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At home in Studio
Beeline for apartments in
Ground Realty
Real Talk
Tax tips
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At home in STUDIO
What better time than the monsoons to realise that a small trickle can lead to torrential showers? The same goes for new concepts that emerge slowly on the horizon to become a rage, and there are ample signs to portend that studio apartments are going to be the buzz word of the realty scene over the next few years.
The concept, which has very western roots, is slowly blooming in the NCR region and in the vicinity of Chandigarh and Punjab, though with a little variation, to suit the local needs. For purists, studio apartment ideally is fully furnished and combines the living room, bedroom and kitchen in a single unit. “It is a residence that is maintained and managed like a hotel”, says Harmeet Chawla, VP Marketing and Sales, Paras Buildtech Ltd. The company has come up with a 700-unit Paras Tierea project in Sector 137, Noida. However, in Ludhiana, Gulshan Kumar, MD of G.K Estates, who has planned a 1400-unit studio apartment project in Mundian on Chandigarh Road, is ready to give the option of non-furnished units also to his customers. “Our target group is not exclusively upmarket as we are targeting industrial employees working nearby. A 630 sq ft area non-furnished apartment in our project costs Rs 2,200 per sq ft, whereas the going rate in the rest of the project is Rs 25,000 per sq yd”. Though Ludhiana is the industrial capital of Punjab, it will take major industrial houses some more time to switch over to studio apartments to accommodate their employees and clients, he adds. However, according to Chawla, that time is not far when — after Noida and Gurgaon — this trend will catch up in Chandigarh, Ludhiana, Amritsar, Jaipur and Agra. “These cities have a good market for studio apartments as they have a lot of industries, corporate houses and educational institutions are ideal for such projects”, says Chawla while disclosing that the second phase of Paras Panorama project in Kharar may have studio apartments, keeping in mind the demand in the area.
Bang on target
Corporate houses, educational institutions as well as industrial houses form a ready market for studio apartments as these need quality accommodation for their executives and clients. While on the one hand, studios provide a ‘homely’ ambience to the executives, whose day-to-day needs are looked after properly, on the other, these prove to be a much cheaper option to accommodate visiting clients. One night’s stay in a 3-star hotel would cost over Rs 2,500, where as for a monthly rent of Rs 18,000, a studio apartment works out to be quite economical for a corporate house to ensure a comfortable stay for its top brass as well as clients, says Harinder Singh, Director, Vardhman Estates and Developers, in whose Metropolis project in Greater Noida the studios are given on lease to MNCs and IT companies for long-term as well as for shorter periods like three to four months. “In Noida especially, there is an increasing demand as more and more educational institutions are coming up here and the studios are ideal places to take care of the needs of the student community as well as of the visiting parents and faculty of the educational institutions. Here the presence of the hospitality sector is poor. There are very few good quality hotels and whatever is available turns out to be very expensive. Parents find these to be a better option for their wards than PGs”, says Chawla while adding that another target segment is the attendants of patients coming to the region for treatment. “A lot of hospitals are expected to come up along the expressway in the next few years and Gurgaon and Noida are going to be the next hubs of medical tourism after the south which will also increase the demand for studios”.
Good Investment
The trend is becoming very popular as it is a good investment opportunity. It is actually a residential product with commercial returns, says Chawla. “The capital returns in the residential segment are usually not very high as it is an end-user driven market, whereas in the commercial segment the initial capital input is high, and the returns, too, are high. But studios give an opportunity to get good returns from low capital input”. “It is a good choice for those ready to invest between Rs 18 and Rs 20 lakh”, says Singh, whose Metropolis Project is already on to its second phase. “We are offering the lease option to all our buyers. So once the apartments are ready the owner will immediately start getting a monthly return of Rs 15,000 and this contract is for three years”, adds Singh. A 550 sq ft fully furnished apartment in this project is currently priced at Rs 3,250 per sq ft. It is, thus, a win-win situation for investors, customers as well as builders. While the investors get an assured income and significant capital appreciation in the long term, the corporate houses get fully furnished and equipped place for their clients and officials, which saves them the hotel charges and commuting costs, too. For the builders, the large numbers of units constructed and sold completely keep the profit margins healthy. According to Chawla it is the demand that is spurring building activity in this segment with several builders going in for such projects, especially in the NCR region. Almost five to seven new projects are likely to take off in the next few months, he adds.
