How delayed delivery costs customers buying homes on loans

2016 may be a good year to buy a home. Property prices have remained stagnant for almost a year. While the quoted inventory prices may not have changed, better deals are available in terms of spot discounts, flexible payment plans and freebies across most major residential markets. So, this may be the best time to haggle hard and book a property. "Right now, buyers can get up to 20% additional values in the form of freebies and discounts," says Muddasir Zaidi, national director, residential, Knight Frank India.

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But a new trend in the real estate sector may sour your sweet deal. Post the incident of Unitech's top management being taken to court for multiple delays in delivery , developers are becoming more realistic about project completion deadlines.Rather than the standard three-year deadline, fouror five year-completion targets are becoming the norm."It is likely that developers will be keen to hedge their risks of consumer legal action by adopting more conservative completion deadlines," says Anuj Puri, chairman & country head, JLL India.

While developers' aim is to avoid legal action, longer deadlines imply tax loss for those who plan to purchase the property on loan.

TAXING RULES As per the current tax rules, those who purchase a property on loan and for self-use, are eligible for a deduction of up to Rs 1.5 lakh towards principal repayment (under Section 80C of Income-Tax Act) and a further deduction up to Rs 2 lakh towards interest payment (under Section 24D). However, to get deduction under Section 24D, the buyer must get possession of the property within three years of taking the loan. If the three-year deadline is not met, the deduction benefit reduces to only Rs 30,000 a year.

So, if the completion deadline exceeds three years, it would mean a tax loss of Rs 10.9 lakh over a 20-year period (see Graphic) on a loan of Rs 50 lakh. In case of a loan taken jointly, the tax loss could be close to Rs 19 lakh. 

The worst is that the rule adversely affects the end user the most.Individuals who buy for investment purposes can always choose to sell and at maximum, the harm would be they will have to pay tax on the shortterm capital gains, if they sell before three years from the of purchase.

People, who are buying a secondhome which they plan to rent, can claim full amount paid as interest as deduction even if they get possession after three years. They do not even have the Rs 2-lakh cap (see Table).

"Asymmetries between the tax regime and the industry practice of project delivery remain, and need to be resolved to protect the salaried class," says Puri. "The government should consider extending the `period of completion' clause for buyer where the are projects are delayed due to the builder," says Archit Gupta, CEO, cleartax.in.

However, till the authorities wake up to these facts and make necessary changes in the law, you need to be careful as a consumer.

WHAT YOU CAN DO NEW-BUYERS If you are still house hunting, apart from the standard guidelines of choosing a reputed builder, it is safer to pick a project closer to completion or at least at an advanced stage of construction. Usually, bigger the project, longer are the deadlines."When the structure construction begins, developers typically take 20 days to lay a floor. So, depending on the total number of floors the building would have, one can calculate how much time it will take to finish.Once the structure is complete, it takes two to three years to finish a project," says Zaidi. 

Also a building with basement parking facility will take longer to construct than where parking is being provided at the ground-floor level.However, going for a near-completion project also means you'll be paying a higher price compared to a new launch, which may offset any gains from tax deductions. So, do the math before buying. 

Another way is to stall disbursal of the loan. The rule says, "possession within three years from date of taking the loan." So, if you can manage paying the installments for the first few years and take a loan at a later stage so that the project finishes within the three-year deadline, you'll be safe.

EXISTING OWNERS You can choose to sell the delayed property and buy a ready-to-move-in property. However, this property transaction will have heavy entry and exit loads in the form of registration charges and transfer fees. Also, the seller may not get a good price for the delayed project while the ready flat will be at a premium.

 Also be very careful of the capital gains rules in such a transaction.The broad rule says: Short-term capital gains tax applies if a property is sold before three years of purchase.However, there is confusion on its interpretation as one pays EMIs in case of home loans. "There is confu sion on how should one calculate long-term or short-term gains. There is no clarity on where the date of original allotment be considered for this or the date of each year's instalments," says Gupta of cleartax.in.

There is debate too on whether an under-construction property should be considered a capital asset. "Only in cases where there is an allotment letter, property specifications are identified and there is a clear right to the owner, it may be considered a capital asset," says Gupta.

The issues have been a subject of a lot of litigation and several case laws discuss these implications."Considering delays in housing projects and current confusion around the rule, the government should seriously consider a relief on capital gains for the first-time home buyers who are selling the delayed project to invest in another property," says Gupta.

