Indian Millennial Homebuyers: The Times Are Changing

Pharande Vaarivana

Anil Pharande, Chairman – Pharande Spaces

Everything that your parents may have communicated to you about owning a home may be incorrect if you are a millennial under the age of 35. However, don’t blame yourself for this – your parents operated by a rigid set of values that they have simply passed on to you. It was a simple enough formula – get a good education, get married, have kids and buy a big flat in the city. This is – or was – the quintessential Indian middle-class dream.

This dream – and the formula – may continue to have relevance to quite a few younger people in India, but the way life works for today’s millennials in India is no longer so cut and dried as it was for their parents. In the first place, we have a rapidly evolving and increasingly competitive job market in India.

The career charts of Indian millennials are no longer as predictable as those of their parents were – nor does a sound college education mean that one can actually get the best jobs anymore. Also, millennials are the ‘job hopping’ generation which wants to sample different lines of work and also different companies with varied work cultures before they ‘settle down.’ This is one reason why many Indian millennials initially prefer to rent rather than buy their homes.

Secondly, because their careers are no longer cast in the concrete of limited options like engineer, doctor, lawyer, banker or ‘Government job, young Indians today are marrying later and are not necessarily in a hurry to have children once they do, either. When they do decide on having children, having one child is, more often than not, enough. The typical millennial family of today is essentially nuclear and does not subscribe to the values that drove the much larger and much more complex joint family package.

Pharande Vaarivana

They are more flexible and value their freedom, so they are not overly invested in making heavy financial commitments as soon as they are able to (making such commitments was a defining factor of the previous generations of Indians).

What does this mean in terms of their home purchase decisions? For one thing, it means that a smaller flat – even for a dual-income household – is perfectly adequate to begin with. What increasingly matters for the young, smart socially conscious Indian nuclear family of today is not necessarily size, but:

  • Value for money (banks and developers should understand by now that dual income does not equal dual gullibility)
  • Being able to get to and from work conveniently (not because getting to work fast matters most, but because getting home faster leads to better work-life balance)
  • Good public transport connectivity (because using public transport is good for the family budget as well as the environment)
  • Two car parking spaces (because two earning members may need to be as mobile as possible)
  • Fast broadband + Wi-Fi connectivity and other smart home features (because many Indian millennials can and do work from home, or from home as well as an office)
  • Environmental sustainability of the project (because most Indian millennials do believe that the world can become a better place)

Upgrading to larger homes should be an option, but it is by no means the only acceptable path for the Indian millennial to follow. For the previous generations, the ‘upgradation’ route was more or less socially enforced – but that trend is now history.

Strangely, many residential developers in cities like Pune have not caught on to the reasons why their projects are not selling as fast as they used to. They choose to believe that it is because ‘market conditions’ are currently ‘slow’. That may be true, but the larger fact is that housing projects that appealed to their parents may not have the same attractiveness for today’s millennials.

Projects that do not meet the requirements of today’s younger generation of working professionals are not going to work for this buyer segment, regardless of the market conditions.

One truth about the real estate market has not changed, even for millennials – while it is not all about ‘location, location, location’ for them, location is still certainly very important. It’s just that ‘central location’ is no longer the Golden Rule – Indian millennials are far more inclined to purchase their first homes in the suburbs, not in the city centre.

They are also far more likely to buy homes in organized townships with stand-alone infrastructure and their own schools, healthcare and shopping / entertainment facilities. Townships with their own office complexes offering potential walk-to-work or cycle-to-work possibilities and those close to major employment hubs such as IT parks and manufacturing belts are the most preferred.

About The Author:

Pharande Vaarivana

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in West Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

Infrastructure And its Correlation to Home Buying

Pharande Vaarivana Pune

Anil Pharande, Chairman – Pharande Spaces

In India, as in other countries, it is a simple fact that localities which are as close as possible to important workplace areas will be most consistently sought out by people looking to buy homes. Therefore, projects with great connectivity by railway and road, see the highest demand for residential properties.

