real estate company in Lucknow

What should developers do in a challenging market

September 28, 2020 0 Real Estate Real Estate Industry

The real estate market heading into the current crisis has sometimes been described as the real test of character of developers. The deepening economic impact of the coronavirus pandemic is felt worldwide. It is not only the immediate economic challenges which are worrying developers, but also the imminent social and behaviour changes in buyers. It will push us to learn to cope with and embrace a new professional paradigm.

  • What should developers do in a challenging market

Despite the chaos that’s taking hold in the broader market, real estate developers can apply brave but smart strategies to keep their projects going and assets producing. There have been instances of existing businesses cutting down on their manpower or reducing salaries across the board, which will leave lesser money in the hands of consumers, resulting in problems with existing customers who may be on an instalment plan. Also the prospective buyers will be squeezed for funds and there is real danger of reducing per unit price. Some of the investors who had been holding on to their investments in the hope of better returns, may come out to sell in desperation, forcing the prices further down.

What then, a real estate developer can do to survive and come out stronger on the other side of this crisis. There are opportunities which will need to be tapped with a suitable plan. In the space of customer inquiries, it will be prudent to increase spends on creating brand in digital world. With people spending more time indoors and working long hours on their computers, it is quite intelligent to create a connect with customers online. Also, customers try to interact with brands in various ways as online search and research is very intuitive. The developers who could create a simulacrum of the customer buying cycle and fill all the gaps that might exist in digital brand positioning, will walk away with bulk of online enquiries. It would be worth presenting to customers the options understanding the current state of customers.

Another opportunity that presents itself to the developers is in terms of canvassing for upgradation. There is a sizeable chunk of people, who have paid off the housing loans they had taken for their first homes. It is time to give them compelling reason to upgrade or buy another property. Historically low interest rates and availability of good options at considerably stable prices will drive in bargain hunting investors with surplus funds. Can a developer reorient its product proposition to suit their requirements.

The onset of long term social and behavioural changes should also be considered in redrawing the product design as much as possible. In days ahead, functionality of design will win over luxury. It will be smart to reorient designs keeping the new social habits people will form. A great outdoors within the precincts of project may become more attractive than a high end club house. Large open though covered spaces for small group conversations would be inviting for more people than a large banquet hall. Provision of health care facilities and good house keeping services will trump a restaurant or a coffee shop. A developer sensitising and orienting the design and construction team to these realities will be a winner compared to the ones who don’t do this.

Every challenge hides an opportunity in its lap. It needs effort to recognise the same and work to capitalise to come out on top once the challenging situation is over. Time will tell us how manages the crisis period proactively and wins and who gets crushed under the weight of inaction.

Future of Real Estate Industry in Lucknow

August 20, 2020 0 Real Estate Industry

Lucknow has been one of the fastest growing towns in India. The real estate market which has struggled across India has been able to keep the momentum going in this city, especially in certain localities, due to various factors. A positive government, which is great at execution, a city that is known for being peaceful and the presence of excellent infrastructure created by successive governments, make this an ideal place to live and earn a living. There is no doubt that lower GDP growth affected the price appreciation here too. However, if there is one town which will start looking up quickly and it is Lucknow.

The reasons for this optimism are not hard to come by. For migratory laborers, who fled from large industrial towns in west and south during the early days of Covid-19, are closer to Lucknow than any other developed city. Therefore, the supply of labor will not be a constraint here. Similarly, the town also has huge investments coming in from rural areas of Eastern UP. The rural economy is doing well and the recession in the consumption of other items will result in people with a substantial agricultural income to have a higher surplus income. This will find its way into the Lucknow housing market as people will look for towns with good health infrastructure. Lucknow will be the first choice in this entire region for people.

