The draft rules of RERA are out but not too many people seem to be happy with it. The punitive measures have been eased out and there is no clarity on the extent of disclosure of the status of under-construction flats by developers. Will the developer register with the latest sanctions or should the previous changes be accounted for? Will the consent of two-third of buyers for change in layout be applicable on existing projects? Will an already delayed project fall under the ambit of RERA? These are some of the pressing questions that still need to be answered. We hope the final draft addresses this ambiguity and the interest of buyers are safeguarded with retrospective effect.

It is indeed intriguing to see that the National Consumer Disputes Redressal Commission (NCDRC) is dealing with errant developers with an iron hand. In the past it brought Unitech and Lodha to task and now it’s Jaypee Group who is facing the music. While the penalty order has been stayed by the Supreme Court, two other rulings are still under review. However, it is sad that even with RERA looming on the one hand, and the consumer court rulings on the other, delays remain a bitter truth in the Indian realty sector. If the apex court doesn’t retain the rulings of NCDRC, it may not give any further orders to defaulting developers in future. It is no secret that the sector cannot attain efficiency if execution delays and unfair pricing tactics are not sorted out right away.

When we talk of affordability, we only talk about pricing in general. However there are many external factors beyond the control of a developer or buyer which affect affordability. One such factor is Stamp Duty and Property Taxes. While cities like Gurgaon saw a reduction in stamp duty a few months back, there are others like Nagpur which await increased Stamp Duty and Property Taxes. While we are doing everything possible to boost affordable housing, State governments must do a thorough reality check to assess whether such increased levies are feasible at this juncture. If at all any increase in taxes and duties is unavoidable, the quantum of hike must be checked. The market is very price sensitive any such move may prove to be detrimental in the long run.

However, there is also some news that added cheer to the market. The SEBI commendably continues its quest to make REITS an attractive investment arena. The regulatory body issued a consultation paper making various proposals. These include relaxation in pricing/valuation norms, minimum number of investors and increased investment in under-construction properties. So far REITS have garnered tepid response from Indian players despite relaxations and flexibilities announced from time to time. It remains to be seen if the current set of relaxations actually lure participants to REITS.

Pankaj Kapoor
Founder and MD, Liases Foras Real Estate Ratings and Research Pvt Ltd   Vol: 3
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'Fight for RERA' continues
Real Estate (Regulation and Development) Act (RERA) is being touted as the ultimate savior for buyers, but most still have doubts over the draft rules for the RERA circulated by the government. The bone of contention this time is the nature of plan submitted by the builders. A particular group fighting for this pointed out that the draft rules lacked clarity as to which plan the builders of existing projects need to submit while registering with the regulator - the original, sanctioned plan or the latest version. We believe it is in best interest of the buyers if the builders submit the original plans because the latest plan will have got revised many times. Also, there is INDIA AT A GLANCE
ambiguity over the schedule of completion of projects. There are penal clauses in RERA but in the absence of specific rules, the authorities will not be able to bring errant promoters to task.

States to charge lower stamp duty for affordable housing
States to charge lower stamp duty for affordable housing Central Government has directed the states to reduce stamp duty on registration of houses for the poor, to boost affordable housing projects in India. The government has selected around 2,508 cities in 26 states under the 'Pradhan Mantri Awas Yojana' to develop affordable houses for the urban poor. Urban Development Minister, Venkaiah Naidu, empathised with home buyers and stated that the 10% stamp duty in certain states casts a burden on the buyers. This is a welcome move and shows that the Government is indeed walking the right path.   Vol: 3
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The question of vacant houses
The government declared that over 2 lakh houses, constructed under Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and Rajiv Awas Yojana (RAY), are still lying vacant. The highest number of vacant houses are in Maharashtra with 41,449 units, followed by Delhi (26,199), Gujarat (24,769), Andhra Pradesh (20,639), Telangana (17,982) and Uttar Pradesh (16,050). This is one of the biggest anomalies of the real estate sector, where millions are homeless and slums are proliferating, while over a lakh units lie unoccupied. This is clearly indicative of a missing dimension in the cycle that needs to be addressed. Vacant Houses
New constructions approved under Pradhan Mantri Awas Yojana
Pradhan Mantri Awas Yojana According to Minister of State for Housing and Urban Poverty Alleviation (HUPA), 864 projects were approved this year under the scheme, which was launched in June last year. These projects aimed at construction of 7,28,840 houses for the slum dwellers and urban poor, but only 19,255 units were completed and as many as 1,07,687 houses were under construction. India needs to really speed up the construction progress so that we can reach the target of Housing for All by 2022.   Vol: 3
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Navi Mumbai proposes Smart City again

