Onus on government to protect, boost real estate

Presently, the real estate sector in India is facing several challenges. These include lack of adequate sources of finance, shortage of labour, steep rise in the prices of raw material, multiple tax system and lengthy and delayed procedures for approvals.

Funds are the basic requirement for any real estate project. These may be arranged through banks by availing loans. Another way to generate funds for the real estate sector is through Foreign Direct Investment (FDI). According to available information, the real estate sector in India has attracted a cumulative FDI worth over US $22 billion during the April 2000-June 2013 period.

Besides, small and big investors are also the source of finance for the realty developers. Despite all this, developers face shortage of funds. They have to arrange funds through loans from banks at a higher rate of interest. The government should fix reasonable interest rates for the real estate sector, considering the fact that the economy of a nation revolves around this particular sector besides other major sectors.

There is a dire need for the government to provide financial benefits to players in the real estate sector to build low cost and affordable housing for the masses across the country. Also, there is a need for reviewing the existing FDI guidelines for investment and development. Relaxation in FDI guidelines will further boost investment and development in this particular sector. Rather, the whole economy of the country will get a boost.

The cost of construction is increasing day-by-day. If one calculates, one finds that the cost of construction has risen by around 40 per cent in the last 24 months, approximately.

This is because of many factors. The bank rates are high. Many projects are getting delayed because of lengthy and complex procedures of sanctions from various government departments and ministries. The government, both at the state and the Centre, should try to simplify the procedures meant for approvals or sanctions for the real estate projects.

These delays also lead to escalation of cost. There was a slowdown to some extent also in the recent past. This also put an adverse effect on the real estate projects.

These days the real estate sector is not only facing labour shortage but is also under heavy pressure to pay increased wages to the labour. It has been observed that significant number of labourers have returned to their homes states after the start of the Government of India’s MNREGA programme. Labourers find it easy to get jobs at decent wages close to their respective homes. The real estate sector is likely to face more labour shortage in the coming time because labourers are getting attracted towards the MNREGA after listening about benefits of the MNREGA programme from others in their circle.

Therefore, the government must come forward to protect and boost the real estate sector by redressing problems and difficulties being faced by developers across the country.

Vikas Gupta, JMD, Earth Group

Scheming Schemes

Call it the tricks of the trade… After  the RBI’s  advisory  aimed  at curbing 80:20 subvention schemes, ingenious developers have tweaked their  offered  schemes  to attract prospective  buyers  and  have come  out  with  50: 50,  60:40  or  70:30  schemes  just  to  skirt around the  regulatory  stipulation.

While the Reserve  Bank of  India’s  (RBI) move  besides  affecting  home  prices – will definitely reduce the risk borne by  buyers as well as banks, experts feel the move will surely  lead to price correction because of oversupply of units, delayed completion  of  projects  and  will  adversely  harm  the popularity of  under-construction  projects,  dissuading  investors  or  short-term  buyers  which  in  turn  will prevent price escalation.

Under 80:20 schemes buyers need to pay 20% of the full value of the house upfront after which they don’t need to pay EMI’s for two years. Bank pays the remaining 80% in lump sum to the builders upfront at initial stage of construction.

RBI is trying to curb such schemes to promote more transparency between the buyer and developers. This is because according to RBI, these schemes can be risky for banks as well as home buyers since developers are under high financial pressure.

When such alternative schemes come into the market, it may be a reflection of fund crunch. As the current fundamentals and pricing are not correct for the sector, these freebies will give limited cushion to the developers in terms of demand spurt.

There is the risk of delayed projects for home buyers as it will affect buyers financially and emotionally. A two-year EMI-free period or the kind sounds attractive, but what if the developer’s delays the EMI are it is supposed to pay on your behalf. As credit information bureaus will not hold the developer responsible, the buyer’s credit score will suffer to some extent.

Banks run the risk of diversion of funds since developers are in financial crunch. Delays in construction or default on payments can cause dispute between the borrower and the builder. In other words, the bank’s money could get locked in dispute.

Along with many well known developers, VIKAS GUPTA, JMD, Earth Group said:

In fact, other trends will emerge and such examples are the 50:50, 60:40 or 70:30 schemes. The market is never going to stop, so transformation is obvious.  Lower sales demand was bound to happen and 20-30% corrosion was obvious.  It, in fad, favors both the genuine buyers and sellers.  Now the new schemes will, I think, be able to generate demand this time as well.

