Tag Archives: property news

Akrama-Sakrama has no answer to this big question

According to BBMP’s own rough estimates, only two lakh to three lakh properties out of the total 17 lakh properties will come under the current Akrama-Sakrama when implemented. This is just about 17-18% of the overall target of regularization. The new amendment bill passed in the assembly last week concentrates only on the penalty for smaller violations (that’s presently fixed at 25% for commercial buildings and 50% for residential).

According to BBMP officials in the revenue department, what’s presently ‘inferred’ from the enactment is that the violators must bring down their violation to the prescribed limit. But there is no answer to what happens if they don’t conform to it.

Even Bangalore minister R Ashoka admits that there are no immediate proper answers to the gross violations yet. “These violations are more in number. 100% regularization is not possible at one go. But we will have to make a start. Our immediate focus is to regularize the smaller violations,’’ said minister Ashoka.

What is the penalty for properties that have exceeded the set violation limits prescribed under the law? Akrama-Sakrama has no answer to this big question. Even the punishment for those who don’t pay penalty for violations within the set limit is also not clear as the corresponding rules to the enactment are yet to be framed.

Hike in concession rate of service tax

As per the budget proposal for 2010-11, the finance ministry has suggested service tax on construction and sale of property. The contractor was entitled to claim abatement to the extent of 66.7 per cent of the value of services rendered by him. But recently, the Finance Minister has increased the concession on service tax applicable to construction of residential complexes from 66.7 per cent to 75 per cent of gross value of property, including land value.

Suppose you are buying a flat costing Rs. 50 lakh (cost of land, Rs. 40 lakh, cost of construction, Rs. 10 lakh). As per the 2010 budget, the applicable service tax was supposed to be Rs. 171,495 calculated at 10.3 per cent on 33.3 per cent of property value. With the amendment announced by the Finance Minister, the applicable service tax comes down to Rs. 128,750 calculated at 10.3 per cent on 25 per cent of property value. Thus, the savings will be Rs. 42,745.

The Finance Minister has also declared exemption from service tax for low-cost housing segment (less than Rs. 20 lakh). Suppose you are buying a flat in a smaller city for Rs. 18 lakh (cost of land, Rs. 6 lakh, and cost of construction, Rs. 12 lakh). With the amendment announced by the Finance Minister, there would be no service tax applicable.

The notification will be published in July 2010. Till issue of notification, there will be no service tax for under construction property. Property Buyers can pay amount for property and service tax will not be levied till July 2010. After issue of circular or notification, Service tax will be applicable only for under-construction properties and not for resale property.

Memorandum for removal of service tax on under construction property

Confederation of Real Estate Developers’ Associations of India (CREDAI) a real estate industry body submitted a memorandum to the Finance Ministry concerned with the appeal for removal of service tax on housing complexes under construction. The Chairman of CREDAI, Kumar Gera stated that they have put forth their concerns and suggestions and also discussed the probable impact of the provisions with the Ministry.

According to Gera, the money collected through the imposition of service tax on real estate development will not be big enough, rather it would majorly lead an overall negative sentiment and a net loss of revenue. In budget 2010,Service Tax is imposed on 33 per cent of total selling price.

According to CREDAI, it was an impractical proposal to levy service tax on under construction complex since it would lead government giving preference to the secondary market of completed projects. An understanding of the problem and required corrective steps will be taken is a hope from the government. The list of recommendations was built in consultations with KPMG, its knowledge partner and was submitted to Y G Parande, a Finance Ministry Member (Budget).

Registering a property could soon become easier

The government is planning to replace the Indian Stamp Act 1899 with a simpler law that will do away with a large number of provisions and fees.The finance ministry has already initiated a preliminary exercise to draft the new law and is hopeful of finalizing it by the end of the year. The draft will need to be discussed with State governments to elicit their views as well.

Under the Indian Registration Act, the purchase of a house should be registered with the office of the registrar or sub-registrar of the district within whose jurisdiction the property is situated. Registration of property helps trace the history of ownership of a property.At present, the documents are physically verified by different departments, making the process of registration a time-consuming one. The new legislation is expected to address the problems being faced in registration of properties. The proposed legislation is likely to recognize electronic stamping and electronic payment of stamp duties. At present electronic stamping and electronic payment of stamp duties facility is available as part of the e-governance initiative for companies that wish to file their papers online with the Registrar of Companies.

The government is also planning to rework the current structure of stamp duty fees and penalties. Duties charged in the smaller denominations could be replaced with specific amounts or be calculated as a percentage. It is to be noted that the Law Commission had taken up the issue of amending the Indian Stamp Act last year. It had suggested in its report that the required fee for any transaction or court fee should be paid by demand draft, cash, or postal order rather than through non-judicial stamp papers or special stamps.

