Tuesday, 29 November 2016

Pledging PF to buy home may soon become a reality

Labour Secretary said the proposal will be placed before the EPFO's CBT meeting and once approved, the scheme will be available for the subscribers.




NEW DELHI: Retirement fund body EPFO may soon introduce a scheme to allow its over 4 crore subscribers to pledge their provident fund to buy low-cost houses and use the account to pay equated monthly installments.

"We are working on a housing scheme for members of the Employees' Provident Fund Organisation (EPFO). Under it, members will be allowed to pledge their PF accumulations to buy homes," Labour Secretary 
Shankar Aggarwal told PTI.

He added that the proposal will be placed before the EPFO's Central Board of Trustees meeting expected next month. Once approved by the 
CBT, the scheme will be available for the subscribers.

Finer points of the scheme, as to what extent subscribers will be eligible to avail loans and what will qualify as a low cost house, are yet to be worked out.

Aggarwal further said: "We don't want to impose anything on the subscribers. Therefore, we will not buy land or build houses for them. They will be free to choose their own homes from the open market."

The panel had suggested this scheme for low income formal workers who are EPFO subscribers and could not buy a house during their entire service period.

Under the proposed scheme, there will be a tripartite agreement between member, bank/housing agency and EPFO for pledging future PF contributions as EMI payment.

Last year, the proposal for facilitating the EPFO subscribers to buy low cost homes was listed on the agenda of the CBT meeting held on September 16.

A report of an expert committee on housing facility for the subscribers was also presented to the trustees during the meeting.

The committee has unanimously recommended a scheme to facilitate subscribers to buy houses where they will get an advance from their PF accumulation and will be allowed to pledge their future PF contribution as EMI (Equated Monthly Installment) payment.

The panel had suggested that subscribers will purchase a dwelling unit with loans from bank or 
housing finance companies and hypothecation of property in favour of the latter.

It was suggested the benefits under the scheme of Ministry of Housing and Urban Poverty Alleviation can also be extended to the beneficiaries of the scheme.

In May, Labour Minister Bandaru Dattatreya had told Lok Sabha in a written reply: "Government is exploring the possibility for providing a suitable low-cost housing scheme for subscribers of Employees' Pension Fund. It is in preliminary discussion stage."





Saturday, 26 November 2016

Gr Noida's Jewar International Airport gets NOC from defence ministry

The Jewar airport project was also taken up keenly by the previous Mayawati government in UP.



LUCKNOW: The proposed Jewar international airport has moved a step ahead with the Ministry of Defence giving formal no-objection certificate for the ambitious project in Greater Noida, adjoining the National Capital Region of Delhi.

Sources said the NOC was given only last month after BJP MP from Gautam Buddh Nagar and former minister of state for civil aviation Mahesh Sharma sought a push for developing airports in small towns as part of regional air connectivity scheme.

The Jewar airport project was also taken up keenly by the previous Mayawati government in UP. In fact, the project was one of the key features builders and real estate bodies used to lure the buyers with to invest in the upcoming residential and commercial projects.



Thursday, 24 November 2016

Homebuyers move consumer court against DB Realty over delay

These homebuyers are among the 3,500 customers who have been waiting for possession of their homes since 2014 despite having paid 90% of the total amount.



MUMBAI: A group of more than 50 homebuyers has approached the Maharashtra State Consumer Disputes Redressal Commission against DB Realty over delay in delivery of apartments at the developer's project DB Ozonein Mumbai's Dahisar suburb.


These homebuyers are among the 3,500 customers who have been waiting for possession of their homes since 2014 despite having paid 90% of the total amount. The matter is scheduled to be heard on September 2.


Another group of about 200 homebuyers at the same project is in the process of moving the National Consumer Disputes Redressal Commission against the builder.


Until Saturday, more than 100 of these homebuyers had recorded statements for lodging a complaint at Kashimira police station in Mira Road. In 2008, DB Realty's subsidiary Neelkamal Realtors Suburban Pvt Ltd had started the pre-launch bookings for the project.


The construction work for the project was started in 2009 and the company had assured its buyers of possession in 2014. "We have been making construction-linked slab-wise payments regularly since 2009. We were promised delivery of our homes by 2012 verbally, while on the agreement it was mentioned as 2014," said Fahim Sutriwala, one of the buyers.