One thing which is important to be kept in mind during this time is that it is foolhardy to assume that all the localities in Lucknow will see good appreciation. There will be areas that will be preferred over others. And the factors which will decide this are simple – Availability of apartments with world-class facilities, safe and well-sanitized areas, and social and medical infrastructure suitable to fight repeated outbreaks of pandemics. If one scans through Lucknow city a few areas stand out in this test. Areas in Gomti Nagar and Gomti Nagar Extension around Shaheed Path and near Airport can be expected to appreciate much faster than other residential areas. These areas are located near some of the best social and medical infrastructure. These localities also boast of some of the best housing developments with excellent amenities and are considered to be the safest and most hygienic parts of the town.

Real estate in lucknow,Real estate developer in lucknow

The growth of the housing market in Lucknow city is getting on track gradually and is certainly waiting for an opportunity to start its march up. It is of course difficult to precisely predict as to who will this start happening but for any keen eye, it is not difficult to find this opportunity. And this opportunity is being looked at by people across the state and nation, which makes the outlook even brighter. The current state government is ranked high on various parameters of governance and industry is showing a higher level of trust in the state than shown ever in the near past. These factors will weigh on what looks a logical flow of money and it is, therefore, easy to conclude that the future of the housing market in Lucknow is one of the brightest spots one can locate right now.

Why should You Research for Buying your Home During Lockdown?

June 8, 2020 0 Real Estate Industry

The world is currently going through a phase inimical to whatever we have seen over the last so many years. Most of it has left us with negative impacts and thoughts. However, one thing which it has contributed positively to almost all of us is the time to reflect back. A time to connect with our current selves and plan for the future. It is needless to say that financial planning is one of the most important aspects one has to look at in these circumstances. Let us understand it more in detail.

Apartments in Lucknow,Flats in Lucknow,Flats for sale in lucknow

One of the most important things to look at in terms of financial planning is the insurance cover for various types. It is important to calculate what is a good level of insurance cover both in terms of life and health cover that is needed for each member of the family. There are various guides available for the same. You can visit the website of any insurance company in India and can arrive at the broad value of cover that you will need. The other important aspect is to understand how will the Covid-19 impacts the economy and thereby the valuation of assets.

Now to do that, one has to use one’s own analysis and it can’t be left to be guided by a single source. How does one decide where to invest. Should it be in gold or share market or bond market or Fixed deposits? Or should one use the available time to stay in the Real Estate Developer in Lucknow and make an investment there? This is actually a good time to spend time planning this. There is time available to research various sources and discuss with family and friend in peace. A good indicator to deciding this will be the understanding of past such events. There have been no such events in the near past which have destabilized the world so much. However, the middle east oil shock of the 70s and the Lehman crisis of 2008 are the best simulations available.

When one looks at what happened during each of these times, there are a few things stand out. In every single case, the reaction of the market was extreme, resulting in value being lost quickly and the regained in double-quick time. The other lesson is the relatively different effects on different products and countries. While in the short term and during the crisis Gold and bonds did better, in the long term it has been the real estate that has been a clear winner. When looked into from the perspective of a developing country like India, this is even starker. This time, it is expected to be even clearer and faster due to a clear indication of industries moving out of China and setting shop in India. The good news is that the CM of UP has been proactively targetting these industries and the response has been good. If that happens real estate will see a huge upside in the coming years. So use this time to look around what is available of value in real estate and invest. For more information please Visit our website: https://www.paarthinfra.com/

WHY TO INVEST IN REAL ESTATE

April 14, 2020 0 Real Estate

There is no doubt that these are uncertain times. Uncertainty about the future of economy and about our social relationships. For now, the focus worldwide is on creating a healthcare infrastructure that can help the civilization to sustain in the face of Corona virus. However, there are some less-reported developments, which are important for our future. Let me try to delve deeper into some of these aspects, which will have a long lasting impact on all of us.

