Bogged down by depressed property mkt?

Gurgaon News: Did you know that a slowdown in the real estate market is an opportunity for making money on real estate? This is no joke. Bust times are as much an opportunity to make money as boom times, say experts. It only requires structured market analysis to get your returns right.



Take the case of investors who have purchased at a frenzied pace during boom times. With the property market churn slowing down, many investors are exiting the market at cost price or even less. For instance, an investor who put in Rs 70 lakh (30-40% of the total cost of the property) in a premium project in Gurgaon, recently sold at a profit of a mere 7-8 lakh. And that too because he was able to purchase on the first day of the booking. For those who purchased 15 days after the booking began, the rates were higher. Those buyers have no option but to hang on or sell at a loss.

But this is a good opportunity for end users or long-term buyers to enter the property market. The developer has now started receiving final clearances and sanctions for the project and the project will start soon. This is good news for an end user who knows that his property will be ready in a finite number of months.

The end user today is also in the driver’ seat while purchasing new property that has recently been completed or is nearing completion. Developers such as Supertech and Achievers are offering to pay the interest rate on the loan till the property is ready for possession.

Once he gets possession of the property, especially in expat-driven markets such as Gurgaon, Noida and South Delhi, the buyer can fully fit out and furnish the property for lease. “Once a premium property is fully furnished, you get Rs 30,000-50,000 more as rental values,” explains real estate consultant Ashok Narang. He gives the example of Laburnum in Gurgaon where monthly lease rentals range about Rs 1.5 lakh per month. But once the owner has furnished the property, he can easily get back Rs 2 lakh per month. “Furnishing involves an additional investment of up to Rs 15 lakh but yields monthly returns of about Rs 50,000 more than unfurnished property,” Narang says.

The trend of expats driving better rental returns is happening across segments of the property market too. Latest trends indicate that with every expat CEO coming to the country, there are four middle level manager who also come to India to accompany him. This segment is looking for well-maintained, well located, furnished and managed property.

They seek shorter tenures of lease but are willing to pay for services. Therefore choose your property well to get better yields. They should be in the vicinity of the economic hubs with good social infrastructure such as schools and hospitals as well as recreation facilities.

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source: gurgaonsearch.com

Gurgaon raises circle rates, property rates to head north

Gurgaon News: The revised collector rates, or circle rates, decided by the Gurgaon district administration will see a quantum jump in property rates in areas under New Residential Zones (NRZ).

These zones are cultivated land being developed into residential areas. The new rates will be applicable from July 4. For populated areas, the administration has envisaged a nominal increase in rates — 10 to 12 per cent. The rationale, administration officials

said, is to tap the growth potential of NRZs. “Property rates have not gone up much over the past few months in areas that are already developed,” Gurgaon DC Rakesh Gupta said. “So, in order to be realistic, there was no requirement to increase the circle rates there.”

But rates of agricultural land in villages where residential zones have been recently approved will rise between 200 and 300 per cent.

Among villages where property rates will double, or nearly triple, are Wazirpur, Daultabad, Dhankot, Khirki Daula and Sihi Sikandarpur.

Collector rates, or circle rates as they are known in Delhi, in DLF City and Sushant Lok have been increased by 10 per cent. It is a reflection of the sluggish property market of late, officials said.

In DLF Qutab Enclave Phases I and II, for instance, rates for residential property have been hiked from Rs 15,000 to Rs 16,500 per square yard (see box for details).

Land rates in Wazirabad, Samaspur, Gurgaon village, Shahpur, Sikanderpur Ghosi, Nathupur and other villages have been increased from Rs 40 lakh to Rs 70 Lakh per acre. Besides, 20 per cent extra stamp duty would be levied on land on Jaipur National Highway, Sohna Road, Pataudi Road and Sultanpur Road. These charges are payable up to 2 acre depth from the main road.

Similarly, 10 per cent extra stamp duty would be levied on land falling on link roads.

Real estate developers say the new circle rates are a reflection of real estate trends in Gurgaon and across NCR in the past few months. Circe rates had earlier been hiked in Delhi, followed by a rise in land rates in Noida and Greater Noida.

