The Most Expensive Real Estate Markets in the World!

Best locations to buy a Home in India in 2015

Oh! Looks like you are thinking of buying a home. Why not think of buying a home in the most sorted locations in India in 2015? Well then grab that steaming cup of coffee, pull your bean bag and relax. We have an assorted list for you.

1) How about settling in the city that never sleeps? Yes! Mumbai

Localities like Ulwe and Chembur in Mumbai are one of those fashionable residential destinations, which have a lot on offer. Apart from great projects and great lifestyle, they assure great return on investment too.

2) What about the national capital- Delhi?

In Delhi, Noida Extension, Delhi-NCR and Dwarka Expressway, Delhi-NCR have an edge over other emerging destinations as they cherish proximity to both the city and the International Airport. These destinations are also foreseeing noticeable price appreciation in the years to come.

3) Oh! How could we forget Pune – The Oxford of the East?

Pune's prominent localities like Hinjewadi, Aundh, Kodhwa and Kharadi in Pune are dotting commendable rise in residential development. A home to prestigious projects, these locations are developing at a fast pace.

4) What's more from the biryani land- Hyderabad?

Forget the biryani and a peculiar lingo, Hyderabad too holds the stage as one of the most economical cities for one to reside. The places like Hi-Tech City, Manikonda, Kukatpally are indeed dream destinations to buy a home.

5) Not to miss- Namma Bengaluru!

Growing with an unmatchable pace, Bengaluru is a popular residential destination. Locations like Whitefield, Rammurthi Nagar, Bannerghatta Road and Marathahali stand as apt locales for residing.

Shortlist your favourite! We hope there is a house warming ceremony soon. Happy Browsing!

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Top 3 Real Estate Hotspots of India in the year 2015

The inception of new central government in the year 2014 had brought the country’s development on a roll. The Abki baar Modi Sarkar<link> campaign created a much-needed push for every sector of the economy. While India is ready to become the manufacturing hub on one side, the concept of smart city has found its place in everyday conversation, on the other.

One zone that has been showing maximum development signs is Real Estate.

The #RealEstate industry of the country has shown signs of stable growth; in terms of capital appreciation, new launches, and infrastructure developments. In the competition for becoming a renowned smart city, a majority of states are coming up with new projects, renovating infrastructure, etc.

All of these have transformed the sentiments of both developers and end buyers largely.

Year 2015 is expected to elevate the demand and supply further. The factors to support this growth are:

• The risk of inflation has submerged, and the borrowing rates are expected to be lower than the present levels.

This will support potential buyers wanting to take advantage of home loans in order to make the deal. In addition, due to the stability of property prices plus good offers by developers for clearing inventory, apprehensive buyers are becoming optimistic to purchase their dream house.

• The economic activities are slowly rising.

Central Bank has forecast the GDP growth to be 6.5% in financial year 2015-16. The Corporate India has also announced that they will hire more talent to assist in tackling growing business activity. When we add it together, it means an increase in jobs and thus incomes. This in turn is going to be extremely favourable for all commercial and residential real estate markets, irrespective of the zone.

• The real estate segment has seen a re-orientation.

This has made developers largely focus on affordable homes largely. This is expected to go a long way in covering the present wide distance between supply and demand of the affordable homes.

While almost every region of the country has shown signs of development, three cities have emerged as the most promising ones for investment purposes. Let us look into them in some detail.

1. Mumbai

The Financial capital of the country, Mumbai has shown a strong growth by attaining the 11^th position in the year 2015, which was earlier 20^th & 23^rd in 2013 & 2014 respectively. The reasons behind the increasing popularity of Mumbai are:

• Greater income demographics
• Higher investment activity level
• Equal growth in development among all sub markets of the city

For end users looking to buy a house in Mumbai, the average increase in the last quarter of 2014 was around five per cent among all regions when compared with an increase of just one per cent in the earlier quarter. According to Insite, a quarterly real estate report, the new launches, positive consumer sentiments, developers declaring possession of new projects along with a boost in the infrastructure developments has surged the movement.

