Tough road to home
Hike in prices due to rise in raw material costs and taxation has given a jolt to home seekers
Geetu Vaid

It was not long ago that Chandigarh-based professional Vikas Malhotra was all excited about owning a home of his own in one of the upcoming projects. He had carefully selected a good location and a flat that fitted his budget. He also had the home loan EMIs completely figured out in his monthly budget. But his ‘perfectly balanced’ stepping into the homeowners’ league received a rude jolt when his builder indicated that the price of his desired home may go up by a few lakhs in the coming weeks, making him rejuggle the financial calculations.

This is not a stray incident as many prospective home buyers are in a similar quandary because several builders have either revised or are in the process of reworking the prices of residential units. The new home buyers may have to shell out 10 to 15 per cent more on new bookings.The main reason for the impending price rise is the raw material and labour cost as well as the introduction of service tax.

Steel and cement prices and commodity prices have shot up by up to 40 per cent in the past two years. One tonne of steel was availble for Rs 25,000 in 2007, and is now priced Rs 35,000, which is a substantial rise.

“When we plan a project certain cost escalation is factored in but so much increase is difficult to be absorbed”, says Mayank Modi, Director of Ashiana Homes, which has ongoing projects in Ghaziabad and Noida.

While presenting the builders’ point of view Bhim Yadav, CEO -Falcon  Realty Services Pvt. Ltd. says, “Developers are increasing the prices of the residential projects due to increase in input costs” . Falcon has recently increased the prices of flats at Gulmohar Woods project from Rs 5.9 lakh to Rs 7 lakh.

“There has been a steep increase in the prices of raw materials like cement, steel, bricks, sanitary fittings and also labour costs. As a result of 2 per cent hike in excise duties, the cost of raw materials has increased since last year and, therefore, there is a 7.5 per cent rise in construction costs. Service tax, on the other hand, would increase the purchasing cost by 2.7 per cent for the buyers”, said Yadav, while maintaining that price hike in this case has been kept marginal.

But then is there any way in which the price rise can be kept under check? As per Ashwani Prakash, Excutive Director, Paramount Builders, there certainly is a way to keep the prices at the affordable level if delivery is made in time and by providing basic facilities rather than going in for fancy detailing which adds to the cost factor in most cases.

A strong votary of sticking to deadlines, Prakash says that by just delivering the units in time and by strictly sticking to deadline, a builder can save up to 15 to 20 per cent on the overall cost. Paramount, that has projects in Ghaziabad, Noida and Saharanpur, has so far not revised the prices of residential units in different projects and as per Prakash they would try and absorb the escalation for the moment.

“We have also reverted to cost-effective measures and new technonlogy to keep the prices within the limit. Another price controlling factor is that we are providing basic facilities to our customer rather than offering them expensive options.

According to Vineet Relia, Chief Operating Officer of SARE India, “Keeping a control on prices depends on how organised the developers are and how much time and resources they are willing to commit on research of prices and trends worldwide. SARE has an internal procurement team which keeps a tab of the costs and trends of building materials worldwide so that the company is well informed and prepared for any price hike in the near future”.

Tax impact

Though the Budget has given sops to home buyers in the form of tax savings and interest rate subvention, it quietly brought back the much-dreaded service tax. Come July 1 and the service tax of 2.57 per cent of an apartment’s cost will be effective. While the service tax on the value of land for such calculation has to be paid, the finance ministry has enhanced the rate of abatement from 67 per cent to 75 per cent (of the gross value of land) for service tax on construction services.

This means service tax will be computed on the remaining 25 per cent (attributable to the value of services) of the house price, leading to 2.57 per cent effective tax. This would mean, for instance, an additional Rs 65,000 cost for a Rs.20 lakh flat booked with payment before completion. This burden will be passed on to the customers as builders won’t be able to factor in this in the original cost of a residential unit, says Modi.

Counter delay

Most of the builders have a no-escalation clause in the sale agreement, and it would be prudent for all new home buyers to ensure that this clause is there in order to avoid price hassles later. In a consumer driven market the home buyer can look escalation-proof deals. Some companies, like SARE have gone an extra mile to attract buyers with clauses like paying penalty in case of delay on the part of the builder. “This works in two ways for the customer. One is it helps them trust us, and secondly, it gives them a confidence that their home will be ready in time since this clause works as a pressure on the developer to deliver on time”, says Relia.

