360 degrees Real Estate Services: January 2018

Homebuyers, Being Tech-Savvy May Not Be Optional Any More

10:00 AM

Homebuyers, Being Tech-Savvy May Not Be Optional Any More

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We often hear them say people are increasingly depending on the internet to buy property. A large part of the R&D (research and development) is carried out using online channels before the need to work offline arises. If one were to do all this work in the real world applying physical labour, this would have been taxing, killing the joys that a buyer derives from the idea of becoming a property owner. Developers and property brokers seem to be taking this oft-circulated news – which is backed by data and supported by trends – seriously. Even small brokers who operate from tiny offices in dingy lanes of their cities are trying to explore the opportunity the internet offers them. In case they are not able to go online themselves, they seek assistance of big players who are growing plenty in numbers. The popularity of the online channels among developers is evident from the fact that many of them conduct online sale of certain projects where they offer buyer a bigger-better deal. Such units cannot be bought using the offline mode.

For these two parties, remaining offline is no more an option. Under the norms laid by the real estate law, every developer must register himself with the state regulatory authority; the same is true of advisors, too. The only party that can still carry out the business in an entirely physical form is the homebuyers. Some of them are really internet shy and find it difficult to trust the virtual world to make a purchase that would possibly be the biggest purchase of their entire lives. Nurturing these sentiments may not be a healthy choice, and you may like to change your attitude towards the internet in the coming times.

Here is something that should help you change your mind.

* Online property advisors are working aggressively to ensure that the entire purchase process could be carried out online. This would mean end of all physical efforts as we know today. Being technologically challenged may not remain an option for you in the times to come.

* Civic bodies are speeding up work to offer more and more services online. Being tech-savvy does not remain optional at a time when more and more businesses are being carried out online.

* There are monetary benefits of being tech-friendly. The time and energy you invest in going places physically are saved when you take a tour of properties using the internet. Even if you do not plan to depend entirely on the internet to carry out the transaction, you could certainly do your homework using online channels.

-by Sunita Mishra
Source : PropTiger

Guidelines

How Do Banks Evaluate Your Property When You Apply For Home Loan?

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How Do Banks Evaluate Your Property When You Apply For Home Loan?

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Calculations are an integral part of the real estate business. It is for the same reason that while you may want to sell a property for a certain amount, you may or may not be able to given the finer characteristics of your property. In real estate, valuations become important. Here’s what you need to know about property valuations.

More and more prospective homebuyers and investors are eyeing an investment in the near future. Banks offer home loan products and for mortgages, property evaluations become necessary for the simple reason that banks want to make sure they do not end up with a loss if you default. So, what is it that the banks check when they evaluate your property?

The location of the property

Homes are completed and delivered only when the supplier is able to conveniently manage the delivery. Similarly, banks will see whether the home loan that you are applying for is a property that is in a region where they service. It is also a way to ensure that the bank can service you at later stages, too. A property is valued in terms of the convenience factor. If it is easily accessible, you get a brownie point.

The use of the property

Different types of properties and the way they are being used, are valued differently. For instance, if you are using a residential unit as a warehouse, the valuation would be lower. Whether the property is vacant or is put on rent or being used by the owner as well as the nature of the property – residential, industrial, commercial or agricultural – will be valued differently.

Do note that banks may not prefer approving your home loan if they feel that the property is in a risk zone. Some cities, for instance, are more prone to earthquakes and are at a higher risk. Or say, some properties are in a flood-zone – such properties are not favourably valued.

The quality of the property

Not just homebuyers, the banker, who has to approve the loan, will also be obsessed with the quality. In the wake of unauthorised constructions that may have moved in the market because of the price advantage, banks strictly maintain that they would not approve loans on such constructions. As a homebuyer, you must ensure that you are buying an asset and not a liability not just from the valuation perspective but from the safety angle too.