As a response to the Covid 19 induced challenges, the governments worldwide have committed funds to fight this menace. That’s a wonderful news, because governments everywhere have shown a firmer resolve to fight a problem that has hit everyone, ever in the history of mankind. Starting from US to Japan to Europe and including middle-east to India, every government has simply opened its purse to pump in money into the businesses and healthcare infrastructure. It is estimated that all governments put together would invest close to 2% of world’s GDP into fighting Covid-19 pandemic. Now that’s a lot of money. We have never seen this kind of money supply coming all at once.

So what will this money do and where will it go. Let us look at history and try to figure out how this money would flow in and what would be the response. This money will start flowing into various infrastructure projects across the world. We have seen this story playing out so many times in past. Let’s take example of the world after Second World War. While, anyone around there at that point of time, would have thought that countries like Japan and Germany will never be able to grow out of world war devastation, what we see is completely opposite. The two countries not only repaired themselves but became the foremost world economic powers over the years after the war. Both of these economies are part of the top 5 economies of the world and the most stable ones.

The same happened during the great depression after the World War 1 and the oil price induced depression of 80s. Even if we look at our own Indian stories. In 1990, we reached a level where we felt like collapsing economically. There was a time during PM Chandrashekhar’s rule, when we didn’t have money to meet our debt commitments and we had to pledge our gold reserves. But what happened in the years after that. Did not we see the biggest asset growth in 30 years starting in 1991? It may look counter-intuitive when we are inside a crisis but when looked at retrospectively it all started making sense. The people who had the foresight to buy assets during those times of crisis, earned sweet returns on their investments. But those who were afraid and did not invest in assets, were left high and dry. The high inflation reduced the value of liquid holdings significantly.

Let us look at another aspect of this economic fight against the virus. Remember, since the world is fighting this together and it is known that if Corona virus simmers in any geography, it will affect the entire world, the movement of money will be swift across the borders. Fortunately India is at the forefront of this war against virus. There are several reasons for the same. Our large young population makes it an interesting case to watch out for how the virus story plays out here. We will discuss more about its impact in the next paragraph. Another contributing factor is our leadership position in Pharma production. Thirdly, our big IT sector. While China has been losing trust of the world as a dependable supplier, the democratic nature of our country enthuses more trust in other countries.

So why will we be better off with a younger generation? One, the mortality rate in youngsters is significantly lower than the older generation. We have a significant percentage of our population younger, which is much more than any large economy. This coupled with the fact that the way China has handled the Corona pandemic will bring India at the forefront for the corporations who want to move out of China and relocate. The Indian response to this pandemic and the statesmanship that our leadership has shown will keep us in good stead. Our leadership position in Pharma industry and our positive contributions to world society’s sure to make world look at as much more favourably. The idea of looking only at efficiencies while ignoring behaves aspects completely has made the world realizes the kind of challenges it poses. And therefore, we already see a much more positive tone for India than China or any other country.

Another significant change that the world will face on behaviour and social aspect is also a big plus for India. We are going to see a big shift in our behavior when technology will become much more important than what it has been. The social distancing will be the new norm and work from home the new corporate mantra. Outsourcing of work will get more traction and technology will be the way to go, for most developed western world. India holds a significant advantage in this area with significant progress over last 2 decades.

But how is all this going to affect me? And what should be my actions now which will benefit me economically in future. With expectation of these large government spending worldwide finding a route to India as deduced above, will create a surge in the prices of physical assets in India. While virtual assets like shares and bonds may take a long time to appreciate, physical assets like real estate will be appreciating fast and for a long term. Added to the fact, that new developments of real estate projects have already been very low as the segment has been facing head winds for years. The property prices have not appreciated for last few years and supplies are constant. With new norms of social distancing in place, the laugh of new projects will be much slower. So we will be in a state where too much money will chase too few assets. And that is when we will see a fast and sustained increase in real estate prices. Our parents have seen it and benefitted from it in earlier moments, now is our time to invest in Real Estate and earn long term. So, if you have some liquid funds, keeping it like that is sure to erode its value. However, investments in Real estate when economy is tumbling, is sure to help you make a fortune.