Till then, if you calculate the gains on the basis of allotment date, do not be surprised if you get a tax notice seeking an explanation on this transaction. 

Source - ET

Cabinet Okays Changes in Real Estate Bill to Protect Home Buyers

New Delhi: The Union Cabinet on Wednesday approved the Real Estate (Regulation and Development) Bill, 2015 which will now be taken up for consideration by the Parliament.
Chaired by Prime Minister Narendra Modi, the Cabinet gave the nod to the Real Estate (Regulation and Development) Bill, an initiative to protect the interest of consumers, promote fair play in real estate transactions and to ensure timely execution of projects.

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The Bill provides uniform regulatory environment to ensure speedy adjudication of disputes and orderly growth of the real estate sector.

The Bill ensures mandatory disclosure by promoters to the customers through registration of real estate projects as well as real estate agents with the Real Estate Regulatory Authority.

The Bill aims at restoring confidence of consumers in the real estate sector, by institutionalizing transparency and accountability in real estate and housing transactions which will further enable the sector to access capital and financial markets.

The salient features of the Bill include establishment of 'Real Estate Regulatory Authority' in states/union territories to regulate real estate transactions. It is applicable both for commercial and residential real estate projects.

Projects of 500 sq.mt area or 8 flats will have to be registered with regulatory authority instead of 1,000 sq.mt and 12 flats earlier.

Registration of real estate projects and real estate agents with the authority, mandatory disclosure of all registered projects, including details of the promoter, project, layout plan, land status, approvals, agreements along with details of real estate agents, contractors, architect, structural engineer are other features of the Bill.

It has also specified that deposit of specified amount in a separate bank account to cover the construction cost of the project for timely completion of the project. The Bill includes a provision requiring real estate developers to deposit 70 per cent of the project cost in a separate escrow account.

The Bill envisages establishment of a fast-track dispute resolution mechanism for settlement of disputes through adjudicating officers and Appellate Tribunal.

Other major changes approved by the Cabinet in the Real Estate (Regulation and Development) Bill, 2015 include equal rate of interest to be paid by promoters and buyers in case of default or delays while liability of promoters for structural defects has been increased from the earlier 2 to 5 years.

Carpet area has been clearly defined to include usable spaces like kitchen and toilets imparting clarity in the matter which was not the case earlier.

Garage is now to kept out of the purview of definition of apartment and is separately defined and formation of allottees associations is now mandatory within three months of allotment of majority of units in a project so that buyers get to manage facilities like common hall, club house, reading room.

Aggrieved buyers can now approach 644 consumer courts which are available at district level in the country instead of only the Regulatory Authorities proposed to be set up under the Bill, mostly in capital cities, for redressal of grievances. This makes it easy for buyers besides reducing the costs of seeking redressal.

Regulatory authorities would promote single window system of clearances for real estate projects benefiting the sector and can now grade projects along with grading of promoters, besides ensuring much desired digitization of land records.

Regulatory authorities will now be required to make regulations within three months of its formation as against six months earlier proposed.

States will now have to make rules within six months of notification of the proposed Act as against one year earlier proposed and allottees shall take possession of houses in two months of issuance of occupancy certificate. This prevents delaying registration resulting in denial of revenues to the respective states in the form of stamp duties and registration charges.

Chairmen and Members of regulatory authorities and appellate tribunals are barred from taking up post-retirement jobs except in government and statutory bodies.

Additional benches of appellate tribunals can be set up in a state if required for speedy adjudication of grievances.

There is new provision for imprisonment up to three years in case of promoters and up to one year in case of real estate agents and buyers for violation of orders of appellate tribunals. Appellate Tribunals now required to adjudicate cases in 60 days as against 90 days earlier proposed and regulatory authorities to dispose of complaints in 60 days while no such time limit was indicated earlier.

With all these major amendments to the Real Estate Bill first moved in 2013, the Real Estate (Regulation and Development) Bill, 2015 is expected to protect the interests of large number of buyers besides promoting fair play in real estate transactions and ensuring timely execution of projects.

According to a real estate research agency, 10 lakh consumers buy houses every year with an investment of about 3.50 lakh crore in residential segment. About 3,200 to 4,000 new projects are launched every year. At present about 17,000 real estate projects are in progress in 26 major urban agglomerations in the country which also will come under the ambit of the proposed Bill.