As per industry watchers this kind of price hike threat create only a temporary ripple in the market and as the market now is not only back on firm ground but is also a user-driven market rather than an investor-oriented one so there would not be long-term effects of this kind of price rise. There is a substantial gap between the demand and supply in the affordable housing sector so if prices are kept within the affordable range of Rs 25 to Rs 40 lakh then there will always be buyers in the market. 

Decoding DTC
S. C. Dhall

The Direct Tax Code (DTC) is a hot topic of discussion among people currently. The code is an attempt by the government to simplify the existing income tax laws in the country. Assuming there are no further roadblocks, the government expects to implement DTC on April 1, 2011, after it is passed by the Parliament. Here are answers to some questions like what will be the likely impact of the changes proposed on people’s household budgets, or how will the proposed changes impact the real estate sector:

Short-term capital gains

The government has revised the criteria for computing short-term capital gains. According to the proposals, any loss or gain made on the sale of an asset within a year of purchase will be taxed.The loss or gain made will be factored in the assessee income and taxed according to the income tax slabs of the investor. According to the existing tax laws, sale of asset before three years of purchase is considered short term.

Long-term capital gains

Any loss or gain made on the sale of an asset after one year of purchase is liable for long-term capital gains tax. 

Insteadof indexation benefit, the government plans to introduce the concept of discounting based on which LTCG will be calculated. It has also revised the base date for determining the cost of acquisition.

According to the draft code, from April 1, 2011, April 1, 2000 will be considered for calculating the discount rate and not April 1, 1981, which is used currently. This is a good news for investors who have invested in property years ago, as the unrealised capital gains on such assets between April 1981 and April 2000 will not be taxed.

Earlier long-term gains were taxed at a flat rate of 20 per cent after indexing it for inflation. However, now it will be added to assessee’s income after indexation (wipe out the rise in property value on account of inflation) and be taxed at the marginal tax rate i.e., the rate will be dependent on the tax bracket you find yourself in. This change will have a direct bearing on individuals in the higher income bracket as tax outflow will increase. So if you fall in the 30 per cent tax bracket, your gains will be taxed at 30 per cent.

Rental income

DTC had proposed that gross rent should be calculated at a presumptive rate of 6 per cent of either the market value or the cost of construction or acquisition, whichever is higher. However, it has now decided to reinstate it to the actual rent received or receivable for the financial year. Doing away with the complex method of calculation of rent will prove to be beneficial for recent home owners letting out their house.

Interest on home loans

The revised DTC intends to continue tax deduction on the interest paid on home loans up to Rs 1,50,000 for purchase or construction of residential property. This has come as a relief for first time home buyers.

Property not let out

Any one house property that has not been let out (treated as self occupied) will be eligible for deduction on account of interest to the tune of Rs 1,50,000. DTC does not mention anything about the tax benefits on the principal amount paid on housing loans, while it clearly states that interest paid is deductible up to Rs 1,50,000. It has also not mentioned anything on the tax treatment of interest during the pre-construction period.

Changes proposed in the revised draft of the Direct Tax Code will cheer home owners and home buyers. While changes like tax deduction on interest paid on home loans and calculation of tax on actual gross rent are favourable for investors, changes in capital gains dampen enthusiasm.

Direct Tax Code will change the whole tax structure of the country, and every corporate and individual will require in-depth study before its implication. Moreover, it is probable to withstand many emendations before it is conclusively performed.

The income from other sources now would be taxable under the head Income from house property as direct tax code adds extra words to the definition of income from house property i.e Machinery, Plant, furniture or any other facility, if letting of both is inseparable.

Now, as per current tax laws, taxable income is determined by annual value of the property fixed by the Municipal authorities / fair market value / rent actually realized. However, as direct tax code tells that contract rent, presumptive rent would be taxable income of house property except for a hotel, convention centre or cold storage and further the DTC proposes 6% of the value.

TAX TIPS
Manner of raising claims
S.C. Vasudeva

Q. My question relates to Section 50C of the Income-tax Act.

In the return filed under Section 139(1) for assessment year 2010-11, the full value of sale consideration received on the sale of immovable property is shown as adopted by Stamp Valuation Authority under Section 50(c) which is much higher than actual sale consideration received and recited in the registered sale deed.

