Thane West: A well-connected Mumbai locality with many multi-storey projects

 

April 2022

Mumbai

This week's realty hot spot looks at Thane west in Mumbai. The area hosts good schools, hospitals, malls and several multi-storey projects by well-known developers. It has excellent connectivity to other parts of Thane city and MMR via the NH-48, Eastern Express Highway and Old Agra Road. Properties here are available in the price range of Rs 9,500-18,300 psf.

Locality snapshot

* Excellent connectivity to other parts of Thane city and MMR via the NH-48, Eastern Express Highway and Old Agra Road

* Hosts several multistorey projects by well-known developers such as Shapoorji Pallonji, Tata Housing, Kalpataru, etc.

* Key employment hubs: Lodha Supremus, Dosti Pinnacle, Ashar IT Park, Nitco Biz Park and Lotus Park

* Major social infra: Jupiter Hospital, Bethany Hospital, Orchids The International School and D.A.V. Public School

* Nearby retail infra: Viviana Mall, Korum Mall, Lodha Boulevard, High Street Mall and R-Mall * Schools 20+

* Hospitals 20+

* Restaurants 20+

* Banks 20+

* Grocery Stores 20+

* Petrol Pumps 15+

26,000 house registrations recorded in Jan-Mar quarter

 

April 2022

Navi Mumbai: More than 26,000 house registrations have been recorded in the last quarter of the financial year 2021-2022 (January 2022 to March 2022). City developers have called the numbers good for the real estate market.

As per the Maharashtra Chamber of Housing Industry (MCHI-Navi Mumbai), total 26,484 house sales were recorded in the registration offices in Panvel, Vashi, and CBD-Belapur, with a majority of 2,184 registrations from the five registration offices of Panvel.

“With the declining Covid-19 cases and lifting of lockdown, the real estate business is picking up. We expect more sales in the next two fiscal quarters as the citizens are showing interest in Navi Mumbai properties, especially in the growing Panvel areas, including Ulwe,” senior vice president, MCHI-Navi Mumbai, Manohar Shroff, said.

He, said the carpet rate for residential houses in Ulwe is currently in the range of Rs 6,500 to Rs 8,000 per square foot, while that in Vashi, being the oldest and most developed node of Navi Mumbai, it still remains highest at Rs 15,000 to Rs 22,000 per square foot.”

Shroff further said that in comparison to the 26,000 registrations in the last quarter, the figures for the corresponding period in 2021 were only 16,400, mainly because of the second Covid wave-induced lockdown rules.

“Since the state government has reduced stamp duty rates on property deals from 6% to 3%, more customers have come forward to buy ready-possession houses, and also those under construction. The city builders are further anticipating a rise in property sales this year,” he informed.

What NRIs Need To Know About Investing In Real Estate In India

 Due to government regulations and increasing technological accessibility in COVID-19, the real estate sector has been a center of attraction for NRIs

Indian real estate market has been an area of attraction for NRIs since time unknown. Due to investment purposes and even emotional attachment to their country, NRIs rarely miss an opportunity to own a real estate property in India. This statement can be backed by a report from Knight Frank's Active Capital, which states that, Indian real estate has witnessed a massive demand by the domestic population as well as the NRIs. The report further concludes that foreign investments in Indian realty rocketed from USD 3.2 bn during 2011-13 to USD 7.6 bn during 2014-16 recording a staggering growth of 137%. It was also discovered that nearly 63% NRIs choose to invest in real estate rather than any other investments in India, by data from ANAROCK’s consumer sentiment survey for H1 2019. According to Reserve Bank of India (RBI) data, half of income earned by Indian citizens is used for family upkeep, followed by bank deposits, although a significant portion is also invested in real estate. According to this report by 360 Realtors “NRI investments in Indian real estate have doubled from $5 billion in 2014 to $10.2 billion in 2018," The major reason for the growing interest of NRIs in the Indian realty market is technological advancements like virtual tour of homes, digital inspections, and complete paperwork without visiting the property physically along with the new government policies favouring NRI investments such as RERA which has created transparency between builders/developers and consumers. Let’s take a look at what are the technological and government policy factors which are helping NRIs invest in properties in India