Property investment is always driven by the infrastructure in and around a locality. From sufficient roads to reliable water supply and drainage, infrastructure includes all the physical characteristics which contribute towards creating sustainable communities. Unsurprisingly, property costs close to infrastructure including airports, railway stations and roads are higher than in other regions.

If a location does not offer reliable electricity and water supply, connectivity, public transportation stops and sanitation by ways of good sewerage and waste disposal, it will not work as a residential destination regardless of what else it offers. All these are services that nobody living in a modern Indian city is prepared to live without.

From a property marketplace outlook, sufficient infrastructure in an area includes everything that leads to an easier, convenient lifestyle which does not have to contend with any kind of shortages, service outages and breakdown of public facilities.

Well-planned roads and public transport

Roads are required to make transport quicker and simpler. They are important right from the time when basic infrastructure and initial real estate development are being put in place, as raw materials and labour has to be able to reach the location. Once the area is established, roads let people travel to and from work, for kids to get to and from school and for access to shopping and entertainment.

Proper planning of road, rail and public transport nodes is very important. The key factor to be kept in mind during this planning is that people do not want to too close to bus depots, railway stations, shopping areas and industries businesses – but neither will they wish to be too far away from them.

Reliable supply of essential utilities

In a developing country like India, there are still many towns and suburbs of cities that do not enjoy reliable water and electricity supply, garbage management and public security features. With the income of typical Indian families constantly growing, today’s urban homeowners are willing to spend more to get access to seamless water and electricity, and adequate security.

Naturally, residential complexes that provide 24×7 water and electricity supply and round-the-clock security are far now highly favored. This is what has led to the growing momentum of township development in Pune and even more so in PCMC. Housing projects in places that don’t have reliable utilities and where security is a concern do find takers – but these are usually exceptionally budget-strung buyers who resign themselves to having to wait for everything to fall in place at some stage.

Sanitation infrastructure

In India, there has been rising awareness of the minimum levels of sanitation that a household should have access to. A new location will only start attracting real demand from homebuyers if it offers appropriate measures of sanitation such as municipal road cleaning, trash removal, sewage and waste water disposal, and other related services. Without these services, life becomes unhealthy and intolerable. A location’s score on the sanitation front is a very important criterion for homebuyers who are shortlisting housing projects in which to buy a property.

Social infrastructure: Schools, hospitals, shopping and recreation

Indian families put great onus on the availability of schools in a residential neighbourhood. This is why areas with good schools in the vicinity fetch higher property rates than most others. This is not only a question of convenience for Indian parents, but also of the safety for their children. Because of life’s uncertainties and the rise in road and domestic accidents, hospitals are another component in an area’s social infrastructure that is of critical concern for homebuyers. They expect quick access to medical facilities –  this is non-negotiable.

Recreational open spaces such as parks are also consistently in favour from city dwellers that wish to experience nature to some extent, and thereby be able to find some refuge from the urban madness that rules most of their days. A locality that offers water bodies, gardens, parks and playgrounds in the vicinity are considered premium.

Developers of large integrated townships are aware of how important the availability of good social infrastructure has become, which is why they include gardens and artificial lakes as well as schools, shopping and entertainment inside the project premises for their residents.

Infrastructure in all its facets is therefore hugely important in today’s residential property scenario, and it directly influences the buying behavior of Indians scouting around for homes. The degree to which social and civic infrastructure is available in a neighbourhood dictates how successful a residential destination is today.

This is why integrated townships have become the most important trend on the Indian property market today. Townships are not dependent on how proactive the municipality and private sector players in deploying social and physical infrastructure. They deploy it themselves in perfectly-contained microcosms that not only include residential projects but also office and retail complexes as well as educational and healthcare facilities.

Integrated townships ensure that their residents have everything they need for a modern comfortable and secure lifestyle accessible within easy reach, for instant use. The high demand for township properties in rapidly urbanizing cities like Pune and PCMC vouchsafes the fact that homebuyers are no longer willing to compromise on the advantages of sufficient infrastructure in their neighbourhoods.