My question is, if the Assessing Authority does not issue any notice to assessee and accepts the return, then can the assessee raise a claim under sub section 2 of Section 50(2)? If so then what is the mode of raising such claim and what is the time limit for raising this claim.

Alternatively in case the Assessing Authority issues any notice to assessee on the basis of return filed, for making assessment then what is the mode of raising claim under Section 50(2).

— Avtar Kishan Kapur

A. Section 50 of the Act deals with special provision for computation of capital gain in case of depreciable asset. Sub-section 2 of the said Section deals with the case of ascertainment of the cost of acquisition of block of assets where any block of assets ceases to exist as such, for the reasons that all the assets in that block are transferred during the previous year. The said sub-section has no relevance with Section 50C of the Act. It seems you have referred the wrong Section.

Possibly your question is with reference to sub-section 2 of Section 50C of the Act where the assessee claims that the value adopted or assessed by the stamp valuation authority exceeds the fair market value of the property as on the date of transfer. If this presumption is correct, such a claim has to be made by the assessee during the course of the assessment proceedings or in reply to a show cause notice issued by the Assessing Officer in this regard. In case there is a likelihood of assessment being completed without the issue of a notice for scrutiny, it would be advisable to revise the return so as to show the amount of capital gain on the basis of the actual consideration received by the assessee. The time limit for raising the objection would thus be the period within which the assessment is required to be completed in accordance with the provisions of the Act. 

Capital gain muddle

Q. I had applied for a flat from AWHO in  September, 2001 at Panchkula. The details are as under :

l Flat allotted on October 1, 2001.

l Date of completion November 2005.

l Payment of instalments from 2001 to August 2008.

l Flat possession taken on January 22, 2009.

l Possession offered from June 2008 onwards.

Now I am selling the flat in June end. My queries are as under :-

Am I eligible for long-term capital gain or STCG?

Date is to be taken from Date of allotment or from the date of original completion (November 2005) as the AWHO delayed the project by more than 2 yrs and 6 months?

What all charges can be included in the cost of flat i.e. Registration charges, maintenance charges, society charges, alteration charges etc.?

Please advise on applicability of LTCG or STCG. There is a gain of approx Rs 11.50 lakh.

 — Col. Onkar Singh

A. The capital gain in the case cited by you should be with reference to the date of possession because the right of allotment gets merged with the right of possession. Accordingly, the capital gain arising on the sale of flat would be a short-term capital gain. It may, however, be added that there are few decisions of the Tribunal in which it has been held that the capital gain should be computed with reference to date of allotment. Some of these cases are detailed hereunder:

CIT v. Jindas Panchand Gandhi (2005) ITR 552 (Guj.)

CIT v. Anilben Upendra Shah (2003) 262 ITR 657 (Guj)

You may, on the basis of the above cases, be able to claim that the capital gain arising on sale of the flat is a long-term capital gain. Cost of flat should include registration charges and alteration charges subject to evidence as to the incurrence of such expenditure being available. 

Late for revising tax return

Q. I have an income from salary from a nationalised insurance company. I had filed my tax return for assessment year 2008-09 before the due date and I have received intimation for the processing of the return. I have sold my residential house in the financial year ended March 31, 2008 and a loss of Rs 1.5 lakh has been incurred on the sale of the house. This was not reflected in my tax return. Is it possible for me to set off loss against the salary income by revising my tax return for the assessment year 2008-09?

— Kanhaiya Lal

A. The return for the assessment year 2008-09 should have been revised by March 31, 2010. Therefore, it should not be possible for you to revise your tax return for the assessment year 2008-09. Further, the loss of Rs 1.5 lakh may not be allowed to be set off against any other income in view of the provisions of Section 71(3) of the Act, which provide that in respect of any assessment year, if the net result of computation under the head ‘capital gain’ is a loss, and the assessee has income assessable under any other head of income, the assessee shall not be entitled to have such loss set off against the income under the other head.

Compute LTCG

Q. I had purchased a plot measuring 202 sq. yard on August 18, 1986 for Rs 6,000 at Kardhan village adjoining Ambala Cantt. A sum of Rs 750 was paid for registration of the sale deed. I constructed a house on this plot in 1991-92 which costed me Rs 2.40 lakh. Now I want to sell my house for Rs 10 lakh. The deal is likely to be finalised within next two months. Kindly let me know what would be the long-term capital gain after taking into account the cost inflation index. Secondly, suppose, the long-term gain comes to Rs 2 lakh, whether the whole amount of consideration i.e. Rs 10 lakh would be needed to deposit in tax savings fund or only Rs 2 lakh are required to be deposited as I intend to utilise this amount for construction of house at Nangal Township within the next two years.