Source - NDTV

Home Buyers Can Now Get More Loan for Property up to Rs 30 Lakh

Mumbai: Banks can now provide home loans up to 90 per cent for properties that cost Rs 30 lakh or below, the Reserve Bank of India (RBI) said on Thursday.

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Earlier, the facility was available only in cases where the cost was up to Rs 20 lakh.

This will benefit those home seekers who plan to buy properties in the range of Rs 20-30 lakh.

The RBI's decision comes in the wake of all major banks reducing interest rate on home loans.

The Reserve Bank of India said in a circular that in case of 'individual housing loans' falling under the category of up to Rs 30 lakh, the LTV (loan to value) ratio is now up to 90 per cent.

For properties above Rs 30 lakh and up to Rs 75 lakh, the LTV is up to 80 per cent and for those above Rs 75 lakh, the ratio comes in at 75 per cent.

Source - NDTV India

Where to find affordable homes in Pune

Pune, an IT hub of India, is majorly preferred by professionals to migrate and settle down. So if you are looking for property here but have a low budget of upto Rs 40 lakh, then the current edition of PropIndex (Oct-Dec 2014), a quarterly report by Magicbricks, brings you areas where you can find such properties. 

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According to the PropIndex, residential properties in the range of Rs 20-40 lakh are in maximum demand across the city, which is contrary to the previous quarter (Jul-Sep 2014), where demand was inclined towards the Rs 40-60 lakh budget category.   

As per data with Magicbricks areas such as Dhanori, Wagholi and Hadapsar offer properties within Rs 40 lakh.

Dhanori
Located on the North-East fringe of Pune, it is a rapidly developing suburb. What makes it a preferred choice is the availability of housing options at affordable prices. It is in close vicinity to premium areas of Koregaon Park, Viman Nagar and Kalyani Nagar. It offers residential properties at Rs 4,350-5,350 per sq ft while prices in the premium areas range between Rs 6,400-11,450 per sq ft. So those who can’t afford to buy in the premium localities can purchase in Dhanori and still be close to these premium areas.

Hadapsar
It is 12 km from Pune city and is strategically located on the Pune-Solapur Highway. The locality is widely preferred by buyers as prices of the residential units are affordable as compared to the nearby areas such as Fatimanagar, Camp and Magarpatta. In the most preferred budget category of Rs 20-40 lakh, one can buy apartments sized 600-1000 sq ft.    

If you intend to live in and around the IT hubs, Hadapsar can be an option. Magarpatta houses over 21 well known IT companies and is 5 km away from Hadapsar. So if you can’t afford to buy an apartment in Magarpatta, you know where to invest.

Wagholi
Located in South Pune, it is one of the fast developing areas. Increasing number of residential developments and availability of housing options in varied budget ranges makes it an ideal choice for many. Majority of builders offer properties within Rs 40 lakh due to rising demand for this budget category.

Buyers who are unable to own a home in Kharadi, the IT hub of Pune, generally opt for Wagholi owing to the affordable housing options and at the same time closeness to work spaces. In the said budget the apartments are available in sizes of 700-1000 sq ft.    

So, buyers with a budget of Rs 20-40 lakh in Pune can now consider the mentioned localities.

The buyers are offering discounts that are attracting property buyers. A new car is offered by developers on every booking! Many cases tax exemption is provided by the developers as additional benefits.

Source - TOI

Realtors hope for turnaround after home loan rates cut

Ahmedabad

The recent cut in home loan rates has revived hopes of a turnaround in the realty market. Buoyed by the RBI cut in repo rate, city-based realtors expect demand to increase slowly by Diwali. 

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"Unlike other cities in the country, the property prices in Ahmedabad have remained stable over the last three years. No major projects were launched during the period. Now, new projects are being launched. Many existing projects currently have no unsold inventory," said Deepak Patel, president, Gujarat Institute of Housing and Estate Developers (GIHED), which is organizing a three-day GIHED property show in Ahmedabad starting from October 9.

Shekhar Patel, managing director of Ganesh Housing, said the industry is expecting another round of rate cuts before the next budget. "Our economy has started showing positive signs. The rate cuts will certainly help the realty market," he said.

