more conducive land" to develop low cost housing, Kapoor said.

While most of the cities in the country saw a decline in housing sales in the September

quarter, few cities such as Jaipur, Nashik and Ahmedabad saw a jump of 22%, 25% and 4%

respectively during the period.

Newspaper/Online Live Mint(online)

Date November 24, 2019

Link https://www.livemint.com/industry/infrastructure/despite-slowdown-housing-sales-see-steady-growth-in-tier-ii-cities-11574615290051.html

Real estate developers and consultants said that while big cities and metros are seeing a

huge supply overhang, smaller towns and cities have been less affected by any speculative

activities or downturn in the past.

"While the growth in the smaller cities is nothing prominent as of now, these places were

less affected by the bubble which were there in the market. Some of these cities have

remained very stable and have not been affected by the downturn.Thats why these cities are

showing a relatively healthier position," said Sourabh Mehrotra, national director, Knight

FrankFrank, a property consultant firm.

According to him, lower land prices have helped developers execute low housing projects in

smaller towns as they are able to bring down the capital cost by as much as 25-30%.

"The mega affordable projects like 7-10 lakh have come up in smaller towns. Reasonable

land prices along with government's subsidies have helped local developers to build low

cost housing projects such places," Mehrotra said.

However, developers feel that growth in last five years in tier-II cities is only "a green

shoot" as job markets expand beyond the metros but would take few more years to similar

demand in the major cities like Mumbai and NCR.

"Many smaller cities in India are likely to see incremental development because of the kind

of thrust that the government is giving on creating smart cities. But it is a long term story.

However, some of the smaller cities in south like Mangalore or Kochi have seen significant

changes in the last few years. More jobs and development will lead to offtake of residential

housing in these cities," said a spokesperson with property developer Puravankara Ltd. The

Bengaluru-based has ongoing affordable housing projects under the brand Provident in

cities like Kochi, Coimbatore and Mangalore apart from others.

____________________________________________________________________

Home sales in Jaipur up by 22%: Report

But as per the report by Liases Foras, an independent non-broking real estate research

company, the beaten down sector in Jaipur is not out of woods.

Home sales have shot up by 22% in Jaipur in the quarter ended September compared to same

period last year. According to the findings of a report tracking 35 top cities in the

country, residential property sales have risen in 15 cities with Jaipur witnessing second highest

rate of growth after Nashik at 25%.

But as per the report by Liases Foras, an independent non-broking real estate research company,

the beaten down sector in Jaipur is not out of woods. Its unsold stock continues to be one of the

highest in the country.

An efficient market maintains 8-12 months of inventory. It represents the number of months

required for the stock in the market to be absorbed according to the existing demand. In case of

Jaipur, the inventory level stands at 56 months in the said quarter, dropping marginally from 58

months (5%) in the same period last year.

Chennai is the only city covered in the city where the overhang is higher than Jaipur at 76

months.

Newspaper/Online ET Realty(online)


Link https://realty.economictimes.indiatimes.com/news/residential/home-sales-in-jaipur-up-by-22-report/72193283

It appears that despite the sales growth of 22%, the inventory level has not come down, rather

the unsold houses have risen by 17%. It indicates that along with the high sales growth, new

supply has come into the market.

Anand Mishra, president CII-Rajasthan, also director of a real estate company, said, "It clearly

shows that both demand for houses and new supply in the market has expanded which is a good

sign."

Majority of the new projects has come in the affordable category. But stakeholders in the

industry said that these projects have also added to the glut and demand has not kept pace with

supply. But there is a revival in demand for houses in the price range between Rs 40-75 lakh.

Sanjeev Rawat, senior official of a real estate company said, "We are witnessing revival of

demand for houses in the price range of Rs 40-75 lakh. There is an oversupply situation in the

affordable segment while projects above Rs 80 lakhs are struggling."

Some in the real estate industry in the state pointed out that despite the sales rising and months

inventory coming down, the survey finds that the number of unsold units have gone up by 17%

which appears to be at variance. Tanvi Goyal, head - client engagement, Liases Foras, said,

"Jaipur has witnessed an upsurge of both demand as well as supply in the past few quarters.