About The Author:

Pharande Vaarivana Pune

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in West Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

Festive Season: Tips On Freebies And Offers On Property

– Anil Pharande, Chairman – Pharande Spaces

In Maharashtra, Diwali is definitely the time of choice for property buyers to invest in their dream home. In fact, property buyers look forward to this festival to sign the papers on their homes because this city cherishes this traditional time of investing in the future.

Pharande Vaarivana PuneObviously, builders also respond to the vastly improved market sentiments and do all they can to sustain them. During the Diwali period, property buyers will be presented with a slew of offers which developers introduce to induce sales. The Diwali period this year will see a lot of such activity, because property developers are eager to create sufficient interest in their projects. The residential property market has seen slackness over the preceding months, and Diwali is the time that developers have been looking forward to as much as property buyers.

The question here is – do such ‘freebies’ constitute real value for property buyers? The answer to this does not depend solely on what is being offered. It is a normal market phenomenon for incentives to be offered during the festive season, but property buyers should consider the actual value of the property.

They should be cautious about extravagant freebies and take a close look at the factors that add or reduce value in the case of real estate. If the project is by a developer known for sub-standard construction, or if it is located in a ‘blind spot’ of the local real estate market, no amount of freebies can compensate. The property itself will not represent a good investment, and the buyer will not benefit in the long run.

Another aspect to watch out for is freebies being offered for properties in over-priced projects. At a time when property buyers seek the best options for their money, getting a free car along with an overpriced flat does not make sense. If the flats in this project do not represent good value for money, freebies will not improve the situation. If a buyer wants to buy a flat in Pune such a project, it is best to negotiate for a better price than to accept freebies – or ask for them in addition to a discount.

Home buyers should especially beware of freebies being offered by investors who have put their money into properties in locations that are known to be ‘overheated’ (in other words, where rates have been artificially inflated by excessive investor activity). In such cases, freebies are meant to act as psychological encouragements to make an unwise property purchase.

There are certain incentives that buyers can definitely take seriously. These are not in the form of cars or vacations, but represent actual savings to them. Such incentives include:

  • Reduced down-payments to book flats, with balance payable on possession, resulting in an extension of the period between booking and full payment. Normally, buyers would have to pay the balance as the building progresses
  • Waiver on stamp duty, VAT and registration charges
  • Free or significantly reduced clubhouse memberships
  • Free parking, furnishing, interior decoration and smart home features (which would otherwise be charged for)
  • Waiver on premium for floor-rise

About The Author:

Anil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area, offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

Infrastructure: The Key Real Estate Investment Criterion

– Anil Pharande, CMD – Pharande Spaces

We keep hearing the term ‘market drivers’ being used in real estate. What are they? Market drivers can be defined as developments in an area that increase the value of living there. It is a well-established fact that infrastructure is by far the most important driver for real estate demand and property appreciation growth.

Infrastructure can take many forms. It includes road development to boost connectivity of a location, civic infrastructure such as dedicated water and electricity supply, public gardens, etc. that increases the quality of living in the area, and social infrastructure such as schools, colleges and healthcare, which result in shorter travelling time to such very essential services.

Pharande Vaarivana Pune

Infrastructure must be put in place either before or along with other real estate development. Attempts to put it in place retrospectively create the kind of mess that we can see in many of our cities today. The building of flyovers and road widening are attempted in highly congested areas, disrupting the flow of normal activity and taking ages to be built, causing great inconvenience and massive costs to the city because of the incessant delays.

Building infrastructure is like growing trees – in both cases, there needs to be enough space for them to grow, and sufficient opportunity for a root network to deploy. Without space and depth, neither trees nor infrastructure can grow and flourish. If we take the case of Pune as an example, we can see that building infrastructure as an afterthought to real estate development, rather than as a precursor, does not really work well.