The age of the property

Yes, the age matters. For example, in an independent house, the total useful age is considered to be 60 years. Suppose you are selling it after 20 years of construction, selling price minus depreciation is arrived at by this simple formula- Number of years after construction/ Total useful age of the building. In this case it is 20/60 = 1/3. Therefore, the remainder of the useful age is the price you can ask for. Here, the selling price would be 2/3rd the price of a newly constructed independent house in the same location. Banks calculate it this way. However, land costs do not depreciate and is calculated separately.

Do you have papers in place?

Unauthorised constructions cannot be an asset and legal constructions give you the luxury of getting hold of important documents such as the sanction plans, occupancy certificates, society registration documents and such other files. Keep these handy for bank’s perusal.

How well did you maintain?

Did you know an old, maintained houses stand a better chance than relatively new and unkempt house? Valuations in the latter case are generally lower.

- by Sneha Sharon Mammen
Source : PropTiger

Home Buyers

Auspicious Days For Griha Pravesh In 2018

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Auspicious Days For Griha Pravesh In 2018

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Home buying is followed by housewarming ceremony, conducted usually on auspicious dates after consulting a priest. According to the Hindu panchang and Vastu, there are few mahurats that are considered lucky for griha pravesh. If you too are planning to move into your new home in 2018, here are few dates which are termed as auspicious according to the Hindu panchang.

Griha Pravesh Mahurats In January (Magh), 2018
January is also known as Magh according to the Hindu panchang. There are no auspicious mahurats or nakshatra in January for griha pravesh ceremony. However, Makar Sankranti that falls on January 14, new homebuyers are advised to do charity on that day for well-being and prosperity of the occupants of their new home. Since Vasant Panchmi is falling in January this year, you can consider performing housewarming on this auspicious day.

Griha Pravesh Mahurats In February (Faghun), 2018
There is only one mahurat for griha pravesh in February, 24th day of the month. Consult the local priest if there are other mahurats based on your horoscope. Since the festival of Holi falls early in the month of March, the eight days before Holi, also known as Holastak are not advised for a housewarming ceremony.

Griha Pravesh Mahurats In March (Chaitra), 2018
There are many auspicious dates for griha pravesh ceremony in March after the festival of Holi. Here are few dates that you can consider for the housewarming.
1)    March 2
2)    March 7
3)    March 8
4)    March 12
5)    March 18

Griha Pravesh Mahurats In April (Baisakha) 2018
There are selected days in April that are auspicious for housewarming ceremony. These are:
1)      April 19, 2018
2)      April 20, 2018
3)      April 27, 2018

Griha Pravesh Mahurats In May (Jyestha), 2018
The month of Jyestha consists of last few days of May and initial days of June. The initial half of May is Baisakh which is considered very lucky for housewarming ceremony. You can consider following dates for griha pravesh ceremony:
1)      May 2, 2018
2)      May 11, 2018

Griha Pravesh Mahurats In June (Ashadh), 2018
As per the Hindu Panchang, June comprises of Jyestha and Ashadh. The housewarming ceremony should be considered in Jyestha and not in Ashadh. Consider following dates for your house-warming ceremony-
1)      June 22, 2018
2)      June 25, 2018

Griha Pravesh Mahurats In July (Shravan) 2018
The month of July has just one auspicious day for housewarming ceremony which falls on July 5. You should also discuss with a local priest before proceeding with the ceremony.

Griha Pravesh Mahurats In August, September, October (Bhadrapad) 2018
Homebuyers should avoid shifting to their new home in August, September. According to the Hindu panchang, the period is inauspicious and could bring losses, health issues and troubles.

Avoid griha pravesh puja during Shraadh Paksh, that will fall in September-October. Some of the other mahurats for conducting house warming ceremony are Navratri, Dusshera and after Deepawali.