Sales witnessed a 22% growth in September quarter as compared to same period last year while

unsold increased by 17%. Months inventory dropped marginally to 56 months due to higher

growth in sales."

________________________________________________________________________________________________

Residents of Delhi's illegal colony can apply for ownership from

December 16

The Union Cabinet had on Wednesday approved a bill which provides a legal framework

to grant ownership rights to the people living in unauthorised colonies in the city, a move

that will benefit 40 to 50 lakh people.

Residents of unauthorised colonies in the national capital will be able to apply for ownership

rights starting December 16, Union Housing and Urban Affairs Minister Hardeep Singh

Puri said on Saturday.

The applicants will get the ownership certificate within 180 days from the date of application,

the minister said at the launch of a portal which will 'define and delineate' the boundaries of

1,731 unauthorised colonies here using satellite imagery.

The Union Cabinet had on Wednesday approved a bill which provides a legal framework to

grant ownership rights to the people living in unauthorised colonies in the city, a move that will

benefit 40 to 50 lakh people.

The decision is politically significant as it will benefit millions of poor migrants who hold key

to the assembly election due early next year and had backed the Aam Aadmi Party in large

numbers in the 2015 Delhi polls.

Inaugurating the website developed by the Delhi Development Authority (DDA), Puri said:

"What the Delhi government couldn't do in 11 years, we have done that in just three months".

Accusing the Arvind Kejriwal government of delaying the process of delineation of

unauthorised colonies on various pretexts, Puri said, "Obstructionist and irresponsible attitude

of the Delhi government is evident on every issue pertaining to the welfare of the people.

"We want the resident welfare associations to look at the boundaries delineated using satellite

imagery and convey their suggestions and objections within 15 days". The Union minister said

that another website will be launched for residents to apply for ownership rights starting

December 16.

The applicants will have to register and upload the required documents -- general power of

attorney, payment receipt, possession letter, etc -- on the website, DDA Vice Chairman Tarun

Kapoor said.

"Thereafter, a team of DDA will visit the spot for verification. The officials will help the

applicants remove deficiencies, in case there are any," he said.



Link https://realty.economictimes.indiatimes.com/news/residential/residents-of-delhis-illegal-colony-can-apply-for-ownership-from-december-16/72205741

Kapoor said DDA will start operating helpline centres at its local offices from December 1 to

make the process smooth.

In a bid to remove legal hurdles in granting ownership in unauthorised colonies, the lieutenant

governor has already declared 79 villages as 'urban areas'. Ongoing cases pertaining to change

of land use will also be withdrawn soon, he said.

________________________________________________________________________________________________

Website launched to delineate boundaries of unauthorised colonies

in Delhi

Housing minister Hardeep Singh Puri said that another portal will be launched for

residents to apply for ownership rights.

Union housing and urban affairs minister Hardeep Singh Puri on Saturday inaugurated a portal

which 'defines and delineates' the boundaries of unauthorised colonies in the national capital.

Inaugurating the website developed by the Delhi Development Authority (DDA), Puri said:

"What the Delhi government couldn't do in 11 years, we have done that in just three months".

He said that another portal will be launched for residents to apply for ownership rights.

________________________________________________________________________________________________



Link https://realty.economictimes.indiatimes.com/news/technology/website-launched-to-delineate-boundaries-of-unauthorised-colonies-in-delhi/72205942

Violations led to Lulu project cancellation: Andhra Pradesh

tourism minister

The minister, who held a review meeting with GVMC officials on sanitation, seasonal

diseases and town planning, alleged that the most expensive land pocket in the heart of the

city was given to Lulu group at throwaway price.

Tourism minister M Srinivasa Rao on Friday claimed there were several violations in the land

allocation as well as bidding process for the proposed mega convention centre in the city

by Lulu group.

The minister, who held a review meeting with GVMC officials on sanitation, seasonal diseases

and town planning, alleged that the most expensive land pocket in the heart of the city was

given to Lulu group at throwaway price.

