Wish list for the upcoming Union Budget 2015-16

The various developments in the real estate market in the second half of 2014 have made an optimistic focus for the real estate sector starting with this year. The Indian economy has also been showing positive signs with the start of 2015. A gradual improvement has been witnessed both in domestic and foreign markets regarding institutional investment. The fundamentals are also in place for the global economy to move ahead.

Tax Limit and Incentives

Income tax limits and home loan incentives will boost the sector to drive the demand in the residential real estate. The budget will act only as a catalyst in achieving the same where the end users and long term investors are going to be benefitted.

Cheaper Funds

We are expecting the budget to offer directions for obtaining cheaper funds for both developers and home buyers. If the interest rates for home loans decrease, then more people will be able to buy the house they want. Also, if the cost of funds for a developer is cheaper, the cost of houses might reduce, which in turn will lead to more housing sales, which has been on a slump in the last quarter of 2014.

RBI Rate Cut

With banks becoming tighter on lending, the timelines of deliveries have taken a hit. The RBI rate cut announced in mid January didn’t quite move positively with the commercial banks. There was hardly any discernible interest rate decrease by banks and now the 50 bps SLR cut may not give impetus to the demand for housing. It is time that RBI goes assertive with rate cuts and impress upon banks to reduce lending rate in equal measures. As a result, the buyers will be incentivized through rebate in individual income tax as well.


Besides, the cash-starved sector needs a fresh momentum in housing. A top priority has to be accorded for bringing in FDI in India. This FDI proposition is not just about bringing in the dollars and helping the sector revive, apart from money, the larger focus would be a holistic one wherein we bring here global expertise and upgrade in operational strengths. India is still far behind in infrastructural development and it needs large investments to help bridge the infra gap. The Union Budget should make more provisions to increase foreign investors’ participation in this sector.

Affordable housing is another area where a lot has to be done. In the previous nine month budget, the new government defined its vision for boosting affordable housing. So in the upcoming budget, recommendations of a task force have to come into being. If the Land Acquisition Act 2013 is passed, one can hope that there will be incentives for the low cost housing spaces. The government should also offer tax rebates on housing purchases and mortgages. This will definitely push the affordable housing at a large scale and will bring a sigh of relief to the developers as well as buyers.

Infrastructure development

Infrastructural development has been at the forefront of the new government’s agenda and we hope it brings about positive reinforcements. India lacks on the technical and financial strengths which calls for a global support system which can stimulate those on ground. Be it architects, contractors, material suppliers and most vital being the project management diaspora. The development of the allied sectors is a necessity for the real estate sector to flourish.

Approval and Clearance

Quicker approvals are the need of the hour. Due to complications of government channels, many projects get halted and delivery is delayed resulting in cost escalation. A rapid completion of stalled projects is essential. The single window clearance is a long pending issue. The current approval process takes a really long time for approval.

Policy Reforms

Clearer and uniform policies should be introduced by the government. Frequent change in policies and regulations affect the approval as well as construction process. The execution of policies should be faster. Policies should be loop holes-free and transparent. More skilled workforce should be inducted in the entire administrative and civil set up and make the entire system accountable by fixing responsibilities.


We are also looking forward in making Indian real estate more investment friendly and attractive for overseas investment funds by introducing a revised tax code for REITs to take off, approving and implementing of pending Real Estate Regulatory Bill (RERA), to establish transparency and fairness in this sector, Relaxing Counter-Productive Clauses in LARR(Land Acquisition , Rehabilitation and Resettlement) Act to counter land-related bureaucracy and encourage “green” sustainable Real Estate by providing combination of incentives.

The latter half of 2014 was all about bringing in reforms on paper for the real estate market. The empirical reforms are to be looked forward for in this year. And the initiation has already begun. The pace is soon to increase. One needs to focus on the negatives too like  despite the recent RBI’s call for rate cuts,   there have been no substantial new developments on the disinflationary process or on the fiscal outlook since January 2015. There has been only a modest effect on the Indian banks. Real Estate developers are hopeful things will take a positive turn after the Union Budget 2015-’16.




