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Riding high on
‘spiritual’ connect On
the anvil
Launch
pad Tax
tips
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Riding high on ‘spiritual’ connect Several Tier II and Tier III destinations with a religious connect are attracting buyers and developers and the real estate scene is blooming there
However, in the midst of this grim scenario in the Tier II and III cities, the cities with a religious connect are the only ones that seem to have withstood the headwinds of slowdown. “There is no major slump in the demand in religious towns. In fact, on the contrary there is an annual increase of 15-17 per cent for such properties”, says R.K Arora, CMD, Supertech, whose group has big-ticket commercial projects coming up in Haridwar. No wonder then that temple towns and religious cities like Haridwar, Rishikesh, Mathura-Vrindavan, Ajmer-Pushkar, Dwarka, Varanasi, Allahabad, Shirdi etc have seen a steady influx of developers and new projects over the past few months. End users looking for a second home as well as investors looking for rental returns and capital appreciation are driving the demand here.
The growth drivers “Contrary to the notion that youngsters are turning away from religion, the reality is that the noise, tension and insecurity of jobs in cities are pushing them towards these destinations that promise to bring inner peace. They may not take sanyas and live permanently at these places, but they do like to visit occasionally. Those who are financially well-off like to buy a flat or place to stay which could alternatively work as investment option too”, says Kunal Banerji, Group Advisor, Shri Infratech Moreover, the appreciation potential in these places is also very high as compared to that in other cities where the market is already saturated. “The developers also have the added advantage of low capital stakes due to less investment in land and better sales and that too by genuine buyers”, adds Bhadla. This is one of major reasons why many established developers have either forayed into these cities or are planning to do so soon, adds Bhadla. “Besides the local builders several big players are also active in these religious centres in order to cash in on the demand from those looking for a second home close to a religious centre. Sales volumes are good here. For example in Haridwar and Rishikesh many people from Delhi, Punjab, Gujarat and Rajasthan are buying ready-for-use property so the demand is good”, says Sudarshan Negi, a Dehradun-based property consultant who also deals with property in Haridwar and Rishikesh.
Platter of options Variety and range are the other factors that have kept the real estate market buoyant in these centres. With demand controlling the supply here, the developers are offering products to suit every pocket. So there are villas and cottages for the affluent, and studio apartments and serviced apartment for those with a limited budget. “The price range that buyers look at while purchasing property ranges in these cities ranges between ~2500 per sq ft. to a higher range of ~4000 per sq ft approximately”, says Neeraj Gulati, Managing Director, Assotech Realty. Talking about the buyer profile in Haridwar Sushant Muttreja MD Cosmic Group, says, “People from Delhi, Punjab and UP and locals working in indistrial units comprise 75 per cent of the investors here and the rest are NRIs”. The demand for affordable properties that assure good rental returns is more here. “The prices are lower here which makes these holy destinations a much sought after buy”, adds Arora. Many developers are offering assured rental returns also to the buyers. According to Ravi Saund, COO, CHD Developers Ltd, his company is offering time-share options for its properties in Haridwar. Those with deep pockets also have a lot to choose from in the form of furnished cottages and villas. Cosmic Group’s ‘The City of Romance’ at Narender Nagar near Rishikesh is one such project that offers cottages, villas, presidential suits and studio apartments with seven-star facilities like theme restaurants, discotheque, spa and naturopathy therapy center, yoga and meditation caves, swimming pool and gymnasium , club and lot more.