―Moreover, the convention centre on beach road, which already witnesses huge crowds during

weekends, is not a suitable location for the project. The government cancelled the MoU taking

all these factors into consideration, not because of differences with N Chandrababu Naidu,‖ he

said.

Srinivasa Rao further said there is a clear drop in the number of vector-borne diseases within

GVMC limits as compared to last year.

―While the city registered about 1,464 dengue cases last year, it is about 679 cases this year.

The number of malaria cases this year is only 83 compared to 416 in 2018,‖ he observed.

The minister also set Dec 10 as deadline for GVMC officials to repair damaged roads in the

city. He also asked them to make the bus rapid transit system project operational in the next

one-two months. ―Several educational institutions operate out of commercial complexes. The

GVMC should launch a special drive to identify such institutions, which pose a threat to safety

of students during fire mishaps and other disasters,‖ he said.

______________________________________________________________________________________________



Link https://realty.economictimes.indiatimes.com/news/industry/violations-led-to-lulu-project-cancellation-andhra-pradesh-tourism-minister/72195494

Realty sector shows revival signs: Ravindra Pandey, CGM, SBI

He said the demand for residential units in the premium segment is clearly visible but we

would like to wait and see if this is holding on to emerge as a turning point of an uptrend.

The real estate sector has shown signs of revival in the past few months, leading to an optimism

that the slowdown has bottomed out and a recovery is underway, said Ravindra Pandey, chief

general manager of SBI, Jaipur after inaugurating the ―Times Top Brands Real Estate Expo‖ at

The Marriott Hotel Jaipur on Saturday.

He said the demand for residential units in the premium segment is clearly visible but we would

like to wait and see if this is holding on to emerge as a turning point of an uptrend.

The two-day expo, organised in association with SBI, began on Saturday. Most of the leading

real estate companies are showcasing a wide range of properties to meet needs of various class

of buyers. Additionally, SBI has put up a loan mela to help buyers with financing needs.

Many of the builders participating in the expo said that the market is now driven by real end-

users.

―Any upmove starts with end-users which we are witnessing now. If the trend sustains, then it

will attract investors. Let's hope the nascent recovery gathers momentum and tracks a broad-

based growth trajectory,‖ said an exhibitor.

SBI CGM Pandey said that the Centre has announced several stimulus measures to generate

demand for real estate and we are optimistic that they will have an impact in changing the

direction of the market for the better.

________________________________________________________________________________________________



Link https://realty.economictimes.indiatimes.com/news/industry/realty-sector-shows-revival-signs-ravindra-pandey-cgm-sbi/72205800

Home First Finance plans IPO to raise up to Rs 1,500 crore

Axis Capital, Credit Suisse, ICICI Securities and Kotak Mahindra have been appointed

by the company for the share sale.

Home First Finance Co (HFFC), a mortgage financier backed by True North and Singapore’s

sovereign wealth fund GIC, is looking to list shares locally in an initial public offering that

seeks to raise up to Rs 1,500 crore.

The draft red herring prospectus (DRHP) for the share sale at the home financier, backed by the

bulgebracket global funds, could be filed as early as next week, three people familiar with the

plan said.

Axis Capital, Credit Suisse, ICICI Securities and Kotak Mahindra have been appointed by the

company for the share sale.

The IPO will be a mix of capital raising and an offer for sale, allowing True North and GIC

along with Bessemer Venture Partners to partially exit their respective investments in the

company.

True North (44 per cent), GIC (30 per cent) and Bessemer (16 per cent) together hold 90 per

cent stake in the company and may sell some part of their shares depending on the valuations on

offer, these people said.

The company, founded by former Citibankers Jaithirth Rao and P S Jayakumar in 2010, is a

mortgage financier in the affordable housing segment. It has a loan book of Rs 3,200 crore as of

September with loan ticket size averaging Rs 10.4 lakh. Jayakumar owns 5 per cent stake in the

company.