In cities like Bangalore, Chennai, Kolkata, Pune, Mumbai and Delhi, owning a house has become a daunting task for the salaried class. However, as compared to these cities, in Ahmedabad property prices are comparatively cheaper. According to the data released by real estate rating and research firm Liases Foras, at an average cost of Rs 28 lakh, flats in Ahmedabad are still cheaper.

According to Manan Choksi, director of RE/MAX Gujarat, "The average ticket size of each transaction for the first half of 2015 (January to June) was over Rs 3 crore. During this period value of transactions recorded in all the 19 sub-registrar offices of Ahmedabad was Rs 12,500 crore."

During the sluggish period, consumers were in wait and watch mode. "The prices of real estate in Ahmedabad have bottomed out and there is no room for further correction. This is the right time to buy properties as home loan rates have come down now and further rate cuts by RBI are likely," said Ashish Patel, vice-president, GIHED. The excitement among the realty players is evident from the fact that as many 70 reputed builders with 500 projects are participating in the property show and more are likely to join. 

Source - TOI 

SBI home loan customers to get only 50% benefit of cut in base lending rate

MUMBAI: The euphoria over State Bank of India's 40 basis point (0.4 percentage point) reduction in interest rates is likely to get watered down considerably for home buyers. India's largest bank has said that the interest rate on new home loans will be only 20 basis points lower -less than half of the 50 basis point reduction in benchmark rates by the Reserve Bank of India.

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This 40 basis point reduction in the bank's base rate will not fully apply to new home loan customers because the bank has revised the spread at which it will advance home loans for borrowers to 20 basis points above its benchmark base rate as against offering loans at base rate earlier.

Sources said that the bank had taken a decision to revise the spreads to protect its margins since the rate cut has been front-loaded without an equivalent reduction in the cost of funds.

SBI takes lead, lowers EMIs after RBI cuts repo rate

SBI's decision to cut interest rates on new home loans by only 20 basis points is a rare instance where old borrowers stand to gain more than new customers. A woman borrower who had taken a loan in the first week of October would get home loans at the base rate that is 9.7%.

Following the revision in the base rate, the borrower would see her loan rate coming down to 9.3% (base rate) in the next quarter. However, if she delayed taking the home loan to October 5, she will be able to avail the loan at only 9.5%. The lending rates applicable to women will also apply to joint loans where the first borrower is a woman. For all other borrowers, the interest rate would be 5 basis points higher (9.55%).

Sources said that the bank had taken a decision to revise the spreads to protect its margins since the rate cut has been front-loaded without an equivalent reduction in the cost of funds. SBIchairman Arundhati Bhattacharya had earlier suggested that the bank be allowed to come out with a teaser loan-type scheme to incentivize new borrowers. However, the RBI has not been very conducive to the proposal.

Rival lender ICICI Bank has announced a 35-basis-point reduction in base rate to 9.35%.The private bank has, however, not announced the home loan spreads. If the earlier spreads (base rate + 15 basis points) for women and (base rate +20 bps) for other borrowers continue, the home loans would be available at 9.5 and 9.55%. However, if the bank continues to offer loans at a markup to SBI, as has been its strategy in the past, the spreads may get revised. Both ICICI and HDFC were offering loans at 15 bps above SBI rates.

Besides revising spreads on its home loans, SBI has also made high-value Maxgain loans more expensive.

The Maxgain loan is a home loan structured as an overdraft. In this loan, the borrower is not charged any interest for any surplus that the borrower parks in a current account linked to the loan. For a Maxgain loan above Rs 1 crore, interest has been revised to 9.75% for women and 9.8% for men. In a commercial real estate maxgain loan, the interest has been revised to 9.95% for women and 10% for other borrowers.

Source - TOI

Why festive season is the ideal time to buy a home

Experts believe that the real estate sector has a lot of unsold inventory in the luxury space but not in the affordable housing space where there is a major supply shortfall.

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Hence, the customer has to first segregate both these markets and adopt a suitable approach for each of them that effectively enable them to get the best deal. In the luxury space, it's clearly a buyer's market; hence, the buyer can name his price within the region. A 15-20 percent discount below the listed price is possible in projects where the developer has a high debt.

Rohan Bulchandani, co-founder and president, Real Estate Management Institute (REMI) and The Annet Group explains, "The festival period, starting around Janmashtami (August-September) through the end of the year, is the ideal time to buy a home in Mumbai. It would appear that this period creates an almost perfect convergence of the three key elements required for a property transaction to culminate: demand, supply and money."