Technological factors

During the Coronavirus outbreak in 2020 the figures for NRI investments were reduced by 35%. However a significant improvement was witnessed in the 2nd quarter due to the use of technology by real estate developers to promote virtual tours of properties and online payment. There are several technologies like: Virtual tours which allows people sitting in any location to inspect a property and do the paperwork without the physical involvement. BMI (Building information modelling) which allows builders to showcase the upcoming projects to interested home buyers by compiling a 3D model of the building/project. It helps potential buyers/investors take a closer look at the insights and they feel more comfortable because they’re taking an informed decision. Another reason for this surge in the 2nd quarter was due to attractive payment plans and huge discounts offered by the real estate developers, and due to the growing belief that real estate properties are the safest option for investment in the post lockdown world. A cherry on top technological factor which has raised a sudden interest of NRIs is Smart homes & Eco-friendly features. Home Automation systems allow residents to control everything with just a click. And Wi-Fi enabled security cameras also make them feel safe about the chances of break-ins and any other security concerns. This has created a cushioning amidst the people who are not in India and still want to invest in residential property.

RERA (Real Estate (Regulation and Development) Act, 2016)

The Real Estate (Regulation and Development) was passed by the Indian parliament in 2016 to protect the interested investors/buyers and create transparency among them & builders/developers while increasing the accountability. RERA states that a builder needs to register before promoting or advertising any of the projects. Along with this, there are regular updates about ongoing projects and developers can't divert funds from unannounced projects and are answerable for all the glitches, and hence RERA has emerged as a great tool for home-buyers and NRIs. The most important aspect of RERA is that it has created a uniform body in all the states and union territories like SEBI (for stock markets) which in turn has standardized all the purchase of properties be it apartments, homes etc. Due to this, we have witnessed investments worth $13.3 Billion by NRIs in the real estate market of India during fiscal year 2021 as against the earlier estimates of $13.1 billion, according to a report by 360 Realtors. The ratio of investment volume has seen a growth of 6.4% compared to the previous fiscal year despite the slow market during the pandemic. A regression analysis from the same report by 360 Realtors suggested further that estimate investments will grow to $14.9 billion in fiscal year 2022 witnessing a growth of 12% The rupee's depreciation, attractive payment plans, and flight to tangible assets such as real estate will continue to encourage the expansion of NRI investments in India Looking at the above trend and the future estimates, it is obvious that real estate investments in India, by NRIs will continue to increase. Let's have a look at some points which NRIs need to consider before investing.

a) Availability of proper documents : Non-Residential Indians, planning to buy real estate properties in India can invest in only commercial and residential properties. For this, the list of documents that NRIs might need is, thankfully, not long. All they'll need is a passport, address proof, a permanent account number (PAN card) and a recent photograph of them looking at a property they want to invest in.

b) FEMA rules : The Foreign Exchange Management Act 1999, by The Reserve Bank Of India has made it pretty easy for NRIs to make real estate investments in India. According to the guidelines of this act any NRI or PIO (person of Indian origin) is eligible to own any property in India other than agricultural land, plantation property or a farmhouse. However there are certain exceptions to the act that NRIs must consider before making the investment.

