Thursday, 31 January 2013

Real Estate Upsurging Trends in 2013

The prospects of revolutionary Real Estate trends in 2013 are undoubtedly promising. By keeping aside the conventional path and adopting new trends and issues, the real estate market will see a skyrocketing growth in itself. Owing to a recuperating and distressed economy worldwide the prediction may sound too hard to believe, but excerpts are formidably accounting for a momentum shift in all property types. Though the clouds of uncertainty regarding the economic slowdown still hover on this business, staying positive and laying the best foot forward can help in gaining plenty of profits and enhanced scope. The business is largely capital intensive and hence an economic boost is the need of the hour.
However the following key trends will be firmly exhibited in the sector, for good or for the worse, implying a noticeable turnaround in the industry.

  1. Increase in home prices as well as rise in housing rents-
The expected increase in the home prices is because of the slow pace in their construction. This has resulted in a shortfall of available homes. Thus a steep rise in the prices is imminent. Furthermore, the number of people moving out and looking for their own apartments has dramatically increased consequently leading to an increase in the rents.
A remarkable hike in the prices of building materials is also a reason behind the inflation seen in the industry.

  1. Watch out for the first timers-
It is more likely that amidst the growth in demand for single family houses it will be the first time buyers dominating. This trend has been in practice since the last couple of years and is expected to continue in the very same manner.

  1. Need of Property Managers-
The requirement of property manager will see a considerable increase owing to the fact that many distressed and foreclosed properties will be snapped. A professional property manager will be helpful for an investor for renting and maintaining the purchases.

  1. Rise in mortgage interest rates-
The mortgage interest rates have been at a minimal low since years and an increment is definitely expected. But, rest assured the rise will not be a pronounced one.

  1. Urging for compactness-
Gone are the days when businesses used to demand for big commercial complexes. The trend has shifted to compactness, i.e. smaller places are much more preferred. It’s easier to maintain and the rents and operating expenses are drastically reduced.

  1. Going Suburban-
Though its’ difficult to move businesses into the suburb’s, the necessity demands for one. With more and more young people thriving for a suburban life, it won’t be a bad idea for the real estate builders to explore such avenues. But one must keep in mind about the selective business which could survive the suburban nodes. With such businesses one can witness urbanization in those areas. Furthermore, this suburban concept has led to a quick spur in multifamily projects. Adopting the suburbs will be a trend to look out for in the real estate business in the year 2013.

Tuesday, 29 January 2013

Real Estate Financial Facts in Jaipur

Investment in Tier II cities of India, like Jaipur, is a more profitable proposition and is growing at a breakneck pace.

Overall, the long-term returns say that for around 10 years or so, real estate has compounded almost 15-16% annually. These types of returns are difficult to find in any other asset class.

At present the interest rates have begun to soften, which will improve the ability of buyers to make house purchases. But it can push property prices from the current level, which is already considered high. Therefore, if you want to buy a house for personal or investment purpose, experts say it is not advisable to wait for prices to correct. It will be better to go for a long-term investment if you want to invest in real estate in Jaipur.

Rents in Jaipur rose sharply in the past two years. If you take into account the rental income, the investment income realized by you to purchase the home is much less. For example, if you buy a house for Rs 1 crore, your EMI at the current rate of interest- around 10% over the repayment period of 20 years, will be Rs 96,502. Of this amount, Rs 83,333 will be adjusted against the interest of the capital for the first month and the remaining Rs 13,169 will be used to offset the principal amount. So for the next month, the capital will be reduced to Rs 99,86,831 against Rs 1 crore at the starting of the loan. Therefore, the interest for the next month will be reduced to Rs 83,224. And, therefore, only Rs 83,224 will be used from EMI to pay interest and rest Rs 13,279 will be adjusted on the principal.

In this way, the interest expense will continue to reduce, allowing much EMI to be charged on the principal amount. At the end of the fifth year, you pay only around Rs 10 lakh directly. But it will lower your payment from your interest in the EMI to Rs 75,014 against Rs 83,333 at the beginning of the repayment period. This will help increase the return of capital to Rs 21,488 by the end of the fifth year.

Flats in Jaipur

Annual rent of an apartment in Jaipur increased to about 3% of the value of the capital, against 2.5% of the capital value a couple of years ago. This means that a flat worth Rs 1 crore fetches around Rs 25,000 per month or Rs 3 lakh per year in rentals. This will reduce your interest costs substantially. In the first year, 10% of your interest charge on a loan of Rs 1 crore amounts to Rs 9,92,552. If you set the rental income, the net outflow of interest payments will only be Rs 6,92,552. This will reduce the effective interest rate to 6.92%

Rentals normally grow 10% per year, but even if you take an escalation of 5% per annum, the interest expense will continue to decline.

At the end of 14 years, rents will be more than the interest share of your EMI. At the end of the 14th year, the interest share of your annual EMI of Rs 11,58,024 will be Rs 5,54,115. And against this your annual rental for the present year will be Rs 5,65,690.