DB Realty's spokesperson said in an emailed response to ET's query, "Since the matter is sub judice we would not like to comment." The project is spread over 16 acres with 25 buildings and falls under the jurisdiction of the civic authorities of both Mumbai and Mira-Bhayandar.


"In April 2016, the company told us that they don't have funds to complete the project...Now the company is saying the first four buildings will be delivered by January 2017. However, not many of us are ready to trust this deadline either," said Sheetal Kadam, one of the homebuyers who have moved the state commission.


Home buyers are questioning as to how the company can say it does not have the money to complete the project if they have already paid nearly 90% of the total amount. While the recently cleared Real Estate Regulatory Act expects a developer to maintain 70% of sales proceeds in a separate bank account to cover cost of construction and land, the current system does not have any such restriction.


The home buyers said they have been burdened with home loan instalments as well as rents during this period, and therefore, need to be compensated. The possession deadline has been extended at least four times from December 2014 to December 2015 and December 2016, while now the company is giving assurance of phased completion of the project starting January 2017, they said.





Tuesday, 22 November 2016

Narendra Modi takes up flat buyers’ concerns in his speech

PM Narendra Modi bats for flat buyers after the realtors, especially in the Delhi-NCR region, are being blamed for prolonged delay in delivering projects to their clients

Prime Minister Narendra Modi during his address to the nation on Independence Day Monday. Photo: Pradeep Gaur/Mint



New Delhi: Breaking his silence on the homebuyers’ sufferings due to delay in real estate projects, Prime Minister Narendra Modi brought up the issue in his Independence day speech delivered from the Red Fort on Monday.

“Builders show nicely printed booklet to buyers to lure them. The middle class do not have technical knowledge but keep giving builders money and yet the builders don’t build the houses on time,” Modi said.

The real estate market in India, especially in the Delhi-NCR region, has been characterized by prolonged delay in delivering projects, with buyers organizing themselves into associations and protesting to get the authorities’ attention.

Some have reached out to the prime minister himself. The buyers from Jaypee Wishtown project organized a protest last month and signed a petition to the prime minster, asking for help in getting the builder to finish the project.

While the prime minister had constantly mentioned the issue of lack of affordable housing in India, he has steered clear of talking about widespread delay in real estate projects, especially in the Delhi-NCR regions.

Empathizing with the public about the emotions attached with buying a housing, Modi said, “my fellow brothers and sisters, middle class persons dream of constructing a house, buy a flat.”

“Middle class invests their life long savings and capital in this one-time investment. To protect the interests of buyers, we brought forward Real Estate Bill to regulate the builders. This measure will help the middle class home buyers,” the prime minister said.

The central government passed the Real Estate (Regulation and Development) Act (RERA), 2016 in March to clear the way for setting up a real estate regulator, with a provision that can sharply improve transparency.

“This means the matter has reached the prime minister and the government is up to something, so very soon a clampdown can be expected on the builders,” said Nrip Kumar Mehta, coordinator of Wish Town buyers’ movement and a buyer in Jaypee Krescent Homes project in Noida.

“However, we haven’t got any formal response from the Prime Minister Office,” Kumar added.




Saturday, 19 November 2016

Telangana CM KCR wants 2-BHK scheme to be expedited

CM convened a review meeting at his camp office during which he took the stock of the scheme.





HYDERABAD: CM K Chandrasekhar Rao on Sunday directed officials to expedite the works of free two-bed room houses scheme for poor. The government has fixed a target of building three lakh houses under the flagship scheme.


CM convened a review meeting at his camp office during which he took the stock of the scheme. A release issued by the CMO said he wanted different approach."In cities like Hyderabad, where land is scarcely available, we must go for buildings with nine or ten floors, while in rural areas we can build independent houses," he said in the meeting.The government has proposed to build two lakh houses in districts and one lakh houses in Hyderabad this year. He wanted the officials of both housing andMA&UD to take steps to turn slums in Hyderabad into well-developed colonies with proper structures including roads, drainages, and regular supply of drinking water and electricity.