— R.C. Sharma

A. The capital gain on the basis of the fact given in the query would work out as under:

Sale consideration 10,00,000

Indexed cost:

Cost of plot (6,750 X 660/140) (31,821)

Cost of house (2,40,000 X 660/199) (7,95,980)

Long Term Capital Gain 1,72,199

The above computations have been made on the estimated cost inflation index notified for the financial year 20010-11 as the index for the said financial year is yet to be notified by the government. The amount of actual capital gain may therefore differ on account of the change in the cost inflation index.

You will have to deposit the amount of capital gain with a bank under capital gain scheme account for utilising the said amount for the construction of a residential house in Nangal Township within the specified period.

Benefit under Section 112(2)

Q. My questions relate to proviso Sec. 112(1) and Sec.112(2) for working out tax liability on long-term capital gains.

The facts are that total gross income of assessee for assessment year 2010-2011 consist of income from other sources (interest from bank and post office) and LTCG on sale of immovable property.

After deduction of cost of acquisition worked out by indexation under second proviso to Section 48 from full value of consideration, capital gain arises which attracts tax at the rate of 20 per cent.

Section 112(2) provides that where gross total income of an assessee includes any income arising from the transfer of a long term capital asset, the gross total income shall be reduced by the amount of such income and the deduction under Chapter VIA shall be allowed as if the gross total income as so reduced were the gross total income of the assessee.

The total income of the assessee as reduced by LTCG, and after deduction under Section 80C (Chapter VIA) falls short of maximum amount, which is Rs 2,40,000 as the assessee is a senior citizen not chargeable to tax.

My question is whether the above referred shortfall can be adjusted against LTCG under proviso to Sec. 112(1) when the assessee has claimed deduction under 2nd proviso to Sec. 48 by adopting indexation for working out the cost of acquisition.

Where is the provisions/column in return Form ITR-2 for claiming tax relief under proviso to Section 112(1).

— Kishan Kapur

A. Your queries are replied hereunder:

n You would be entitled to claim the benefit allowable under Section 112(2) of the Income-Tax Act 1961 (the Act). Therefore, in case your total income, including long-term capital gain does not exceed Rs 2,40,000 for the assessment year 2010-11, you will not be liable to pay tax on such a total income, including long-term capital gain.

n The proviso to Section 112 refers to the capital gain arising on the transfer of listed securities which is not exempt from tax under Section 10(38) of the Act.

Such long term capital gain being taxable, the benefit under Section 112(2) should be available in respect of the long-term capital gain referred to in the first proviso to Section 112(1) of the Act. The relevant computations are to be given in ITR-2 in Schedule CG - Column B3 – “Asset in the case of others where proviso under Section 112(1) is exercised”.

Not entitled to exemption

Q. I sold a residential plot in December 2009 for Rs 5 lakh. The long-term capital gain is around Rs 2 lakh. Total amount is lying a savings account till date. I intend to invest this amount in a flat in my name which is under-construction and likely to be completed by December 2010. My queries are as under:

n Should I deposit the amount in Capital Gain Saving Scheme before June 30, 2010.

n I have one more residential plot and two flats are under-construction.  Whether I can save the long-term capital gain?

— Ved

A. Your queries are replied here under:

n Section 54F of the Act which deals with exemption from the leviability of capital gains tax provides that in case of long-term capital gain arising on the transfer of a capital asset other than a residential house, the net consideration be deposited in a bank under capital gain scheme account for utilisation of the said amount on the construction/purchase of a residential house within the specified period.

You would not be entitled to claim exemption from the leviability of tax on capital gain under the aforesaid section in case you own more than one residential house other than that which is being acquired.

GROUND REALTY
Durable roofing
RCC is the best choice for roof slab, writes Jagvir Goyal

It is surprising to note that in many parts of the country, the practice of laying reinforced-brick slab (RB slab) instead of Reinforced Cement Concrete slab (RCC slab) in buildings and houses is still prevalent. For many builders, RB slab is the favourite choice. Many masons consider themselves expert in RB roofing and convince the house builder to opt for it. Only a few house builders are courageous enough to ignore mason’s and builder’s advice and choose RCC slab.