Griha Pravesh Mahurats In November (Kartik) 2018
As Deepawali falls in November, the most auspicious period after July is only in November, around the festival. Shifting to a new home during Deepawali brings prosperity to the family. You can consider the following dates for griha pravesh ceremony:
1)      November 8, 2018
2)      November 9, 2018

Griha Pravesh Mahurats In December (Marghsheesh, Paush) 2018
The initial days of December, also known as Marghsheesh, are ideal for housewarming ceremony. The remaining days of December, Paush (the Hindu month for December) is considered inauspicious and brings bad luck for the family.

-by Surbhi Gupta
Source: PropTiger

NRI Guide to Real Estate

NRIs, In Whose Care Is Your Property?

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NRIs, In Whose Care Is Your Property?

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That real estate investments are a double-edged sword is no secret. You buy property with a view to make gains. However, you also run the risk of losing if you own an asset. Because India’s real estate provides great investment opportunity, non-residents are often willing to put more and more of their money here. At the same time, they have to make sure their investments in the country of their birth remains safe. All the instances of relatives snatching properties of their NRI kith are sure to make them apprehensive. Purely for this reason, many of them take the help of professionals to take care their properties. Even in such a scenario, an NRI investor will have to exercise caution.

In the care of :

Do I leave it to relatives?

Our first thoughts go to our relatives when we start thinking about who could take care of our property in our absence. These are the people we trust, who would take care of the business without charging any money. However, this can be a tricky situation. In case your relatives decide to snatch from you what is legally yours, you could fight a legal battle against them.

Under Section 5 of the Specific Relief Act, 1963, a victim of a fraud can claim his property back. Section 6 of the Act says that the recovery will take place if you are able to prove your previous possession and the subsequent dispossession. Additionally, you could initiate actions against the offenders under Section 145 of the Criminal Procedure Code.

However, there would be much bad blood in the entire process. You run the risk of losing your dear asset and even dearer kith and kin. This move of protecting your property is best avoided.

A tenant is a safe bet, then?

Renting out your property could be one way of guarding your property without involving your relatives. However, this safe route is not without flaws. According to the provisions the Limitation Act, 1963, a squatter – who could be a tenant – can acquire legal rights over the property in case an owner does not stake his claim over his property for 12 years. To claim his ownership, this squatter has to prove that his occupancy of the property has been uninterrupted for the entire period.

Now, in case the property is rented out:

*It would be great if you could visit your property from time to time and keep a tab on things. However, this is easier said than done. It is here you could seek a little assistance from your friends and relatives who happen to be living in the city. They could occasionally visit the site and report to you any untoward occurrences, if there are any.

*Do not keep the same tenant for a long period for your own safety, even if this good tenant has been regular with his monthly payments and has been taking good care of your property.

What about caretakers?

In case you have been finding it difficult to get a tenant, you could also hire a caretaker to maintain the property. If things go bad and this caretaker turns into a squatter, he would find it quite hard to claim ownership. Giving its verdict in the Maria Margadia Sequeria versus Erasmo Jack De Sequeria case in 2012, the Supreme Court held that “a caretaker, watchman or servant can never acquire an interest in the property irrespective of his long possession”. “The caretaker or servant has to give possession forthwith on demand,” the apex court ruled.

Then there are also service providers that take care of your property for you and charge you accordingly. This happens to be one the most hassle-free ways to manage your estate. However, do create a legal caretaker agreement in case you are going for this option.

In any adverse circumstance, the documents that prove your ownership of the property will help you. However, you would rather prevent than cure, would you not

- by Sunita Mishra
Source : PropTiger

Benami Property

Benami Property: All You Need To Know

2:26 PM

Benami Property: All You Need To Know

What does Benami mean?

Benami is a South Asian word that means “without name” or “no name”. So, the term benami property means property without a name. It includes the transactions, in which the person who pays for the property is the beneficiary who purchase the property in the name of another person. The person does not buy it under his/her own name.The person on whose name the property has been purchased is called the benamdar and the property so purchased is called the benami property.

