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EFFECT OF GST ON REAL ESTATE BUYERS AND INVESTORS

The main implication of GST is that it has brought a simplified tax structure. Previously, the buyers had to pay VAT, Service tax, stamp duty and registration charges when purchasing a property under construction. However, for purchase of completed properties, only stamp duty and registration charges were payable. The registration charges, stamp duty and VAT varied from state to state. Earlier due to various types of taxes, the businesses and purchasers had to pay tax on tax which was very complex. To tackle this problem, Government introduced GST. This has introduced positivity among the buyers and investors because of a less complex tax structure.
Under GST, all properties which are under construction will be charged at 12% of property worth. Stamp duty and registration charges are not included in this. For the properties which are complete, the previous provisions will prevail. No indirect tax will be paid by the buyers on sale of ready to move in properties. Thus the implementation of GST has brought in more transparency in taxation and has boosted the sentiments of buyers and investors.

  • Simplified taxation
  • Transparency and clarity
  • Reduced tax burden
  • Increased profit margin
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Compact Homes: A Growing Trend in Indian Real Estate

The pattern of compact homes is picking up energy in he real estate sector, the main reason being an increase in nuclear families. Particularly in the metro cities where majority of the population is working, these homes play a vital role as they are affordable in range. The space in a compact home comprises of a hall, kitchen, bedroom, study area, washrooms and a balcony. The area ranges from 500 square feet to 800 square feet, which is a sufficient space for a nuclear family. According to a survey by real estate expert, the metro cities like Mumbai, Delhi, Kolkata, Bengaluru and Chennai have little land and the prices are less too because of which the pattern of compact homes have gained immense popularity. It has also been observed that selling expensive and luxury apartments is really troublesome for developers and that’s why they prefer compact homes.
There has been an increase in preference of nuclear families by the millennials, also a growing demand for compact homes as it does not require much investment. Other advantage of these homes is that it is constructed elegantly keeping in mind the space and using it perfectly. The latest technology and latest trends in interiors is also kept in mind. The compact homes are most practical to deal with as it involves low maintenance cost which is of utmost importance to the working generation. Thus, minimum spending on furniture, electricity and other interiors. This gives the opportunity to decorate the home as one likes, customizing it according to their taste as one has dreamt of. Another advantage of these homes is that it has a great resale value. The return on investment for compact homes is far better than big luxurious apartments. Also they are sold off easily as their demand is great in urban cities. So it comes to no surprise why these small spaces are gaining widespread popularity among the millennials.

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HOW TO INVEST IN REAL ESTATE WITHOUT BUYING PROPERTIES

The trend in real estate has evolved with time. To fetch high returns on investment people are investing in commercial properties. Earlier people used to invest only in residential spaces but now it has changed. To get assured rental income people are not investing in just one commercial project but in several small budget projects. Virtual space is the talk of town now. Virtual space investment means the space being registered in investor’s name but he does not have its physical ownership. The biggest benefit here is that the investor does not have to think about maintenance of the owned space. After completion of its construction, the owner starts getting its rent. Virtual space is actually an office space which is rented out to different buyers. At any point of time the investor is free to sell the property. It offers varied use of commercial development like restaurants,food courts, offices, rentals, spa. There is a better growth of return in such investment.

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PERKS OF INVESTING IN LUCKNOW

PERKS OF INVESTING IN THE CITY OF NAWABS

The city of Nawabs, Lucknow has developed tremendously in all areas especially in real estate sector. There are various reasons why one should one invest in this city. The Town and Country Planning has estimated that approximately 197 villages will be brought under the Master Plan 2021. So it is speculated that many residential properties will be developed in these locations. Faizabad road, Sultanpur, Raebareli road will not be far behind when it comes to commercial properties. An approval has been done by LDA for the construction of 150 metre wide ring road to popularise private projects in the city. There will also be a development of Knowledge park between Mohan road and Jail road having higher education and coaching institutions in its vicinity. The development of metro in the city will be an impetus for the growth of real estate corridor. This will surely prove to be beneficial for the public. Various townships and IT city spread over an area of 100 acres is being developed by ACL technologies. Lucknow comes second in the list of Smart cities given by the Centre. Assistance and funds will be provided by the Centre. Multi speciality hospitals are being set up in the city which makes it a medical tourism spot. These were some of the perks to invest in the city.

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CO-WORKING SPACES: A NEW TREND IN THE INDIAN MARKET

A joint report by JLL and Confederation of Indian Industry said that net absorption in commercial segment is expected to exceed 39 mn sq ft by 2020. There has been a huge demand for co-working spaces in the recent times and few reports highlights that absorption by service providers is tripled to 3.44 mn sq ft in the period January-September 2018. In the year 2017, the co-working space was 1.1 mn sq ft. The co-working sector has doubled to 10%. According to the report vacancy declined to 13.7% in the period July- September 2018. The office sector will gradually come down in the mid term (2018-2020). Companies in the industrial segment in the cities like Bengaluru, Delhi-NCR, Chennai have been showing keen interest in office spaces. Mumbai and Pune are no far behind. But interest has been shown more for the co-working spaces. The share of co-working sector went up from 4% to 10% from last year. According to Ramesh Nair, CEO and Country Head, JLL India, the preference for co-working spaces will rise substantially in the coming years, especially in the cities Bengaluru, Mumbai due to availability of infrastructure and a startup culture. Tier II and tier III markets will also catch up soon.

The report states that large demands for co-working comes from big corporates(40-45%), then comes small-medium enterprises(35-40%), the last being start-ups(15-25%). The co-working spaces helps in cost reduction by 25% in cities like Delhi-NCR, Bengaluru, Mumbai and Pune. According to Sandeep Sethi, MD, Integrated Facilities Management- West Asia, JLL India, the commercial real estate will have to buckle up to match the technology disruptions affecting the way companies are conducting their businesses globally. FinTech startups have promoted low cost office spaces with modern technology infrastructure. E-commerce players are also considering co-working spaces now for cost savings. The new standard of holistic Wellness for office buildings is gaining momentum. The concept aims to address the wellness of employees at workplace.

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