A friend whose house was under construction in urban estate, Patiala, many years ago rang me up to tell that in his house, RB slab was ready for concreting. When I advised him against it, he had the courage to get removed the laid bricks and steel and opted for RCC slab.

RB Myths: Most of the people choose RB roofing under the impression that this type of slab is economical and doesn’t develop cracks. They are mistaken as RB roofing suffers from many defects. A few are listed below:

l Less durable than RCC slab.

l More prone to rusting of steel.

l More prone to appearance of efflorescence.

l Costlier than RCC slab.

l Not designed, but based on thumb rule.

RB slab composition: RB roofing consists of bricks laid on edge and covered with a 40 mm thick layer of concrete. Steel reinforcement is laid in the gaps left between the bricks laid on edge. A bottom cover of 12 mm is provided to the reinforcement. The total thickness of slab works out as 167 mm or more. No design is followed. The spacing of reinforcement gets decided by the brick-laying-arrangement itself which is ridiculous from the design point of view.

Excess steel in RB slab: Normally, in houses, 12 mm diameter reinforcement bars are used in RB slab as main reinforcement and 10 mm diameter steel bars as secondary reinforcement. The spacing of steel also gets fixed as 95 mm and 250 mm. Such an arrangement consumes much more quantity of steel than required and proves very costly for the house builder. If a RCC slab is provided, the main reinforcement for similar spans is generally of 10 mm diameter and secondary reinforcement of 8 mm diameter. The spacing of main steel is also more than that in RB slab. A RCC slab therefore requires much lesser steel than a RB slab and saves money on this account.

Bricks and concrete in RB slab: Thickness of RB slab works out as 167 mm. Such a slab uses 3.10 cubic feet of concrete and 40 bricks in one square meter area. A RCC slab of 113 mm thickness will use 3.98 cubic feet of concrete in one square meter area. Cost of concrete and bricks used in RB slab works out to be more than cost of concrete in RCC slab. RB slab proves costlier here also.

Durability of RB slab: Durability and strength of RB and RCC slabs are simply incomparable. Brick masonry has a permissible compressive strength of 2.5 N/ sq. mm while M20, the lowest grade concrete used in RCC slab has a strength of 20 N/ sq. mm i.e. 8 times that of brick masonry. RB roofing has 48 per cent brick volume and balance is concrete volume. Such a composite composition can’t be considered as strong and durable as bricks are a low strength and highly porous material.

Cracks and moisture: As and when RB roofing is laid, care has to be taken that bricks are thoroughly soaked in water before use. This is required to avoid the bricks soaking up water from the concrete layer laid over them. Such soaking of water by bricks from concrete results in cracks in the top layer of concrete. Often this important factor is overlooked while laying RB roofing. A little sprinkling of water on bricks is considered as enough. Such practice results in appearance of cracks in top layer of concrete and ingress of water resulting in cracks, appearance of ugly patches on the ceiling.

Rusting of steel: During the laying of RB roofing, another factor to be kept in mind is that the steel bars should be so placed in-between bricks that these do not come in contact with them. However, in actual practice, the steel bars get displaced from their laid positions when concrete is filled in joints. This results in rusting of bars after a few years. If such a thing happens, there is no remedy except to dismantle the slab and re-lay it. This is an impossible task as the whole of the house is to be undone. It has also been noted that in order to allow placement of concrete in the little space among the bricks, extra water is added to concrete to have easy workability. This is highly objectionable, and further weakens the slab.

Efflorescence: The problem of efflorescence, too, occurs on ceilings that are made of RB roofing as the bricks used mostly contain some inherent lime that always erupts later in the form of lime efflorescence.

Expansion cracks: The only factor that goes in favour of RB roofing is the low thermal conductivity of bricks. This helps in lesser expansion of slab and better insulation to heat. However, this factor weighs little against the drawbacks this type of roofing suffers from. If proper end treatment is given to RCC slabs, no cracks will appear in them.

The following treatment should be applied to RCC slabs:

l Provide a 6 to 8 mm gap at slab ends and fill it with sand filler.

l Provide a 10 mm thick bearing plas ter over the walls, cure it well and apply bitumen coat on it when dry. Now, lay the slab on it.

l Don’t concrete the slab during extreme summer days. On these days, expansion of steel causes cracks in slab.

l Cure the laid slab very well.

l Cover the slab with the designed roof treatment at the earliest.