Original source: http://www.realtynmore.com/scheming-schemes/

Earth Titanium and Earth Gracia get propitious Commencement

Many new and ground-breaking real estate projects in Delhi - NCR have made the region as one of the most diversified real estate markets. Stunning projects have been launched to accommodate the rising as well as changing demands of the investors. Earth Group too has come up many innovative projects beyond expectation of the investors.

In this line, Earth Group endowed auspiciousness to its two projects namely Earth Titanium and Earth Gracia located at Greater Noida. Earth organized auspicious occasion of Bhoomi Poojan of Earth Titanium and Earth Gracia on 2nd September 2013 at their respective sites. The Bhoomi Poojan program of Earth Gracia was organized at its site 12 A, Sector -1, Greater Noida (West) from 8.00 AM while the Bhoomi Poojan program of Earth Titanium was organized at its site Plot Number - 6, TechZone, Yamuna Expressway, Greater Noida from 10.00 AM onwards.

Earth Titanium is a Hi-Tech City of Excellence studded with modern offices, IT spaces, studios, retail, villas and institutional areas. With LEED certification and NFPA compliance Earth Titanium is spread over an area of 37.50 acres. It has been developed around the Green Buildings as well as SEZ concept of a hi-tech area. Earth Titanium is built on the parameters of a high-end mix land use development. The very best of the world facilities in the most high profile Tech Zone of Greater Noida. Main features of Earth Titanium include -

Excellent Offices & IT Spaces: Conceived on a SEZ concept, Earth Titanium offers Hi-Tech IT/ITES office spaces, the best of its class in the up and coming Techzone. It is an ideal destination to flourish your business, not only in India but world-wide.

Exemplary Studio Apartments: Welcome to Titanium Studios, your ideal destination for private space. A modern-cum-luxury private living set amidst your own comfort zone. An address that\'s the pulse of activity, yet it is a place you can very well call your own.

Exclusive Retail Spaces for Hi-end Lifestyle: Earth Titanium will house various stores which would cater to all your needs. Conceptually designed by international architecture and engineering firms, it meets global design standards and offers you the opportunity to realize all your commercial dreams.

Exciting Recreation Space: Earth Titanium offers you number of restaurant s and food courts spread around the complex to satisfy your taste buds. Some of these restaurants are based on the concept of a particular theme that takes priority over everything else influencing the architecture, food, music and overall feel of the restaurant.

Exanadu of Luxurious Villas: Earth Titanium brings to you luxury villas which are the embodiment of elegance where you can bask in glory and grandeur. The concept bears its root from the idea that this project is elegant, grand and signature in nature.

Exquisite Features & Facilities: Earth Titanium provides you the best features and facilities to make your working, living and enjoying experiences comfortable and complete. This has been done with a view that you don\'t have to leave the campus looking for any of your regular as well as special needs.

Earth Gracia, on the other hand, is a high-end open lifestyle based residential project which gives the feeling of openness at the very first impression. In fact, the charm of Earth Gracia has been tagged with Open Minds, Open Space, Open Neighborhood, Open Choice, Open Your self. Spread over an area of 5.5 acres, Earth Gracia is a lifestyle apartment, situated in an excellent location, developed with the concept of Green buildings and comply LEED and NFPA certifications.

Shri Atul Gupta, Joint Managing Director of Earth Group shares his views about the Hi-Tech City of Excellence i.e. Earth Titanium and open lifestyle based residential project Earth Gracia, Greater Noida is one of the fastest emerging real estate destination in India both on the commercial as well as residential fronts. We have come up with two high-end world class projects on both the fronts to provide our investors complete solutions. Earth Titanium provides modern style offices as well commercial places while Earth Gracia attracts with its Open charm for today\'s professionals.

About Earth Group

Earth Group of is one of the fastest growing real estate group in India. Earth Group is known for its innovative and green projects which are aimed to serve planet Earth with energy efficient structures. Earth Group is the first developer to have initiated the green building technology in North India and offers the most innovative and diversified product mix comprising residential, commercial/IT Parks, retails, hotels, farm houses.

Earth Group has innovatively designed value for money LEED Certified Green Homes for the ultimate living experience for all.