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Beeline for apartments in
Ambika Sharma Equipped with all the requisite facilities, these dwelling units provide ready lodging facility to industry executives working in or visiting this belt. Having facilities like a community kitchen, laundry services, community hall and shops fulfilling day-to-day needs of the people, these apartments take care of every need of an individual within the campus. Lalit Jindal, who has launched studio apartments by the name of Ashray at Jharmajri, while explaining the idea behind his project, said, “There is an immense demand for decent accommodation in the BBN belt, and in the absence of good choices, the industry executives have been commuting from Chandigarh and its peripheral areas so far. But now all this is going to change with these studio apartments. “We have provided seven shops in the community centre, which will meet the basic needs of company executives who come to stay here. Apart from this, a single room along with a kitchen are being offered for individual stay.” Priced at Rs 6.45 lakh, these apartments have caught the fancy of big corporate houses as these will help provide stability to the industries. “Talks are under way with big corporate houses that plan to buy 60 to 200 units at a stretch so as to provide housing facility to their staff. This will enable them to woo their executives as in the past, lack of good housing had led many of them to leave jobs after working here briefly.” A look at the sales figures reveals that there have been many takers for the concept. Almost 75 per cent of the studio apartments have been sold out, and about 10 to 15 per cent of the buyers include investors who have further rented out these units. Fetching a modest monthly rental of Rs 4,000 to Rs 4,500, these units generate steady income for the investors. The first block of 60 units is ready for possession, and another 60 will be handed over to clients soon, said Jindal. Jiwan Prakash Aggrawal, president, Barotiwala Baddi Jharmajri Industries Association, and also an associate of Amaravati Apartments, said, “Young company executies are on the lookout for a rented accommodation where food, entertainment and decent housing could all be provided under one roof. While this would save their time, the presence of all facilities in the close vicinity would provide a hassle-free dwelling.” The trend has caught up in the industry, and the demand seems overwhelming as several companies were now exploring the idea of providing housing to sustain their workforce. While some companies have come forward to purchase these units outright, others are exploring the idea of getting these units constructed as per their requirements. With nearly 1,921 industrial units in the BBN having a workforce of almost 1.38 lakh, at least 10 to 12 per cent are middle-rung executives, who now prefer such ready-to-move in accommodation. And there is going to be ample choice for them soon as studio apartments will be on offer in projects like Spangle Heights, too. With as many as three universities already running in the Baddi area and another two slated to open soon, the demand for such units is sure to go up. Kulbhushan Aggrawal of the Amaravati Group, which was the first housing venture of BBN, said small units sold out readily and promised returns of 6 to 7 per cent, which was a good margin, given the slump which the real estate market had been facing.
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Ground Realty
Decide the design
A staircase can be of simple and straight, curved, L-shaped, U-shaped, circular or any other shape desired by the house builder. Depending upon the space available, decide the design of staircase. Make it look ornamental, shapely and beautiful if located in the lobby or living room. Otherwise it can be simply serving its purpose if located in an unimportant area of the house.
The location
The present trend is to locate the stairs inside the lobby. However, if the upper floors are to be used by the tenants, the staircase has to be located outside the external walls of the house. Try to locate a staircase in the South or South West direction. Vaastu suggests that after the landing, the stairs should turn clockwise and not anti-clockwise. It also wants to keep the number of steps as odd. However, one must not disturb the plan or geometry of house to apply these rules.