Project watch Haridwar and Rishikesh have emerged as major realty hubs for end users as well as investors. Among some of the main projects here are : Among the oldest projects is the AEZ Group’s Aloha Rishikesh in Tapovan Village along the Badrinath highway. It was launched in 2005 and possessions have been given to a majority of buyers. Spread over five acres, this project has approximately 200 one and two-BHK units. The original cost of the units was from
Rs 24 lakh onwards and according to property consultants operating in the area the resale price now is anywhere between
Rs 65 to Rs75 lakh. A resort is also coming up within the project. CHD Developers Ltd has a project — Sri Gayarti Lok Apartments in Haridwar with the Shivalik mountain range on one side and Ganges on the other. The project has been approved by the Haridwar Development Authority and is located on the Delhi-Haridwar National Highway (NH-58). The Cosmic Group recently launched its township project — City of Romance in Rishikesh. It is located at an altitude of 4,500 ft and is 25 km from the spiritual city, on the Rishikesh Tehri-Gangotri-Yamnotri–NH-94. On offer are British style villas of 7,456 sq ft area in G+ 2 floors. The work is also in progress at Antriksh Developers’ 25-acre project — NRI City in Haridwar. On offer are 300 plots and 700 flats located in the SIDCUL complex that houses major companies such as Hindustan Lever, Mahindra, ITC, Havells and the Hero Group. On offer are plots of sizes 120 sq yd to 180 sq yd, priced at ~3,425 per sq ft. Unnati Fortune Group is currently in the process of acquiring land in Haridwar and awaits a few approvals. Its project is spread across 60-70 acres and mainly has 1BHK units of 650 sq ft priced at
Rs 24 lakh. Anil Mithas, CMD, Unnati Fortune Group says, “It has been observed that people with religious mindset prefer affordable units in Haridwar but those with the sense of adventure and style prefer luxury units in Rishikesh. We are planning to launch around 120 villas spread across 12 acres priced at
Rs 1.5 crore there. This will be launched within a year”. The commersial property scene here too has huge potential. “The kind of brands coming to this region are attracting a lot of people from areas like Roorkee and Saharanpur, which has given a boost to the commercial market in Haridwar”, says Arora of Supertech. The Supertech Group has a commercial projects like Pentagon Mall and hotels like Hyphen and 5-star Radisson Blu in SIDCUL, for which it has a tie up with Carlson Hotels Worldwide. Mathura-Vrindavan is another such destination which has seen realty boom over the past few years. the Shri Group has a large number of projects coming up in the twin cities. These include SHRI Radha Vintage, New Mathura; SHRI Radha Florence, Vrindavan; SHRI Radha Valley, Mathura; SHRI Radha NRI Greens, Vrindavan etc. CHD Developers, Karmayogi group and Pushpanjali Constructions are some of the other major players in this market. NRIs and people from Delhi are the main investors in this area. Prices too are affordable in comparison to those in Delhi-NCR. A ready-to-move in 2BHK flat (1,100 sq ft) is available for around
Rs 24 lakh and furnished studio apartments. Shirdi is another such destination. This spiritual epicenter of the saint Sri Sai Baba attracts lakhs of devotees each month and the demand for second homes is growing here. Assotech Realty recently launched serviced residences — Sandal Suites at Shirdi. With an investment of
Rs 100 crore, the project is spread over 2.5 acres and will consist of 142 suites. Thus, with a steady supply and sustained demand, the realty scene in these religious centres is likely to remain upbeat in the near future as Shravan Govil CEO, REPL sums it up, “These towns offer good value preposition since real estate prices are much lower then the major metro cities thus attracting the buyers. These homes make the investors connect with the religious towns even stronger besides working out as an investment solution.”
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On the anvil The housing ministry will launch a pilot HSUI in collaboration with the Reserve Bank of India (RBI) to serve as a tool to reflect changes in the housing sector and related industries vis-a-vis the overall economy. Work has started in 25 pilot cities and information on 6 lakh buildings in different stages of construction has been collected. A technical committee of RBI is developing the index. The housing and construction industry has links with nearly 254 ancillary industries, and thus it will be a lead economic indicator. A National Building Organisation report had said that housing and building construction activities have powerful multiplier effects on the economy. While a higher-than-expected increase in housing activity triggers economic growth and is considered inflationary, a decline slows the economy and can push it into a recession. This will be an important macro economic indicator, useful for forecasting in several housing-linked sectors and not many developing countries are able to bring this out. The index will thus function as a lead economic indicator because of its linkages with more than 270
industries. A housing ministry official said that while there were permit-issuing authorities in India, like municipal corporations, town planning authorities and village councils, it took long for the ministry to launch the index as data wasn’t being collated in a systematic manner. Thirty cities collated data and a housing start-up survey was done in 27 cities using a mobile application. All stakeholders including buyers, builders, government and lending institutions will benefit from this index. While it will benefit a buyer as he doesn’t have much market intelligence, it will also benefit governments as they will know in which area more housing is coming and can develop infrastructure. Home buyers: Through this index, prospective buyer or seller will get a good idea of the future supply, helping them get a better fix on the likely trends in prices. The buyer/seller can compare the index price with the offer while deciding on a deal. The Index, also helps in tracking consumer behaviour as well as the investment trends geographically The first phase of HSUI will cover 31 cities across the country. These will include all major cities like Delhi, Mumbai, Chennai, Bengaluru, Kolkata, among others. Eventually it will cover the rest of the country. Once operational, the data is expected to be printed on a quarterly basis.
