Disclosing this at the Assocham conference on ‘Urban Land Markets & Finances’ held in Delhi this week, Union Minster for Urban Development Jaipal Reddy also announced that the proposed authority would work as a role model for other states to follow, particularly in view of growing real estate activities throughout the country so that the consumers get a fair deal.

OFFICE STAKES IN BIG METROS

Decline in the growth of office rental values in South Delhi is attributed to new supply that has entered the market this year. On the other hand, rental values in Mumbai’s Bandra Kurla complex rose by 22% from January to September 2007, marking it the fast emerging new central business district of the metropolis

There is increasing interest in investing in land rather than constructed properties. This trend has merit, since land value appreciates while the value of a construction depreciates. In other words, buying land in a growth sector always makes sense. However, one should approach such land purchase with due caution and prior research.

Investment horizon

Purchasing land as an investment usually pays off only as a long-term venture, with a minimum holding period of between 5-10 years.

Safe purchase parameters

In general terms, it is definitely not safe to buy land without thoroughly acquainting oneself with the local market, and the legislative dynamics of that area.

Buying land situated near a housing scheme calls for extreme caution, since one may inherit the covenants and restrictions applicable to the housing scheme.

Ø          While buying a plot as an investment, one should ensure reason able proximity to key roads and access to water and electricity.

Ø          One should also acquaint oneself with the development plan for the chosen area – this can be established from the local administrative body.

Ø          One should be very clear about what taxes one will incur and whether the plot has a permit for raising residential/commercial structures. Raising large structures is not an option on agricultural plots, which are cheaper and have a lower tax burden. If the plot is the agricultural kind, one should establish whether its status can be converted for construction purposes later on, or not.

Ø          Before purchasing land, one need to investigate possible multiple ownership issue and zoning restrictions such as CRZ, NDZ etc.

Return on investment

The value of a plot of land in any particular location depends on what the government will permit to be done there, and on the success dynamics of the society in which the land is situated.

You cannot add to the value of land as you can to a structure - value derives from the dynamic community that makes the land desirable. Therefore, a plot's value will appreciate if there are developments in the vicinity to make this happen. Sometimes, investors purchase land based on anticipated value – something like a mall, multiplex or office block is scheduled to come up nearby If the anticipated development fails to materialise, or if the location does not receive water or electricity supply, the plot will fail to appreciate.

Land will also fail to appreciate if it is in danger of being taken over by the government for its own purposes.

No matter how good a plot looks, or how reasonable the price, one must check everything. The price may be low because certain legal sanctions or complications incurred during a previous ownership have rendered it a non-selling proposition.

Other factors to investigate.

Ø          Availability of ground water

Ø          Soundness of electrical supply in the area

Ø          In case of residential land – avail ability of schools, colleges, medical facilities, domestic markets, public transport, etc.

Ø          In case of commercial land – avail ability of retail outlets, post offices/couriers, telephone connectivity, other reputable commercial establishments in the vicinity.

Ø          Availability or non-availability of the above will substantially influence the property's overall appreciation potential. Investment in commercial or residential land in an established growth sector with all of the above factors in place definitely makes a lot of sense.

Where are the best land deals today?

The most sought-after land for sale in India is in the metros. However, due to the extreme supply crunch, the rates are invariably completely out of reach for any but corporate or institutional investors. As a rule, the only ‘good deals' in central Mumbai, Bangalore, Delhi and Kolkata comprise of purchasing available plots at exorbitant prices and then cashing in on their immense appreciation potential.

For smaller investors, buying a plot in an upcoming suburb or a potential-rich Tier II or Tier III town is a far more feasible option – especially in context with larger plots, which are out of question in metros.

    Courtesy: HT, 12^th Nov. 2007

With regards,

John, http://www.zameen-zaidad.com                   

Apartment spread cross 6,500 sq ft with private parking bays on each floor, exclusive elevator for each apartment, ultra-luxurious amenities and a manicured garden thrown in. The building is Ellora Castle, the price of each apartment is Rs 6 crore and the location is Palm Beach Road of Navi Mumbai.

Ellora Castle is just one among the 119 stalls at the ongoing Haute Property exhibition in Vashi (November 16 to 19 at the exhibition grounds outside Vashi station), which is mainly targeted towards homebuyers from the Mumbai metropolis.

“From being a low-cost housing destination, Navi Mumbai is now the preferred option for many high net worth individuals because of the quality of life it has to offer,” says Bhupendra Shah of Bahamian Group, part of the exhibition’s organising committee.

Till a few years ago, Navi Mumbai promised affordable housing and a lot of people shifted from Mumbai to bigger flats in the satellite city. Today, the real estate prices in areas of Navi Mumbai like Vashi and Palm Beach are on par with or even higher than the suburbs of Mumbai. For those with large families, Navi Mumbai is the one of the few places where one can afford a palatial penthouse or a four-bedroom flat with a view.

For the others, most nodes of Navi Mumbai offer row houses, independent houses and flats at affordable rates. Shopping malls, wide roads, good schools, sprawling markets and good connectivity are the key factors that make Navi Mumbai an attractive housing option.

“The infrastructure of Navi Mumbai is improving with each passing month,” says Nerul-resident Nar HERE IS UR TOOesh Sawant. In the last two months, three major malls have been inaugurated in the city, giving the local residents lot to choose from for the weekend outing. Educational facilities are also a major reason for people preferring Navi Mumbai. There are about 10 engineering colleges in Navi Mumbai, apart from medical, degree and catering colleges and institutes.

Prakash D’Mello, who moved to Koparkhairne from Chembur, reminisces, “We bought this house about 11 years ago and have seen the place develop. What I like about Navi Mumbai are the educational facilities. They are far better from most schools of Mumbai and affordable too.” His wife Sujata adds, “The bus depot is just a couple of minutes away that connects us to the rest of the city and Mumbai.

Navi Mumbai is also quite spacious with with a lot of greenery around. This is what we call luxury” While educational facilities are the preference of some people, others prefer the peace that Navi Mumbai offers. Rakesh Sharma, resident of Belapur is very happy with his house in the Artists Colony “With the extra FSI, our house is much bigger now. For me the serene surroundings itself are inspiring and I sometimes wonder how people live surrounded by busy roads and continuous traffic in Mumbai.”

Source: Hindustan Time