For more information please visit our websit:www.paarthinfra.com

What to Consider Before Buying a home? It’s Location, Location and Location!

March 17, 2020 0 Real Estate Industry

Man is a social animal and therefore he needs a social infrastructure to survive. One can’t live a happy and purposeful life if he has to live in isolation. Therefore, it is important to buy one’s home in an area where like-minded community exists and social infrastructure to match that kind of lifestyle is available. In Lucknow, the areas around Gomti Nagar are the best location to live. Simply because of a fledgling upper middle class society and the resultant infrastructure projects, that are keeping pace with increasing population, everyone desires to make this area as his abode. Amongst the new developments, two residential societies by Paarth Infrabuild, Paarth Aadyant and Paarth Arka stand tall in terms of location.

It is always said that the 3 most important criteria to take care of while buying a property in lucknow is Location, Location and Location. Let’s dwell a bit on it to understand the reason for the same. We have observed in the past that some areas in a town develop into much better residential areas compared to others even if all of these started developing at the same time. So why is it so? Answer is deep yet simple. Since early days of urban developments, people preferred living closer to the areas which were important for economic activity. Therefore, we saw the emergence of city centres which had the highest amount of economic activity. People engaged with such organizations, preferred to live nearby and therefore the physical infrastructure in the form of residential areas with facilities like water and electricity developed fast. Along with this, the social infrastructure developed fast to meet the post work requirements of working population as well as the other requirements of families.

Property in Lucknow

When we talk of families and their requirements, we need to understand what a family consists of. The family will have children, elderly parents and of course the working age people. What do each of these groups need to live a fulfilling life? So children will require good schools, play grounds, sports facilities and places to socialize. Elderly will be concerned about 24*7 medical facilities, green areas to sit and relax and same interest groups to while away the time. The working people would expect basic necessities of life like water, electricity and transport that is hassle free, activity areas like sports facilities and markets and restaurants. Now, while it may be fashionable for some of the real estate developers to talk about emerging locations, the fact is that one wants to live in her house today. So if physical and social infrastructure is not yet developed, how is one to be happy and survive? Also, the pains one has to endure for the time when the infrastructure is still developing makes the entire experience quite depressing and isolating at times.

And that is the reason why our elders have always told us to consider Location as the single most important criteria while building our abode. A place that is well connected and close to areas where job opportunities exist. An area where there are quality schools and has kids around where our kids can intermingle and play without us having to worry all the times. A location where markets, cinema halls, sporting facilities exist to engage in socializing. Hospitals and other medical facilities and safety security of the area are other features that you would include in a good location.

Lucknow is a big city now and has been developing very fast for last few years. It has been the hub of political as well as commercial activities in Uttar Pradesh. It is also the preferred city for anyone in Eastern part of UP for various reasons, most of these as we discussed in the earlier part of this article. Lucknow has had an asymmetric development in different directions. So, while residential areas sprang up all over the boundaries of Lucknow, the developments in and around Gomti Nagar have been the best in last 25 years. A locality with upper middle class residents, the emergence of best schools of the city, the finest shopping areas, the malls, cinema halls and the best medical facilities. There have been couple of new developments here that are worth mentioning.

We are talking here about Ekana cricket stadium, the largest cricketing facility in north India. It is also the home stadium of Afghanistan national cricket team and has been hosting international cricket matches more regularly than any other center in India. This stadium is not only an architectural marvel but has also been a center of attraction for people. Another development very close to it is the opening up of Phoenix Palassio, the most modern mall Lucknow has experienced. These two developments have converted this 1 km area into the real magnet and has created the fastest self-fulfilling cycle of development. One can argue that these developments have happened as there are more people living here. But that is a flat argument. People have been living on Hardoi road, around Rae Bareilly road or at Faizabad road for the similar time as here. However, the pace of development and provision of facilities in these areas is absolutely different.