Villas in Jaipur
Not only that, if you buy a ready-to-move-in home, in the first year itself, the effectiveness of EMI on a home worth Rs 1 crore will come down to Rs 71,500 from Rs 96,502. By the fifth year it will become more affordable to Rs 66,114, which will further reduce to Rs 55,780 by the end of the 10th year. At the end of the 15th year the same will be reduced to Rs 47,000 only. Therefore, the actual cost of your investment will be significantly reduced during the period of the loan itself.

If property prices increased by 10% compounded annually, which is very conservative as the property rates have an appreciation of the order of 17-25% per annum compounded annually for the last 20 years in Jaipur, the value of your investment will be about Rs 6.75 crore.

If you calculate your return from the rental income in the account, it will be in the range of 15 to 16 percent, compounded annually.

If you want to invest in a house under construction, the return will be much better. However, you will not get any rental income in the early years, but the cost of house under construction is usually less than a completed one.

But, if you are investing in a house under construction, you must take care of some things like the history of the builder or property owner. Timely delivery is very important to keep your finances in good condition as the burden of maintenance after the completion of the house will be lower if the builder provides quality products. As well as, you should take care of the connectivity of the project. Better connectivity to a project will always give you a better price and yields better quality.

Monday, 21 January 2013

Real Estate Success Mantra in Jaipur

Do you want to invest in real estate and get maximum benefit from it? If yes, then the best place to accomplish your dream from real estate investment and earn a huge profit is Jaipur. The real estate markets have had a great development in Jaipur and hence flourishing profits.

Investors around the world are eager to invest or buy property in Jaipur. Also known as Pink City, it is gradually gaining popularity amongst investors. Jaipur is also famous for its jewellery business, heritage places and architecture. It is also one of the favourite destinations for tourists as they are attracted in large numbers. This is because of its culture and heritage. People, not only from different parts of India, but also from abroad visit this city. Hence the most important factor contributing in the growth of the real estate business is the tourism industry.

Real estate investors from different cities, not only in India but also around the world are investing in property in Jaipur. In terms of real estate Jaipur city is considered very safe and secure. Security is the key factor that people search for in the real estate market and Jaipur is the one such destination.

In terms of development, Jaipur is the second to Gurgaon. This is due to the tremendous growth and development in Jaipur. Property in Jaipur is available at a much more affordable price compared to any other city. Real estate investors are aware of the benefits that can be achieved by investing in real estate in Jaipur. With the change in lifestyle and the rapid growth of real estate in Jaipur, several brands are showing their interest and also making investments in properties. It’s a long way to go and this city have had the perfect start.

With a high rate of such development, Jaipur is the desire to be among the major cities soon. Growing culture center, the late night parties and several other developments are popular Jaipur. One of the major changes, the subway is proposed. Jaipur gets a lot of attention because of this project. Since the return on investment in real estate is high, NRI are also showing their interest to invest. Jaipur real estate activity is increasing because of these reasons.

Jaipur is gaining popularity in both commercial and residential areas. IT companies see Jaipur as a place for potential IT hub. Areas where these projects will be developed are for example the area of the airport and the metro area and some other important monuments. Jaipur connectivity with other cities of high technology is also an important reason that attracts investors here.
So, do not think, investing in real estate and be the proud owner of the property in Jaipur.

Wednesday, 16 January 2013

Jaipur- A power-packed property in the upbringing

World Trade Park

Jaipur has always ranked high on the itinerary of Indian and foreign tourists, and flourished, not only because of its proximity to Delhi, but for the richness in culture it offers to every visitor. In the last decade, Jaipur has also taken a giant leap and joined the ranks of modern computational technology centres in India today. The IT companies in the city have created a need for commercial spaces, modern and subsequent requirement for appropriate housing. Real estate development in Jaipur has peaked surprisingly and developers from across the country are competing for a share of the real estate market here in Jaipur. Obviously the prospect is very lucrative in Jaipur, the pink city of India.

Residential property: The opportunities for investors and end-users from ongoing projects initiated by private property developers are several, and affordable, even at current rates, which have gained significantly in the past year.
Ajmer Road is the place for all manufacturers of ownership. The Vatika Group has opened the way for real estate development project in Jaipur with its historic town Infotech on 800 acres, autonomous integrated commercial complexes, a five star hotel, a leisure centre, health club, medical facilities and schools. A five-star and a seven star hotel have been provided on site, accessible from the Ajmer Road. A shopping centre is in focus right now with a target to be built up in more than one million square feet!
Similarly, Omaxe Limited, Suncity Builders, Panchsheel Colonizers, and Melange Era Group offers integrated common international standards with residential plots, apartments, villas stretch, hospitals, shopping complexes and schools. Rajmahal Royal Residency, Green, Platinum Mehandipur Residence, Garden City, Green Heights, Elite Residency, City Ville, Mahima's Panache, Panorama, and Studio Panache are the recently launched residential projects in Jaipur.