c) Home loans : With the government promoting foreign investments in the real estate market in India, they have established easy access to home loans for NRIs. If you're an NRI who lacks ready funds, you are still eligible to apply for a home loan. Banks and housing finance institutes, that are registered with the National Housing bank, are now permitted by the RBI to provide home loans to NRIs who want to buy a residential property in India, considering all monetary transactions have to be done in Indian currency. Interest rates on home loans are as low as 6.5%. While an NRI can also avail a loan for upto 80% of the total property value. However, an important thing that NRIs need to remember is that the home loan will not be credited directly to the bank account of an NRI, rather it will be disbursed to the seller's or the developer's bank account directly. Whereas, the loan can be repaid through the funds from NRO(Non-Residential Ordinary), NRE (Non-Resident External) account or FCNR (Fixed Deposit Foreign Currency account) deposits of the NRI. It's a smart choice to use NRE account while applying for a loan because this will allow the investor to repatriate the capital invested in the property, when you sell it off

d) Taxation for NRIs When it comes to tax benefits, an NRI will enjoy the same benefits as that of a resident Indian. Along with that an NRI will have to pay a rate of 1% for withholding tax deduction at source if they're buying a property that costs more than 50 lakh Indian rupees. An NRI must pay the same taxes as any other Indian resident when purchasing a property in India, including stamp duty, registration fees, post-purchase yearly property taxes, and even GST in the event of an under-construction home. You may also invest in real estate in India to gain rental income. You would, however, be taxed at 30% via tax deducted at source (TDS), with the remaining money being repatriable under FEMA regulations. Proceeds gained from the sale of an immovable property can be repatriated after a TDS deduction of between 20% and 30%, depending on whether it is a long-term or short-term capital gain.

e) Power of Attorney : Since the NRI may not physically be present in India, despite owning a property, they can choose a relative, colleagues or even a close friend to carry out all the legal transactions. This can be done using a power of attorney, which is basically a document that allows a person to act on the behalf of another person. Thus an NRI, investing in the Indian real estate market must ensure that he delegates the power of attorney to a suitable person and registers the document to avoid any frauds and disputes in the future.

f) Choose the right developer : It is of foremost important for an NRI to carry out his own personal research and select a good developer. Choose a developer who has a good reputation in not only the regional real estate industry but on a wider scale. An NRI should look for certificates and awards and should also inquire about the developer through local residents.

Where NRIs or PIOs can invest?

The Reserve Bank of India has granted wide authority to NRIs to acquire any residential or commercial property in India via a circular with one restriction of them not being able to own any agricultural land or plantation property in India. The investor is not needed to seek special authorization from the RBI, nor is he obliged to submit any letter or notification to the RBI in this respect. Income tax regulations also let an NRI to possess as many residential or commercial properties as he or she desires, also having the right to apply for any arbitrary number of home loans too. This falls under the current general permits. If they wish someone to do the needful transactions on their behalf, they have the authority to give Power of Attorney (PoA) to that individual.

Tax implications of NRI sellings properties in India

An NRI must pay the same taxes as any other Indian resident when purchasing a property in India, including stamp duty, registration fees, post-purchase yearly property taxes, and even GST in the event of an under-construction home. Proceeds gained from the sale of an immovable property can be repatriated after a TDS deduction of between 20% if the property is been sold after 2 years of purchase, i,e, long term capital gains, and 30% if less i.e. short term capital gains.

Section 54 exemption Section 54 exemption applies to long term capital gains, the property can be self-occupied or let out. You are only required to invest the amount of capital gains, not the whole selling receipt, and your exemption is limited only to the whole capital gain from the transaction. Section 54 allows you a time frame of a year before the sale or 2 years after the sale on a ready possession property or a construction property which will be ready for possession under 3 years from the date of sale.

Section 54F exemption Section 54F exemption applies to long term capital gains for property assets and other than residential house properties. To obtain this exemption, the NRI must either acquire one home property within one year before the date of transfer or construct one house property within three years from the date of transfer of the capital asset. This new house property must be located in India and cannot be sold within three years of acquisition or construction. One more thing to be noted here, the NRI should not possess more than one home property (apart from the new house), nor should the NRI buy or build another residential house during the next two years.