In fact with Ekana cricket stadium and Phoenix city market place, this area would be the magnet that will attract everyone and all the new developments. However, there are not many good residential developments in the area for one to choose. The lucky ones can still get an apartment in either Paarth Aadyant or Paarth Arka with the luxury of watching a cricket match at Ekana stadium from the window of their drawing room. This location only keeps getting with time. Now with Phoenix Palassio Mall, the convenience of an elite lifestyle gets embedded in this area. With both these residential societies developed by Paarth Infrabuild, so close to these future magnets, one can only wish to buy a house here. The amenities within these, complement the facilities outside and promise a lifestyle no otherreal estate development in Lucknow can match.

Lucknow – The City of Nawabi Architectures

December 11, 2019 0 Real Estate Industry Residential Properties

Lucknow, also known as the city of Nawabs with iconic Mahals and beautiful buildings and bungalows. In that edacity of city culture, there are modern constructions trying to improvise with the spectacular Royal buildings. Not only the the havelis or compounds but also 1BHK or 2 BHK houses can also have the iconic royal looks. Here are some ideas of interior designs for modern buildings to give them that improvised look inspired by the royal Nawab Culture.

2 bhk house in lucknow
For sale 2 BHK Independent House/Villa in kanpur road Lucknow

  1. The Royal Palace (Bungalow)-The design is as iconic as the name suggests. The walls decorated with the royal petal cravings towards the roof. The royal chandelier hanging on the roofs, giving a shiny appurtenance. The crafted walls goes well with the light golden colour doors with the knob handles polished to perfection. Here we cannot also forget about the golden design borders and big hall upfront the main entrance, decorated with royal while couches in the middle. The living rooms composing with the King Size beds nearby the window (though a charging point still remains the priority) which get along with the royal old style cupboards. The kitchen can express the most iconic beauty in its own terms with the composite glass wares and tanned cooking utensils. This contributes to a lustrous environment which gives a feel of royalty.

  2. The Kings Mansion (3 BHK house)-If you are here reading this you must have heard that “the consumer is a King and King never bargains”. If you are a person who do not compromise anything for a Royal beauty this is definitely for you. Yes, we here are talking about kings and kings do not lay bare feet on floor. Well we aren’t talking about floating in the air but a fur mattress under your feet. Let’s start with the floor mats, a fur textured, dyed like animal skin (just dyed we love animals). All let under the most used house features like bed , dining table, drawing area and all the floor spaces where we sit most frequently. Make sure that all the living rooms are oriented similarly and are identical. Place the grilled queen size beds with a big mattress covered with sheet. The window’s curtains dressed up like it welcomes you with pride. All these there at the right places and you get the charm you want. Where the kitchen stays modular with a touch of royal looking wallpapers on the side walls which just adds royalty to the modern ethnicity to the level of perfection.

  3. The Hagrid keepers (2BHK house)-We all know the Hagrid from Harry potter and we know his house, here even the smaller modular houses can also get a fantastic royal looks. It just requires a bit touch of remodelling the interiors with the antique looks and a metal-ware with a glass composite structure. The living rooms in the small house show the best part of the Nawab looks, the positioning of the beds the colour of the surroundings, putting in some glass.

    Lucknow – The City of Nawabi ArchitecturesPaarth Infrabuild, Real Estate Developers, Lucknow, Uttar Pradesh, India

Benefits and Tips to Keep your House Clean

December 11, 2019 0 Real Estate Residential Properties

Thinking of keeping your room and house clean might makes you feel irritated, lazy and nauseous. But there are unexpected benefits to keeping your home clean you can’t even think and you won’t realize it until you experience it.

Benefits of clean room and house:

Real estate developers in lucknow
Reduce Allergies. Regular cleaning is the best way to reduce dust

  1. Stress reduction: Keeping your room, house, and apartment clean will help to reduce down your physical and mental stress. Psychology says that cleaning not only helps to declutter your room but your mind too.p>

  2. Escalate productivity: When you see good, beautiful and organized things, the cells in your mind get activated that leads you to feel more energetic this will increase your productivity levels.