Buyer-led demand

For most Indians, the purchase of one's home is perhaps the most significant life-investment, requiring a large capital outlay and as a culture deeply rooted in spirituality, religious sentiment and superstition, there is a significant bias towards making such an important life-purchase decision during the festival season.

Developer-led supply

Developers are acutely aware of the buyer-led demand phenomenon during the festive period. Sluggish sales of completed homes over the prior months, have led to a glut in the finished goods inventory, which developers are now keen to offload. As many developers are faced with this situation, the competitive environment drives them to differentiate themselves by offering innovative deals in order to attract customers.

Bank and Housing Finance Corporations (HFCs)-led money supply

To further facilitate property transactions during the festival season, banks HFCs also play their role, in capitalising on the opportunity to increase business for them. In addition to interest rates and EMI reductions, institutions often sweeten their offerings by eliminating the processing fees, waiving customary pre-payment penalties and by including free property and accident insurance.

Things to keep in mind for value picking

"Pick projects where the developer has a good track record of quality, on-time delivery, amenities being delivered across other projects, etc. For the affordable housing space, always go with a branded developer with a high reputation; pick a project which is an integrated township near a railway station. Look for a place where people are already residing or the pos session is only a few months away. This way, the customer can be sure of the amenities being de livered and also that utilities such as water, electricity, etc, are not a problem," suggests Rohit Poddar, managing director, Poddar Developers.

Buying a property is a one-time decision for many, so while buying a property during the festive season; buyers should focus on the budget and the connectivity of the area as they are the most important factors one should keep in mind for value picking.

Gaurav Shah, director sales and marketing, Ravi Group, feels, "The cost of the property plays an important role, whether the buyer is buying an under construction flat or a resale property. If the cost is not considered, the dream home could end up becoming more of a worry than an escape. Another prime factor is the connectivity. The area should be well-connected to schools, colleges, hospitals, markets, shopping places and bus, train stations. The location is often an afterthought when it comes to purchasing a property because nowadays, buying a property in Mumbai is an expensive affair."

According to experts, the festive season creates a win-win-win situation wherein buyers, developers and financiers, all benefit from the appropriate environment. Historically, property transactions increase by 25-35 percent during the festive season and in certain cases, upto 40 percent of sales take place during this period.

Source - Property News

After RBI cuts rate, realtors want banks to cut home loan rates

MUMBAI: Real estate developers have welcomed the RBI's decision to cut repo rate by 50 basis points, but have also appealed to banks to pass on the benefits to consumers by easing the home loan rates. The reduction in the banks' lending rate is also expected to lower the borrowing cost of builders and ease the pressure on interest outgo.

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"The reduction will have a positive impact on developers' borrowing cost. However, operating performance of these companies should not deteriorate any further as credit ratings have already worsened and resulted in higher cost of borrowing," said Sandipan Pal, analyst, Motilal Oswal Securities. "To see improvement in operational performance of developers, we need more of price correction than interest rate reduction." Realty developers' debt levels have been mounting in the backdrop of low sales for some time now and a saving of 40-50 bps in interest cost would be significant, reckoned analysts. The total debt level of the top 15 listed realty developers stood at over Rs 54,567 crore as on FY15 end, against Rs 50,400 crore during 2012-13 end. Developers are also expecting the easing of cost burden to result in better prices for consumers. "It will be easier for developers launching new projects to pass on the savings on borrowing costs to consumers. These can be significant savings for both developers and homebuyers, given that a project usually takes about two years for launch after land acquisition," said Sandeep Runwal, director, Runwal Group.

 Prior to Tuesday's 50-bps cut, the central bank had earlier cut the repo rate by 75 basis points since January, but the net loan rate reduction by banks so far has not been more than 25-30 points. "This is a helpful move, but was long overdue. We now appeal to banks to pass on the rate reduction to consumers. They can now pass an entire 1% rate reduction to home loans," said Getamber Anand, president, CREDAI. "If that happens, this year's Diwali will see a revival in home sales momentum." Apart from the rate cut, the RBI has also announced that it will lower the risk weightage for lowcost home loans. 