Section 54EC exemption If you can avoid paying taxes on long-term capital gains by investing in specific bonds. For this aim, bonds issued by the National Highway Authority of India (NHAI) or the Rural Electrification Corporation (REC) have been designated. These are redeemable after 5 years (formerly 3 years) and must not be sold before 5 years (previously 3 years) from the date of sale of the house property. It is important to note that you cannot deduct this investment under any other circumstances. You have a 6-month window in which to invest in these bonds; but, in order to claim this exemption, you must invest before the return filing deadline. Experts also expect that the need for homes among NRIs would rise in 2021 as a result of remote working. While the GST and the pandemic caused some ups and downs, the Indian real estate market has taken up the pace once again. Given the current scenario, the unforeseeable future, technology developments, and favourable laws, it is a viable moment for NRIs to engage in the Indian real estate market, and their investment in domestic properties will continue to rise significantly in the coming years.

Hall colours as per Vastu for a happy home

 Colours have the power to heal people, reduce stress and attract positivity. In this article we look at various hall colours, as suggested by Vastu.

Home hall colours as per Vastu

The hall in a home, is the hub of all energies. It should always have a comfortable and calming touch. The colours of the hall, as per Vastu, should evoke joy, happiness and attract favourable vibes. These colours include a palette of light blue, pale yellow, light brown, white and pink. The colour green or blue can also signify serenity and well-being with a touch of red, orange and purple.

White hall colour as per Vastu

White, in all its shades, creates an active and encouraging hall space. When it comes to wall paint for the hall, according to Vastu Shastra, white brings freshness, wisdom and purity. However, avoid a stark white living room and play with textures. Add a subtle dose of pastel shades to add life. Creating a neutral base for the hall interiors and sprucing it up with coloured accessories is the most appreciated design norm. It keeps the space classy. Brighten up a Vastu-compliant white hall with coloured linen or green plants and bright pictures.

Vastu-compliant blue hall

Sky blue has an elegance that brings serenity to the hall. Since it is a great Vastu colour, it gives a good vibe to your living room. Light or pastel shades of blue in the living room can create a cosy and peaceful atmosphere. Opt for a Mediterranean-inspired colour palette with a blue accent wall and all-white furniture. Blue also denotes beauty, contentment and inspiration. It enhances creativity if you have a home office in the living room. You can also use it liberally in your work area.

Brown hall colour as per Vastu

Brown has become a popular choice in recent years. It has nourishing energy that is associated with good things, such as the earth, chocolate and coffee. As per Vastu, brown radiates comfort and stability. It is easy to incorporate brown in the hall with an accent wall or wooden furniture. The colour brown is traditionally associated with warmth, comfort and shelter. Colours like light brown and other earthy shades evoke a sense of well-being. Decorating with different shades of brown adds visual interest and depth to your hall.

Green hall as per Vastu

A colour that is connected with nature and mother Earth, green is calming. It invokes healing and growth. Using green on all the living room walls may be overpowering. Hence, consider using it for an accent wall, curtains in green or green plants. Green also helps calm down tempers and soothe the mood, making it perfect for a family room.

Pink hall colour as per Vastu

Pink signifies good health and helps in calming the nerves while also creating a romantic ambience. Pastel pink lends calmness to the hall décor. It represents warmth and love. If you and your family spend a lot of time in the living room, shades of pastel pink colour combination for living room, as per Vastu, can help develop a bond and keep conflicts at bay.

Vastu-recommended yellow hall colour

The yellow colour is ideal for halls that do not get enough sunlight. Yellow colour combination in the living room, as per Vastu, can bring a fresh wave of energy, enthusiasm and cheerfulness. Yellow is recommended by Vastu for creativity, concentration, liveliness and happiness. So, it is apt for the hall home office too. You can invite positive energies into your hall by either having a bright yellow accent wall or a statement piece of furniture like a yellow sofa or high back chair.

Orange hall colour as per Vastu

Orange attracts positivity and has the balancing properties of cheerfulness and healthy relationships. According to Vastu, orange generates energy to promote conversations and relations. Use this colour in moderation in the hall, as it can also lead to aggression and temper issues.