  3. Boost self-esteem: Accomplishing any work or target helps you to build your self-esteem. So you feel accomplished when by making your bed and keeping room and house tidy.

  4. Good-night sleep: When you keep your surrounding clean the atmosphere around you is filled with positivity which reduces your stress and that will make you sleep well.

Tips to keep your room and house clean:

  1. Making your Bed: As soon as you get up to start your day by making your bed which will make your room look put together also this will less than a minute.

  2. Take Out Put In: If you take something out for use, you should keep that back in its proper place. Sounds simple! But it is very difficult to be consistent. Make this a habit and inculcate this in all your family members.

  3. Clean & Wipe: It does take some effort but it is very easy once it comes in your habit. Start with cleaning sink and wiping bathroom floor to keep it dry. Cleaning the kitchen encounter after preparing your meal also do wipe the table after having your meals. Fix a day or two in a week to clean your toilets, bathroom’s walls, showers.

  4. Doing Dishes: This will help your kitchen not to turn into a monster. After every meal do your dishes even if it is a cup of tea or coffee.

  5. Laundry: Don’t wait for stinky and dirty clothes clogged up to large numbers. Spread it out evenly every day. It is very before going for a bath just put your dirty clothes into the washing machine and it will get clean in the time you take your bath.

  6. Do Little Every Day: Don’t try to get it ‘all’ done in a day or every day. Just do something each and every day and you’ll get over the feeling of need to clean your house all at once. With a simple cleaning routine, you’ll find that maintaining the basics every day is really the secret to a clean and tidy home.

Paarth Infrabuild, Real Estate Developers, Lucknow, Uttar Pradesh, India

7 Books to Read Before Becoming Real Estate Investor

December 11, 2019 0 Digital Marketing Real Estate residential Residential Properties

The first question which might pop in your head that Why Books? Because self-education plays one of the most crucial role in the early stage of your career. For creating a rock-solid building, your foundation should be very strong which can be done by reading books. You should always prefer books over any digital medium because books will help you to focus without any distraction. It is a well-known fact that you are going to imbibe more content when any content is read either from a book or paper. Also instead of reading free articles online, you should prefer books because generally books have story writing format which makes it very interesting and psychology says that your mind likes stories, our mind always remember a story.

So here are 7 books to read before becoming real estate investor.

  1. Building Wealth One House at a Time – John SchauhThe main idea of this book is that you can build a fortune by investing in real estate arrangements like single-family houses and small units. It can be said that this is a hedgehogian approach as it just focusing to invest in houses. Also, appreciation in real sector is very uncertain and difficult to predict.

    2. Ideas from the book

    • Buying one house can make you rich
    • Buy with your money without any borrowing
    • Houses are the best form of investment
    • Right house at the right location will attract long terms tenants
    • Sell house on lease for profit maximization

  2. Rich Dad Poor Dad – Robert KiyosakiThis is the quintessential book on the power of investing. This book largely focuses on working for money or investing to let money work for you. This book is not about how to invest but focuses that investing money is very important.

    3. Ideas from the book

    • Wise investment decisions
    • To reduce your tax liability
    • You will more from real-world
    • The importance and potential of investing

  3. The book on Investing in Real Estate with No Money Down – Brandon TurnerThis book is about how to invest in real estate but doesn’t have much money. Also, this book is not about getting rich with tricks but to it gives you a toolbox of financing that you can use to buy real estate. As an investor has no money to invest in the concept of borrowing for real estate is explained in a sophisticated way. This book contains hypothetical examples which are very useful for the beginners to learn and make a different kind of strategies.