The three ideal locations for investment in the city are MMR, Thane, & Navi Mumbai. They have shown an increase of 5%, 3%, & 6% respectively in the last two quarters of 2014, & are expected to continue doing so in 2014. Investing in a property in Navi Mumbai can prove to be extremely beneficial in the present time.

2. New Delhi

The capital of India, Delhi has been on the growth radar since beginning of the year 2014. It showed a strong positioning in the real estate market by being on the 14^th position in 2015, which was earlier on 21^st position in the year 2012 & 2013. The factors that led to this surge are:

• Mixed income demographics
• Excellent infrastructure & connectivity
• Great infusion of both retail & commercial spaces

For the investors looking to invest in the city, the fact that there is now a stability in the new government & various key policy announcements have been made in the real estate front at the Centre have created a positive sentiment. According to Insite, this has increased the capital growth by 3% since the last two quarters of the year 2014.

If you are looking to buy a house in Delhi, the three areas that have shown high growth are - Delhi West, Gurgaon & Greater Noida. The percent increase they showed were 5%, 4%, & 4% respectively.

In the present scenario, investing in a property in Delhi West can be seen as beneficial in terms of returns.

3. Bangalore

The Electronic capital of India, Bangalore is popular as the haven of property seekers. New launches & development of the micro markets were on an all-time high last year. This trend continues to grow in 2015 too. Bangalore stood at 17^th position while it was 19^th & 20^th in 2013 & 2014 respectively. The reasons that led to this rise were:

• Most of the micro markets being extremely affordable
• IT sector dominates the city, making it an ideal location for millions of employees
• Continuous infrastructure development

For the property seekers’ wanting to buy a house in Bangalore, the infrastructural growth & increasing economic activity in the city has been the major driver of growth. According to Insite, Bangalore’s real estate market increased at a rate of 5% in the last quarter of 2014; making it come in the list of the top cities to invest in.

For someone looking to buy a house in Bangalore, the three key areas that have shown a constant growth are Bangalore East, Bangalore West, & Bangalore South. The increase percent in the last quarter for these were 7%, 5%, & 5% respectively.

Looking for a property in Bangalore East is good for buyers expecting high future returns.

* The insights are from the PWC report on emerging trends in real estate Asia Pacific 2015.

Factors like new project launches, high infrastructure developments, stable government, & growth of micro markets, etc. have led to the change in sentiments of developers & buyers. This has led to an increased effort to maintain the demand & supply equilibrium. The current surge can be expected to grow further this year.

2015 has announced itself as the year of real estate.

Author Bio: Tripti writes on the behalf of 99acres.com. Her articles talk about new developments in the real estate industry. She is an avid fiction reader, craftsman & a keen observer. Being someone who just observes without having a point of view, she keeps herself updated in real time.

Disclaimer: The above article & the insights it provides are based on the author’s analysis based on published reports. Though the information & analysis are perfectly thorough and highly informative, RealT Horizon takes no responsibility for the investment decisions based on the article. Readers are suggested to analyse themselves & invest accordingly.

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Is this the Right Time for NRIs to Invest in India?

NRIs (Non-Resident Indians) comprises of an important chunk of population which contributes the most to Indian economy, without even being physical present here. India is blessed to have such a huge Indian population fueling its growth from abroad and the same is true for NRIs, who are blessed to have India as their motherland which provides them such fantastic investment opportunities. Let’s see how.

INR vs. $: Who all get benefitted with their movements?

 If you follow the Asian Financial and Economic markets, you would know what is going on in the volatile Indian markets. INR has been falling continuously against US $ before lately regaining some strength. At the time of writing this post, INR was placed at Rs. 61.20 against $ 1. But the situation had been worse a few days back when INR had touched Rs. 67 = $ 1 mark, creating an all-time low record; So much so that people had started comparing INR with US Cents; Rs. 1 = 1.5 cents.