The CM said the government would give incentives to companies coming forward to build two-bed room houses. Supply of free sand, and cement at the factory price were among other incentives proposed.





Thursday, 17 November 2016

What if builders throw up their hands on unfinished projects?

On Friday, one of India’s largest builders threw up its hands and told the Supreme Court that it did not have the money to give refunds to home buyers in some of its projects. It said that if it had the money it would have completed the project instead.

This is symptomatic, in a way, of the state of many builders in the country with projects to be finished, home buyers breathing down their neck, but no cash flow to restart stalled construction at these projects.

Yes there are bright spots with some builders standing out of the crowd, but there are just too many of them saddled with unfinished projects. Home buyers are worried, and so should the government.

The court, in the Unitech case, has asked for the list of home buyers who want a refund and those who want possession of their homes with interest of course. Let us see how the court finally resolves the issue, especially when the builder has said upfront that it does not have money to pay refunds.

Such situations shouldn't arise but these are tough times when many builders have their backs against the wall.

But every case like this shouldn’t have to be decided by the courts.

That brings me to the point that a group of home buyers have been raising on the draft rules of the new real estate regulatory act. They point out that the rules are unclear so far on how existing projects, many of which are massively delayed, will be treated when they register with the to-be-setup regulator.

If the rules finally do not take into account the fact that in many ongoing projects builders have collected more than 80-90% of the money from buyers and yet those projects are stuck, and the need is to ask builders to keep aside whatever amount of money is required to finish the project (not just what the buyers owe to the builder), it will not serve the purpose.

With just 5-10% of money to be received from buyers, who will finish these projects then? Will the home buyers be asked to pitch in more? Will that be fair? If the builder throws up his hand, like Unitech has, what happens to the project and its buyers?

RERA can be helpful in bringing sanity to this industry and help it mature, but only if some of these questions are answered.






Tuesday, 15 November 2016

Builders gyp MHADA of 5,000 flats in island city

Based on the revelation, the activist who posed the RTI query pegs the loss at Rs 14,000 crore



Maharashtra Housing and Area Development Authority (MHADA) has not received around 5,000 flats from private builders since 2006, reveals a reply to a query raised under Right to Information (RTI) Act.

To an RTI application by social activist Kamlakar Shenoy, the housing authority has admitted that in 266 cases it is yet to receive flats with a cumulative area of 1.05 lakh sq m in the island city. Shenoy estimates the claims value of these flats to be nearly Rs14,000 crore.

The issue pertains to redevelopment of the cessed buildings in the island city. The cessed buildings are mostly those buildings which were built in the first half of the last century and whose rents are protected under Rent Control Act. As rents were frozen, owners lost interest in maintaining these buildings.Subsequently, these buildings were handed over to MHADA for repairs and maintenance, and in return, MHADA collects cess on rent from tenants of these buildings.

There were 22,000 such buildings in the island city (between Colaba and Nariman Point in the south and Mahim and Sion in the north of Mumbai); of these, around 2,000 were redeveloped by MHADA and 4,000 by private developers.

The private builders get extra FSI for redeveloping these buildings and have to share the excess FSI awarded to them with MHADA and hand over a pre-decided percentage of constructed flats to MHADA free of cost. In 29 cases, FIRs were registered by MHADA in various police stations against builders for selling these flats without handing them over to it. However, in none of the cases has MHADA initiated civil proceedings to take these flats back from builders, Shenoy pointed out.

Considering the rate of real estate in island city is between Rs 40,000 and Rs 50,000 per sq ft, the total amount locked in these flats is around Rs 14,000 crore.

Housing rights activist and convenor of Ghar Bachao Andolan, Simpreet Singh, said, “Considering this government has given the slogan `Housing For All by 2022', it is its duty to recover flats which are due to MHADA and allot them to economically weaker sections of the society.“

In response to text message, MHADA CEO Sambhaji Zende said that he was out of station and will be available for comment only on Thursday.







Saturday, 12 November 2016

High-rise forced to admit member after cops show up

Grand Paradi at Kemps Corner had illegally demanded a massive transfer fee from a flat buyer



A Kemps Corner high-rise that had demanded a massive transfer fee from an apart ment buyer in violation of norms was compelled to accept him as a member after authorities showed up and entered his name in the society register.