Meaning of Benami as per ‘’Merriam Webster” dictionary: made, held, done, or transacted in the name of (another person) – used in Hindu law to designate a transaction, contract, or property that is made or held under a name that is fictitious or is that of a third party who holds as ostensible owner for the principal or beneficial owner.

The Benami Transactions (Prohibition) Act, 1988: Evolution and developments
- The 57th report of Law Commission on ‘Benami Transactions’ was forwarded by the chairman, Mr. P. B. Gajendragadkar on August 1973.

- Accordingly, the Benami Transactions (Prohibition) Act, 1988 was enacted by the Parliament which came into force on 19 May 1988.

- The Benami Transactions (Prohibition) Bill, 2011 was introduced in the Lok Sabha in July 2011. The report was submitted by the Standing Committee in June 2012. The Benami Transactions (Prohibition) Bill, 2011 however lapsed in view of dissolution of the Fifteenth Lok Sabha.

- The Benami Transactions (Prohibition) Amendment Bill, 2015 was first introduced in the Lok Sabha on May 13, 2015 by Finance Minister Arun Jaitley. It was then referred to by a Standing Committee on Finance. The Committee submitted its report on April 28, 2016. The government has proposed amendments to the Bill on July 22, 2016. Then, it was passed in the Lok Sabha and Rajya Sabha on July 27 and August 2 respectively. On 10th August 2016, the Act received the assent of the President. On 25th October 2016, the Central Board for Direct Taxes (CBDT) notified that the provisions of the Benami Transactions (Prohibition) Amendment Act, 2016 which would come in effect from November 1, 2016.

What falls under benami transaction?
As per Section 2(8) “benami property” means any property which is the subject matter of a benami transaction and also includes the proceeds from such property.

The following transaction is benami transaction under Section 2(9)-
- A property which is purchased using a fictitious/fictional name means the owner does not exist.
- Person holding the property has no knowledge about the transaction mode or ownership of the property.

- A person who has provided the required money for the transaction is no longer traceable.

- Person holding the property or the person on whose name the property has been transferred has not paid the money or the price of the property in question is paid by someone else.

Any transaction where possession of any immovable property is taken as a part performance of a contract is not a Benami transaction if the contract is registered and consideration as well as stamp duty have been paid.

Property would include asset of any kind, whether movable or immovable, tangible or intangible, and includes rights or interest as well as proceeds from the property.

For example, Suppose a property of Rs. 10 Lakhs was purchased in the name of Mr.B, and the consideration was paid by Mr. A, who is not traceable, is a Benami transaction.

What isn’t a benami transaction?
Benami Transaction has the following exceptions:
- In case of Hindu Undivided Family (HUF), Karta or any other member of HUF owns or held any property for his benefit or for the benefit of the family members and the consideration for the same is paid out of the known source income of HUF.

- A person acting within fiduciary capacity for the benefit of another person i.e. transaction involving trustee, executor, partner, director of a company, a depository or a participant as an agent of a depository under the Depositories Act, 1996 and any other person as may be notified by the Central Government for this purpose.

- Any individual transacting in the name of his/her spouse or any of his/her children (excluding married daughter) and consideration of such property is paid out of the known source of income of the individual.
- any person in the name of his brother or sister or lineal ascendantor descendant, where the names of brother or sister or lineal ascendant ordescendant and the individual appear as joint-owners in any document,and the consideration for such property has been provided or paid out ofthe known sources of the individual.

Facts for determination

- The source from which the purchase-money was derived;

- The possession of the property

- The position of the parties and their relation to one another;

- The circumstances or otherwise, of the alleged transferor;

- His motive in taking the alleged transfer;

Authorities involved:

• Initiating Officer

• Approving authority

• Administrator

• Adjudicating Authority

“Initiating Officer” means an Assistant Commissioner or a deputy commissioner as defined in clauses (9A) and (19A) respectively of section 2 of the Income-tax Act, 1961.

“Approving Authority” means an Additional Commissioner or a Joint Commissioner as defined in clauses (1C) and (28C) respectively of section 2 of the Income-tax Act, 1961.

