SPACE

Till recent years my realtor mind could associate the word SPACE only with 'an area', 'a field', 'a plot', 'an arena'. My interpretation of space was restricted to an office or a residential premise. 

As the grey on my hair, the interactions in business and the demands from life increased, I understood that space has more dimensions to it. I located an area inside me which could not be bought or sold, could not be divided by a boundary, could not be seen-only felt. I started going inwards, I realized that the clarity and cleanliness of this space is important as it is the origin of my thoughts and feelings.

I acknowledge its presence and visit it often now. This space feels comfortable, feels safe, feels home....the kind of peace, familiarity and security a home withholds when its family members bond with love and respect for each other. the energy, the purity, the radiance a home exhibits when its family members stand up for each other in tough times....that's the kind of luxury this space brings to me.

Space is an important aspect of Life. When used in alphabets, it creates words; when used in music, it creates symphony; when used in relationships, it creates bonding; when used in self, it creates awareness. This secret and sacred SPACE exists in all of us and its value is never subject to depreciation.

Pravin Makhija is the Founder - CEO of Dreams2Realty, a Mumbai based, award-winning Brokerage and Real estate advisory firm. A Commerce Graduate with a PG in Law, he is passionate about making real estate a more transparent and more service-oriented business.
www.Dreams2Realty.co.in

9 THINGS YOU SHOULD KNOW ABOUT RERA

RERA or The Real Estate (Regulation and Development) Act, 2016 is a Regulatory Bill, which will help regulate the Real Estate sector and bring in clarity for both buyers and developers. Here are 9 things you should know about this bill, touted as a key reform measure in the vast Real Estate sector. 

1) REGULATORY AUTHORITY

It establishes the Real Estate Regulatory Authority for that particular state as the government body to be approached for redressal of grievances. This will happen once every state ratifies this Act and establishes a state authority on the lines set up in the law.

2) RESIDENTIAL AND COMMERCIAL

This law vests authority on the Real Estate regulator to govern both residential and commercial transactions.

3) BUILDER OBLIGATIONS

This Act puts an obligation on the developer to park 70% of the sale proceeds in a dedicated  Bank account meant only for the completion of the construction of that project. This will ensure that developers are not able to invest in numerous new projects with the proceeds of the booking money from one project, and delaying completion and handover of the project to the consumers. 

4) TRANSPARENCY

This law makes it mandatory for developers to post all relevant information related to the project with the Real Estate Regulatory Authority (RERA) such as the layout, government approvals, Land title status, subcontractors to the project, the schedule for completion etc and pass this information on to the consumers.

5) CLARITY

The current practice of selling on the basis of the ambiguous super built-up area for a Real Estate project will come to a stop as this law makes it illegal. Carpet area has been clearly defined in the law.

6) PENALTIES

The law ensures that any delay in project completion will make the developer liable to pay interest as paid by the Consumer to the Bank.
The maximum jail term for a developer who violates the order of the appellate tribunal of the RERA is three years with or without a fine. 

7) AFTER SALES

The buyer can contact the developer in writing within one year of taking possession to demand after sales service if any deficiency in the project is noticed.

8) CONSENT

The developer cannot make any changes to the plan on the basis of which it was sold, without the written consent of the buyer. 

9) REGISTRATION

Lastly, every project measuring more than 500 square metres or more than eight apartments will have to be registered with the RERA. 

7 Good reasons why Real Estate is a better INVESTMENT than Gold or Stocks:

7 Good reasons why Real Estate is a better Investment than Gold or Stocks:

1. Leverage
Real Estate is the only investment option where you can purchase a property worth Rs. 1 Crore by paying only 5 Lacs down payment, today most developers in alliance with finance companies are offering attractive schemes of only 5-20% down payment balance at the time of possession or structured to suit your convenience. Leveraging in stocks with derivatives needs expertise and tends to be very risky.

2. Tax Benefits + Capital Appreciation
• Real estate investment is also beneficial because of tax exemption up to Rs. 2.5 Lacs on Interest amount and up to Rs. 1.5 Lac on Principal amount.
• When investing in an equity fund, an investor has to first decide which level of the market and fund category to invest in like, diversified, index, large/mid/small cap fund, sector-specific fund, etc.
• Similarly, while investing in a DF (Debt Fund), an investor has to decide when, at what level of interest rate and which scheme to invest in – FMP, liquid funds, ultra-short term, short term, income funds, gilt funds, etc. He needs to understand and appreciate the key risk factors affecting DF i.e. interest rate risks.
• There are a lot of factors to be considered before investing in an Equity / Debt fund, involves serious strategic analysis, not easy for everyone to understand and implement.