— TNS
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Subvention schemes Panchsheel’s Fantastic 50 offer Panchsheel Buildtech Pvt. Ltd, an NCR-based real estate company has announced Fantastic 50 – ‘50:50 payment plan’, for its customers. The group has a number of residential projects such as Panchsheel Park Colony in Hapur, Ashok Vatika, SPS Apartment Phase I, Panchsheel Park Colony, Euro Apartment, SPS Apartment Phase II, SPS Residency, SPS Heights, Panchsheel Wellington in Ghaziabad and also Panchsheel Primrose, Hapur Road, Ghaziabad. Fantastic 50 – ‘50:50 payment plan’ is applicable on all the projects of Panchsheel Group. As per the scheme, the booking will be done on 50 per cent advance payment and rest has to be paid at the time of possession.
— TNS
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Launch pad This occasion also marked the unveiling of Gaursons’ new logo which signifies and embodies the new brand identity for the company.
SG Benefit in Ghaziabad SG Estates Ltd.launched SG BENEFIT, a residential- cum-commercial project in Govindpuram, Ghaziabad. The new project is approved by the Ghaziabad Development Authority and will offer around 200 units. Price will start from Rs 3200 per sq. ft for 1 BHK and Rs 2950 sq. ft for 2BHK and 3BHK. One BHK units will be between 640 to 732 sq. ft. in area. Two BHK units will be of 1032 sq. ft. to 1135 sq. ft. area, while 3BHK will be of 1335 sq. ft. to 1661 sq. ft. area. This mixed-land use project is located on a corner plot and has 24 m wide roads on both sides. “Govindpuram is a well developed area in Ghaziabad and offers excellent connectivity with NH-24 and NH-58”, said Gaurav Gupta, Director of SG Estates. said. An office-cum-shopping complex will be part of this mixed-use development with office space for consultants, service providers, banks, financial institutions, insurance companies and travel companies etc. It will have shops ranging from 328 to 545 sq. ft., 2 anchor halls in the size of 3300 sq. ft. each and office space ranging from 355 to 993 sq. ft. In the affordable price for shops start between Rs to Rs 11000- per sq. ft. and office space is available in Rs 4500 sq.
ft.
— Based on information provided
by the developers
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Tax tips
A. The facts in the query seem to be contradictory. You have stated that the earnest money and subsequent instalments were paid from your personal savings account. It is not clear as to how drafts for yearly instalments were issued by debit to your husband's account. I presume that the amounts for the issuance of such draft were paid by you to your husband prior to the issuance of such drafts and such amounts paid by you were out of your own sources i.e. gifts and shagun money received by you from your relatives. If that be so, in case of any enquiry by the tax department you should be able to lead evidence that the amounts paid as yearly instalments by debit to your husband's bank account were actually out of your resources which represent gifts and shagun money received over the years. You will be liable to pay tax on capital gain arising on the sale of the plot @ 20 per cent plus education cess of 3 per cent thereon. The tax payable can be saved by utilising net consideration accruing or arising on the sale of plot towards the purchase or construction of a residential house. The purchase can be made within one year before or two years after the sale of plot. The construction on the other hand, has to be completed within three years after the sale of the plot. You also have another option of saving tax. You can invest the amount of capital gain towards the acquisition of tax saving bonds within six months of the date of sale of plot. These bonds have a lock-in period of three years and carry interest @6 per cent p.a. These bonds can be bought not exceeding Rs 50 lakh in a financial year. What is the difference between Section 54 and Section 54F?