HFFC has been growing at a compounded annual growth rate of 50 per cent in the last four

years and needs continuous capital infusion to maintain the pace of growth.

―They are growing very fast and using up capital pretty quickly. In fact, they raised some

capital earlier this fiscal as well but at the pace they are growing, they are doubling their book

every year which means that to increase leverage to continue growing, they need capital," said

one of the people cited above.

The company's capital adequacy currently stands at 48 per cent after the private equity

companies infused a total of Rs 328 crore in the first two quarters of the fiscal.

Chief executive Manoj Vishwanathan acknowledged that the company is looking to go public



Link https://realty.economictimes.indiatimes.com/news/allied-industries/home-first-finance-plans-ipo-to-raise-up-to-rs-1500-crore/72215877

but declined to divulge details.

"Some plans are there. Discussions are going on...we are working toward it. Going public has

its own advantages. The company will be well scrutinised and in the public eye and people have

that much more confidence in the company – be they customers, rating agencies or lenders,‖

Vishwanathan said.

―Secondly, we anyway have to raise capital because we will reach a Rs 5,500-crore loan book

in one year and at that level, we will need at least Rs 1,200 crore to Rs 1,400 crore capital and

we are at Rs 880 crore of capital; so we need Rs 300 to Rs 400 crore of capital anyway."

Bankers are still working out the details on the amount of capital that will come into the

company and the number of shares to be offered by the private equity funds. However, they are

confident that the company will be able to attract investors because of its strong growth and

solid asset quality.

HFFC's gross NPAs at the end of September 2019 were at 0.86 per cent of its loan book,

slightly up from the 0.66 per cent reported a year earlier. Loans to builders, a major pain point

for the industry, are also at only Rs 80 crore. However, the company's small size and low rating

at A+ have meant that its cost of funds has increased since the IL&FS crisis.

Vishwanathan said one reason for the capital raising was also that the company wants to keep

liquidity handy in the current challenging environment.

―We will be close to a Rs 4,000 crore loan book by March and at Rs 880 crore of capital with

almost four times leverage. Historically you could do seven to eight times but in the current

environment, people are not comfortable with more than five times leverage at our size and

rating. Banks will see how you are leveraged. By the middle of next year, we will be at five

times leverage with the current capital,‖ Vishwanathan said.

________________________________________________________________________________________________

Companies renewing office leases ahead of expiry to cap costs

This office space precommitment activity is primarily being driven by technology and

banking, financial services and insurance (BFSI) firms, said Gautam Saraf, managing

director, Mumbai, Cushman & Wakefield.

Robust demand for Indian commercial real estate and rising rentals are pushing companies to

renew lease deals ahead of expiry, as they seek to future-proof their businesses against cost

escalation, according to a real estate advisory firm.

This office space precommitment activity is primarily being driven by technology and banking,

financial services and insurance (BFSI) firms, said Gautam Saraf, managing director, Mumbai,

Cushman & Wakefield.

―Falling vacancy levels and rising rentals due to healthy demand for commercial real

estate across key markets are prompting occupiers to act and enter agreements for their future

space requirement,‖ Saraf told ET. ―It’s a win-win scenario for both occupiers and the project

developers, ensuring good space take-up and cost efficiency.‖

Occupancy levels in Indian commercial real estate have been rising over the last few years on

demand from new players in ecommerce, healthcare and technology, apart from existing

demand from the BFSI sector. Data shows that leasing in the first three quarters of 2019 has

inched closer to the full-year performance level of 2018.

Office space takeup is expected to be at an all-time high this year — driven by tech corporates

that account for about a third of the leasing activity—against the peak of 49 million sq ft last

year.

A recent instance of a high-value pre-commitment deal is global investment bank Morgan

Stanley entering into an agreement to lease nearly 800,000 sq ft of commercial space in Oberoi

Realty’s under-construction Commerz project in the Goregaon suburb of Mumbai.

Also this year, in one of the biggest office space transactions, US multinational investment bank

and financial services company Bank of America’s offshore delivery arm picked up nearly

500,000 sq ft of office space in DLF and GIC’s commercial complex DLF Cyber Park in

Gurgaon on a long-term lease. This deal was also sealed when the complex was under-

construction and nearing completion.