Kashi Nath Shukla

The author is the Chairman and Managing Director, Tashee Group, one of the most preferred real estate brands spread across high-end commercial complexes, residential developments, retail spaces, office, Mega Township etc since its inception in 2004 headquarter in Delhi. Over the last 10 years, the group has a business interest in Real Estate, Entertainment Industry, Hospitality, Care Home as an executer of some real estate projects and producer of several upcoming tele-serials respectively in India. 

Are high-rise residential blocks really eco-friendly as they claim?

Is high-rise a solution?

From full-page newspaper advertisements to huge hoardings along city roads, grand visions of high-rise apartments are popping out, enticing us to buy one today itself. Additionally, the catchy slogans like 75% garden, only 25% built and such others make us think as if we are going to live amidst green, though in reality we could be living in a crowded high-rise concrete tower with no green right outside our house.

The assured green could be in one large parcel at one part of the master plan, with no benefit to every living room of an apartment in the complex. Are these high-rise residential blocks really eco-friendly as they may claim? How do low-rise houses compare with high-rise single blocks?

Many such complexes have got green building certifications, but they are not based on embodied energy or options for low energy designs; instead they are based on the criteria laid out by the certifying agency.

Major difference

For the developer, utilising the maximum permitted built area called floor area ratio (FAR) is important for return of investment, so he would utilise the FAR equally, high-rise or low-rise. The major difference would be in the ground coverage, where the option of tall tower block would leave more ground area unbuilt, claiming it to be garden – a unique selling point.


In the architects’ professional circles, comparison between low-rise high density development and high-rise high density development has been an age old debate, with both the theories attracting their supporters.

However, if energy consumption and sustainability becomes the yardstick, high-rise apartments tend to raise more questions. They demand on site management, mass concreting, precise execution and an efficient supply chain to ensure smoother project completion. To that end, hi-tech practices, multiple high speed elevators and such others are a must both during and after construction with uninterrupted power.

Due to the extra efforts required in lifting materials and moving people to higher levels, labour costs increase with building height.

Maintaining the wall surfaces of tall buildings is a challenge, so the designers tend to opt for materials such as aluminium and glass, known for high cost and high embodied energy, besides many other manufactured materials.

If the walls are largely plastered and painted surfaces, their periodic repainting can be a humongous task, at great cost. Higher we go lesser we get to see the ground-level gardens and lesser accessibility to them, actually an anti-thesis to the selling point, whereas in low-rise apartments, there could be a visible open area outside each unit.

In a multi-level apartment, construction is sequential with each slab casting, but in a cluster of low-rise houses, it can be parallel, saving project time.

Many occupants of tall residential concrete towers complain about them being large and intimidating, while smaller group of houses can form social spaces and human scale – possibly a reason stronger than that of eco, to critically relook at high-rise houses.

Source: The Hindu – (The writer SATHYA PRAKASH VARANASHI is an architect working for eco-friendly designs and can be contacted at varanashi@gmail.com)

Metro boosts real estate prices in Chennai Saidapet

Chennai’s metro’s corridor 1 plan covering Little Mount near Saidapet has started pushing realty prices for residential and commercial property.  The city’s neighbourhood has become the nerve centre of connectivity in and out of the city as the arterial road diversion via Sri Nagar colony has already made commuting a nightmarish experience for people every day.

With rail and bus connectivity providing uninterrupted services throughout the day, Saidapet has been driving the demand for housing to an unprecedented level.  Lack of land for residential development has pushed both rental and capital values of apartments in the neighbourhood.  Capital values are being quoted at Rs 8,000 per sq ft in West and East Saidapet whereas in Sri Nagar colony, an idyllic neighbourhood near bus depot, the quoted value starts from Rs 16,000 per sq ft onwards.  Even resale units are being quoted at Rs 55 lakh for 2BHK units in West Saidapet and Rs 85 lakh for 2BHK units in Sri Nagar colony, said Jayakanth, a realtor with I Homes.

Scarcity of land availability is the major reason for the sudden surge in apartment value.  Sri Nagar colony is now buzzing with activity due to vehicular movements. Land values are being quoted at Rs 5.25 crore per ground (2400 sq ft).  Rentals being cited are Rs 15,000 per month and above for 2BHK units and Rs 18,000 – Rs 20,000 per month for 3BHK units depending on the developer, building and amenities offered in the project.  Sri Nagar colony is also home to some of the celebrities in the Tamil film industry.  Proximity to Raj Bhavan, Anna University and IT Corridor provides recurring demand for rental housing.