Green buildings are considered high performance buildings

Green building rating systems are an important tool in measuring and evaluating the environmental performance of a building. Strategically integrated mechanical, electrical and materials systems often create substantial efficiencies, the complexity of which is not always transparent. Rating and certification systems help define green buildings in the market. They inform the buyer/ viewer how environmentally sound a building is, providing clarity to what extent green components have been incorporated and which sustainable principles and practices have been employed.

One rating system cannot be applied to all building types. Thus IGBC has launched different rating programs to suit different building types. IGBC (Indian Green Building Council) has developed IGBC – Green Homes (specifically for residential projects in India).LEED is seen as the mother of all rating systems. Most systems have been influenced by LEED rating concepts and processes. LEED India and IGBC Rating systems adopt the best of national and international standards and codes.

IGBC is developing hard and soft infrastructural mechanisms like training professionals on green building concepts and simulation, capacity building through IGBC Accredited Professional Exam, Third party assessors services of green projects, Credit Interpretation Rulings.Green buildings are considered high performance buildings. Green building rating systems are an important tool in measuring and evaluating the environmental performance of a building. With the introduction of the LEED India rating system, it is observed that there is a huge demand for efficient living and working spaces.

India tops Asian real estate investment markets for 2010

Mumbai: According to a study by PricewaterhouseCoopers (PwC) and Urban Land Institute, a global non-profit education and research institute,India leads the pack of top real estate investment markets in Asia for 2010.The study is based on the opinions of over 270 international real estate professionals, including investors, developers, property company representatives, lenders, brokers and consultants.

Residential properties are viewed as more promising than other sectors and Mumbai, Delhi and Bangalore top the pack in the hotel ‘buy’ prospects as well.The report,points out that India, particularly Mumbai and Delhi, are good destinations.The relatively stronger fundamentals and the lack of dependence on foreign demand are seen as key advantages as India has managed to mitigate the severe recession that has hit most other Asian countries.

Reference:

http://www.thehindubusinessline.com

The Government may remove the mandatory three-year lock-in period for overseas investments

To boost FDI in real estate Govt may scrap 3-year lock-in

Delhi:To boost foreign direct investment (FDI) in real estate, the government may remove the mandatory three-year lock-in period for overseas investments in the sector.The department of industrial policy and promotion (DIPP) has proposed this move, with a draft cabinet note on the proposal being circulated for inter-ministerial consultations.

 

Lodha builders honored with Best Developer Involved in High-End Residential Properties

Mumbai: Lodha builders Pvt Ltd, Mumbai’s premium real estate developer, has been honoured with “Best Developer Involved in High-End Residential Properties” across India, by construction source india, which is unique in offering a holistic platform for the construction and building material industry. Construction source india had honored architects and builders for their contribution to various aspects of urban development.

 

The online building plans acceptance scheme started by PCMC

Pune: In order to speed up the working process in the administration the Pimpri Chinchwad Municipal Corporation (PCMC) has introduced the e-governance system. The introduction of e-governance system has facilitated online submission of property tax, submission of tenders, water tax and system for submission of octroi statements for a large number of industries. In addition to this, the online building plans acceptance scheme started by PCMC on a trial basis.

 

Bangalore Shifts into one BHK homes

Bangalore: Many developers in the city are looking at building— 1-BHK ranging between 500 sqft and 800 sqft with a price tag of around Rs 10 lakh to Rs 15 lakh. Electronic City, Whitefield, Marathahalli and Bannerghatta Road are the current hotspots for 1-BHK and studio apartments. Brigade Group, which just announced the launch of its value homes, says that 30% to 40% of the 10,000 units it’s expected to build would comprise 1-BHK units.

 

The new assembly complex will lead by example in the area of water conservation

Chennai: The Sewage Treatment Plant (STP) coming up inside the new Tamil Nadu Assembly complex in the Omandurar Government Estate on Anna Salai will help save about 2.5 lakh liters of water a day. The rainwater harvesting structures there will store 1.2 lakh liters while the STP, likely to come up on the Sivananda Salai side, will treat 2.5 lakh litres of water everyday.

Residential prices have started to look up in all markets

Hyderabad:According to the report, NCR and Mumbai have seen values climb up with the return of investors and an end users interest in the realty market in the third quarter ending September 2009.However, prices in cities in south India have stabilized, with the exception of Bangalore, which is still witnessing a slight correction.Rental and capital values in third quarter witnessed minimal correction in Hyderabad as price points inched closer to buyer expectations.