―With 11 million sq ft in DLF Downtown Gurgaon, with the 7 million sq ft in Taramani in

Chennai, we are well positioned to preleasing spaces across geographies. The testament to this

is near 100% preleasing in DLF Cyber Park in Gurgaon and the four blocks of about 1.6 million



Link https://realty.economictimes.indiatimes.com/news/commercial/companies-renewing-office-leases-ahead-of-expiry-to-cap-costs/72215830

sq ft sf completed recently in DLF Cybercity, Chennai,‖ said Sriram Khattar, managing

director, DLF Rental Business.

―Preleasing has taken place to large marquee multinationals. In fact, the 2.5 million sq ft DLF

Cyber Park in Gurgaon is fully preleased to about a dozen high-quality multinationals.‖

In Bengaluru, precommitments formed 40.2% of commercial deals so far this year, as against

36.5% in the full year 2018.

In Delhi-NCR, too, such deals have risen to 26.8% so far in 2019 as against 12.3% in 2018,

according to Cushman & Wakefield data. Pre-leasing activity touched 5.9 million sq ft in the

first half of 2019, almost twice the pre-leasing numbers in the corresponding year-ago period.

Healthcare products maker Abbott India also picked up an under-construction building with

over 160,000 sq ft of built-up area in Mumbai’s Andheri to set up an innovation and

development centre.

Several companies are also renewing leases much ahead of expiries to get the benefit of locking

rentals at a lower level.

Japanese financial services major Nomura Holdings has entered into an agreement with

Brookfield Asset Management for renewal of its lease for the over 450,000-sq ft office space it

occupies in Winchester commercial tower in Mumbai two years ahead of its expiry. The lease

was due for expiry in 2021, but Nomura has reset it for 10 years. Nomura will be paying rentals

of Rs 135 per sq ft a month for the office space with effect from 2021.

According to developers, IT/ ITeS, ecommerce and new-age companies are looking to expand

in good micro-locations in safe, compliant and sustainable projects of developers who are ready

to walk the extra mile to ensure higher employee satisfaction and efficiency.

________________________________________________________________________________________________

CPPIB, Mitsui Fudosan plans to invest Rs 3,000 crore in RMZ

office parks

RMZ is looking to bundle this office portfolio into a separate SPV and the deal, if it

fructifies, will be a major fillip to the Bengaluru-based company’s target of doubling its

office portfolio to over 75 million sqft in the next five years.

Japan’s Mitsui and Canadian Pension Plan Investment Board (CPPIB) are in advanced

discussions to invest about Rs 3,000 crore in a few upcoming office portfolios

of commercial developer RMZ Corp, people familiar with the matter said.

Mitsui, whose investment will be made through its real estate arm Mitsui Fudosan, and CPPIB

are looking to pick up equity stake of about 12.5% each in the near 12-million sq ft portfolio

which is spread across Bengaluru, Chennai and Hyderabad. Both the companies are looking to

invest similar amounts — in the range of Rs 1,200-1,500 crore.

RMZ is looking to bundle this office portfolio into a separate SPV and the deal, if it fructifies,

will be a major fillip to the Bengaluru-based company’s target of doubling its office portfolio to

over 75 million sqft in the next five years. RMZ has 15 million sqft of projects under

development across the country and 16 million sqft of completed projects generating rental

income of Rs 1,200 crore annually.

―At this time there is no confirmed deal of this nature to report,‖ RMZ said in an emailed

statement. CPPIB declined to comment, while Mitsui Fudosan said it could not immediately

respond.

________________________________________________________________



Link https://realty.economictimes.indiatimes.com/news/commercial/cppib-mitsui-fudosan-plans-to-invest-rs-3000-crore-in-rmz-office-parks/72215715

Maradu municipality selects four agencies for debris removal

The municipality had received around 10 EoIs from various agencies before the last date

(November 6).