Materials
Dimensions
Always make steps as wide as possible. In no case should the width of steps be less than 3 feet. Try to keep the width at 4 feet if possible. Provide full headway for the staircase. One should ascend or descend the steps without any fear of striking the slab above. Good headway also facilitates easy transportation of heavy items like furniture up and down the stairs. Only under exceptional conditions, when no space is available and access is to be provided to upper floors, a spiral staircase can be used. See that the ‘riser’ of all steps is equal. Riser is the front vertical dimension of a step. Keep the riser less than 160 mm. Unequal risers result in false stepping. Keep the ‘tread’ of the steps as 25 cm or more. It shouldn’t be less than 25 cm. Tread is horizontal width of a step.
Get the steel designed
For a RCC staircase, the steel reinforcement for the steps and the supporting slab, called waist slab is typical and should be got designed from an engineer. Take special care of entry of slab reinforcement bars in the landing at top and bottom. It is so placed that there is no ‘lift off’ of reinforcement. When the bottom of a slab is not plain but zigzag, in the shape of the steps going up, load at each node of tread-riser has to be worked out by the structural Choose finishing material
Many finishing materials for steps like wood, stone, mosaic, marble and tiles are available. However, the most important thing to see is that the steps don’t become slippery on providing it. For stairs inside the lobby, wood is the preferred material. However, don’t polish it to high finish to avoid slipping. For stairs located in the outside of house, stone or tiles can be chosen. All treads should be given double mould nosing of 20 mm beyond riser face. ‘Nosing’ is the projection of tread beyond riser. You can also choose porcelain stoneware. It looks really beautiful on the steps. Use plain colours like rust, peach, ivory, white, and blue while choosing porcelain stoneware. Its biggest advantage is that the nosing is ready built in the tread pieces which can be as wide as 1.2 meters. Thus, there are no joints in tread finishing if the steps are up to 4 ft wide. Combinations of ivory treads with rust color risers and white treads with blue risers look beautiful.
Railing design
The latest trend is to use stainless steel railing with glass or black wrought iron railing with wooden handrail. Stainless steel railing has simple vertical posts in stainless steel with toughened glass fixed to them. The glass pieces are easily removable and replaceable. Glass thickness is kept as 8 mm to 10mm. the posts are fixed to the step-treads through base brackets on the bolts embedded in the steps. If full width of steps is to be availed, the railing posts can be mounted on the side of the steps. The railing supplier has to be told whether you want a base mounted or side mounted railing. Stainless steel railing can be erected in a day. Choose chromium plated, full shine handrail of semi-circle shape for handrail. It looks really beautiful. If choosing wrought iron posts, choose a wooden handrail on them. In this case, don’t clad the wrought iron posts with glass. Wrought iron posts are available in multiple designs, covering full width of the steps, thus requiring no glass.
Wood and glass finish
In a simple yet elegant finish, the steps can be provided with dark rosewood covering while toughened glass sheet of 10 mm thickness, cut to stair slope is screwed to the side of wood covering at each step. No handrail is provided on the top of glass sheet finished blunt.