Businessman R Shah had purchased a flat in Grand Paradi two years ago, but the society refused to register him as a member unless he paid a transfer fee of Rs 33.5 lakh.According to the law, a housing society cannot demand more than Rs 25,000.

The flat needed urgent renovation, but Shah could not order any work without the membership. After a series of letters failed to resolve the dispute, Shah approached the deputy registrar of societies, which ruled that the demand for Rs 33.5 lakh was illegal and asked Grand Paradi's managing committee to collect only Rs 25,000.

The order was issued in March this year. The society appeal against it, but officials again ruled in Shah's favour and asked the managing committee to register him as a member.

Committee members apparently continued to drag their feet on the issue, forcing the Shah family to again seek authorities' help.

On June 27, the officer of deputy registrar asked the authorised official on the case, Anil Jadhav, to ensure the registration formalities were completed. Jadhav visited the society twice, but each time he was turned away.Finally, the deputy registrar wrote to the tehsildar's office.

Last week, the tehsildar and the city's executive magistrate ordered the Malabar Hill police to visit Grand Paradi and enter Shah's name in the register. A share certificate was also issued. “I hope this serves as a wake-up call that such intolerance and highhandedness will not be taken lying down,“ Shah wrote in a letter to the society.

Despite several attempts by Mirror, society chairman Jyotsna Tanna didn't respond to calls and messages.





Thursday, 10 November 2016

Court edge for G L Raheja's son in clash for his Rs 11,000 crore estate

The siblings are clashing in court over a Rs 11,000 crore estate left behind by their late father upon his demise in March 2014.




MUMBAI: In a setback to Sonali Arora in her legal battle against Sandeep Raheja, both children of late construction czar G L Raheja, the Bombay high court recently pushed the dispute back one step in her brother's favour.


The siblings are clashing in court over a Rs 11,000 crore estate left behind by their late father upon his demise in March 2014. An appeal bench of Justices Abhay Oka and P D Naik set aside an order passed 10 months ago by a single judge and directed that preliminary objections to her suit be heard and decided first.


Her plea is for administration of a majority of their late father's estate. In other words, it is for distribution of the estate to the legal heirs. Her brother's case is that control of the entire group vests with him as his father had added Sandeep's as the second name (after his own) to shares of each of the four holding companies of his empire.


The order disposed of Sandeep's appeal against an order passed by Justice Gautam Patel last October. Justice Patel had dropped the preliminary issues over maintainability of Sonali's suit framed last February. The issues were whether her claim to administer the estate was legally delayed or barred by other legal provisions.


G L Raheja died two years after he moved the high court against his only son, in a battle over control of the group's estate. He had accused his son of "usurping'' control contrary to a family agreement under which he remained in overall control of the group companies. Sandeep denied such allegations and has contested the claim by raising a preliminary challenge to it even being heard. His challenge is pending in court.


In the meantime, following her father's death, Sonali moved the high court and was allowed to step into her father's shoes to continue the legal battle he started. Last year, though, she also filed a separate suit against Sandeep, seeking rights for administration of properties owned and held by her father, excluding those held in trust by her brother.


Justice Patel observed that there was no question of the claim being barred by delay or issues of ownership because all that Sonali claimed was administration of the estate. "She has not laid claim to any particular asset as being held benami," the judge said and held that the preliminary issues cannot survive and set out to hear both sides on merits of the case.


Aggrieved, Sandeep appealed against that order as it meant his sister was entitled to an order on her plea. His contention is that her plea is barred by law and ought not to be heard. The bench, without going into merits of his contention, though, held that once preliminary issues of jurisdiction were framed by the judge, it was not open for him to say these did not arise. Sandeep's lawyers also argued that in any case, the suit filed by G L Raheja ought to be heard and decided first, as it also involves questions arising over ownership of the shares and other assets. Sonali's lawyers said she has every right to file a parallel and independent claim which can be heard even now, for the estate exclusively held by her father. The bench, in its order on August 5, citing precedents laid down by Supreme Court, said once an objection to jurisdiction of court is raised at the interim stage, the court has no choice but to frame the preliminary issue and decide it after a proper hearing. This means that it is back to the beginning for Sonali. The single judge will have to decide maintainability of her plea. She may decide to challenge the order in the Supreme Court.