Maradu municipality has selected four agencies for removal of debris from the four illegal

buildings situated within the limits of the local body. The buildings will be demolished on

January 11 and 12.

The municipality had received around 10 EoIs from various agencies before the last date

(November 6). One of the major criteria for selecting the agency was that it should have 50

vehicles to transport the debris from the site. It has been learnt that the agencies either own or

have the capacity to hire 50 vehicles. The other key factor was that the agencies should have dry

land to dump the waste.

―The four agencies meet the criteria (land and vehicles). We can reveal their names only after

bidders submit the financial bid. The agencies have submitted us the details of dry land where

they plan to dump waste. In order to ensure that the agencies do not dump the waste in

waterbodies, the municipality will reach an agreement with them. As per the details submitted

by these agencies, the debris will be dumped on dry land situated within and outside city

limits,‖ said an official with the local body. A decision on the financial bid is expected at a

technical committee meeting on Saturday.

Meanwhile, pollution control board (PCB) will install an ambient air quality monitoring

machine 24 hours before the demolition. It will assess the pollution level after the flats are

demolished. However, PCB said the equipment requires uninterrupted power connection.

The equipment can be installed 200 m away from the buildings since filter papers and other

systems in it need to be changed at certain intervals. ―The equipment can be placed on 3 m high

structure. We need to ensure that it gets uninterrupted power supply. One of the neighbours

should allow us to install this in his/her house compound. If KSEB disconnects power supply

during demolition, we will not get information of pollution at that time,‖ said a PCB official.

Meanwhile, municipality officials suspended demolition of the swimming pool in Alfa Serene

using machines as a crack developed on the external staircase of a neighbouring house.

―We feel that the vibration caused during demolition of the swimming pool led to a crack on the

staircase in the neighbouring house located just 3m away from the building. We will demolish



Link https://realty.economictimes.indiatimes.com/news/industry/maradu-municipality-selects-four-agencies-for-debris-removal/72195723

the rest of the pool manually,‖ said a local body official.

Coimbatore-based Vijay Steels and Explosives, which will demolish Alfa Serene, is doing this

work.

________________________________________________________________

Chennai: About 62% assessees paid increased property tax

Greater Chennai Corporation data shows at least 10% more assessees have paid taxes in

the first half of this year compared to the same period in the last fiscal.

Chennaiites may have been complaining about the increase in property tax (which was recently

rolled back) last year, but 62% of the 12 lakh property tax assesses in the city have paid the tax

in the first half of this financial year.

Greater Chennai Corporation data shows at least 10% more assessees have paid taxes in the first

half of this year compared to the same period in the last fiscal. The corporation has collected

around ₹700 crore this year, which is at least ₹300 crore more than the collection during the

period last year.

This, however, will not benefit the corporation as the rollback will make it poorer by around

₹400 crore. Those who paid the revised tax will get the extra money adjusted against the next

payment.

An increase in cashless payments has helped collection. ―Many residents have opted to pay

online or at e-seva centres. Tax collectors have also gone to homes with point-of-sale

machines,‖ said an official. Many residents and associations had complained that the revision

was too high. The corporation, however, argued that property tax rates in Chennai are lower

than those of Mumbai and Bengaluru.

―It ranges from 50 paise per square feet for residential to ₹18 per square feet for commercial,

depending on the street. People pay many times this amount for monthly maintenance,‖ said a

corporation official.

Property tax in core areas of Chennai have not been revised since 1998. However, areas

annexed to the corporation in 2011 like Alandur and Ambattur zone, already had high tax rates

imposed by the erstwhile local bodies.

The corporation has a monthly expenditure of around ₹130-₹150 crore, including salaries and

payments to contractors. It gets around ₹70 crore from the state and the Centre. The rest has to

be made through property tax collection. ―It is with the surplus that we carry out civic projects,‖

said an official.

Sources said the Corporation will now begin a drive to collect property tax from the remaining

4 lakh assessees, at pre-April 1, 2018 rates.