3. Reverse Mortgage
A Reverse Mortgage is a type of mortgage in which a homeowner can borrow money against the value of their existing property. It is a special type of loan against a home that allows the borrower to convert a portion of equity in the property into cash which they can receive on a monthly basis for all their life, which is not possible in other asset class.

4. Low Volatility
Prices are liable to change rapidly and unpredictably in the case of Stocks and Gold, whereas Real Estate prices change moderately and consistently. Fluctuating and Volatility of prices increase the risk involved in Stocks and Gold.

5. Supply of Land is limited
As we all know, the supply of Land is limited as compared to that of Gold or Stocks. Since the supply is less, Real Estate prices will keep increasing in the long term.
"The best investment on earth is earth".

6. Need v/s Want
Home-purchase is a need. It is one of the basic necessities of life. Whereas Gold is more of a Want than a Desire. We cannot compromise on our needs but we can definitely compromise on our wants.

7. Regular Income from Real Estate Investment 
An Investment in Real Estate can yield a regular income in the form of Rent which can help you to hold the property for a long term, which is not possible with Gold and even though stocks or equity of good companies declare dividends they are not consistent and if at all are paid annually.

Qualify your Broker

A few years ago, I read an article "If you find a Good Broker, Marry him.” The article highlighted the fact that there was a dearth of Good Brokers. It’s easy to point out the negatives of any Industry, besides, which industry is absolutely clean or clear of any issues? Be it the noblest and the most respected medical or the financial and accounting or for that matter, the legal profession, all of them have their share of problems. There are as many tainted Brokers and Builders as there are professionals from the above industries, unfortunately, since the Real Estate Industry is not organized and involves huge moolah, it attracts all the attention.

My question to all these people complaining about unprofessional-ism in the Real Estate Sector, do you guys discuss your medical problems, or your taxation or legal matters with anyone and everyone? No, we enroll a professional. We take references, check their credentials and only then open up to discuss our problems but when it comes to Real Estate, we would like to discuss the issues with anyone and everyone, be it the local baniya or for that matter the building watchman.
We feel Real Estate is only about that introduction to the potential buyer and seller, after which the Agent has no further role.

A good Real Estate Agent is like a conductor of a symphony, coordinating with the different players to make a successful transaction a reality. At different points in the process, the Real Estate Agent is a Salesperson, an Advocate, an Analyst, a Business Manager, a Consultant, a Negotiator, and a Marketer.
Unfortunately, Real Estate has no entry barriers, attracting anyone and everyone to the Industry from the roadside Paanwala to the so-called qualified financial consultant. Today everyone from the building manager to the society secretary, from the property owners cousin to his personal assistant, all of them want their piece of pie for providing information about a potential Seller to the Buyer. They trade Real Estate information, there is no service being provided.

So how do you Identify or Qualify a Real Estate Agent? One must look for the following qualities:

1. Knowledge of the Industry: Knowledge is power, having up-to-date information on the current Real Estate trends and the inventory in the local market.

2. A network of connections: A good real estate agent will have a vast Network of Contacts including other real estate agents and brokers, potential buyers and sellers, and all the other players in the real estate industry such as leading advocates, tax consultants, and mortgage loan advisors.

3. Use of Technology: Technology plays an important role in Real Estate Marketing, so be it the website or the Real Estate Portals or for that matter the Social Media, a good Real Estate Agent should be able to use all these channels effectively to market his inventory.

4. Attention to detail: A good Real Estate Agent is attentive to the unique needs of his clients. He is organized, follows up aggressively with leads, communicates well, and pays attention to the needs of his clients.

5. Problem solver mindset: A good Real Estate Agent comes up with creative solutions to problems or issues, knows how to properly showcase a house to make it more marketable and develop creative listings to attract the right buyers.

6. Honesty and integrity: Most important, a good Real Estate Agent should have great work ethics, a professional reputation and must practice high ethical standards.

In conclusion, a good Real Estate Agent is that friend or guide who is well connected with his ears on the ground. He is a location expert, able to identify and offers opportunities and has the relevant knowledge of the Industry along with updated information on all the statutory compliances. He has the temperament and skill to negotiate the best price and smoothly close the transaction, pampering the egos of both the buyer and the seller.