Electric conduits: Sometimes, provision of PVC conduits in the slabs to accommodate electric wiring results in development of hairline cracks in the slabs because a proper bond among the concrete and the PVC conduits is not developed. Wrapping cheap binding wire over the conduit pipes increases their bond with concrete and cracks can be avoided.

Cost comparison: It is estimated that properly designed RCC slab costsabout 25 per cent less than RB slab. For a house having 3000 sq. feet covered area, the saving may be to the tune of Rs 50,000 at the prevailing prices of cement, steel, bricks and labour.

Readymade houses: While buying a built up house, ensure that it doesn’t carry RB roofing. Builders often provide RB roofing. Therefore, be doubly sure through actual check at site.

RB roofing should, therefore, be altogether discarded by the house builders and only RCC slab should be used.

This column appears fortnightly

Home Decor
Room with a view
From coastal decor to other nature-inspired designs, there are many ways to brighten up your bathroom,writes Viral Nandu

Bathroom is a room too, thus goes the tagline of an ad about bathroom accessories. And surely there is no denying the fact that pleasant and stylish environs of a bathroom are relaxing and rejuvenating. So, it’s high time that we get into the mood of redecorating and give our shower rooms a well-deserved facelift. Bathroom accessories for summer abound with fresh looks from the outdoors. Here are some ideas to spruce up bathrooms.

The beach effect

It is a fun idea to dress up your guest shower room with a fun beach theme. You’ll find plenty of designs in glazed tiles, carved ceramic, clean-cut porcelain, and simple but elegant rocks, shells, pebbles. Seashells added to a bathroom can add an element of peace and tranquility. Next time when you are on the beach, collect the most beautiful seashells you can find. When you return home, purchase clear glass bowls. Fill them with a layer of sand followed by a layer of seashells. You can even do several layers of alternating sand and shells. Place these glass containers on the bathroom vanity as well as other strategic places in your bathroom. Seashells look best if your bathroom is painted a light colour or if you have light colored wallpaper on your walls. Other ideas are to decorate the edges of your bathroom mirror with shells or glue seashells to ceramic bowls and use them to hold your bathroom necessities.

Make a difference with fabric

Don’t skimp with the fabric, and your bathroom will look much better and sorted. Use it on the windows wisely with a set of velcro, and also for the shower curtain outside the tub area. Lacy white linen is inexpensive, yet looks beautiful, and there are some great summer prints as well to work with.

Potted beauties

Live plants thrive well in bathrooms that are airy and get adequate sunlight. They are always a good decor choice for shower rooms. And the best part is, you do not need to spray clean them everyday. Choose plants that can flourish without large amounts of light such as bamboo which gives a bathroom a contemporary, spa-like atmosphere. Ferns, orchids or lilies too add the touch of exotic. You can also add fluorescent bulbs to your bathroom to provide more light for your bathroom plants.

Accessory accents

Use practical items as accents to decorate your bathroom. Swap your wall hooks with a set of new ones, and switch to chrome or brushed silver towel bars for a fresh summer look. Add wicker baskets for additional storage. Hang towels and wash clothes, adding splashes of colour. Use toothbrush holders, soap dishes and the like that you cover in fabric to match your window treatments. Add jungle animal knickknacks to shelves or counters.

Bath mats and rugs

Do away with your old bath mats and rugs. Spread new rattan inspired rugs which speak of the outdoors. Choosing the right bath mat is a matter of balancing safety features with design and comfort goals. If safety is a primary concern, choose a mat with a rubber backing that will not slide around the floor. Also pick a mat that allows for secure footing and does not become dangerous when wet or damp. If you’re looking to comfort your bare feet, find a mat that is thick, soft to the touch and easy to stand on. Consider soft fabrics, carpeting or even a rubberised fabric. Another consideration when choosing a bathroom mat is its shape and size. Since most bathrooms are long and narrow, bathroom mats that are rectangular in shape make the most sense. Round bathroom mats can break up a boxy space, especially in a small, square bathroom.

Fragrance all around

A bathroom should always smell great. Use decorative scented candles and potpourri to bring in that fragrant touch. Dried flowers, eucalyptus leaves and essential aromatic oil in small glass bottles also work well for the purpose. Candles are a great way to achieve low light without changing the bulbs in your bathroom. Gather up candles from around your house and place them around your bathroom. Candles with scents that you find calming and soothing will help add to the scent of the bathroom, unless you have potpourri or incense you can use. If you do not have any scented candles or incense then you can gather flower petals from your yard to dry and use later as potpourri. Candles will give a wonderful spa feel to your room, as well as romantic, but remember to put them out when you leave the room.