The demand for housing – new and resale units have increased as the metro station will soon become functional.  Resale residential units are being quote at Rs 12,000 per sq ft for a 16-year old project in Sri Nagar colony.  The establishment of a police station to check crimes in the locality has also been an influencing factor in increasing the demand.

With the impending metro station and the continued diversion of arterial road via Sri Nagar colony in Saidapet, the transit crowd would further aggravate the congestion and facilitate more people to migrate to the neighbourhood in search of housing.  Property developers are eyeing existing buildings for redevelopment opportunity in anticipation of additional housing demand in future.

Source; Times of India Chennai/ V Nagarajan, Magicbricks.com 

How to save power in Homes in India

U. V. Krishna Mohan Rao tells Hema Vijay how families waste electricity

Do you know that much of the electricity used in homes is wasted because of faulty practices and our choice of gadgets? Award-winning energy consultant and expert on water efficiency and green business U. V. Krishna Mohan Rao says it’s possible to drastically reduce our electricity consumption by adopting a few simple measures. Rao’s family of six living in Viswa Syamalam, spread over 2,000 sq.ft., consumes only 100 units of electricity a month. His firm, U. V. Krishna Mohan Rao Associates, charges customers a fee based on the energy savings they achieve. Excerpts from an interview:

What are the common mistakes we make that lead to electricity wastage?

One of the common mistakes is turning off appliances using the remote, which leads to significant loss of ‘stand-by’ power. 1-5 per cent of the electricity consumed by the appliance when in use, continues to get consumed by it even when it is turned off using the remote. Placing warm/hot food in the refrigerator is another mistake. We should pump water into the overhead tank during non-peak hours (6 to 10 p.m. in many states), which ensures better efficiency as the quality of power received then is better.

Do electrical appliances that are plugged in even after turning off the power source lead to power wastage?

No, this does not cause any electricity drainage. It’s a myth that appliances that are plugged in to the power source cause wastage.

How can we minimise electricity consumption when using air-conditioners?

Use air-conditioners in combination with a ceiling/wall/pedestal fan and set the AC temperature at 27 degrees. This will give you the same cooling comfort as you would get when you set the temperature between 18 and 22 degrees. Opt for moderate cooling as air-conditioners are not meant to chill the room and necessitate the use of blankets. Remove redundant material/furniture from the room as electricity gets spent on cooling it.

What lighting fixtures can we use that will help conserve energy?

The entire home can be made to receive ample natural light throughout the day by channelling in sunlight through large windows, light pipes, extra windows at higher levels, etc. For the night, use LED lights that consume just a fraction of electricity as compared to CFLs/fluorescent tube lights. Painting walls in white or pastel shades enhances lighting and minimises heat absorption from sunlight.

Does minimising electricity consumption necessarily involve high initial costs?

If done during the construction stage, it may cost less. Redundant investments on voltage stabilisers, unnecessary wiring, etc, can be avoided. Retrofitting can be done at a later date, considering the recurring operating expenditure.

What should we keep in mind while buying gadgets?

Use only star-rated and super-efficient appliances. Ask about ‘stand-by’ power consumption details. Choose appliances that can run on wide voltage variations (160 V to 240 V) without the need for external stabilisers as stabilisers consume between 1 and 5 per cent of the electricity they draw in. If you have to use a stabiliser, locate it outside the air-conditioned room, as stabilisers generate heat. For hot water, use solar-thermal heaters, not electric geysers. For daily washing purposes, do not turn on the heater in the washing machine.

Source The Hindu Property Plus

3 land deals show corporate interest reviving in Chennai

The deal according to market sources could be around ₹90 crore, according to the sources. Land prices in this area, on the IT corridor, range at ₹18-20 crore an acre.

Another deal on a similar scale is of a Japanese two-wheeler major acquiring a three-acre property for a similar price range also on the IT Corridor to set up its corporate office.