Demonetisation Good for Real Estate

There have been a lot of talks these days about Demonetisation and its effects on the economy as a whole, and Real Estate in particular. I am no Economist and may not be able to comment on the impact of demonetization on the Indian economy, but being a person associated with Real Estate for the last 25 years, can surely confirm, that the effects of demonetization on real estate will be only a knee jerk reaction. It will be more about the sentiment and the uncertainty, which will make most buyers defer their decision. The reason I say Real Estate will not be impacted due to Demonetization is because to a large extent Cash component was eliminated from the Real Estate sector, atleast in most parts of Mumbai, and especially in the transactions with the Builders and Developers. Let me explain to you the reasons behind the elimination of CASH from Real Estate:

(1) Sweeping reforms in Real Estate in the last decade, including valuation of all properties as per Ready Reckoner, has ensured both buyer and seller do not undervalue their property. As a consequence, most transactions are all cheque and clear of any CASH.
(2) Also with the current purchasing power vested in the hands of the working professionals, and a double income nuclear family, who, on the basis of their salary income, are entitled to large Home Loans. This Home Loan, along with their lifetime savings, have ensured all transactions are in full cheque and there is no CASH involvement.
(3) Besides with the corporatisation of the traditional but large Real Estate companies, like the Raheja’s, Hiranandani constructions or the Lodha and Oberoi’s, and also with large corporate’s like TATA, L & T, Shapporji Pallonji entering the Real Estate Development, the CASH component has been virtually eliminated.
(4) Most Developers and Builders today are not dependent on the traditional individual money lender (Loan Sharks) for their funding and have access to loans and funding from Banks, Institutions, and Funds which have eliminated the CASH component from the Real Estate sector.

So relax and be rest assured, this Demonetisation will not affect Real Estate beyond the temporary knee-jerk reaction, infact with the current market sentiment, there will be OPPORTUNITIES which you should fully exploit. For its very wisely said, “Do not WAIT to buy Real Estate, buy Real Estate and WAIT…”

CLICK it

My mobile has been beeping continuously since last night with WhatsApp messages flooding in, from various groups- ''News channels had prepared for Clinton and Trump, Modi came out of syllabus''

And- ''The Delhi smog is finally explained...it wasn't crop burning, it was cash burning''

Then - ''While America is still in labour, Modi delivered.''

Another message, the best one- '' Ek 9\11 main America hil gaya, dusre 9\11 main India hil gaya''

I am amused at not just the wit of people creating these messages, but also at the speed at which these kind of one-liners emerge! This instant humour apparently is the latest addition to the tribe of INSTANTS-instant food, instant wash, instant cash, instant loan......name it and it is instantly available.

A few decades ago, trunk calls and telegrams were the fastest modes of delivering urgent messages, these days, a click on 'send', and the message is delivered . 'Click' then was synonymous with relationship status....today 'click' is synonymous with speed.

         In those days women consciously spent long hours cooking a meal, brewing the tea, boiling drinking water. Maggi did not come with its two minute noodles, Taj did not come with its ready teabags, Eureka Forbes had not introduced its Aqua guard to those women's rescue! Men spent long hours reading newspapers and children spent long hours playing time consuming games like hide-n-seek and saakhli.

There was no hurry in finishing tasks nor was there an urgency of meeting deadlines. I have experienced the leisure of that time as well as the fast pace of today. Though I admit missing the serenity of those years, I do admire the latest technology and applications that quicken and comfort life processes today, the patience of the older generation and the skill of the younger generation makes India a highly progressive country.

Similarly, your search for a Dream HOME deserves patience and perseverance, skill and dedication. It is not only an investment of a lifetime  but also expresses each of its member's dream. Once you find it, do not miss it... 'CLICK it'

Commercial versus Residential property

In the last 25 years of my experience in Real Estate, this is the first time I have experienced a situation so unique wherein the commercial properties as in office premises are CHEAPER than residential premises. The demand for commercial premises is primarily based on the large corporates, be it the large Indian corporates or the international companies setting up their base in India. In the last 5 years with the major slump in the international markets there has been a huge drop in the business sentiment deterring most corporates from any kind of growth or expansion for the time being. The purchase or sale of commercial properties by investors who lease out the same to such corporates is primarily based on such demand for lease, otherwise the demand is for smaller units for self consumption by professionals, self employed and slightly larger units by exporters and small and medium sized Indian Companies who do not mind investing or ploughing back their profits in Real Estate and creating an asset for themselves. 

Typically commercial offices are at least 25-30% higher than the residential premises in the same location, but today because of the International Business environment, the economic slump and the lack of demand on lease for the first time in the history of Real Estate commercial office property is available at the same price as residential properties if not cheaper. So gone are the days when an investor would prefer to invest in commercial premises over residential property. Today even though residential premises do not offer more than 2-3% rental return as against 8-9% return p.a by commercial premises, the capital appreciation in Residential Properties have more than adequately compensated for the rental return.

The huge population, the economic progress in the last few years and the nuclear family concept of our country has contributed to the massive demand in Residential premises and even though with the current policy changes (FDI in retail & aviation) there will be a demand in commercial premises, but it will not be able to match up with the Residential Properties.

www.dreams2realty.co.in