Illuminate well
Always make a good lighting arrangement for the staircase. Provide small lamps in the wall at each step level. Overhead lights should be so provided that no shadows are formed while moving up and down the stairs. Prefer to have natural light during the day. Locate windows in the external wall enclosing the staircase. This column appears fortnightly. The writer is deputy chief engineer, civil, PSEB. He can be reached at www.jagvirgoyal.com
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Real Talk
A first generation realtor, J.R Goyal, the brain behind the GS Promoters and Developers, is a builder with a vision to create affordable housing for common man. Credited with successfully promoting major housing ventures, including Tricity Plaza, Platinum Towers, and Tricity Homes, in Chandigarh’s periphery, Goyal is of the firm opinion that affordability is the major factor is the Indian real estate scenario. Excerpts from an interview:
Competition among the real estate players is hotting up in the Chandigarh’s periphery with big builders coming up with mega projects. Where do small developers stand in such a scenario? Small local builders have always caught the fancy of investors and end users given their credibility in providing affordable housing to the lower and middle class. Since small builders are mostly based in the
tricity, they are more in touch with the ground reality vis-à-vis the big players, who mainly rely on intensive advertising in the media to attract buyers. Apartment culture is yet to catch up in Chandigarh’s periphery. What is the future of thousands of apartments coming in the area? With Chandigarh’s periphery growing by leaps and bounds due to robust economic growth particularly in the services sector, apartments are the future of housing in city’s periphery. Affordable costs, state-of-the-art designs and large chunks of land provide perfect scope for the apartment culture to flourish. Is the impact of recession still visible in the realty market? Recession is virtually on its last legs in the realty sector. With banking industry’s confidence coming back in the real estate sector, realty is virtually on a roll in India. The coming months spell good news for realty sector with the Indian economy looking up. As a builder, do you feel that that the real estate laws have kept pace with times? Now the reality is dawning on the Central and state governments that without incentives the real estate sector could not flourish. Various sops to this sector would go a long way in making the dream of having a house for millions of Indians a reality. How can the government and private sectors collaborate in the housing sector? Since housing a basic need, the government should not think private players in the housing sector as adversary. In fact, joint ventures in the housing sector and healthy competition are key to providing affordable housing to the general public. Should foreign real estate players be allowed entry in India? There should not be any problem for the entry of foreign players in the Indian real estate markets. However, strict regulations should be imposed to provide level playing field to the Indian players, particularly small developers.
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psharma@tribunemail.com
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Tax tips
Kindly clarify the following assuming that the selling price of the house is Rs 1 crore. The cost price of the house alongwith indexation/ discounted price. What will be the amount of LTCG? I intend to buy a flat through a general power of attorney for Rs 40 lakh. How much LTCG will I have to pay? Whether I can show the flat’s sale in my LTCG return? When will I have to submit LTCG return?
— Kulbir Singh A. Your queries are replied hereunder: As the house constructed by your father had been held for a period of more than three years it would be treated as a long-term capital asset. You have a right to adopt the fair value of the house property as on April 1, 1981 for the purposes of computing capital gain. The cost of house property need not be ascertained. There is, however, a difficulty as to the year from which the benefit of indexation should be granted for the purpose of computing capital gain. The department is of the opinion (which is based on a strict interpretation of the language used in the relevant section of the Act) that such benefit should be allowable from the year, the assessee becomes the owner of the property. For example in your case it would be the year 2002. However, in a recent decision Hon’ble ITAT (Delhi Benches) has held that such benefit should be available from the year in which the house was acquired by the previous owner. For example in your case it should be 1968. Since fair value as on April 1, 1981 is to be substituted for the cost, you should be entitled to claim indexation from this date as per the said decision. Presuming that the benefit is available from the year 1981, cost inflation index for financial year 2010-11, would be multiplied with the fair market value as on April 1, 1981 and divided by 100 being the cost inflation index for the financial year 1981-82. The value so ascertained would be deducted from the sale price. It may be added that the cost inflation index for the financial year 2010-11 is yet to be notified. It is not possible to compute the amount of capital gain as the relevant figures are not indicated in the query. The amount of tax leviable on account of the sale of a residential house can be saved by investing the capital gain in the purchase of a new residential house within a period of one year before or two years of the date of sale. Such tax can also be saved by investing the amount of capital gain in the construction of a house property within three years of the date of sale. In case the cost of the new residential house purchased or constructed is less than the amount of capital gain, proportionate benefit would be allowable from the taxability of capital gains. Accordingly, in case the capital gain computed on the basis explained herein above is more than Rs 40 lakh, you would be entitled to a proportionate exemption. To avail complete exemption from tax in such a case, you have an option to invest the balance amount in the bonds issued by the National Highway Authority of India or Rural Electrification Corporation Limited within six months of the date of sale. Any purchase or sale of a property for a sum of Rs 30 lakh or more is required to be disclosed in the Income-tax return. Therefore, in case you sell the house property inherited from your father for a sum of Rs 30 lakh or more, a disclosure thereof will have to be made in your tax return.