Pune’s haphazard development in the past has not been favourable for decent infrastructure deployment to complement its rapid development on other fronts. Battling severe constraints, Pune’ development authorities are doing their best to counter the ill-effects of unregulated development which has so far been taking place.

Pharande Vaarivana Pune

We are seeing some good results in building support infrastructure, but the Pune Municipal Corporation is actually a losing battle. This is amply illustrated by the fact that the Pune Municipal Corporation is not able to provide suitable parking, traffic management solutions and utilities supply despite enormous investments.

Guidelines For Homebuyers & Investors

  • The infrastructure of a location is a major focus area for property investors for a very good reason. Real estate investors want to attract end-users, either as rental or purchase clients, to the properties. They know that an area without sufficient infrastructure will be unattractive to their clients, because the quality of living quotient is low.
  • Again, properties in areas without good infrastructure tend to have cheaper property rates for a reason. Developers with projects in such locations know that the area has little or nothing to say for itself in terms of quality of life. The only way they can hope to sell their projects is to offer very attractive rates.
  • Buyers should place infrastructure availability prominently on their checklist while scouting for suitable homes. Road and rail connectivity, water supply, proximity of schools, hospitals and shopping outlets are of paramount importance. Buying a home cheaply if the location does not offer these is meaningless, and will give cause for regret.
  • If one is buying a property purely as a long-term investment and primarily for capital appreciation, one can afford to be a bit philosophical about existing infrastructure. After all, one is not planning to live there and does not expect very fast appreciation. As long as there is a reasonable assurance that it will arrive in the foreseeable future, it makes sense to invest in a property located in an emerging area where infrastructure is in its nascent stages.
  • However, if one is buying the property in order to generate rental income, existing infrastructure is far more important than upcoming infrastructure. People looking for rental options are also looking for a certain ease and dignity of living. They are willing to put the option of buying a home aside so that they can live in a good home in a good location on rent.
  • Where the option exists, give a high preference to townships over all other options. While checking out townships, ensure that they are located in areas which have a good saturation of support infrastructure as well. Most large Indian cities now have township projects coming up.
  • In Pune, the infrastructure-rich Pimpri-Chinchwad Municipal Corporation is attracting the highest number of buyers and investors of township properties. In other parts of the country, Navi Mumbai and the Kalyan-Dombivli and Vasai-Virar belts are becoming important township hubs.
  • In Delhi NCR, the areas to look at for townships are Ghaziabad, Faridabad and Greater Noida. In Bangalore, the growth hubs for townships are Yelahanka and Devanhalli, and in Chennai they include Sriperumbadur, Perambur, the OMR belt and Anna Nagar.

About The Author:

Pharande Vaarivana PuneAnil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings. Woodsville in Moshi is another highly successful PCMC-based township by Pharande Spaces which is now in its 3rd phase.

More Scope For Green Development In PCMC

The PCMC is one of the pioneering regions in the country to embrace the concepts and principles of sustainable development, and I myself have always been a strong advocate for the green way of life.

Pharande Vaarivana PuneThe use of green building technology, non-conventional energy sources and sustainable waste water management does not only have a positive impact on the environment but also on the overall quality of our lives. Moreover, adoption of sustainable building and living practices reduce the strain on municipal resources, resulting in significant revenue savings which can then be used to build better infrastructure and provide even more services to the people.

I would like to touch on PCMC’s major thrust towards sustainable real estate development. It is no secret that green development is the future of real estate all over the world. In fact, many of the bigger residential townships and commercial complexes in the PCMC have already adopted the ‘green development’ mantra. Many of the developers active here have started to take sustainable real estate development seriously and begun launching Green Homes.

To date, there are around 60 registered green buildings completed or under construction in the PCMC. The new PCNTDA building itself is a resounding statement to how important sustainable development has become to the city.

Obviously, the Pimpri Chinchwad Municipal Corporation is taking its mission to provide cleaner, greener homes to its citizens very seriously. But I must also add that we still have a long way to go. In my opinion, there is still not enough enthusiasm within the region about the benefits of green homes and workplaces. One of the reasons for this is lack of awareness.