Either way, the hearing on her claim stands deferred.




Monday, 7 November 2016

The unofficial renaming of the suburbs- Developers touch new lows

Take away my good name & Take away my life- Anonymous
Though clich├ęd, I cannot resist quoting Shakespeare from Romeo & Juliet here “A rose by any other name would smell as sweet” due to the apt context. But apparently Mumbai builders seem to disagree with the Bard and have launched into a renaming spree while selling properties. Obviously they firmly believe that the so-called “lesser” known locations will benefit from them being herded along with their more “popular” cousins. Yeah! As if calling Dahisar as Upper Borivili will change the property value of a housing project overnight and give it the sheen and polish it was missing till now.
Zero effort “relocation”


Maybe the builder communities can pressurize the respective municipal corporations to change the geographical boundaries of their jurisdictions and probably coerce the local, jurisdiction-bound police stations too to stretch their precincts. Imagine how Borivili’s “poor cousins” Dahisar & Mira Road benefits immensely after this renaming is done with. The Sanjay Gandhi National Park, in all its splendour and glory, not to mention the wildlife, will suddenly come closer to Mira Road. I mean who wouldn’t want their address to read as XYZ Heights, opposite SNGP, Mira Road? That too without any of them gravitating an inch towards each other. 


If the readers are confused about moving to Upper Worli from plain old Lower Parel as the result of a single full page advertisement in the leading newspapers, without any legal agreement, you have the builder fraternity to thank, for this overnight miracle. They have researched extensively and found out that Wadala residents were extremely distraught about their location on the map and decided to move them a little bit to the south of Mumbai. Not literally but at least on the first page full-page ad. And suddenly, New Cuffe Parade was born.


Developers-Taking buyer’s for granted
Every suburb in Mumbai, Thane & Navi Mumbai has its own share of history and I am sure its residents would be proud of it, without ever feeling the need to “borrow” some from its next-door neighbour. Today’s property buyer is an informed one and certainly has enough “vision” to see the signboards that proclaim the suburb’s name. But the property developers have a single aim while doing so-SELL PROPERTY and the present lot will “move mountains” in their quest.


Cases of blurring boundaries are on the rise by the day and developers are trying make hay by shifting locations, as seen in Upper Worli & Upper Borivili, and in certain cases, making them jump over long distances too, as seen with New Cuffe Parade. At this rate, I am sure Virar will soon become “Super Upper Borivili” and Kalyan/Dombivili will be known as “New Thane”. This senseless renaming has to stop and fortunately we buyers are legally fortified through the Consumer Protection Act, 1986 which takes a strong stand against misrepresentation of facts. If a section of property developers feel that their prospective buyers will buy their bluff, they sure need to reconsider their strategy, if not rename it!

Credit : Ramprasad Padhi
Founder & CEO - MumbaiProperties
President - Association of Real Estate Agents (AREA)


Friday, 4 November 2016

‘Maha housing board's policy to dilute rights of tenants meant to favour builders’

Former Congress MP Milind Deora, whose south Mumbai constituency contains a large chunk of the over 16,000 cessed properties, blamed the government for trying to undermine tenants’ rights yet again.



MUMBAI: The state housing authority's controversial proposal to dilute the rights of tenants during redevelopment of old cessed buildings in the island city has evoked strong reactions from various quarters.

Former Congress MP Milind Deora, whose south Mumbai constituency contains a large chunk of the over 16,000 cessed properties, blamed the government for trying to undermine tenants' rights yet again. "By reducing the tenant consent clause from 70% to 51%, Mhada is clearly batting for landlords and property redevelopers. This is the third such attempt in less than two years of the BJP-Shiv Sena government," he told TOI. "We will take to the streets in conjunction with all tenants' groups and ensure that this proposal does not see the light of day."

On Sunday, TOI reported that Mhada wants to curb tenants' rights during redevelopment by reducing the consent clause from 70% to 51%. If two or more buildings are proposed for redevelopment, then 51% consenting tenants of both properties will be sufficient, according to the proposal.