So how is the above information related to our topic on NRIs? Well, let us tell you how. We will be extremely straight forward in putting forth our views on this topic. Consider the following situation:

• Mr. A is an NRI, residing in Michigan, USA.
• He aspires to invest in India and his obvious choice would be to invest in Real Estate; because he is sane ;-).
• He wants to invest in a range of INR 5 million to INR 7 million.
• Let’s compare the scenario when INR was 67 and when it is 61 (rounded off for simplicity) against $.

Cost of Property	Cost in $ (Case: INR/$ :: 67)	Cost in $ (Case: INR/$ :: 61)	Absolute Difference	% Difference
INR 5 million	$ 74,627.00	$ 81,967.00	$ 7340.00	9.8%
INR 7 million	$ 104,478.00	$ 114,754.00	$ 10276.00	9.8%

Just look at the above figures. Mr. A would have saved a fortune, at a discount of ~10% if he would have invested in the same property when $ was making rounds near INR 67 as compared to the current situation!

Closing Thoughts

Dear NRIs,

India is a great destination for investment – this statement needs no evidence. So just be a little more rational and act as soon as possible to make investments. This is because you never know where our new Governor & upcoming new Government will take the INR ;-). It is always better to be late than never J.

Sincerely,

RealT Horizon

PS: We would have made the investments if we would have been in your place, you may not. It’s subjective as well as cognitive.

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Valuation of Real Estate: How can you value your Real Estate Asset?

While laying down on the couch on this lazy Sunday evening, a thought stuck to us: Is there any defined way to value our Realties? Of course there are few in the form of Govt. DLC rates & CMP (current market prices) that gives some indication of the possible value of our real estate properties, but still we miss out many important aspects if we go by these rates. Let’s go back to the basics and first try to slice the term ‘value in real estate’ to finer levels.

What is ‘Value in Real Estate’?

To state in layman terms, value in real estate is created if any of the following dimensions gains weight.

Let’s have a look at these aspects in finer details.

Utility 

Any asset/object is worthless if it doesn’t create utility for the owner. If real estate property, howsoever costly it may be, is unable to create its worth and use for the owner, then its utility decreases. We hope the following figure can help in explaining this further:

In above case, the utility of cookies decreased with the increase in number of cookies. Same is the case with real estate utility. If the property can’t be utilized to its full value, its utility decreases.

Supply 

Just compare the price of a commodity (like salt) which is abundantly available to a commodity (like petroleum) which is scarce! Same holds true for Real Estate in the way that properties in an area where there are several options is cheap as compared to the one where no properties are available.

Demand 

Similar to the above concept of Supply. If a property is in high demand, it is valued more & vice-versa.

Transaction 

Suppose you have bought the bicycle - Litespeed Blade (£25,317)

Just imagine how difficult will it be for you to resell it or make its transactions! Same goes with Real Estate; you invest in some property like this and get stuck to it for your lifetime: literally no value.

Psyche 

The social pride and psychological pleasure is something that no one can monetize. It will be different for each and every individual. Suppose for example, someone will definitely derive immeasurable value by just having the pride of owning the above bicycle.

Let’s demonstrate the entire above concepts using a common example. Suppose you have a family of 2-3 members & have bought the home shown below: (Just an imagination; don’t get carried away! ;-))

Just check its value on different aspects:

Aspect	Reason	Value
Utility	Such a big house for just 3 members!! Under-utilization of resources.	▼
Supply	Definitely, houses of this sort are not available down the street. It is tough to find such houses. They are scarce.	▲
Demand	Demand for such properties depends on buyers, which is generally very less. You will rarely find a buyer looking for such properties.	▼
Transaction	Tough to transact, definitely!	▼
Psyche	Un-measurable; if you can take care of the income tax folks!! ;-)	▲▲▲▲

Closing Thoughts: These are some of the basics that we thought are vital for any Real Estate Valuation. There are few more technical methods which we will try and cover in our forthcoming posts.

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