A third-deal was for a 6.5-acre by Synergy Maritime, a ship management company which acquired the land off the IT Corridor at ₹12 crore an acre, totalling close to ₹80 crore, the sources said.

Source- The Hindu  Business Line Chennai

Chennai Perungudi gaining preference among tenants

Perungudi entered in the PropIndex* list of top 10 preferred localities for rent during the Oct-Dec 2014 quarter. Stable rental values during the last three months in the area and spillover demand from nearby Thiruvanmiyur, Velachery, Palavakkam and Adyar has made Perungudi a prospective rental destination for the IT professionals employed in the region.

*PropIndex is an India Apartment Index report published quarterly by Magicbricks. Read here

The Rajiv Gandhi IT Expressway, popularly known as the ‘IT corridor’ is home to many IT/ITES companies. Perungudi along with areas such as Adyar, Thiruvanmiyur, Palavakkam, Kottivakkam, Thuraipakkam, etc. are the localities that form part of this ‘IT corridor’.

“Not only there is a high supply of rental properties even the rental values here are affordable when compared to neighbouring areas,” says Hari V of Bhoomi Estates, a broker firm. Rental values in the area start from Rs 8,000 per month for a 500-600 sq ft apartment while 3BHK units having 1500-1600 sq ft covered area are being leased out for 25,000 per month.

Rental values in Thiruvanmiyur, situated about 3km from Perungudi, range from Rs 10,000-85,000 per month for residential units having 600-2000 sq ft covered area. Getting hands on a rental property in Palvakkam, situated about 2km, is not only difficult but expensive as well. Rental values here range from Rs 12,000-50,000 per month.

Adyar, situated about 4km from the area is expensive as well. Rental values here start from Rs 8,000 per month and go upto Rs 1.3 lakh for residential units having 350-4000 sq ft covered area. “Migrant population working in the IT and software companies is dominant in the locality,” says Gopi Subramanian of RR Realties, a broker firm.

As to why prices are low here, Subramanian says that despite significant growth in both residential and commercial sector, the area is still struggling with poor infrastructure. “Region has gained importance only because of its location along the IT highway but it also needs to sustain this demand and the rising population,” he adds.

Currently, the area lacks in basic civic amenities such as waste and drainage system, piped potable water and internal roads. Tenants however have the option to live in gated communities which have sprung up in the area and offer amenities like water storage, power backup and security. Also, having your own vehicle can be beneficial as the local transport besides the Metropolitan Transport Corporation (MTC) services is not frequent.

Source: Times of India / Ankit Sharma writer with Magicbricks

Chennai realty sector gearing to catch up

Chennai is gearing to catch up with the lost momentum in investments when compared to its cousins in South.  The real estate market is predominantly driven by end users constituting 75-85 per cent and their typical investment ticket size has been estimated at Rs 40-60 lakh.  However, the pent-up demand is slowly entering the market now.

In a panel discussion on aiding real estate growth in Chennai, Credai –JLL initiative has analysed with industry captains consisting of leading developers, international property consultants and HFCs and banks, on factors ailing the realty sector in and around Chennai and the remedial measures needed to revive the sector.

Chennai is the preferred destination for corporate occupiers due to availability of skilled professionals and Tamil Nadu accounts for more than 30 per cent of the engineering talent available in the country.  The city which has been awarded India Today Best City Award 2014, also boasts of the highest number of chartered accountants in the country. Read more

Do new properties need legal checks?

The property buying process is most crucial when you think of owning or investing in a new property. It’s wise to be doubly sure rather than being duped into a never ending legal battle. To provide guidance on ‘Do new properties need legal checks?’ Magicbricks organised GuruTalk – a live chat session with Dhiraj Jain, partner-real estate, SNG & Partners.

If you are looking to invest in a new property that is still under-construction Jain said, “It is wise to get a thorough legal and technical due diligence done to ascertain the following:  Read more

What real estate buyers should expect from Budget 2015?

Real estate stakeholders in every Indian city are looking forward to the upcoming financial Budget 2015 to see whether it will provide any relief to the sector. Developers have their own expectations, because positive announcements for real estate buyers made during the budget will help increase the market sentiment, and therefore sales. The general hope is that the Union Budget this year will provide cheer to intending home buyers who have been deterred for various reasons.