And despite all the progress that has been made, there should be more determination by the PCMC to encourage and promote developers who are taking the Green cause seriously. I still see a great deal of disconnect between developers, agencies like GRIHA, the environment department and the building permissions agencies. Permissions for green buildings should be fast-tracked and be given preferential status. But this is still not to be seen, and it is quite disappointing.

Such disconnect is not worthy of a mighty and progressive municipality like the PCMC. Everything that happens here should be a benchmark for other regions to follow. The PCMC should be the most encouraging and determined of all the regions to promote and develop green real estate. There should be attractive incentives for both developers and consumers of green real estate. Only in such an environment can we hope to see PCMC become and remain the leader in sustainability.

I look forward to an era when this will happen, so that everyone associated with the PCMC can benefit and be proud of its efforts. This is my vision for a better tomorrow for the citizens and all stakeholders of PCMC, India’s most progressive municipal corporation. Jai Hind. Jai Maharashtra.

About The Author:

Pharande Vaarivana PuneAnil Pharande is Chairman of Pharande Spaces, a leading construction and development firm that develops township properties in Western Pune. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area offering a diverse range of real estate products catering especially to the 42 sectors of Pradhikaran. The luxury township Puneville at Punavale in West Pune is among the company’s latest premium offerings.

Punawale Now: Taking West Pune Real Estate To The Next Level

Pharande Vaarivana PuneTaking West Pune Real Estate To The Next Level

PCMC In 25 Years – A Fast Forward Into The Future

Anil-Pharande
 
 
Anil Pharande on his vision and his expectations of the PCMC of the future
The Pimpri Chinchwad Municipal Corporation follows a real estate model that has proven to be the most progressive and sustainable all over the world. The essence of this model is ‘planned development’ or ‘controlled urbanization’. PCMC is a twin city to Pune, but in that respect is uniquely different. Pune’s real estate development has not followed any sort of plan, and it is not hard to see it as a smaller version of chaotic Mumbai in less than 25 years.
A HOMOGENEOUS, MULTI-FACETED MOSAIC
In the same time span, PCMC will have attained its fullest potential as a model city of the future. Obviously, it will look very different from what we see today. It will have grown exponentially, into a harmonized montage of large industrial units, IT Parks, hotels, shopping and entertainment plazas, educational institutes and healthcare facilities – towering above public parks and gardens and crisscrossed with multi-lane roads and flyovers.
Further, the additional 25,000 acres of land that have come within the PCMC jurisdiction by virtue of the last Development Plan will eventually result in the addition of at least 2 million new homes. These homes will cater to every social stratum of property buyers, from the lower to the high income segments.
HORIZONTAL AND VERTICAL EXPANSION – CREATING A SPECTACULAR SKYLINE
In other words, there will be tremendous – yet controlled – horizontal real estate growth over the next 25 years. Most spaces allocated for residential use will have been utilized for that purpose. But this will not result in an urban jungle, since the PCMC planning blueprint will enforce the maintenance of vast green spaces at all stages of development.
Moreover, the Pimpri Chinchwad Municipal Corporation will at all times endorse self-sufficient real estate developments such as townships and other integrated residential projects. The authorities have long since recognized that these are the most sustainable and progressive models for optimum real estate growth. These projects will ensure a scientific uniformity to the horizontal growth.
However, even these 25,000 acres will not suffice, since PCMC will have to accommodate a massive demand for housing. The following graph illustrates this point – it charts the population growth in PCMC over the last 25 years, and clearly depicts that this growth has been almost ten-fold (from 200,000 to 2 million).