The writer is, Director, Euro Ceramics Ltd, Sanitaryware Division

Steady march towards transparency

The 2010 Global Real Estate Transparency Index released by Jones Lang LaSalle and LaSalle Investment Management revealed a worldwide slowdown in the progress of real estate transparency over the past two years. The survey suggests that the recent turmoil in global financial, economic and real estate markets has impacted on market behaviour, with real estate players focusing on survival rather than market advancement. The average improvement in real estate transparency across the 81 markets covered by the survey has halved in 2008-2010, when compared to the 2006-2008 and 2004-2006 period.

Abhishek Kiran Gupta, Head – Research & REIS, Jones Lang LaSalle Meghraj , states, “The latest transparency index reveals that India has yet again surged ahead in its real estate transparency ranking. The country’s Tier 1 cities are currently ranked 41 among nations surveyed, while India’s tertiary cities have graduated from the Low Transparency tier to Semi-Transparent. Further, Indian cities in each tier are now considered slightly more transparent than their Chinese counterparts.”

Nine out of the 15 fastest improvers are in Europe, and the remaining six are in Asia Pacific - to be more precise, three from India and three from China. Countries with lower investor interest levels — such as Turkey, Poland, Greece and others — have actually improved the most since 2008. On the heels of the global crisis, real estate transparency levels in one-third of the countries are static or declining.

“India’s real estate market is rapidly shedding the elements that were part of a less mature system,” says Anuj Puri, Chairman and Country Head, Jones Lang LaSalle Meghraj. “The increasing transparency levels are a reliable indicator that the country is adapting fast to the ways in which real estate business is conducted in more developed countries. The result is that Indian real estate is gaining swiftly in international credibility, and this in turn is boosting investor confidence levels.”

The survey identifies the fastest moving markets over the past two years, and presents the top-ranking markets in each of the five transparency categories - Performance Measurement, Market Fundamentals, Listed Vehicles, Legal and Regulatory Environment and Transaction Process. — TNS

Key Findings

l India has surged perceptibly ahead in its real estate trans parency ranking. It currently occupies the 41 slot among transparent countries

l Tier III cities in India have graduated from low to semi-trans parent levels

l Indian cities in each tier are now considered slightly more transparent than their Chinese counterparts

Realty biz to remain local play

Real estate market may have grown in leaps and bounds in recent years, but the business may remain a regional play in the country, as law of land is different in different regions, feel experts.

“There is different process and law in every state for acquiring land, getting approvals for projects and property taxation, which makes it difficult for developers to have a pan-Indian presence, Property consultant Jones Lang LaSalle Meghraj Country Head and Managing Director Anuj Puri told PTI.

He, however, said that some developers like DLF have succeeded to a limited extent in expanding their businesses to other regions.

Noting that realty is a regional play globally as well, Puri said there are not many developers having a global footprint.

Many developers also believe that property sector is a regional business as one need to understand local dynamics to develop realty projects.

“Real estate in India continues to be a regional play with the need to have strong regional knowledge of legal systems and approvals to be successful,” Sahara Prime City Chief Executive Officer Sushanto Roy said.

BPTP Senior Vice-President (Marketing) Amit Raj Jain: “A strong local knowledge is a must because land acquisitions are governed by typical local issues. We have concentrated our business in Delhi-NCR region”.

“Knowledge and acquaintance with politicians and bureaucracy are necessary along with knowledge of local rules and regulations,” Kumar Urban Development CMD Lalit Kumar Jain said, citing reasons for regional nature of real estate.

Developers and consultants are of the view that unless there is uniformity in land acquisition process and regulatory approvals, it would be very difficult for developers to have a pan-India presence.

Roy of Sahara Prime City noted that the absence of any central platform for addressing the concerns of the developers makes it difficult for any regional developer to venture into new geographical region.