Link https://realty.economictimes.indiatimes.com/news/industry/chennai-about-62-assessees-paid-increased-property-tax/72193184

Karnataka plans forum to sort out disputes between buyers and

promoters

The Karnataka RERA, which is ready with the draft, is likely to issue the notification in a

week’s time.

Karnataka is set to establish a conciliation forum to facilitate amicable settlement of

disputes between promoters of real estate firms and homebuyers, replicating Maharashtra and

Uttar Pradesh.

The independent forum consisting of representatives from homebuyer groups, promoters and

Real Estate Regulatory Authority (RERA) will sit across to hear complaints from homebuyers

and negotiate a mutually acceptable deal.

―We have observed that not all complaints that are registered with RERA need legal

interventions. Many complaints can be resolved if the aggrieved party and the promoter sit

across the table and arrive at a mutual agreement,‖ Karnataka Real Estate Regulatory Authority

secretary KS Latha Kumari told ET.

The Karnataka RERA, which is ready with the draft, is likely to issue the notification in a

week’s time. With about 3,394 complaints registered with K-RERA until now and the RERA

rules mandating disposal of cases within 60 days from the date of filing them, the initiative is

expected to cut down the number of complaints that the real estate regulator gets.

Section 32(g) of Real Estate (Regulation and Development) Act provides for initiating measures

to facilitate amicable conciliation of disputes between the promoters and the allottees through

dispute settlement forums.

Maharashtra was the first state to create the alternative dispute resolution mechanism and has

solved about 70% of cases.

The Karnataka RERA secretary said that the forum will have a representative from the

consumer and the promoter’s side and the RERA executive will monitor activities. ―We are just

adding one more layer of intervention. If the cases are not resolved at conciliation then,

homebuyers can file a complaint with RERA,‖ she said.

This alternative method is only an option for buyers. The complaint filing section on the K-

RERA website will give an option to approach the dispute settlement forum before proceeding

with their complaint, if the homebuyer wishes to.



Link https://realty.economictimes.indiatimes.com/news/industry/karnataka-plans-forum-to-sort-out-disputes-between-buyers-and-promoters/72195686

―Litigation will consume a lot of time and energy of complainants. The forum will be a relief to

homebuyers as they will have an opportunity for case redressal before getting into legal

hassles,‖ MS Shankar, secretary of the Forum for People's Collective Efforts, said welcoming

the move. He said homebuyers are hoping that cases can be redressed in twothree sittings at the

conciliation forum.

CREDAI Bengaluru too has welcomed the decision. Chairman Suresh Hari said that

conciliation is the first and the best option for aggrieved parties. ―The experience of CREDAI’s

grievance cell is that most cases arise due to ineffective communication or due to ego or

technical issues. These cases can be solved through mediation,‖ he said.

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UK: Additional 3% surcharge maybe levied on stamp duty land tax

for foreign buyers

UK residents and foreign buyers currently pay the same level of stamp duty, which is

applied at various rates that rise with the value of the transaction.

Britain's Conservatives said Friday they will make foreign individuals and companies pay more

tax on residential property purchases if they win next month's election. Prime Minister Boris

Johnson's party said it would levy an additional three percent surcharge on the country's stamp

duty land tax for buyers who are not tax residents in Britain.

UK residents and foreign buyers currently pay the same level of stamp duty, which is applied at

various rates that rise with the value of the transaction.

There has been sustained critism of the level of foreign ownership of properties in Britain,

primarily in London, despite drops since the 2016 Brexit referendum amid ongoing economic

uncertainty.

There are no official statistics on the sales of residential property to overseas buyers, but studies

show they have accounted for as much as a third of purchases in parts of central London in

recent years.

Meanwhile, a 2017 York University report showed that 13 per cent of new homes across the

capital were bought by non-residents in 2014-16.

Analysts and political parties agree this inflates house prices and makes it harder for people to

get a foothold on Britain's notoriously expensive property ladder.

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Link https://realty.economictimes.indiatimes.com/news/industry/uk-additional-3-surcharge-maybe-levied-on-stamp-duty-land-tax-for-foreign-buyers/72193349

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