With a view to improving "affordability of low-cost housing" for the economically weaker sections and low income groups and giving a fillip to "housing for all" initiative, the RBI has also proposed to reduce risk weights applicable to lower value but well collateralised individual housing loans, the RBI said in its policy statement. The central bank will separately issue detailed guidelines on this. "Risk weightage for home loans need to be halved to 25% from 50%. And not only for the economically weaker sections but across categories, because the NPA in home loan segment is less than 1% and it's justifiable to lower the risk weightage," said Niranjan Hiranandani, MD, Hiranandani Constructions. 
 

Source - ET

Tips for buying home in the festive season

The festive season, as we can all guess, will bring with it big offers from the real estate industry. Glance upwards at any major traffic signal and one will see hoardings with unbelievable offers on homes. Buy one bedroom and get another free. Receive 12 percent per annum interest on any booking amount one pays. Book now and pay nothing until possession. Discounts on registration fees and stamp duty, free cars, parking, modular kitchens, club memberships, gold coins and cash discounts. If somebody is looking to buy a home, the upcoming festive season might bring the dream home within one's reach. 

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One must remember to double and triple check the offer before signing anything.

Here is a list of things to keep in mind.

Builder's track record: All offers will seem attractive but not all of them are worthy of one's time. It is important to understand that in this market, separating the developers by reputation and track record has never been more important. One needs to look for a builder with a track record of delivery and quality, a company that has not only managed to meet its deadlines on possession but also delivered what had been promised at launch. Do a quick search online on customer forums, news reports and look for problems that the builder might have had with previous projects. Visit previous projects and speak to residents about their experience with the builder. A reputed builder will also be a member of an industry association like Confederation of Real Estate Developers Association of India (CREDAI).

Strong location: Make sure the project is in a strong location with potential for price appreciation. Growth in prices depends on factors like job creation. Is there an IT park or an SEZ nearby? Does the location have good infrastructure in roads, fly over’s, Metro or train stations planned in the future? Is there easy access to schools, colleges, hospitals and malls and parks? A neighbourhood that can check all these boxes will offer the fastest growth in prices.

Price Point: Making a decision on fair price might seem difficult in this market. Start by finding out the prices of similar projects by similar developers in the area. Speak to several local brokers to find out the rack rates and the possible room for negotiation. Speak to a customer who has just bought a home in that project and find out the ground reality of discounts the builder is willing to offer. Find out the monetary value of the offer or the freebie; work it into your price as a discount. When negotiating with the builder one should push for cash discounts over freebies. If one has a pre-approved home loan and the ability to close a deal at the table it will boost the ability to drive a bargain on discounts.

Use the festive season to find the perfect deal for the dream home. Remember, cherry picking in this market will ensure a great value that might not always be available.

Source  TOI 

Home loan interest rates expected to come down

Bangalore

The inflation rate is under control and the given macroeconomic factors could lead to the RBI bringing down the key rates in its next monetary policy review later this month. The next Credit Policy review is due on September 29. As always, there are expectations of a reduction in the key interest rates. The expectations are strongly supported by the ground realities and requirements. Bankers expect the Reserve Bank of India (RBI) to cut the key rates later this month as the inflationary pressures seem under control.

The industry is already pushing strongly for a rate cut. The RBI has already made a 75 basis percentage points reduction this year in instalments. It is to be noted that although the inflationary pressures are still not completely under control, the government's food management and the minimal rise in support prices of farm products should help in keeping the inflation rate under control.

The RBI has observed that 'so far the inflation outcomes have closely tracked the projections'. A reduction in the key rates is also called for because of the stressed balance sheets of corporates and banks, low capacity utilisation, low oil prices and depreciating rupee.

Some macroeconomic factors will further help in the push for an interest rate reduction. The major supporting factor is the subdued inflation rate that has touched record lows, as well as the inflationary forces. It has been further supported by the falling crude oil prices.

Bankers expect the RBI to cut the policy repo rate from 7.25 percent at the next meeting. The consumer price data for July has shown the retail inflation rate at a record low of 3.78 percent, giving the RBI more room to ease the policy rates.

In order to inject more momentum in the economy and encourage investments, the government and corporates have requested the RBI to lower the interest rates. The Index of Industrial Production (IIP) data for the month of June came in at 3.80 percent as compared to the previous month's data of 2.70 percent, but we have to gear up much more in the manufacturing segment for higher growth.

An interest rate cut by the RBI is sure to boost investments. Further, it is apparent from the recent earnings of corporates that demand has not picked up in almost all the sectors. However, this earnings season was better than the March quarter. Though the corporate earnings' growth has been muted so far, it is expected that the markets will remain positive as the long-term growth story of the economy is intact. The GDP growth rate slipped to seven percent in the April-June quarter of 2015-16, from 7.50 percent in the preceding quarter.