Tenants are currently protected under the Rent Control Act. Landlords have complained that rents have been frozen since the past many decades; tenants pay as little as Rs 100 to Rs 300 a month as rent while occupying large flats.

Mhada CEO Z Z Patil submitted the proposal to the municipal chief last month and urged him to incorporate the suggestions in the new development control rules.

Viren Shah, president, Federation of Retail Traders Welfare Association, said his members will approach chief minister Devendra Fadnavis to ensure tenants' rights and the 70% consent clause is protected. "This proposal is clearly meant to favour builders. We will call a tenants' meeting and chalk out protest plans."

NGO Janhit Manch too said the proposed amendment is "clearly at the behest of builders". "This will result in developers appropriating large tenanted premises and oust tenants using harassment tactics," said the NGO's vice-president, Utsal Karani.

Arun Zaveri, secretary, Federation of old Buildings Co-op Housing Societies & Tenants Associations, said Mhada and the state government seem happy to please builders at the cost of 30 lakh tenants. "It is a silly idea of Mhada to club slums with old cessed buildings for redevelopment. We shall be happy if the Mhada chief takes care of all Mhada buildings and colonies first."

Zaveri added that tenants are willing to co-operate for redevelopment if developer is "reputable, good and honest, but not when the entire scheme is loaded in favour of builders".

Sena MP from south Mumbai Arvind Sawant pointed out that the government said that old buildings be redeveloped by Mhada, instead of handing them over to private developers. "The state government must make a new law for redevelopment of old buildings," Sawant added.

Early this year, there were large-scale protests by tenants and political parties, including Shiv Sena and Congress, when the housing department tried to increase rents drastically for tenants living in large flats. According to that proposal, the state planned to target families occupying flats over 862 sq ft and commercial properties over 500 sq ft. However, Fadnavis was forced to withdraw it following stiff opposition from his own party.






Wednesday, 2 November 2016

Commercial properties should do well: Anand Piramal


Piramal Realty, promoted by Ajay Piramal group, has launched five new real estate projects in Mumbai, the latest being a commercial project. Anand Piramal, executive director of Piramal group, discusses the company's strategy and plans with Raghavendra Kamath. Edited excerpts:


How have your launches fared given the slowdown in the real estate market?


Without any advertising, we sold around 250 apartments in our Vaikunt project in Thane in the first phase in just three months where we hope to sell only 75 units. In the second phase, we have sold 30 units. There has been a 25 per cent appreciation in prices since the launch of the project in September. We have seen a good uptake. You are right, there is a slowdown in the market and it will take two to three years if it has to come back in a big way. But, there is a good demand for projects of reputed brands. People feel with approval issues and cashflow problems, only good developers can execute and deliver their promises.

You were predominantly a residential developer. Why did you shift towards commercial properties?

We are pretty bullish that if India grows at 8-10 per cent, commercial properties should do well. We want to have a healthy mix. If residential would provide good cashflows, office properties will give positive yields and annuity like income. We are looking for land parcels in Mumbai for both commercial and residential projects. We are also open to joint ventures if our vision and values match with that of our partner’s.

Will you consider moving beyond Mumbai?

No. Ours is a Mumbai-only strategy. We will do projects that are within two hours from our office in Lower Parel. We believe geographic concentration will bring good results. Besides, it is a local business and understanding the complex approvals in one region is extremely important.

Piramal Realty outbid other players in the past to buy land parcels. Do you think you overpaid for some parcels?

No. Whatever we bought have given us good returns. In Mumbai, if you buy a good land parcel, there is value in it.

Do you think land values have become more rational now?

Now that distress in the system is pinching people, they’re offering good deals than they would otherwise have given. Land prices would have become a little bit rationalised.

What is the vision for your company?

In five to seven years, we want to be known as India’s most admired real estate company not in terms of scale and profitability but the role played by it in improving people’s lives and the country’s progress.

How will you achieve it?

One of our initiative is Piramal Assurance wherein we can buy back the property from the buyer at a five per cent discount to the market value between now and the possession of the project if he or she is not happy with the progress of the project or changed their mind for any reason. The value of the property will be done by two independent valuers.
 
Besides your existing projects, are you looking to launch more projects?

Yes, we will launch the Mulund project in the next couple of months. We’re evaluating two to three land parcels.