Saving capital gains tax
Q. In 1980 I purchased a plot in Hisar for Rs 60,000 and sold the same for Rs 20 lakh in April 2009. The amount has been put in a fixed deposit for one year as I wish to purchase suitable land for constructing house at the place where I am intending to settle down permanently. Kindly advise me what is my capital gain as well as capital gains tax liability on this amount. How much amount should I invest and by what time in order to avoid the capital gains
tax? — S.K. Patil A. On the basis of facts given in the query, you had purchased the plot in 1980. For computing capital gains you have the option to adopt fair market value of the plot as on April 1, 1981 instead of the cost incurred in 1980. Such figure not having been provided in the query, the computations have been made on the basis of the cost of plot incurred by you. On such basis the indexed cost would work out at Rs 3,79,200. The long-term capital gain after deducting the said indexed cost from the sale consideration of Rs 20 lakh would work out at Rs 16, 20,800. The capital gains tax at the rate of 20 per cent plus education cess at the rate of 3 per cent thereon would work out at Rs 3, 33,885. It may be added that in case you have income from other sources and the same is less than the maximum amount not chargeable to tax, the taxable amount of capital gain would be reduced to the extent of difference between the maximum amount not chargeable to tax and the amount of income from other sources. The amount of tax on capital gain could have been saved if you had invested the amount of capital gain in the acquisition of tax saving bonds within six months of the date of transfer. You have now an option to purchase a residential house within two years or construct a residential house within three years of the date of transfer of the plot and invest the net consideration i.e. Rs 20 lakh in such acquisition or construction. However, part of the above amount of Rs 20 lakh which is not utilised for purchase or construction of residential house before the due date of filing the income tax return for assessment year 2010-11, should be deposited with a bank in a capital gain scheme account to avail the benefit of the above exemption. The amount deposited in such an account can be utilised for the purpose of purchasing or constructing a residential house.
Lease or sell wife’s share
A. It would be observed from my reply to your query that in case your wife has to claim the benefit from the taxability of the capital gain arising on the sale of plot, she will have to invest the amount of ‘net consideration’ realised on the sale of urban plot. Accordingly, in case she has to invest the amount of net consideration in the construction of a residential house being constructed on a land owned by you, it will be possible to claim the aforesaid benefit to the extent of investment towards her share in the residential house. In the case cited in the query, it would be advisable to lease or sell the portion of land in the village to the extent of her share in the residential house.
Pay tax on capital gain
Q. I purchased one kanal land in June 1981 for Rs 6000. Now I want to sell that plot for which available price is Rs 16,000 per marla i.e. total; cost Rs 3.2 lakh. The government reserve price for registered deed is Rs 40,000 per marla i.e. Rs 8 lakh. Will I have to pay any tax in this case?
— Joginder Pal A. You would be liable to pay tax on capital gain arising from the sale of the plot of land which was acquired by you for a sum of Rs 6,000 in 1981. The capital gain would be computed by deducting the indexed cost from the value adopted by the stamp valuation authority for the purposes of levy of stamp duty on the registration of sale deed. This is in accordance with the provisions of Section 50C of the Income-Tax Act, 1961 (the Act). In case the government has notified the price of Rs 40,000 per marla for the registration of sale deed, the indexed cost would be deductible from such value adopted by the stamp valuation authority i.e. Rs 8 lakh. The capital gain would be chargeable at the rate of 20 per cenr plus education cess of 3 per cent. Since it would be a case of long-term capital gain, you can save the tax by investing the amount of capital gain in the acquisition of tax saving bonds issued by the National Highway Authority of India or Rural Electrification Corporation Limited. The bonds should be acquired within six months of the date of sale.