graphAs the graph below indicates, there is reason to believe that population growth is likely to cross 50 lakhs (5 million)  by 2035
This growth will be fuelled by several factors. On the one hand, there will be a huge requirement for homes from the rapidly growing manufacturing sectors of Pimpri-Chinchwad and the Chakan-Talegaon belt. Chakan itself, though a burgeoning industrial hub, has little to offer by ways of residential facilities. The onus naturally falls on PCMC, which will necessarily be the residential location of choice for the entrepreneurs and employees of these units.
Simultaneously, there will be the spill-over effect from Pune City (which will have reached complete saturation point in the next 25 years). We further have to factor in the ever-increasing migrant population from all over the country, attracted as much by the excellent education institutions as by the varied career opportunities.
The obvious solution lies in growing vertically as well as horizontally. More land will have to come within the purview of planned development, and building heights will need to increase from the currently permitted 70 metres – approximately 22 floors plus parking – to 100 metres or more. FSI, which still currently stagnates at 1, will need to be raised to at least 2, or even 2.5.
In 25 years, PCMC will be a skyscraper city on the lines of Gurgaon.
WORLD-CLASS INFRASTRUCTURE
In most cities, such growth would mean serious infrastructure challenges. We have already seen what happens in a city like Mumbai, where skyscrapers are being built without sufficient parking, connectivity and municipal amenities to support them. However, thanks to the master plan that PCMC will always adhere to, the necessary infrastructure will precede the building of high-rises. I firmly believe that 25 years from now, the Pimpri Chinchwad Municipal Corporation will serve as a national and even international benchmark for planned, scientific vertical real estate growth.
An essential pre-requisite to support this massive growth is an advanced public transport system. With an eye on this future requirement, PCMC has adopted a model similar to Ahmedabad’s Janmarg – a scientifically designed BRT-based  public transport system spanning 130 km across 14 routes in PCMC. This system involves 4-lane wide, exclusive roads with grade separators that will reduce the dependence on private transport in favour of more efficient public transport. This, in turn, will result in smooth traffic flow, less road blocks, radically lower pollution levels and a healthier, energy-conserving environment. To ensure that there are no hitches in the development of this lifeline, the PCMC has established an Urban Transport Fund for its funding.
Another pre-requisite for efficient transport is more connecting roadways. A ring road is on the drawing boards, but that will become truly effective only with the implementation of a hub-and-spoke road network. To illustrate this point, there are currently only two arterial roads connecting Pune with Pimpri-Chinchwad, and only two connecting Pimpri-Chinchwad with Chakan. These cannot sustain the enormous increase in vehicular traffic that industrial and residential growth will generate.
Again, it is my opinion that this alone may not suffice to cater to the public transport needs that will emerge over the next two decades. I personally feel that an elevated skybus or monorail network or even an underground rail network will be called for.
THE ULTIMATE GAMECHANGERS
I cannot end these musings without mentioning the new international airport being planned near Rajgurunagar and the International Convention Centre at Moshi, which will cover a sprawling 200 acres. The Convention Centre alone will spawn a huge tourism, hospitality and retail boom which will convert PCMC into a major urban destination both within and outside Maharashtra, perhaps second only to Mumbai. Global hotel chains will have redefined the hospitality sector, and the shopping centres will be populated by marquee retail brands.
In fact, the next two decades are surely going to see PCMC being catapulted into the international Big League, giving it a distinct global identity in its own right.
Anil Pharande is President, CREDAI – PCMC and Chairman, Pharande Spaces, one of the most innovative developers in Pimpri-Chinchwad