“Administrator” means an Income-tax Officer as defined in clause (25) of section 2 of the Income-tax Act, 1961.

Adjudicating Authority:

(a) has been a member of the Indian Revenue Service and has held the post of Commissioner of Income-tax or equivalent post in that Service; or

(b) has been a member of the Indian Legal Service and has held the post of Joint Secretary or equivalent post in that Service.

Detailed Procedure

An Initiating Officer, if believes that person is benamidar then he may issue the notice to that benamidar with the previous approval of the Approving Authority. Initiating officer may hold the property for a period of 90 days from the date of issue of notice.

Then after 90 days, the case is referred to Adjudicating Authority. On receipt of a reference, the Adjudicating Authority shall issue notice, to furnish such documents, particulars or evidence as is considered necessary on a date to be specified therein. The notice shall provide a period of not less than thirty days to the person to whom the notice is issued to furnish the information sought.

The Adjudicating Authority after considering the reply, such inquiries, reports or evidence, taking into account all relevant materials, give an opportunity of being heard to the benamidar, the Initiating Officer, and any other person who claims to be the owner of the property. Then pass an order on whether or not to hold the property as benami.

But no order shall be passed after the expiry of one year from the end of the month in which the reference was received.

According to the order of the Adjudicating Authority, the Administrator will confiscate the property.

The Administrator shall,—

(a) by notice in writing, order within seven days of the date of the service of notice to any person, who may be in possession of the benami property, to surrender or deliver possession thereof to the Administrator or any other person duly authorised in writing by him in this behalf;

(b) in the event of non-compliance of the order referred to in clause (a), or if in his opinion, taking over of immediate possession is warranted, for the purpose of forcibly taking over possession, requisition the service of any police officer to assist him and it shall be the duty of the officer to comply with the requisition.

Appellate Tribunal

In case the individual is not satisfied with the order of adjudicating authority, may prefer an appealto the Appellate Tribunal.

A person preferring an appeal to the Appellate Tribunal under this Act may either appear in person or take the assistance of an authorised representative of his choice to present his case before the Appellate Tribunal.

Appeal to High Court

Any party aggrieved by any decision or order of the Appellate Tribunal may file an appeal to the High Court within a period of sixty days from the date of communication of the decision or order of the Appellate Tribunal to him on any question of law arising out of such order.

The High Court may entertain any appeal after the said period of sixty days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the period specified.

Special Court

Chapter VI provides for constitution of special Courts. The Central Government, in consultation with the Chief Justice of the High Court, may appoint one or more Courts of Session as Special Court or Special Courts for such area or areas or for such case or class or group of cases, by notification, for trial of an offence punishable under this Act.

The Special Court shall not take cognizance of any offence punishable under this Act except upon a complaint in writing made by—
(i) the authority; or

(ii) any officer of the Central Government or State Government authorized in writing by that Government by a general or special order made in this behalf.

Penalties

Anyone found a guild of entering into a Benami transaction would be liable for rigorous imprisonment for a minimum of 1 Year to maximum of 7 years and Financial Penalty of up to 25% of the fair market value of the property.

If anyone gives incorrect information or explanation in response to an inquiry to any authority, he shall be punishable with Rigorous imprisonment of minimum 6 months to maximum of 5 years and Financial penalty up to 10% of the fair market value of the property.

- by Dr. Rajkumar S. Adukia

Source : Accomodation Times

Indian Real Estate

2018: Bringing Back Realty To Life

10:00 AM

2018: Bringing Back Realty To Life

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The year that is going by has been a year of many ups and downs for the real estate sector. In 2017, the sector underwent major change, attributed to the key reformative legislations introduced. This phase of change made homebuyers investment-shy while developers engrossed themselves in making their business compliant with the newly introduced real estate law.