Depreciation facts
Can I take rebate in income tax of its (House) depreciation every year? If yes then please let me know about the rate of depreciation and how should I show this in my annual tax return. — Surinder Singh A. Depreciation is allowable to an assessee in respect of an immovable property which is being used as a business asset. In other words, depreciation is allowable for computing the income from business. It is also allowable in case of income from other sources if such immovable property (building and land appurtenant thereto) has been given on lease along with plant and machinery.
This column appears weekly. The writer can be contacted at sc@scvasudeva.com
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Reality Byte
New Delhi: Supertech Limited has announced the launch of Capetown, a new affordable luxury housing project located in Noida. This is a residential project, a perfect combination of luxury, comfort and budget. Located in Sector 74, Noida, this residential project will be spread over an area of more than 50 acres. The project will have 2, 3 and 4 BHK options with a total count of 8,000 units. The project will be constructed in 2 phases and its completion is expected in 30 months from the date of construction.
Addressing the launch, R. K Arora, Chairman and Managing Director of Supertech Limited said,” We are launching this affordable luxury housing project to fulfill the need of our valued customers. It extends the concept of convenience to mean ‘luxury within reach’. We will be investing Rs 2,000 crores on the construction of this project to provide the best of infrastructural facilities and a relaxing environment.” The key highlights of the project are an international level club of 1 lakh sq. ft. area with facility of health related activities like Massage Centre, Ayurvedic Therapy Centre, Yoga and Meditation Centre etc., apart from other attractions like water bodies, wave garden, amphitheatre, slope garden, kids play area, café shops, sports centre with basketball, badminton, lawn tennis and squash court, school and medical facility
— TNS
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What better time than the monsoons to realise that a small trickle can lead to torrential showers? The same goes for new concepts that emerge slowly on the horizon to become a rage, and there are ample signs to portend that studio apartments are going to be the buzz word of the realty scene over the next few years.
The concept, which has very western roots, is slowly blooming in the NCR region and in the vicinity of Chandigarh and Punjab, though with a little variation, to suit the local needs.
Ambika Sharma
With decent housing being the oft-repeated lament of industry executives in Himachal Pradesh’s industrial hub of Baddi-Barotiwala-Nalagarh (BBN belt), the trend of studio apartments seems to be catching on fast here.
Equipped with all the requisite facilities, these dwelling units provide ready lodging facility to industry executives working in or visiting this belt.
Jagvir Goyal
In TV serials and movies one often sees aesthetically decorated stairs located right in the middle of living room, the main area of action and the actors frequently run up and down these. These, well located staircases leave an impact on the viewer’s mind who also wants to have a similar set-up in his dream house. However, space constraints play spoilsport as king-sized living rooms are required to accommodate six feet wide stairs running up from the mid-point. Plots of 2 kanal area and above only can have such an arrangement. Otherwise, the staircase needs to be thoughtfully planned and located to add to the beauty of the house. Here are a few tips:
Adopt fair value of property
Jagvir Goyal
Stairs located outside the house should be in RCC or brick masonry or iron only. Inside the lobby, wood can also be used. Give preference to stronger materials like RCC. While the finishing material can be any, basic material must be durable. RCC can be moulded to any shape desired by the user. These days, cantilever steps emerging from the wall are liked a lot by the house builders. For these steps also, RCC remains the best choice.
Q. My father had purchased a 250 sq yd plot in Chandigarh in 1968. He built a house for which no bills are available. He got the house passed and I inherited the house on the basis of his registered Will after his death in 2002. Now I intend to sell the house in September 2010.
Q. Thanks for the reply through The Tax Tips column regarding the reinvestment of the LTCG by my wife. However, I would further like to know whether my wife can invest her LTCG, received from the sale of plot, jointly with me in the construction of residential house on the land inherited by me in the village. I am constructing the house out of my resources of pension. If yes, kindly let me know if there is any legal
procedure. — R.C. Gathania
Q. I had purchased in a house that was constructed in 2000 in the year 2004 for Rs 25 lakh by taking a loan of Rs 20 lakh from a bank. I am a senior citizen (67 years old) and am paying EMI regularly. Please let me know: