Selling Your Home? Tips from Top Developers’ Strategies

Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Sooner or later, you will find that your ‘starter home’ no longer meets your family’s growing needs for space, comforts and conveniences and that the time to upgrade has arrived.

At that point, your first concern will usually not be finding the new home but selling your existing home for the best possible price. After all, it is the proceeds from this sale that will fuel your next home purchase.

This brings up the very sensitive topic of right pricing. In most large cities of India, what we currently have is still very much a buyer’s market.

In other words, buyers have a sizeable degree of control and are also spoiled for choice – especially on the resale market, which has taken a big hit because of the Government’s demonetization move.

You will need to address the issues of:

  • Attaching a good selling price to your home
  • Positioning the property favourably on the resale market
  • Navigating away from non-serious inquiries and focusing on the serious ones.

This is where you can take some clues from top-ranking, reputed developers who are confident of their product. Such developers have no reason to shy away from the topic of price, for three reasons.

The first reason is that they know they are selling a quality product and that a quality product must be priced accordingly. Secondly, they know how to bring out this value while discussing with interested customers. Thirdly, they know their market and will not price themselves out of it.

One-off developers with no real brand value, experience, expertise and established track record usually enjoy few or none of the advantages that reputed players have while selling their properties.

This is why they will quote unnaturally low prices in a buyer’s market and are willing to negotiate even more on that price.

Whether the property you are hoping to sell is of high quality or not, you can still learn from the sales strategies that top developers use in order to sell your home at the best possible price in the prevailing market conditions. Here they are:

Know your market and price according to prevailing trends

As a seller on the resale property market, you do not have much scope for ‘experimental’ pricing. If you price your property too high, you will not get any inquiries.

If you have placed a high price on it but choose not to reveal it in an online listing or via a broker, you may get some inquiries but they will not materialise into a sale once you discuss price.

In other words, find out what the prevailing market rates are, price your property accordingly and do not hesitate to announce it. This is the approach that reputed, credible developers use with great success.

Understand the value of your property

You may have bought your starter home for certain reasons, attractive price probably being among the leading reasons.

If you have occupied it for a period of at least 2 to 3 years, even with good maintenance and upkeep, the inherent property value may have depreciated to some extent due to the age of the building.

However, the location will have become more valuable because of any number of reasons which are not immediately apparent to you:

  • The arrival of better grocery shops, pharmacies, etc.
  • Road development and better public transport facilities improving commutability
  • A mall with a Cineplex or a couple of good hospitals opened up close to or within a few kilometres of your property

If you look at the marketing brochure of a top developer, the location advantages of the project will be among the first things you see. In other words, position your property in accordance with the new existing location advantages it gives to potential buyers.

Learn to differentiate between serious buyers and ‘window shoppers’

Top developers go to great lengths to train their marketing personnel in the fine art of distinguishing between serious and non-serious inquiries. You should be able to discern the difference too, especially since you still live in the property you are hoping to sell.

An endless parade of people inspecting every nook and cranny of your family’s personal space is not a happy thought. While reputed developers will obviously not see the inspection of new, empty flats a personal intrusion, having to deal with too many frivolous visitors is still a waste of their time.

To eliminate at least some of such ‘window shoppers’, ask for an initial discussion over the telephone and be up-front about the financial terms. Also, ask the caller exactly what they are looking for, and evaluate whether they will find it in your property.

Obviously, if they are firm on wanting a clubhouse and swimming pool and your project does not have such features, the inquiry will not translate into a sale and is not worth an inspection visit. The same principle holds true if they are hoping to negotiate extensively and you are more or less confident and firm on your asking price.

Finally, be ready to have your property up on the resale market for at least 3 to 4 months with a stated price tag before considering a downward revision of your price.

Avoid posting your property on multiple online aggregator sites, as this will result in countless brokers trying to involve themselves and wanting to show your home to prospects. Utilise the services of one property agency specialising in your particular location, and establish a good level of trust with them.

About the Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

RERA Is A Reality – Should You Buy Your Home Now?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

RERA – or the Real Estate Regulation Act – has finally become a reality.

Though there are still plenty of hiccups and it will obviously take some time for the industry to absorb all the facets of the Act, it should be kept in mind that RERA is a process, not an event.

Meanwhile, the foremost question in property buyers’ minds is – should they wait until the RERA process is streamlined, or can they go in for home purchase now?

This is a fair and valid question.

After all, buying a home is in many cases a once-in-a-lifetime event, and one which most people look forward to and plan for assiduously.

At the present time, the real estate market in most cities is flush with options for buyers in most price brackets, and developers have also kept various offers and schemes in place to maintain the sales momentum.

Prices have corrected in most locations, and projects which seemed too pricey only a year ago are suddenly quite affordable.

Indeed, buyers have every reason to view this as a very favourable time for home purchase. Yet, the ongoing implementation process of RERA is giving them pause.

In the past, we have seen that anticipation of price corrections and lower interest rates keeps many potential buyers on the fence.

Paradoxically, the announcement of RERA is now having a similar effect, largely because buyers are unsure of whether they will benefit from it immediately or whether the benefits will take some more time to come in.

As of now, developers have been given until the end of July to register their projects under RERA. Likewise, real estate agents – who also fall under its ambit – are still in the process of registering under RERA.

As mentioned, RERA is a process and not an event. The process includes the remaining States falling in line and adopting the Real Estate Regulation Act in letter and spirit – and, most importantly for buyers, developers registering their projects under RERA.

None of these things can happen instantaneously, as many people had expected.

As of now, developers have been allowed to continue marketing their under-construction projects until 31st July 2017, which means that they have a three-month window period in which they can register these projects under RERA.

Meanwhile, buyers should only consider projects in good locations, by builders who are in the process of registering their projects under RERA.

Only players with strong balance sheets and an equally strong reputation on the market will be able to see this process through and to prevail in the future.

One sound piece of advice for homebuyers is to check out the developer’s website, which should reflect the fact that they are actively pursuing RERA compliance.

A builder’s depth of credibility on the market has always been the foundation of his success – and it will be even more so in the post-RERA era.

In the months to come, we will see many small-time developers who do not have the capacity or willingness to abide by RERA’s rules and regulations vanish from the market.

They will sell off incomplete projects or land parcels to bigger, established players, dissolve their real estate businesses and turn to other market areas.

This kind of consolidation is a natural and expected by-product of RERA, and one of the primary ways in which it will create a more transparent and healthy property market.

Only builders with sound reputations will remain in the real estate business. In the future, RERA will revolutionize the manner in which residential housing projects are planned, marketed and sold across India.

Homebuyers will be able to stop worrying about lopsided sales agreements, delays in handing over their properties, unscheduled changes in building plans and several other risks which were so far considered part and parcel of buying into under-construction projects.

At the current time, the safest bet for homebuyers is to turn their focus on projects whose builders have a strong reputation and track-record.

It is these players who will eventually remain on the market, and are in fact gearing up for making their projects and businesses RERA-compliant as we speak.

The others will wind up and their projects may either be taken off the market or rebranded under the auspices of these stronger players.

In other words, there is no need for aspiring homebuyers to wait for more clarity on RERA to emerge. It is certain that RERA will clean up the market – and it is equally certain that it is only strong, reputed developers will be able to do business in the future.

The soundest strategy for buyers is to identify projects by these builders which are either complete or in advanced stages of completion, and make use of the very favourable market conditions existing now to close the deal on their dream home.

About the Author:

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township, Astonia Royale in Ambegaon.

Property Investment Tips: Buying A Home That Delivers

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

With RERA as well as various other policy initiatives such as the Benami Transactions Act and the Government’s determined push for affordable housing, the time has never been better to buy a home.

We are already seeing a lot of increased activity in the residential property market in the larger cities. After the dampener of the demonetization move late last year, the positive buyer sentiment visible now is especially significant.

With the return of buyer sentiment, builders are obviously determined to capitalize on it via increased marketing efforts.

Given that there is already a lot of supply on the residential market – a lot of it for ready possession – fresh launches have been curtailed so that existing inventory can be absorbed. Much of the intensified marketing efforts are centered around special deals and offers.

Advice to property buyers

Obviously, it is a very advantageous time for property buyers right now. Yet, they should be judicious while evaluating offers and schemes and base their purchase decisions solely on the real value of the home instead of on freebies.

Buying a home is an expensive undertaking, often involving a substantial part of a middle-class family’s savings as down-payment and a prolonged commitment to pay EMIs for several years.

Freebies such as gold, cars and household goods have an undeniable attraction, but they are fundamentally frivolous in nature and do not add to the value of the home.

The price of a home is obviously an important consideration for middle-class property buyers. However, the strategy of looking for the cheapest options on the market does not make much sense because it is quality that determines value. In the case of residential property, the quality of an offering is vested in three aspects:

  • The quality of the location
  • The brand value of the builder
  • The availability and quality of facilities and amenities in the project and in individual units

The evolution of ‘location value’

Central locations are traditionally the costliest, thanks to the fact that they offer great access to many important parts of the city – most importantly the CBD and SBD (central and secondary business districts).

These areas tend to host the offices of high-profile companies, which also tend to offer a vast cross-section of jobs – from highly-paid management to more modestly-paid support staff jobs.

Even the second category of jobs is attractive because growth prospects in high-profile companies are usually very good. This is what makes living in central locations very desirable – and, from a real estate pricing perspective – very expensive.

In India, this mantra was rather inflexible and held true for a very long time – until the advent of the Infotech culture. The IT/ITeS industry tends to offer very good salary packages but is not focused on high-value locations.

Quite to the contrary – such firms prefer to set up shop in peripheral locations so as to save on the real estate costs. As a result, many of a city’s outskirts have become very desirable places for homebuyers, and they are far less expensive.

For IT professionals and industrial employees as well as property investors, buying a home in a peripheral location that connects to an IT hub and/or manufacturing belt makes perfect sense.

Unfortunately, such locations attract all kinds of developers – from those who have a reputation for creating true lifestyle value offerings to those who specialize in constricted, lifeless ‘pigeon-hole’ homes. This is where the brand value of a developer plays a significant role.

Brand value stands for assured quality

With a lot of housing supply available in the new growth corridors, buyers are spoiled for choice. The consideration of ‘ticket size – the cost of a flat – is obviously important, but one still only gets what one pays for.

Ultimately, a home is not just an asset but one which performs the very critical function of offering refuge, comfort and security – the three mainstays of lifestyle.

Buyers must look for options which offer them these three advantages to a satisfactory level. Branded builders provide these as part of their standard value offering because their reputation demands it.

Facilities and amenities – life beyond mere living

If four walls and a parking space would be enough to serve our housing needs, the real estate industry the world over would be a very unexciting one at best.

The fact is, urban life today places a lot of stresses and demands on us, and our homes cannot only be places of refuge but must also provide healing and rejuvenation from these.

A clubhouse, swimming pool and children’s park are no longer luxuries but the bare minimum an Indian homebuyer can and should expect. A residential project that does not offer these falls far short of the required mark.

Obviously, even projects without such offerings will find buyers because of their lower prices – but such buyers find very little comfort in their purchases. While short-listing prospects for home purchase, it is definitely important to ensure that the final selection provides a decent lifestyle and not just an abode.

If one looks at the supply on the residential property market from such a focused perspective, the bewildering choice of options automatically narrows down to a more manageable and comprehensive level.

Always to be kept in mind – buying the right home is not just about present and future comfort but also about investment growth. Homes in good locations, built by reputed developers with a good saturation of amenities and facilities will always yield better capital appreciation as well as potential rental income for property investors.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Pune Realty Sector Welcomes RERA Implementation

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd:

The real estate regulatory bill has been long pending implementation, and homebuyers have been eagerly awaiting its nation-wide deployment so that they can finally invest in residential real estate with confidence and assurance.

Industry stakeholders had been divided in their stance towards this vital regulator, resulting in massive delays for its implementation as a firm law. Now, the May 1 deadline is finally here and RERA is all set to usher in a new era of transparency in the Indian realty market.

No doubt, there are still ambiguities and not all States have announced their RERA rules as per the deadline. However, there is now very real pressure on the laggards, and the ambiguities will get ironed out in the near future.

What is important is that RERA is now finally here to empower and protect consumers. RERA imposes stringent regulations on developers as well as property brokers with regards to how they conduct their business. It is very encouraging that the bill is now a reality.

At What Age Should You Invest in Real Estate?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

In India, the current mantra is that property investment is ideal only for upcoming or established career makers – but is this true?

How do banks, lenders and the property sector at large view investors who do not fall in that age bracket anymore?

Can one be too old to put money into property, and would one have missed the chance to grow their wealth through real estate at some point?

Of course, it is true that banks are willing to lend to a person only for so long; when a prospective borrower is looking at retirement in the near future, the concept of giving them a long-term home loan understandably does not make much sense to them.

Let us examine this a little more closely.

When a person is in his or her 30s, they have around 30 years of active professional life ahead of them. Naturally, this gives them abundant time to develop a large property portfolio.

However, even when they are in their 40s, they are far from too old to successfully invest in property. There are still as much as 20 years ahead as an income-generating citizen – and even more if one is successfully self-employed or runs a business.

In other words, there is still plenty of time ahead to make some profitable property investment choices even in one’s 40s.

Of course, it goes without saying that the sooner one invests, the higher will be the ultimate gains because profits from property compound over time.

Home Buyers

Generally, it is assumed that one must have the ability to service home loans for 25 to 30 years to finance one’s property portfolio. However, many banks in India have now understood that people can and do work past the conventional ‘retirement age’ of 65 these days.

Interestingly, once one has secured a good portfolio of assets, one has additional clout and credibility with banks since these properties can act as collateral for fresh loans even at age 50 or above.

Definitely, the time to experiment with ‘speculative’ investment should be over by this time, as one should justifiably have a healthy aversion to risk by age 55.

By this age, the ideal strategy should be to boost the value of one’s existing assets via proven value-boosting routes such as renovations.

Without a doubt, a person who wants to keep investing in property in India at age 60 or above needs to have a very clear understanding of the market, as well as a great deal of confidence in one’s personal finances.

As already explained, it is now technically possible – under certain circumstances – to raise a home loan for property investment even after retirement.

The question whether one would want to is, of course, a personal one and would depend on a variety of circumstances – most related to one’s financial soundness and appetite for such activities.

So far, so good – but what about buying a home for personal use? This is where it gets a lot simpler because there is no ‘ideal’ age for home ownership.

If one has been living in rented homes all one’s life, buying a home even at 65 makes perfect sense. In the first place, it is the perfect retirement gambit, as it provides freedom from the recurring expense of monthly rent.

Secondly, it secures a sound asset which gives unmatched financial security and can be used to raise funds in emergencies. Thirdly, a property is the perfect bequest to leave behind for one’s children.

The bottom line is that there is definitely such a thing as an ‘ideal age bracket’ for property investment – though this age bracket is flexible depending on various factors.

However, there is no ‘ideal age’ to buy a home for personal use. The latter fact is especially true if one sees a self-owned home more as an abode and sanctuary of financial freedom and security than an investment instrument.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Focus Areas for Tackling Pune’s Urbanization Challenges

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Pune – one of the fastest- growing cities in India – is the seventh-largest metropolitan city of India, and the second-largest in Maharashtra.

Over the years, it has attained unprecedented momentum and dynamism on the back of its popularity both as an academic center and a business hub, with Information Technology having become the predominant industry driving its economy, job creation and real estate demand.

It goes without saying that Pune’s growth story is not a temporary phenomenon. The city will expand exponentially in the years to come, both geographically and economically. This will bring its own challenges with it, many of which are already manifest today.

To understand the challenges that urbanization poses to a city, one needs to examine the proportion of population and existing lack of social and physical infrastructure required to cater to the needs of this population.

Obviously, the areas where lack is evident will pose increasingly bigger problems if we assume that population growth is assured and inevitable.

Without a doubt, the city planning authorities are not blind to this. The massive influx of inward migrating population into Pune has catalyzed a major rush for infrastructure up-gradation on all fronts.

We are seeing a lot of efforts being put in to optimize road connectivity, parking facilities, public transport, electricity, waste management, water supply and land planning. Nevertheless, there is a need for increased pace and momentum.

The city is looking forward to the new regime to take urgent real-time steps to ensure that its citizens are not deprived of basic services. Some of the areas that need to be focused on are:

Traffic and transportation:

  • Use of advanced urban street designing for better roads, subways, walkways, overbridges and flyovers
  • Develop better public transport which can reduce usage of individual vehicles (there are 46 lakh vehicles on Pune’s roads every day)
  • Encourage carpooling and bike pooling initiatives. Encourage cycle-to-work concept, develop better accessible cycle tracks and discourage encroachment by motor traffic
  • Focus on Metro, which will significantly reduce the daily travel time for commuters
  • Address the mounting parking issues with more creative cost to parking in major areas, mechanized stacked parking facilities, etc.

Water supply management

Pune’s water supply – and its management – needs to be focused on priority. It has been estimated that about 30% of water is lost in distribution, the main causes being heavy leakages and imprudent household use.

The Government should encourage the use of water cards as already being seen in areas like Nanded, and similar progressive initiatives.

Solid waste and storm water management

  • Develop enough facilities to collect solid waste
  • Increase civic education on waste segregation and improve efficiency of garbage collection
  • Create organic compost systems which can be used for agricultural lands in nearby areas as fertilizer
  • Improve channelizing of drainage systems and storm water drains which released into mass water bodies. The city has only 44% tertiary drains, and the primary and secondary drains are increasingly obstructed by silt. The municipal authorities need to get more proactive on cleaning these drains regularly

Sewerage and waste water treatment

All developed and developing areas should have access to underground drains (UGDs). Pune’s existing sewerage treatment capacity is not efficient, and a large volume of untreated water is released into its rivers.

The Mula–Mutha rivers are polluted, as untreated domestic waste is being discharged into them. Likewise, Khadakwala Lake has also been polluted. Addressing these issues must become high-importance focus areas.

640px-New-Yerwada-Bridge-Over-Mula-Mutha

Sharp focus on housing

  • Encourage the development of more integrated townships with walk-to-work options
  • Encourage housing with open spaces for children and for Senior citizens
  • Create more affordable value homes / low-cost housing and SRA schemes to help curb slums proliferation in the city
  • Increase the pace of project completions via proactive policies to boost the availability of ready-to-move homes where they are needed the most. Given the massive increase in job opportunities in Pune, the supply of affordable, completed housing projects is insufficient when compared to under-construction projects
  • Step up infrastructure creation in the fringe areas with low real estate rates to encourage migration to these areas, and also develop commercial development of these areas to give them economic strength
  • Formulate and implement better zoning for commercial and residential usage
  • Encourage sustainable real estate practices such as mandatory use of solar panels, rainwater harvesting, etc. in new residential projects, and in older projects wherever and to the extent feasible

Modernize public safety

  • Encourage smart transportation with real-time tracking to ensure timely response to emergency situations. This includes geographically integrated systems for identifying caller location
  • Increase public safety with better city surveillance systems and video analytics

While Pune’s inclusion in the Smart City program will doubtlessly address some of these areas, the benefits will not be uniform across all of the city’s ever-expanding boundaries.

The vision of our city planning authorities must be all-encompassing and democratic to all regions. In particular, more attention needs to be given to the much-neglected gaothan areas which have not yet been included within the municipal limits because of various reasons.

In short, Pune must become a uniformly modern city, capable of handling urbanization growth – both now and in the future.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Image By Rsrikanth05Own work, CC BY-SA 4.0, Link

How Does Job Creation Lead To Demand For Homes?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Among the key variables that generate interest from property investors in any given location or city is job creation.

An area in which several businesses are generating career opportunities for people becomes a magnet for demand from homebuyers. Such areas also become the focal point of interest for residential property builders.

Employees of these firms will always hope to find homes close to where they work. Home prices in such areas can be very attractive if it is still developing – as long as it provides good access to a office hub, it will attract a lot of demand.

Apart from end-users, investors will also be interested in buying up residential properties and putting them out on rent.

In any case, since a substantial number of families may decide to purchase their houses there, developers will line up to buy available land parcels and build residential projects.

Residential property builders put in a lot of research before launching a project in any new area. One of the main factors they will focus on is what kind of demand is likely to exist.

For instance, an area near an industrial area or BPO will definitely see a lot of demand from budget home seekers, while a location around a software development firm is likely to generate demand for mid-income and semi-luxury homes.

Baner_from_Baner_Pashan_Biodiversity_Park

If a new office hub is generating highly-paid jobs, it becomes a suitable target for luxury home projects as well. However, many developers tend to miscalculate an area’s potential to sustain demand for luxury offerings.

Also, the Information Technology-driven job market a lot more fickle than that of, say, the manufacturing industry. Industrial jobs in India are largely driven by local demand for manufactured goods, so careers in a manufacturing company can be quite steady even if the salaries are not spectacular.

Infotech jobs, on the other hand, are not as predictable as they may have initially seemed. The demand for such services in India is primarily driven by companies in the United States, where policies regarding outsourcing to other countries can have a big impact.

We are currently witnessing such policy fluctuations happening in the US, causing a lot of uncertainty to software companies here in India.

Not all job categories in the IT/ITeS sector are affected equally, but developers of residential properties looking at cashing in on IT-driven housing demand must nevertheless be attuned to which level of housing demand is sustainable, and which is subject to sudden change.

Investors must also be able to gauge where Infotech-driven residential demand is headed. For instance, the previous IT capital of Bangalore is now rapidly yielding its market share to cities like Pune, which are attracting more and more IT companies with their burgeoning workforces and cost-effective property rates.

About The Author

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

Image source: Wikimedia

Urbanisation: Can We Reconnect Our Cities With Nature?

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

In pre-modern times, people in Indian cities still coexisted peacefully with nature. Sadly, in the current real estate development scenario, we have definitely witnessed an increasing separation between nature and individuals.

In the pursuit of their development and urbanisation agendas, our cities have seen high-rise buildings replacing backyards, parks and forested areas.

However, it is wrong to blame solely real estate developers and municipalities for this scenario. They are effective reacting to the growing demand for such buildings from people whose evolving lifestyles focus more on work and after-work entertainment and shopping.

Let us take the city of Pune as a case in point. In previous times, this city had a much smaller geographic spread and there was no real need to increase it.

Pune was supposed to be city for retired people. The city and its trade activities coexisted very well with a strong agrarian component both in the central and peripheral regions.

Population growth was relatively limited. The neighbouring city of Bombay, established by the British circa 1845 as a major port and trade hub, attracted a significant mass of migrants looking for urban-based employment.

In fact, the British viewed Pune – or Poona, as it was known in earlier times – as a region of political unrest and resistance against their rule. Pune began growing both in terms of population and geographical spread only after India attained independence in 1947.

Then came Pune’s Technological Revolution.

Pune transformed from a relatively small city to a full-fledged metropolis and was drawing a massive influx of people responding to its rapidly increasing employment opportunities – first in manufacturing, then also in software technology and information technology-enabled services (ITeS).

When Pune was still relatively small and untouched by the rampant urbanisation we see here today, there was negligible impact on the natural wealth for which it was once so famous.

Today, we see its once generous share of green open spaces eaten up by both low-rise and high-rise housing developments, landfills, commercial complexes and shopping centres.

Sahakar Nagar Pune
Sahakar Nagar Pune

As a result of this process, city dwellers become disconnected from nature. It is true that there is a lot of awareness and concern about the need to reestablish a healthy environment, and healthier cities.

However, it is also true that most real estate development taking place today is about amenities and facilities, and that any vegetation that is factored in is merely aesthetic and ornamental.

Essentially, the city has gone from green to grey, and any new thinking about and efforts towards reconnecting people to nature must indeed be trans-disciplinary and coordinated.

Construction is an inseparable element of a city – a city without buildings is inconceivable, and deforestation is inevitable. In fact, the very genesis of buildings lies in mankind’s need to protect itself from the wild animals inhabiting forest areas with strong, impregnable structures.

Today, wildlife has been more or less wiped out from our cities, but economic inequality has given rise to new threats of forced entry and loss of life and possessions. As long as mankind prevails, buildings will prevail as well – but can we bring nature back into our cities, as well?

An experiment to achieve exactly that is reaping astounding results in cities like Singapore, where a natural ecosystem is being re-introduced into the urban fabric. It is astounding what such a vision of futuristic urbanisation can achieve.

Clearly, concrete can coexist with abundant greenery and one must not necessarily negate the possibility of the other. However, it takes a magnificent town planning vision, coupled with a strong political will – and also unswerving support from a city’s population.

As long as demand for homes is skewed only towards concrete buildings with modern amenities and some token greenery, only such supply will follow.