After being rejected in the last general body meeting, Navi Mumbai Municipal Corporation (NMMC) has once again submitted its proposal for a Smart City status. The satellite town of Mumbai has a lot of potential to be developed as a smart city. But a lot of work still needs to be done on the infrastructure front.

The long-awaited BDD redevelopment plan to get more units
BDD redevelopment plan The redevelopment of the age-old Bombay Development Directorate (BDD) chawls is likely to get delayed further as the State government will have to seek clearance from the Union environment committee to go ahead with the project. However the good news is that they will get 500 sq ft houses in place of their 180 sq ft tenements. Moreover, the government will get 13,000 additional houses to sell in the open market. We believe BDD chawls' redevelopment will create a large housing stock, easing the property market in the city.
Work to commence on MTHL before 2016-17
As per leading news agencies, work on the Mumbai Trans Harbour Link (MTHL) is expected to begin before the end of 2016-17, as the MMRDA has received an encouraging response in the preliminary bidding stage. Around 20 consortia have submitted bids for the three components of the project that will bring faster connectivity between South Mumbai and Navi Mumbai. Housing units at locations too far from work places is not the idea of an efficient urban economy. Linkages should be established to bridge the travel gap between residence and workplace to achieve housing for all in the true sense. MTHL before 2016-17   Vol: 3
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MMR reels under the pressure of increasing population density
Increasing Population Density The Energy and Research Institute (TERI) has reported that population in MMR increased by a whopping 197% in just four decades. The population density of the region is 37,000 people per sq km of built-up area. A population density like this and continued vertical expansion is creating pressure on the city. There is immediate need for more land parcels to open up and those have to be available at commutable distance from the work place. Redevelopment also addresses a lot of issues associated with the space constraints in MMR.
Mumbai civic body gets ready for DP 2034 execution
The BMC has geared up for implementation of the draft Development Plan (DP) 2034 by drawing up the execution strategy. The first action plan is expected to be ready during April 2017 and March 2018. Around Rs. 5,000 crore per year will be allocated for implementation of the draft DP 2034. Most developers in the city have been waiting for the DP before planning any further projects. Lack of clarity over the DP had also led to a slowdown in new launches. After such a long wait, let us hope that the DP is implemented in a timely manner, so as to avoid further delay in new constructions. DP 2034 Execution   Vol: 3
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Mumbai 2014-2034 Noida gears up for more than 72 completion certificates by December

Noida Authority is working to issue completion certificates to more than 72 housing projects on a fast track. Currently completion certificates have been issued only to 47 houses; so this will take another 3 months to complete. However citizens are of the opinion that only issuing completion certificates is not enough. Adequate infrastructural support is required to make the area livable. Water supply, roads, streetlights are some of the major concerns that need to be addressed to enhance the habitability of Noida.
GNIDA asks developers to charge uniform rates for land acquisition

The Greater Noida Authority has directed the city's builders to charge homebuyers rationally for land acquisition. Developers charging differential rates attracted lot of complaints from buyers. The Greater Noida Industrial Development Authority (GNIDA) has also asked developers to start taking maintenance charges only after residents start residing in their apartments officially. Though it is not an official order from GNIDA, it surely will create pressure on developers to consider efficient pricing of land.