PMC’s Proposal To Extend Duration Of Lease Period Faces Opposition

(TOI, Nov 7, 2010)
PUNE: The civic body’s proposal to extend the duration of the lease period of civic properties is mired in controversy with civic activists alleging that the Pune Municipal Corporation (PMC) has not prepared a draft for the changes proposed in the policy.
Six years after it became the first civic body in the state to have a land lease policy, the PMC now wants to extend the duration of the lease period from the current 30 years to 99 years. The policy was ratified by the Bombay high court.
The PMC has invited objections and suggestions from citizens to the proposed changes. The suggestions and objections should be sent to the land and property department of the civic body within a fortnight from November 3.
“The PMC has not prepared any draft to seek suggestions and objections on the proposed change. On what basis should citizens register their suggestions and objections?” civic activist Vijay Kumbhar asked. Kumbhar and other activists have approached the municipal commissioner on this matter.
Deputy commissioner (land acquisition) Sudhakar Telang, however, said that the suggestions and objections were sought only to extend the duration of the lease period. “If citizens want to go through the existing policy it is available with the PMC. Suggestions and objections have been invited only on the issue of duration,” said Telang.
At present, the civic land lease policy bans the PMC from selling its properties, but allows it to lease the property for 30 years. The PMC has leased out many of its properties, including open spaces.
Activists allege that most properties have been leased out to organisations and people with connections to corporators and politicians. In 2003, Kumbhar had approached the high court which had ordered that civic properties be leased only through a tendering system.
The civic body owns about 3,500 properties reserved for hospitals, community halls, libraries, schools and other amenities. Many properties have been leased out for various purposes, but there is no system in place to check whether the properties are being used for the purposes they have been leased out for. The PMC has not recovered rent from hundreds of properties for several years.

Thriving Real Estate in Pune

(StockMarketsReview.com, October 13, 2010)
Pune is a well established premier IT centre in the country that houses units of various leading IT and ITes companies. Once known as pensioner’s paradise, Pune property market is witnessing mushrooming of various luxurious and affordable housing spaces equipped with modern amenities. It has apparently metamorphosed into a bustling mini metro over the years and ranks among the most preferred property investment destinations today.
The entire realty sector in Pune is flourishing with humungous developments in residential, commercial and retail segments. Some of the popular residential localities in the city are Hadapsar, Kalyani Nagar, Kharadi, Viman Nagar, Baner, NIBM, Koregaon Park, Wakad and others. Similarly, commercial property in Pune is most sought after in areas of Baner, Viman Nagar, Aundh, Lonavala, etc. The entry of technology honchos has not only triggered its economy and created employment opportunities galore but also put it forth as a potential real estate destination.
As is the case with other tier-II and III cities, the large scale migration of professionals and students created the housing needs. Already working hard to cater to the commercial demand, developers then began focusing on the inadequate residential property. With the youth settling in, demand for retail realty in Pune also witnessed a considerable upsurge pushing developers to launch retail property projects in the city.
Undoubtedly, builders have been instrumental in taking Pune real estate to a different level. The coming up of high quality developments in terms of modern apartments equipped with state-of-the-art amenities, commercial spaces with excellent infrastructural support and swanky multi storied shopping complexes and multiplexes are all their efforts. Besides the colossal growth within the city, residential property is burgeoning in the peripheral areas of the city as well.
The demand is increasing relentlessly encouraging more and more realty projects to be launched by both national and local property builders. While corporate companies are scouting for commercial properties in Pune, migrant professionals are eyeing accommodation facilities in the city. The supply of real estate constantly falls short even as housing and office spaces multiply speedily within and around the city. With this conspicuous deficit, the property prices are soaring higher year by year.
The emergence of numerous integrated townships and condos among green environs make Pune an ideal place for living. And the considerably high returns on its realty put it across as a rewarding investment destination. The great capital and rental values spells enthusiasm in the property sector with hordes of realty investors thronging the city’s market. With an attractive 30 to 40 percent appreciation in prices, NRIs are also taking interest in investing money here. As a result, the demand for premium housing- deluxe villas and luxury apartments has also gone up by several notches.
This addition to the already fuelling up demand makes Pune one of the most lucrative realty destinations. It is among the most happening cities, located in proximity to the financial capital of the country and that serves as another advantage for Pune realty. The emergence of tier-II and III cities as property hubs is instrumental in heightening the importance of real estate in India.
Pune has not only come across as a cosmopolitan city but also as the cultural capital of Maharashtra. It offers a wonderful blend of tradition and modernity symbolizing historical past as well as a software and industrial center of today with global presence. It has been attracting huge foreign investments from NRIs, MNCs and FDIs in its realty sector. Real estate in Pune has been expanding ever since the Government started liberalizing its policies to attract investors. It is expected to flourish furthermore in coming years being a favorable investment destination.
Deepika Bansal writes on behalf of 99acres.com, which is an internet portal dedicated to meet every aspect of the consumers needs in the real estate industry. It is a forum where buyers, sellers and brokers can exchange information, quickly, effectively and inexpensively.