Increased demand for urban housing where natural environment is more than just a token gesture and, in fact, available to sufficient saturation to actually have an environmental impact, such supply will surely follow.

We are seeing the return of such demand in Pune, and it is driven not only by the higher environmental consciousness of today’s young homebuyers but also their concerns about their own and their children’s’ health and wellbeing.

A city does not lose its ‘green’ identity overnight – in cities like Pune and Bangalore, the erosion of this identity took several decades.

It will take a few more decades to bring it back, but it is possible if all stakeholders – from town planning and municipal authorities to real estate developers and buyers – decide that it is worth it and must be done.

About The Author:

Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

What Lies Ahead For The Pune Property Market

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

Pune’s real estate market is the stuff of legend, and justifiably so. All the five main verticals of the property sector – residential, commercial office space, retail and hospitality – are performing optimally in Pune.

This is by all standards an exceptional real estate market. Moreover, Pune is always growing and adding to its geographical spread, making it by far the largest and most vibrant real estate market in Maharashtra and beyond.

Therefore, it comes as no surprise that investors from Mumbai, dissuaded by the high property rates and slow market conditions in the financial capital, are extremely active in Pune.

Apart from these, there is a constant flow of investments coming in from other Maharashtrian cities like Nanded, Nasik, Sangli, Kolhapur, Nagpur, Jalgaon and Amravati. As a result, the Pune property market is extremely resistant to stagnation.

Know what drives demand

The huge degree of job creation the city’s manufacturing, automobile and Infotech and services sectors is causing inward migration from almost all parts of India and very rapid absorption of commercial office spaces.

This, in turn, is constantly ramping up residential property demand as well. Additionally, thanks to its many educational institutions, Pune boasts of constantly replenishing talent pool which fuels the growth of all the sectors active in the city.

Because of the multidimensional growth drivers that the city enjoys, the Pune residential property market is quite resistant to the severe demand fluctuations being seen in a number of other cities.

However, successful investment into the Pune residential real estate sector still calls for knowledge about what works, and what doesn’t.

Pune_India

Know where to invest

Like in every other city, Pune’s residential property sector sees the most rapid impetus in pockets or locations that are still developing. It is primarily in these emerging locations that we find the most real estate activity, both its terms of development and demand from buyers.

Areas like Undri, Ambegaon, Keshavnagar and Bhugaon have already established themselves as Pune’s fastest-growing new suburbs. The growth of such locations also serves the important purpose of decreasing demand and development pressure in the central regions. However, even in these areas, there is danger lurking for uninformed property investors.

In many of the emerging residential property destinations, we have seen a huge load of housing projects where construction has either been stalled or delayed far beyond the initially committed completion timelines.

Investors and end- users who bought into such projects at the pre-launch phase to take advantage of attractively low rates have literally become stuck along with the projects.

Know your developer

In Pune, the difference between beneficial and hazardous housing investment lies primarily in the reputation and credibility of the developer. While credibility is a much-abused qualification that almost every developer lays claim to, it is actually quite simple to verify.

One merely needs to examine the builder’s track record of successfully completed housing projects. ‘Successful completion’ does not mean ‘eventual completion’, but completion within 1-1.5 years of the delivery timelines promised to buyers.

RERA Compliance – the new Gold Standard

With the Real Estate Regulatory Act (RERA) slated to finally become a nation- wide reality by mid-2017, Pune’s residential real estate market is going to become more vibrant and lucrative for property investment than ever before.

Thanks to this key reform in the real estate sector, the city is set to shed a lot of its ‘bloat’ – or burden of small-time, inexperienced builders out to make a quick buck with small, shoddily designed and executed projects which are also often of dubious legal status.

Such players will simply not be able to sustain operations post-RERA, and will vanish from the market.

What will remain are builders of good repute, market standing and track record – credible players who are able to abide by the strictures that RERA lays down to protect the interests of buyers and investors.

While this landmark is understandably a source of fear and trepidation for fly-by-night builders, it heralds the even more powerful emergence of strong, credible developers.

About the Author

Kishor  Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd.  is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.

6 Tips For Investing In Rental Property

Kishor Pate 2Kishor Pate, CMD – Amit Enterprises Housing Ltd.

From the initial choice to really purchasing your first rental property as an investment, there’s plenty of planning and work involved.