Subtle hues of purple in the hall

Purple and shades of violet are excellent for stimulating good luck. Purple is linked with royalty, reality and wealth. Add hues of purple or violet in the hall for positive effects on the mind and body, elevating energy, adding calmness and encouraging creativity. Opt for subtle purple on the walls to foster sensitivity, compassion and a soothing ambience. If used moderately, violet brings calm and mental balance.

Vastu-based colour combinations for the hall

Vastu-approved colour combinations can make the hall an inviting and joyful space for your loved ones. Use two or three colours to create separate spaces in a living room but ensure that they complement each other to give a cohesive feel. Identify a theme according to your hall style and think of ways to add colours. Always take into consideration the amount of natural light that the hall receives before choosing a colour tone.

White and blue hall colour combination as per Vastu

The white and blue colour combination for the hall, as per Vastu, is a reflection of serenity. According to Vastu, the best direction of the hall is the northeast or northwest, making white and blue the ideal colours. White represents the metal element of a place and is linked to calmness and clarity. The blue stands for relaxation and peace of mind. The two colours combined are perfect for the hall, as this is where you spend time with the family and entertain guests.

Beige and brown combination

Beige and brown work well together, for inculcating grounded and secure feelings. Beige, the neutral colour, is associated with trees and plants and indicates strength and stability. It is also associated with prosperity. Neutral and warm colours such as light brown and beige are ideal for creating cosy and relaxed environments. Brown, as per Vastu, brings stability, comfort, positivity and prosperity.

Red, white and purple hall colour

A burst of colours adds cheer to a room. Representing power and passion, red colour stands for strong emotions, energy and passion. It also represents life and vitality. Use it subtly to not overpower the room.

Purple is the colour of luxury, riches, self-respect and poise. Set a zesty colour like red against white and pale purple. It is recommended for people who’re suffering from an inferiority complex. Let the entire living room be egg white with an accent wall in a purple-red textured design.

Orange, brown and white colour combination for hall

Bright as it is, a pop of tangerine orange against a mellow white base and light brown textures can add drama to the hall. Use orange as an accent colour for curtains, carpets or cushions. Orange promotes positive energy and conversation among friends.

Hall curtain colours as per Vastu

Vastu-appropriate colours for the curtains can make the hall relaxing and enhance suitable vibes. Use light colour curtains on the windows and doors in the northeast and heavy curtains for the southwest. According to Vastu, yellow, green, blue and beige are ideal curtain colours for the hall. Green is a symbol of hope and stands for healing, blue depicts new beginnings, promoting the inclusion of nature in one’s life and peace, yellow is associated with joy and beige stands for comfort.

Vastu-based painting and artwork colours in the hall

As per Vastu tips for positive energy in home, one can display vibrant paintings related to the beauty of nature, to generate positive energy and lift the mood. The colours of the paintings also have an influence on the overall energies in the hall.

A colourful painting of a meditating Buddha can help you bring inner peace. According to Vastu, Radha-Krishna paintings can also be kept in the hall.

Peacocks are symbols of wisdom, status and wealth. Hang a painting of a peacock in the hall (blue and green feathers) to invite good luck and wisdom.

To attract financial luck, hang a seven-horse painting (white-blue, as per Vastu, is ideal) on the wall in the east.

Keep a few green plants in the hall to get the maximum benefit of using the Vastu-recommended green colour for positive energy.

Plants like the lucky bamboo and money plant attract good luck when kept in the hall.

Which is more attractive: Rental income from residential or commercial property?

 Residential vs commercial property – which rental income is more attractive when you look at property investment? We analyse the benefits and drawbacks of each

Residential vs commercial property: Rental income

Rental income is an important consideration, for people who want to invest in the real estate sector. Property buyers are often confused over which would provide better income option – an investment in a residential property or a commercial one. Arvind Nandan, senior real estate professional, points out that when it comes to residential vs commercial property, the broad principles of asset-selection, such as the location of the property, quality of construction, age of the property and usage remain the same. “When you think of investing, with respect to rental income expected in residential vs commercial property, do note a few points. While most residential properties need to be leased on an annual basis, commercial properties are leased for longer tenures. The vacancy risks in residential properties are higher, given the frequent turnovers of tenants. Hence, property buyers need to pay attention to the qualitative aspects of these two segments before choosing commercial vs residential property,” he explains.