Streamlining of land acquisition laws and adoption of single window approach for all development approvals and clearances are some of the measures which need to be taken before one can see any perceptible shift in this trend, he added. — PTI

REALTY Bytes
Metro Mall in Vaishali

New Delhi: Mahagun Real Estate Pvt Ltd. has launched Mahagun Metro Mall in Vaishali, NH-24 in Ghaziabad. This fast developing neighborhood is home to many premium and mass housing projects and offers tremendous potential for the retail, entertainment and leisure business.

Spread over 7.5 lakh square feet, the mall guarantees to offer an unparalleled shopping experience. According to Dhiraj Jain, Director, Mahagun India (P) Ltd. “This mall would prove to be the best shopping and entertainment destination for the visitors from nearby areas who otherwise had to travel to distant places for their shopping and entertainment needs”.

It is one of the first ever malls in Delhi-NCR equipped with Travalators to make shopping convenient and easy. — TNS

Earth Sapphire Shop Court

NEW DELHI: Earth Infrastructures Ltd. has announced the launch of its exclusive project in Greater Noida KP5. On the occasion of this launch Vikas Gupta, Director Earth Infrastructures Ltd said, “Earth Sapphire court is the first project in India which offers assured return with bank guarantee. After getting a huge response in our residential project, Earth Towne in Greater Noida, we felt that there was a need of local shopping complex to meet daily needs like ATMs, chemists, departmental store, etc for people who are staying nearby areas. Thus we thought of launching this project the main idea was to shop in budget of common people, as well as to meet the daily needs. It will be the only local shopping complex near to the residential societies and Knowledge Park-V”.

With the close proximity to Noida, Knowledge Park V is going to witness a very high speed growth in near future. The main attribute of the location is the way it will interlink with Noida, Ghaziabad, Faridabad and Delhi through different routes.— TNS

Hyatt ‘Andaz’ in India

Boston: Global hospitality major Hyatt has announced plans to set up three new properties, including one in India, under its ‘Andaz’ brand of hotels as it seeks to expand presence in key markets.

A Hyatt subsidiary and Juniper Hotels Pvt Ltd have signed management agreements to build ‘Andaz Delhi’, a 323-room hotel with an additional 118 Andaz-branded apartments.

Slated to open in 2013, the project would be the first Andaz property planned in India.

Hyatt has already announced plans to expand into 15 new Indian markets over the next five years, with properties coming up in Goa, Kolkata and Mumbai.

The Andaz brand is being introduced in India as part of Hyatt’s plan to grow in one of the world’s leading emerging markets, senior vice-president of real estate and development for Hyatt Hotels & Resorts in South Asia Ratnesh Verma said in a statement.

Targetted at the international leisure and business traveller, the project “is consistent with our development strategy of expanding the presence of our preferred brands in key markets with strong and experienced developers and owners,” he added.

Andaz Delhi, which will feature amenities like lounge, theme bar, restaurants, spa and fitness center, will join the existing Andaz portfolio of properties in London and the US.

“The Andaz brand is quickly taking hold in the lifestyle hospitality category and is a key component of Hyatt’s strategy of increasing our presence in key markets around the world where we see growth potential,” Global head of real estate and development at US-based Hyatt Hotels, Steve Haggerty said.

The other two properties are a 183-room hotel in Sanya Sunny Bay, China, and 170-room hotel in Providenciales, in Turks and Caicos islands, a British overseas territory.

The Andaz brand debuted three years ago and has 11 properties open or under development in six countries.

Juniper Hotels is a hotel investment company co-owned by Two Seas Holdings Ltd and Saraf Holdings. JHPL owns Grand Hyatt Mumbai and Hyatt Regency Ahmedabad, scheduled to open in 2013.

Hyatt Hotels’ subsidiaries manage, franchise, own and develop hotels and resorts under the Hyatt, Park Hyatt, Andaz, Grand Hyatt, Hyatt Regency, Hyatt Place and Hyatt Summerfield Suites brand names.

As of March 2010, the company’s worldwide portfolio consisted of 434 properties. — PTI 

Green buildings

New Delhi: A Swiss development agency is negotiating with various Indian companies to construct green buildings. “We have done two projects with Infosys and talking with the other companies in India,” said Veena Joshi, senior adviser, Swiss Agency for Development and Cooperation (SDC).

SDC has joined hands with CREDAI, a real estate developers association, to plan 20 commercial energy efficient buildings in the country.

The organisation is also coming up with a project which includes workshops for builders to guide them on energy efficient buildings.

“We are developing guidelines on energy-efficient residential buildings as well,” Joshi added. — IANS