7 housing colonies in Delhi to be redeveloped

To address the problem of shortage of government accommodation in Delhi, the government has decided to rebuild seven housing colonies to double the existing housing units from 12,970 units to 25,667. The colonies to be redeveloped include some in Sarojini Nagar, Netaji Nagar, Nauroji Nagar through National Buildings Construction Corporation Limited (NBCC); and in Kasturba Nagar, Thyagraj Nagar, Srinivaspuri and Mohammadpur through Central Public Works Department (CPWD).

Commercial plots in Noida struggle to find buyers
The Noida Authority is still struggling to auction a dozen commercial plots in Noida due to lack of response from buyers. The sluggish real estate market and the high prices of plots seem to have impacted the Authority's plans. The commercial plots are to be used for activities such as shopping malls, showrooms, retail outlets, hotels, restaurants and offices subject to the master plan of the city. Noida Authority plans to re-launch the scheme after fine-tuning it to make it more profitable for buyers and investors. Noida Struggles   Vol: 3
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Stamp duty hiked in Nagpur Metro Rail corridor
Nagpur Metro Rail The urban development department has approved the proposal to increase stamp duty in the Nagpur Metro Rail corridor to 7.5% from 6.5%. The corridor refers to the area lying within 500 metres on both sides of the Metro track. While the stamp duty has been hiked, the urban development department still has reservations about increasing the FSI. This is a development which will not go down too well with the buyers or developers. We are in a phase when we need to promote affordable housing and transit-oriented-development, and steps like this act as hindrances.
The game of property tax in Nagpur
Nagpur Municipal Corporation (NMC) has decided to recover property tax of current fiscal as per the old tax system. It is reported that demand notes of 2016-17 have been prepared as per the old system but subject to the new system. Taxpayers will have to pay the difference amount of 2015-16 and 2016-17 at one time in the next fiscal, which implies double the load. Burdening citizens with tax calculations like this is sure to act as a dampener to the Nagpur realty market. City. Property tax in Nagpur   Vol: 3
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Spanish support for Jaipur smart city project
Jaipur smart city The Jaipur Smart Mission Limited (JSML) has appointed Epista, a Spanish company, as the project management consultant (PMC) for the execution and implementation of its smart city project. The Spanish firm will help the civic body in planning, designing, developing and monitoring smart city projects in Jaipur. The State government is also in discussions to incorporate three more projects under the smart city mission which may be areas like Gandhi Nagar station, Ramganj Bazaar and Rajasthan University. Jaipur is one of the fastest growing tier II cities and with sound implementation of smart projects, it can really position itself as one of the leading realty destinations in India.

Indore rides high on upcoming infrastructural projects
The board members of Indore Development Authority (IDA) discussed new plans and projects for the city. The construction of a ring road from Dhar road to airport road got approval and the decided width of the road would remain 60 meters as proposed in the master plan for year 2021; IDA sanctioned Rs. 34 crore for it. In a bid to promote greenery in city, the board is also keen on taking up plantation drives in the city. INDORE   Vol: 3
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Kochi Metro phase two to be financed by France's AFD

Kochi MetroThe French development agency, AFD, is in talks to fund the second phase of Kochi Metro from Jawaharlal Nehru stadium near Palarivattom to Infopark near Kakkanad as well as the improvements of major junctions like Edappally and Kalamassery. Kochi is on a development spree and phase one and two of Kochi Metro, Water Metro and Smart City projects would attract a total investment of Rs. 11,000 crores to the city. The metro is also an integral part of Kochi’s smart city project and if these progress as planned, things will be really different for the city’s realty landscape. reducing the overall cost of the flat and eventually increasing the affordability.   Vol: 3
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The content discussed above is based on reports by leading national newspapers. Neither the whole nor any part of this document or any reference to it should be copied or reproduced without Liases Foras’ prior written approval.

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Mr. Pankaj Kapoor

Founder and MD-Liases Foras Real Estate Ratings and Research Pvt. Ltd

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Ms. Namrata Sen Chanda

Content Manager

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