    4. Ideas from the book

    • Investing without money
    • Start with property owned owners
    • Combination of different techniques
    • Different kind of strategies
    • How to attract private lenders

  4. What Every Real Estate Investor Needs to Know About Cash Flow – Frank Gallinelli:If you love numbers this is the perfect book for you, which makes it perfect for the real estate world. Along with the explanation of the basic formulas, a reader will learn about the principle aspects of real estate investments such as cash on cash return, return on equity, net present value, discounted cash flow and net operating income. The spreadsheet models that are provided in the book are used to help validate how to read a property’s potential, and how to apply financial concepts to be a successful tool.

    5. Ideas from the book

    • A helpful guide to financial cash flows
    • How to make money in real estate
    • Using statics to make any financial decisions
    • There are several methods to calculate return on real estate investment

  5. The ABC’s of Real Estate Investing – Ken McElroyThis is a useful book for the people for long-term real estate investors. This book will help the reader to know about real estate industry and to enlighten them about what they are getting into. A complete overview of the investment made in real estate industry from beginning to end.

    6. Ideas from the book

    • Very direct information about the real estate
    • Explanation about the formulas that can be used to analyse the potential outcome of an investment from cash flow perspective
    • Clear all the myths that curb people to invest in real estate sector.

  6. Every Landlord’s Legal Guide – Marcia Stewart, Ralph Warner & Janet PortmanThis book covers the topic like property management, legal and contracts. This book covers the issue like rejecting applicants, handling of security deposits also it throws the light upon the issues like a potential liability on your property manager’s act and how to handle the subletting requests.

    7. Ideas from the book

    • What, Why and How
    • How to hire a lawyer
    • How to do legal research
    • Legally delegating responsibilities on the tenants
    • How to solve disputes without the lawyers
    • Returning of security deposits and moving out issues

  7. The Book on Flipping Horses – J ScottThis book covers the big picture and are very specific to details. A most fundamental step which is missed by most that is to analyse and choose the target market. This book will help you to analyse the potential market in your own market for flip and to analyse the future market to venture into.

Ideas from the book

  • Good deals of sources
  • Hundred house rule
  • Get your financials very precise

Paarth Infrabuild, Real Estate Developers, Lucknow, Uttar Pradesh, India

Impact of GST on Real estate

December 11, 2019 0 Uncategorized

GST that works on the principle “One Nation, One Market, One Tax” seeks to transform the complete tax system of India. GST are divided into five tax slabs for the collection of tax – 0%, 5%, 12%, 18%, 28%. The tax system in India had a cascading effect, there was a tax on tax. GST simplifies the complete tax system to eradicate the multiple tax system such as VAT, service tax, central sales tax, entry tax, luxury tax etc. Real estate is one of the most crucial sectors of the Indian economy which is contributing about 5-6%a to the GDP on India. It is the second largest employer in the economy after Agriculture sector. According to the report by CREDAI and JLL India’s real estate sector is going to USD $180billionb industry.

Impact on buyers and investors

Before GSTAfter GST
· The construction status of the property will decide the types of taxes the buyers are liable to pay these varied state to state. – (Property under Construction) buyers were liable to the VAT, service tax, stamp duty and registration charges. – (Property after Completion) buyers were liable to stamp duty and registration.· GST simplifies the overall purchase price. · All the property under construction will be charged 12%c of the property value which excludes the stamp duty and registration charges.

Impact on developers

Before GSTAfter GST
· Developers were liable to pay central excise duty, VAT, customs duty etc. · Also, they have to pay other charges like approval charges, legal charges, architectural charges, labour taxes etc. which at the end burden comes on the buyer. · Before GST a huge amount of real estate expenditure undergoes unrecorded. GST will cut down this due to cloud storing of invoice.· Under GST Cement will be taxed at the rate 28%d Iron rods and pillars will be taxed at the rate 18%e.· Reduction in the cost of logistics.

· The developer will be entitled to acquire input credits on the sale of property under construction against the taxes paid by the buyer.