Make home loans affordable

The Union Budget 2015-16 should make the rate of interest specific to home loans more reasonable. Currently, banks are offering interest rates ranging between 10.15-10.40%, and this is far too high. Paying so much interest has serious implications on the family budgets of most middle-class wage earners. It is not surprising that many of them currently shy away from home loans. The budget should bring the interest rate on home loans down to between 7.5%-8.0%. The new government has clearly stated that it wants to make Housing For All Indians a reality by 2022. It is impossible to achieving this goal if home loans do not become affordable to all, as well.

Additionally, the home loan interest amount exemption under Income Tax benefit should be increased from the existing limit of Rs 1.5 lakh to Rs 3 lakh. Further, this exemption should be made applicable for more than single property purchases. This is not an unreasonable expectation. In the current times and in many cases, a single home is not enough to accommodate all family members. The finance ministry should take due note of this fact and accordingly provide relief for both first home and second home buyers.

Eliminate multiple taxation on property purchase

The budget should also do away with the multiple taxes involved in the purchase of residential property. As of now, home purchasers are required to pay service tax and value-added tax (VAT) on top of stamp duty and registration charges. Goods and Service Tax (GST) should be introduced in the place of these taxes. Also, the real estate industry expects the Budget to finally make the Real Estate Regulatory bill a reality this year, so that the industry has the benefit of an apex body via which all concerns can be addressed transparently and efficiently.

Reduce cost of property registration

Another expectation from the Union Budget is a reduction in the cost of property registration. The recent hike in ready reckoner rates in Maharashtra has been a sentiment setback for the real estate sector. Stamp duty and registration costs are as high as 6% in most cases, and this needs to be reduced by a few base points to aid consumers. Alternatively, a slab-based approach should be introduced. Stamp duty falls under state government purview, but the Center can nevertheless issue a directive to reduce stamp duty costs.


Source: Business Insider India

Iyyapanthangal Bougain Villa20150202_150419

It’s time to upgrade to a bigger house on rent

If you think you have outgrown your home, this might be the right time for you to move into a bigger house in Chennai. The city has witnessed an oversupply of 22 per cent for 3BHK units in the Oct-Dec 2014 quarter, according to PropIndex, an India Apartment Index report by Magicbricks. During the same period, 1 and 2BHK units were either low in supply or at par with demand.

Localities such as Velachery, Thiruvanmiyur and Nungambakkam have the highest supply of 3BHK units. These localities are also among the top ten preferred localities for rent in Chennai, as per the current PropIndex (Oct-Dec 2014).


Velachery is one of the prime residential neighborhoods connecting the IT corridor along OMR and GST Road to the Central Business District of the city. Rental values of 3BHK units in the locality range from Rs 11,000-35,000 per month with covered area varying from 1000-1500 sq ft. Both independent houses and apartments are available on lease here.

However, Subramanian R of Lancor Realty Limited, a broker firm says, “It is the flats that are mostly taken on rent here, as most of them are part of gated communities and give a better sense of security to families.” The area can be a viable option for bachelors looking for a bigger rented home, to live in groups.


Situated at the threshold of the East Coast Road and along the Rajiv Gandhi IT Expressway, Thiruvanmiyur offers 3BHK units in the price range of Rs 25,000-85,000 per month. Sizes vary from 1300-2500 sq ft. The locality is preferred by professionals working in the Tidel IT Park and nearby areas.

It is one of the well developed localities of South Chennai with presence of schools, colleges, hospitals and shopping complexes. Those looking for a house or apartment overlooking the sea or the beach can opt for this locality.


Alwarpet, situated between the Boat Club and Poes Garden, is one of the most sought after addresses in Chennai. “The area is home to several NRIs and the elite of the city,” says Yuvaram, a resident of the locality.

Though buying a house or an apartment in the area is expensive, living on rent can still be possible. Rental values of 3BHK units in the locality start from Rs 40,000 per month and go upto Rs 1.5 lakh per month, with covered area varying from 1600-2500 sq ft.

So, if you are planning to rent a bigger home in Chennai, these might be good areas to start your search!

Source: Times of India /Ankit Sharma Magicbricks