Commercial Property: Commercial property in Jaipur are redefined with iconic structures such as the World Trade Park to come up soon, which will be equipped with retail spaces, commercial and industrial trading systems, 5 star hotel, art gallery and a museum, an auditorium and a convention centre.
The pulse City, Crystal Mall, Crystal Court, Crystal Palms and many other to name, offer business and shopping under one roof. The Gold Souk, on the other hand, responds exclusively to consumers for jewellery. The Metropolitan offers 250,000 square feet of shopping, trading, entertainment, a luxury hotel and a business centre.
Mahima's Trinty

Another Rs 1900 crore Film City project on 1,000 acres in Jamdoli is being developed. The state government in March 2007 also proposed a Science City in Jaipur to be developed with the International Convention Centre. A "Mini India" theme park on 50 acres of sharing space with a golf course and a cricket academy is also under consideration.
Hotel Orchid Central will be joining in August to gratify the scope of Jaipur hotels, Bharat Hotels and Hotel Shiv Villas and project Panchsheel Tivoli Garden Resort Hotel.
The boom in real estate in Jaipur is here to stay with the active support of government for mega commercial projects - as they take shape, the real estate market in Jaipur maintains its healthy growth.

Wednesday, 9 January 2013

How to become a successful real estate investor

Real Estate Investment
Real Estate business may be a lucrative and rewarding avenue to explore if one has enough caliber to work with zeal and complete dedication. But to have zeal without knowledge and experience can prove deadly. And experience cannot be learnt somewhere, it would come to you with time and patience. And that would mark your success. Yes, the basic formula to achieve success in the real estate business is to spend time, time where you learn from your mistakes and not shed tears of lamentation. Besides time, the following must also be highlighted:

Communication Skills:
Having good social skills in communicating can do wonders to your chances of compelling the end party. A key to a successful real estate investor is his charm while he faces anyone. This is his job to come across a lot of people and he must be calm and composite. Keeping the right amount of cool can add weight to his credentials. A bit of negotiations can further help him in getting discounts.
This communications can aid him in expanding his network which can come handy in future. 
While dealing for a property, you must have the confidence to convince others. Excellence can be achieved in this business if you have persuasion skills, keeping in mind that it does not lead to the harassment of the client. 
Dealing with finances:
A continuous flow of money doesn’t mark the success of the business. What matters is how well you make the most out of it. You got to be business savvy and must apply wise management when it comes to finances. Explore the options- either further enhancing a property or buying a new one.

Use your sense to cut the losses:
Sometimes waiting for a better offer may be counterproductive. But instead of losing hope start afresh with a new investment. Remember, it is the mistake you commit which will make you a successful real estate investor. 
Ability to understand the changing trends:
Like any other business, investing in real estate requires sense to understand the changes in trends and acting upon them. For example, look at cities like Jaipur. In the 90s, there was nothing in the outskirts of Jaipur. The value of real estate in those areas was nothing. But with the passage of time, there have been many township projects completed and some are on the verge of completion. Many multinational companies and educational institution are also established there. The property rates in Jaipur have reached sky rocketing prices in those areas.
A Real Estate investment requires a good business mind; therefore, a smart businessman must avoid making a bad or illegal deal. Reading the contract paper before signing and consulting a lawyer can further minimise chances of falling into a fallacy.

Sunday, 6 January 2013

Investment Scenario in Jaipur Real Estate

Jaipur, the pink city, and it is also known as "Paris of India". It is the capital of the Rajasthan, which is the largest state of the India. It is known for its culture and heritage places. Nowadays, many companies have started, and many turning towards Jaipur to complete their investment aspects in real estate, and other fields.
Villas in Jaipur
Now, investors are finding the Jaipur as an alternative to Gurgaon, and it is looking forward as the one of the mega cities of India, in the future. Actually, the increasing numbers of MNCs, Institutes, and consideration of corporate are the sign of future growth of the real estate in Jaipur. As the many big IT companies are coming here, and some companies are already established here, it has become the major IT destination. Many International and Indian multinational companies are going to set up their business in Jaipur. 
Commercial property in Jaipur
As the numbers of industries, and companies will increase in the future, then the demand of quality, and luxurious residential property, and infrastructure to support future expansion, will increase. Nowadays, many builders in Jaipur are building many world-class integrated townships which include residential units, commercial units, and office spaces, etc. 
In the future, MNCs like Wipro, Infosys, HCL, etc., targeting Jaipur to expand their businesses, and several hospitality projects including five and seven star hotels by Taj Group, Welcome Group, etc., will support the demand of commercial property in Jaipur
According to the media report, Jaipur is the fastest developing tier II city in the India. It has become the one of the highest tax paying city of the India. And, the JDA has collected the revenue of more than Rs 1,500 crores in 2012.