Source - TOI Banglore 

Vaastu Shastra can improve resale price of your home

Ensure there are no overhead beams running through the centre of the house as this will lead to a disturbed mind.

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Heavy furniture should not be kept in the middle of the House, as it is the Brahmasthan and should be kept as vacant as possible.

Try to avoid bigger windows in the South-west and have bigger windows in the Northern direction for success if the woman is working.

These are some of the common understandings derived from Vaastu.

Your home is divided into 16 zones according to Vaastu Shastra. Every tilt and any modification that you consider has a larger impact than what you probably understand. Vaastu has been around for ages and no matter whether you choose to believe in it or not, you never forget to ask for it. In India, 80 per cent of the population asks for Vaastu compliant homes. It is one area where home buyers are not ready to compromise.

It is interesting to see how the Bengaluru market responds to Vaastu. Properties that are Vaastu compliant command a 10-15 per cent premium than those that are not. But why? Here’s a look-

Vaastu is more than just a traditional concept

When you think of Vaastu, you associate it with the older, traditional generation. However, even youngsters are asking for it. Vaastu is religion neutral, meaning to say, it is devoid of any association with a particular community or the way of life and is directed towards the well-being, prosperity and goodness of the residents. “Tech savvy youngsters these days research online before buying a house and almost all of them have heard about Vaastu. They ask for it not essentially because they believe in it but it is deeply ingrained in their psychology. After all, what is the harm in sticking with something that generations have tried and tested,” says Vasanth Bhat, architect and Vaastu consultant at Vastu Architects with over 25 years of professional experience in the field.

Vaastu brings better ROI

Some go in for Vaastu for better returns. “Vaastu compliant homes are easily saleable in the market and guarantee a better resale value than ones that are not. Property is a heavy investment and buyers want to make sure their built environment radiates goodness as well as fortune,” adds Bhat.

“There is almost no market for homes that are not compliant. Buyers who doubt the compliancy even undertake renovation to modify their homes and build it into livable Vaastu compliant spaces. Sometimes buyers like the location of the house and the rate at which it is being sold but it may not be fully Vaastu compliant so they go in for Vaastu with or without demolition,” seconds Naresh Parashar of Ram Properties and Consultants.

When the market is sluggish, a small proportion of active buyers look for quality and it may be hard to sell a house that is not compliant because it is seen as a basic requirement. Nobody wants to take a chance with one’s fortunes.

Are all homes Vaastu compliant?  

With the increasing number of takers for Vaastu, developers take it up on priority to consult planners and consultants before they begin construction. However, not all homes are 100 per cent compliant. With independent bungalows there is a greater chance of achieving 100 per cent Vaastu compliancy but with apartments it generally does not exceed 80 per cent, confirms Bhat.

Vaastu and NRIs

“The farther you stay the more culturally attached you get,” feels Bhat. NRIs and HNIs are the largest demanders for Vaastu amenable homes.

Vibration analysis is the emerging practice among HNIs. This involves gauging the vibe of the house - positive or negative. In case of the latter, the house is 'cleansed’ by doing small modifications, says Tushit Baalaje, property consultant at Tushit Properties.

As per buyer requirement, aspects like Vaastu, ventilation, quality of construction and interiors, social and physical infrastructure are angles we check. Sometimes the ‘feel’ of the house may not be promising, so the vibration analysis attempts to get rid of the negativity.

A word of caution

There is an unknown fear of the future that grips every individual which is why such concepts floating in the property market have many takers. However, Bhat advices that Vaastu should be seen as a parameter. “It is just like inoculation. You vaccinate a baby to avoid any unforeseen health risks. It is just a preventive approach. Today home buyers approach consultants with problems they are facing and blame it on the built environment. How much is too much is for a buyer to estimate. Too much of dependence paves way for Vaastu to evolve as some kind of marketing gimmick.”

He also goes on to say that Vaastu doesn’t scorn upon having a house on the 13^th floor or opting for a home close to a crematorium. It may be practically a bad idea to live near a burial ground because you wouldn’t want to wake up to see someone wailing somebody’s loss. Vaastu shastra does not mark such properties as good or bad.

Source - TOI