A. The exemption from the taxability of capital gains on the sale of plot and its consequent investments in the purchase of a residential flat will have to be claimed under Section 54F of the Act. The major differences between Section 54 and Section 54F of the Act are as under:-
What are the implications of not utilising capital gain within the time limit? Q. I sold my house for Rs 15 lakh and earned LTCG of Rs 4 lakh after indexation. I have invested Rs 3 lakh in a residential plot and claimed relief u/s 54 on the value of the plot purchased. Kindly clarify: Is it necessary to construct a house on this plot within the prescribed time limit? What will happen if I don't start any construction within this period? What will happen if the Income Tax Department discovers this matter?
— Rikinder A. Section 54 of the Act dealing with the exemption of capital gain tax provides that in case where capital gain arising on the sale of a residential house property is proposed to be utilised for the purchase or construction of a residential house within the specified period and the amount of capital gain is not utilised before the due date of filing income tax return for the year in which the capital gain arose, such amount of capital gain should be deposited in a designated account under Capital Gain Deposit Scheme Account before the said date. The claim of exemption is, therefore, dependent upon such an action. I presume that the investment in the acquisition of a residential plot was made by you before the date of filing the return and the balance amount Rs 1,00,000 was deposited under the above said scheme before the said date. In case the residential house is not constructed within the specified period, entire amount of capital gain of Rs 4 lakh shall be treated as a long-term capital gain of the previous year in which the period of three years from the date of transfer of original residential house expires and taxed at the applicable rates for the said previous year.
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Several
Tier II and Tier III destinations with a religious connect are attracting
buyers and developers and the real estate scene is blooming there
The dark clouds of slowdown that have been hovering over the real estate sector in India have cast a gloomy shadow over most urban centres. The Tier II and Tier III cities that were being projected as the growth centres of the future a couple of years back have also suffered a massive slump and most of the developers, who had planned projects in the smaller centres, have put these on the back burner. 
Commenting on the factors that are responsible for this steady demand Navneet Bhadla, Director, Brys Group says, “With the rising affluence when people look for a second home they normally opt for a holiday home, and in the Indian context these holy places are the best bet for a holiday home as it serves many purposes, ranging from the need for a holiday home to the potential that these places offer in terms of rental yields”. 
The housing start-up index (HSUI) that will track the number of houses being constructed every year across the country will be launched shortly. HSUI, which will be another indicator of the economy’s health, is being developed in collaboration with the Reserve Bank of India (RBI) and will reflect how many building permits were converted into actual start-ups.
Unnati Fortune Group (UFG) has worked out a tie up with Tata Housing Finance Ltd. to provide easy finance schemes for its premium green building project The Aranya. The group is offering a subvention scheme 10:80:10 to help investors own their dream home without much ado. The subvention scheme will allow buyers to pay 10 per cent of the total cost at the time of booking and 10 per cent at the time of possession. The remaining 80 per cent of the cost will be financed by Tata Housing Finance. Located in Sector - 119, Noida, right beside FNG Expressway the project comes with a luxury modern city life style amidst verdant greens that offers excellent connectivity to Delhi and surrounding areas. Uniqueness of the project is that it makes extensive use of green housing technologies that utilizes ambient natural resources such as light and air to power devices.
NCR-based real estate developer Gaursons announced the launch of its ~5,000 crore Gaur Yamuna City on the Yamuna Expressway. Spread over 300 acres, this gated project will have 20,000 units with per unit size ranging from 1000 sq. ft to 2080 sq. ft. The project will offer 2 , 3 and 4 BHK homes, with a price point of ~2,095 sq. ft (BSP). The first phase of the project will be delivered within 36 months, according to a company spokesperson. The entire township has been planned to overlook three big landscape parks – the lake-park, the multipurpose sports park and the urban park. Each of these parks is designed to offer different recreational opportunities for the residents of Gaur Yamuna City. 
Q.
I am a housewife and have no source of income. I was allotted a 6-marla plot by PUDA in 1987. The earnest money and subsequent yearly instalments for this plot were paid from my personal savings (shagun/gifts). But the bank drafts for this purpose were issued by debit to my husband's A/C who is an income tax payee. Now I want to sell this plot. Will there be tax on long-term capital gain? If yes, then what will be the rate of tax and what measures can I take to save it?
Q. I own a plot which I plan to sell and buy a residential flat in a society. Will the capital gain earned on the sale of the plot be exempt under Section 54 or Section 54F of the Act? Would you please highlight the major difference between the two Sections?
— Anil Agarwal