Buying rental property should be approached with a lot of circumspection and forethought so as to get optimal returns and avoid a serious financial setback resulting from a wrongly-chosen property.

There are a number of aspects to be considered when looking for an income-generating property.

You should begin hunting for your rental investment property with an unbiased approach to areas and all of the properties in your investing range.

Let us have a look at the top 6 things you need to think about when trying to find the best rental property.

1. AREA:

The quality of the location in which you purchase a rental property will determine the kinds of renters you will find, and how frequently you may face vacancies.

For instance, in case you purchase the home in an area near a university, the odds are that your pool of expected renters will largely consist of students.

You may be faced with frequent vacancies during the times when students generally return home for the holidays. Also, there would be a higher churn of tenants, when ideally you want long-term leases.

Examine the location and project for existing and planned public parks, shopping malls, gymnasiums, cineplexes, public transportation stops and all the other factors that would conceivably entice tenants.

You can peruse developers’ project brochures and also do online research to establish the saturation of such facilities in a neighbourhood.

You also need to know what new developments are coming in, and what has been zoned for special purposes by the local municipality.

You are looking for a region with excellent growth prospects where schools, business parks, shopping malls and entertainment zones are either already in place or planned.

Simultaneously, be wary of any new developments which could reduce the value of surrounding properties, such as by causing the loss of green open spaces or public parking facilities.

2. PROPERTY TAXES:

Property taxes aren’t standard across the board and, as an investor intending to earn money from rent, you would like to know about how much you’ll be losing to taxes.

High property taxes are obviously justified in very good areas which are superlatively connected. Such areas also usually attract long-term renters. Locations in upcoming growth corridors should be preferred.

3. EDUCATIONAL INSTITUTES:

Your tenants may be a family with kids, or intending to have kids, who would prefer areas which are near to one or more good schools. The presence of quality schools in the area you invest in will positively impact the worth of your investment.

Remember, the total worth of your rental property comes into play when you finally sell it, even though you’ll be mainly concerned with earning monthly rentals in the interim.

4. JOB MARKET:

Areas with growing employment opportunities have a tendency to draw more people – meaning more renters.

Obviously, the most desirable situation for you would be to own a rental property near to or well-connected to an established or rapidly growing workplace hub with reputable companies active and generating jobs there.

5. PROJECT QUALITY:

Today, rental home seekers prefer projects which add value to their lifestyle. Good projects with the best lifestyle deliverables may be out of their purchasing reach, but they expect to get such facilities in a rental home.

Projects with all the amenities like garden, children’s play area, sitting area for elders, reliable security and professionally managed maintenance are always preferred by families hunting for rental flats. The ambience inside the complex is very important to them.

6. RENTS:

You should be aware of what the typical rent in the region is. Make sure you find out enough about the region to judge where it is headed in the following five years.

Property taxes may rise and even if you can afford them now, significant developments in the area which increase property taxes may make them less affordable.

Single-family homes often bring renters looking for long-term leases. A dual-income family is definitely preferable over single professionals, as they are likelier to pay their rent on time and to be fiscally stable.

As a landlord, you would like to find an area where finding such tenants is likely and where such properties are available.

When you’ve narrowed down the right location, look for a property that can potentially yield you steady and growing rental income as well as appreciation on the capital value of the home.

Consider properties which are within your budget and slightly above it as well. The slightly costlier options can be paid for by some bank leveraging, and developers may be open to negotiating the price.

Also, remember that buying property can become even more desirable with some modifications and cosmetic uplifts, which will attract tenants who are willing to pay higher rents.

Such changes to the property will also serve the purpose of increasing the sale value of the home in case you want to put it on the market after some years of good rental income.

Every state and every city has areas which have both suitable and excellent properties when it comes to rental potential.

In Pune, areas like Undri, Kothrud and Ambegaon are excellent locations for rental properties because of the consistently high demand.

In Mumbai, the more cost-effective locations in Navi Mumbai such as Koparkhairne, Airoli and Ulwe are very good options, though property prices are naturally higher there.

Do your research well and ensure that you have your finances in place if and when a very good option comes up.

Remember, real estate investing does not begin with purchasing a rental property – it starts with creating the finances where you can purchase a rental property.

About the Author:

Kishor  Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd.  is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.