Home And Personal Loans To Cost More

The Reserve Bank of India (RBI) on Thursday hiked policy interest rates, sending a message to banks that they need to do the same for their loans. The silver lining is that interest rates on fixed deposits will also rise from the current 7-8% levels.
The RBI increased the repo rate (the rate at which it lends money to banks) by 25 basis points to 6% and the reverse repo rate (the rate at which the RBI takes out excess cash in the banking system) by 50 basis points to 5% with immediate effect.
The central bank did this primarily to contain inflation and to ‘normalise’ policy rates, considering the speed at which India’s economy is growing. Interest rate is a monetary tool used by central banks to ensure that a fast-growing economy doesn’t get out of hand — primarily, that prices of goods, or inflation, don’t spiral out of control due to excessive demand, the hallmark of fast-growing economies.
This is done essentially by controlling the amount of money floating in the economy by raising or lowering interest rates. When an economy declines, the opposite happens — central banks lower interest rates so that people are persuaded to buy goods and thereby generate demand.
“The RBI believes inflation has plateaued (and the declining trajectory inline with its projection), but it highlights that it will remain at ‘unacceptably’ high levels for a few more months.
It hence believes that there is a need for continued policy response to contain inflation and anchor inflation expectations,” said Ashutosh Datar, economist with the brokerage IIFL.
“The broad indication of the RBI action on Thursday is that lending rates will rise. We will take a call in a few days on increasing our personal and home loan rates because the impact of this rate hike will have to be passed on to consumers,” said Kamlesh Rao, executive vice president (personal loans and home finance), Kotak Mahindra Bank.
The timing of the hike will vary from bank to bank, depending on the cost of their money.
“On the interest rate scenario there is definitely an upward bias. But the hike may not be immediate. It will depend upon the credit pickup. Initially, it may be a hike of 25 basis points,” said MD Mallya, chairman and managing director, Bank of Baroda.
It seems both the RBI and the government want fixed deposit rates to rise.
“If bank credit is not to become a constraint on growth, real interest rates need to move in the direction of encouraging bank deposits,” the RBI said on Thursday.
On Wednesday, the government raised the employees provident fund rate by 100 basis points to 9.5%.
Banks had already resorted to hiking their benchmark prime lending rate, or BPLR, in August, citing reasons that their costs were going up. In the near future, they may hike it further and may even hike the base rate, which came into existence from July 1 this year.
“The BPLR may be hiked further as most of the lendings happen through it, and there is also the likelihood that the base rate may be hiked in the next quarter since banks have the option to change the base rate every quarter for the first year,” said Deepak Tiwari, banking analyst at KR Choksey Shares & Securities.
“Borrowing rates will go up for both consumers and developers,” said Shobhit Agarwal, Joint Managing Director (Capital Markets), Jones Lang LaSalle India, a real estate consultancy. Conversely, this could mean demand for homes, and therefore their prices, may decline.
“The projects that are already priced high, the impact in terms of demand erosion will be higher. We don’t see much impact on low-cost housing, that is Rs25-50 lakh purchases,” said Agarwal.
But teaser home loan rate — where you pay a low interest rate in the first year and more later — won’t be discontinued as they are a hot favourite among borrowers.
“I expect teaser loans to continue as they are so popular with people. But I think banks may continue those schemes with a slight increase in rates, said Harsh Roongta, CEO of apnapaisa.com, a personal finance advisory. The State Bank of India (SBI) is offering teaser home loans till September 30 and the committee will take a decision on whether to extend it further or not on September 28, said a senior SBI official.