According to Ankur Dhawan, Chief Investment Officer, PropTiger.com, “In 2017, homebuyers experienced a yo-yo sentiment. While 2016 ended on a bad note after demonetisation, in the beginning of 2017, when banks began to cut rates, homebuyers made a comeback. After the implementation of the real estate law, while the developers were busy registering projects, homebuyers took a step back and waited for the developers to register their projects and then invest in RERA-compliant projects. Then with the coming of the Goods and Services Tax (GST), the homebuyers again turned fence-sitters until September, waiting for clarity on the new tax regime. It is only now from past two months that the homebuyers have regained confidence in the market and are making a comeback.”

2017: The year of change

The year 2017 will be the template for the stakeholders in the industry to show their business a way forward. After many key legislations announced and various relief and boost given to the sector, the year has been a foundation stone for a more organised and transparent sector. According to Dhawan, “the developers at the very beginning of the year started focusing on completing the projects rather than launching new ones, creating more ready-to-move-in inventory. Another key change that we witnessed this year was that smaller developers joined hands with the renowned names. As large developers have funds or have the bandwidth to raise funds, it is becoming easier for smaller developers to complete their projects.”

These steps will give rise to the share of organised developers in the market. The ones complying to the new legislations will survive making the sector more transparent and reliable for the homebuyers to invest in.

These moves will also bring down the cases of pre-launches and launches where in the developers promised timely deliveries and world-class facilities, but, at times, failing to deliver both. “This will make developers more professional and much more planned about what they are bringing to the table,” Dhawan added.

2018: The year of consolidation

The base of a new beginning was set up in 2017 and in the coming year the sector will see building blocks being put to construct a strong business. Some of the major changes will include:

*No more RERA hiccups: Many states across the country until the end of 2017 were trying to resolve the hiccups and the issues related to the real estate law. In 2018, this is expected to resolve.

*Rise in consumer confidence: Under the recently introduced Insolvency and Bankruptcy Code, Dhawan says, “we will see aggrieved homebuyers getting justice in the Amrapali and Jaypee cases. Once the verdict is out, we will see consumer confidence rising.”

*The year of delivery: This year, developers who have launched their projects will be seen delivering them in 2018. “We will witness huge deliveries and projects getting occupation certificates. It is a positive year, as homebuyers will be moving into their new homes,” Dhawan says.

*The growth in numbers: All these put together are expected to move the market towards positive numbers. Although the launches and deliveries will increase, the number game will just be marginal. According to Dhawan, there will be a 15-20 per cent gain in market in terms of launches and sales. He says, “the prices are likely to remain stable.”

*Ready-to-move-in homes to gain traction: Given that developers are now completing their under-construction projects giving rise to ready-to-move-in homes, this segment is expected to gain momentum. This year, more and more homebuyers will be investing in ready-to-move-in segment rather than waiting for under-construction projects.

*Infrastructure to boost new pockets: The infrastructure projects across states, including highways, airports, Metros among others will give rise to new pockets. Wherever these projects create connectivity, new pockets will emerge. “There have been many infrastructure projects that have been left incomplete. These projects are expected to be completed in 2018. These include the Dwarka Expressway, the Delhi-Meerut Expressway, the Noida-Greater Noida Metro connectivity. These infrastructure will give a boost to prices in localities connected,” says Dhawan.

- by Gunjan Piplani
Source : PropTiger

Pages

Homebuyers, Being Tech-Savvy May Not Be Optional Any More

How Do Banks Evaluate Your Property When You Apply For Home Loan?

Auspicious Days For Griha Pravesh In 2018

NRIs, In Whose Care Is Your Property?

Benami Property: All You Need To Know

2018: Bringing Back Realty To Life

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Homebuyers, Being Tech-Savvy May Not Be Optional Any More

How Do Banks Evaluate Your Property When You Apply For Home Loan?

Auspicious Days For Griha Pravesh In 2018

NRIs, In Whose Care Is Your Property?

Benami Property: All You Need To Know

2018: Bringing Back Realty To Life

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