Gurgaon real estate developer R K Yadav said, “Even with the new rates, the price that buyers will pay in Gurgaon in white will be less than the going rate in parts of Delhi, especially in categories A, B and C.”

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source: gurgaonsearch.com

Wakf property in Gurgaon under cloud

Gurgaon News: Close on the heels of Wakf controversies in Mumbai and Punjab, a major scam involving leasing out of Wakf properties in Haryana’s prime town of Gurgaon, in connivance with private parties, has come to light. Mohammad Shayin, a state IAS officer and the Chief Executive Officer (CEO) of the Board, who blew the whistle, has been transferred since. However, he has sent a detailed report to the state Home Department, exposing the scam threadbare.

Shayin, while putting the record straight by submitting a detailed report to the state government, has asked for stern action against those who had been treating Wakf properties as their personal property to mint huge sums of money in the form of illegal gratification. The report has leveled serious allegations on the conduct of its chairman, Hamid Hussain, a former MLA from the state. Hamid Hussain, when contacted by The Indian Express, denied the charges.

The Board had leased out prime land measuring 900 square yards at Garhi Harsru in Gurgaon at throwaway prices, where land prices have sky-rocketed, especially after the Haryana Industrial and Infrastructure Development Corporation allotted 1,400 acres to the Mukesh Ambani Reliance Industries Limited for its Rs 40,000-crore Special Economic Zone (SEZ). The plot had been leased out to M/s Gateway Distri Parks Ltd. in lieu of lease money of Rs 5,000 per month from January 1, 2005. Ironically, the leasing of this property led to demolition of a mosque on this land and against a grant of Rs 1,000 to its Imam. The Board, even after receiving a complaint in this regard, could not act because the chairman of the board, at his own level, had issued an NOC for commercial exploitation of the land. Shayin, in his report, had apprehended that money had exchanged hands.

Similarly, in another case, another prime Wakf property at Choma village in Gurgaon was leased for extraneous reasons. This piece of land continues on monthly lease basis from 1997, but the Board converted this land from urban to rural and leased it out on yearly patta basis from 2004-05 against a meager sum of Rs 25,000 and with a yearly raise of Rs 2,000, which had brought the lease money to Rs 30,000 this year. This happened despite the fact that Board had been earning Rs 60,000 from the same land since 1997.

To further make money, the Board approved a plotting scheme in favour of the pattedar. Seeing this blatant misuse of authority, Shayin proposed cancellation of this lease to develop the Board’s own complex on this land, but the chairman did not allow it. Rather, according to Shayin’s report, he took a bribe to allow carving of residential plots on this land. Here again, the chairman issued the NOC on his own.

Besides leasing out Wakf land for extraneous reasons, the report also alleged that the chairman of the Board leased out Wakf properties to his son-in-law Mohd Iqbal at Badkli chowk at Nagina, now in Mewat district. This land was leased out to Mohd Iqbal and Mohd Islam against a nominal rent of Rs 1,200 per month. The lessee, in turn, constructed six shops on the property to sublet these without the approval of the Board. The chairman is also charged with pressuring the Wakf officers concerned to issue NOCs for construction of a first floor on this land.

In another case of nepotism, the chairman allotted one piece of prime land measuring 860 square yards to his nephew Mohd Talha at a meager sum of Rs 435 per month from October 1, 2004. The allottee in this case also had constructed many shops on this land without the knowledge of the Board, which, according to the report, is not only illegal, but cognizable as well.

Another Gurgaon property located at Dhulkot has been leased out on yearly basis and a plotting scheme had also been approved for carving of residential plots on this land. The Shayin report alleges that the chairman was a partner in this plotting scheme to an extent of 25 per cent of total profit.

“As we all know that Gurgaon has very high potential for residential plotting, it is widely believed that the chairman took a heavy gratification from the said party in lieu of the NOC issued at his own level. The CEO was not able to take any legal action against the lessee as he had the NOC issued by the chairman,” said the report.

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source: gurgaonsearch.com