How to calculate rent on commercial property in India?

Experts advise that any investment in commercial property with rental income like office, retail, warehouse, etc., require the potential purchaser to consider aspects like the current leasing environment, the existing ecosystem in the region, distance from complementary and auxiliary industries, legal due diligence, clearances that are specific to the property’s usage, etc.

When it comes to commercial property vs residential property, a residential property must be analysed for liveability with respect to social infrastructure, the neighbourhood and profile of other residents.

How to calculate rent on residential property in India?

“When it comes to residential vs commercial property, note that in residential realty, the gross rental yields are usually in the range of three to five per cent, per annum, on the fair market value of the property. Let us understand difference between residential and commercial property tax. Net of insurance, property tax and maintenance, the net yields tend to be in the range of two to three per cent per annum. Escalations in home rentals are between five and seven per cent, per annum. On the other hand, in commercial realty, the gross yields are usually in the range of six to 10 per cent, per annum. Net of insurance, property tax and maintenance, the net yields tend to be in the range of five to eight per cent, per annum. Escalations in rentals here, are between three and five per cent, per annum. The overall returns estimate over 10 years, are now around eight to nine per cent per annum in the residential realty sector, in comparison to 13-15 per cent per annum in the commercial realty sector,” explains Amit Goenka, MD and CEO at Nisus Finance.

Risk versus rewards: Residential vs commercial property

Tax benefits: Commercial and residential properties that are let out, attract tax on income from house property. However, a house property that is taken on a home loan, qualifies for tax breaks under Section 24 and Section 80C of Income-Tax Act.

Risk and volatility: This is perceived to be higher in a residential property, due to frequent change in tenants, higher maintenance and upkeep costs and lower returns. Commercial properties offer stable, long-term rentals, with predictable income streams.

Entering and exiting an investment: Both are illiquid assets. However, with Real Estate Investment Trust (REIT) regulations, it would be easier to create a portfolio of commercial properties than residential properties. Also, since the supply of Grade A pre-leased assets is low, the demand is much higher, making it more liquid than residential properties.

Benefits and drawbacks of investing in residential property

Benefits	Drawbacks
Lower entry ticket	Low rental yields / rental incomes
No minimum / lowest size applicable	Investment in interiors, etc., to make it rent-friendly
Loan facilities easily available	Rental agreement usually cannot exceed 36 months
Leasing process is usually easier
Comparatively lower holding period for returns, as against commercial property

 

Investing in commercial property with rental income: Benefits and drawbacks

Benefits	Drawbacks
Higher rental yield and returns	The capital values of commercial properties tend to remain stable for longer periods of time
Longer term lease possible, i.e., up to nine years	The property may need to be of a specific minimum size, to be commercially viable
Leasing can be in bare shell or warm shell	Difficult to offload, as there are fewer buyers in the market
Commercial values are not very volatile

Beware of this if you are investing in commercial property with rental income. In order to make profits out of a sale, developers may lure prospective investors by showing them a higher rental. This is misleading at times. Understand that they may be including a fitout rent and these are not permanent and so, not bankable. They are paid for a limited period of time which can be say, five years.

So, how does that work when it comes to commercial property with rental income? Suppose, the base rent is Rs 60 per sq ft and the fitout rent is Rs 40 per sq ft. The tenant will pay Rs 100 per sq ft, which is Rs 1,200 per sq ft per year. Now, if the actual selling price is Rs 6,000 per sq ft where a tenant does his own fitout, a developer may charge higher, say, Rs 9,000 per sq ft, promising a higher return. This may look attractive but once the stipulated time period is over, the returns will drop.