Under GST real estate industry are also going under automation. Automation will provide ample amount of benefits such as time compliance, generation of the report, comparison among the reports, cost-effective with reduced staff and much more.

Post GST:

  • The transparency in the system is increased as the developers can buy the raw material only from the registered vendors.
  • The complex process for buying a home has become simplified.
  • The foreign investment is also increased as the tax system is simplified without giving them the burden of multiple taxes which will lead to improving the overall quality of Indian standard.
  • GST and RERA together will bring in more transactional transparency into India’s real estate sector.

References:

aSource(IBEF) on 20-06-2018
bhttps://economictimes.indiatimes.com/wealth/personal-finance-news/indian-realty-sector-market-to-reach-180-billion/articleshow/63301570.cms
chttps://www.livemint.com/Money/M5Boa7PF4LHY3o10rdbCyO/How-GST-is-charged-on-houses-under-construction.html
dhttps://cleartax.in/s/impact-of-gst-on-the-cement-industry
ehttps://economictimes.indiatimes.com/industry/indl-goods/svs/steel/steel-industry-likely-to-benefit-from-gst-rate-stands-at-18-per-cent/articleshow/58751901.cms (20-6-2018)

Paarth Infrabuild, Real Estate Developers, Lucknow, Uttar Pradesh, India

Housing for All | “Sabke liye Ghar”

December 11, 2019 0 Real Estate Industry

In the year 2017 for better regulation in the real estate industry, a series of reforms were made like for ensuring transparency in real estate sector RERA was introduced which made the developers to disclose their timelines for their building process. The other massive change was introducing the GST bill in the real estate sector which aimed to reform the tax structure by making it more uniform. But none of them were as impactful as Government’s Housing for All scheme. This will make it easier for the weaker section of the societies to acquire safe loans and invest in making their homes.

Pradhan Mantri Awas Yojana (PMAY) is an initiative by the government under the Prime Minister Narendra Modi under which housing will be provided to urban poor with a target of building 20 million houses by 31st March 2022. Under PMAY, it is planned to build 2 crore houses for urban poor including Economically Weaker Sections (EWS) and Low Income Groups (LIG) in urban areas by the year 2022 through a financial assistance of ₹2 trillion (US$30 billion) from central government.

It has two components:

  1. Pradhan Mantri Awas Yojana (Urban) (PMAY-U) which will target the urban poor.
  2. Pradhan Mantri Awas Yojana (Gramin) (PMAY-G) which will target the rural poor.

The feature of Pradhan Mantri Awas Yojana is that the government will provide an interest subsidy of 6.5% on housing loans availed by the beneficiaries for a period of 20 years under credit link subsidy scheme(CLSS) from the start of a loan. This scheme will comprise of other schemes that ensure that every house will have a toilet, electricity connection, LPG gas connection, drinking water accessibility, and many more. The houses under PMAY would be constructed through a technology that is eco-friendly and preference will be given to an older person and differently abled person for the allotment of the ground floor.

This scheme is comprised of three phases:

Phase 1 – (April 2015 to March 2017) to cover 100 cities.

Phase 2 – (April 2017 to March 2019) to cover additional 200 cities.

Phase 3 – (April 2019 to March 2022) to cover remaining cities.

Private contributors such IIFL home loans have been helping the beneficiaries to avail government subsidies. ICICI bank also giving subsidies to the eligible people for the scheme. AU Housing Finance Limited has also been giving subsidies under the scheme.

Conditions for PMAY:

  1. Maximum age limit is 70 years.
  2. Economically Weaker Sections (EWS) annual income should be less than 3 lakh Low Income Groups (LIG) annual income between 3 lakh – 6 lakh.
  3. The beneficiary should not have any dwelling unit on the name of any family members in any part of India.

Under this scheme, the houses will be owned by females or jointly by the males. This will help to increase the women empowerment in India.

Paarth Infrabuild, Real Estate Developers, Lucknow, Uttar Pradesh, India