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Real Estate Sector Pursuing Input Tax Credit for Leased Commercial Property Developments
Real Estate
20 Jan 2021 | 30 Views
Realty Sector Pursuing Input Tax Credit for Leased Commercial Developments
To avoid double taxation, the government is requested to allow commercial real estate developers to use inputs such as cement paid by rental income tax to boost the business market to help India retain its benefits in various industries such as IT, startups, real estate and consultants. In its Proposal on Budget 2021- 22, the CII industry body requested that, in the construction process where the buildings were destined for commercial lease or rental, the provisions of Section 16 should be amended in accordance with Section 17(5) of the CGST Act to permit real property owners to avail of the Input Tax Credit (IPTC) for the provision of goods and services. It stated that the rejection of ITC would result in the blocking of funds for real estate. If the properties and outlets are leased on a commercial basis in malls, the rental of these premises is 18 percent available to the customer as credit. During the phase of construction, the disallowance of credit leads to increased building expense, loss of working capital, increased cost of finance affecting the entire supply chain. Input Tax Credit for Leased Commercial Property Development Tata Realty & Infrastructure Ltd MD & CEO Sanjay Dutt stated that in accordance with GST rules, the input GST credit is not available for set-off against output GST liability due to the income from the rental input during the construction phase (for commercial properties). In other terms, it is appropriate to capitalise the GST charged for inputs (such as cement procurement, steel, building contract service, etc.) at the cost of construction. As the input prices for cement, stainless steel or other high-tech products are significantly high (from 18% to 28 percent), the developers lose considerable cash flow. He recommended that the input tax credit be provided for leasing of commercial real estate. The commercial real estate developers would be immensely helped to preserve large cash flows and to help developers sustain themselves if such GST input is used to offset GST liability output. He added that this will sustain India's competitive edge in IT & ITES and start-ups by commercial real estate. This would benefit the Indian office markets, which witnessed a decline in net leasing in 2020 as a result of the COVID-19 pandemic. Sahil Vachani, Max Ventures & Industries, MD & CEO,  mentioned enabling developers, and particularly those building to lease the input credit, can be a major boost. Since now to that developers have to pay the GST for different goods and services while constructing up the projects. If the state allows input tax credit it would not only encourage more developers to build leasing Grade A offices, but will also help rationalise rentals, which will help India eventually to establish a competitive advantage over countries where real estate expenses are more expensive. As the unexpected pandemic caused a short-term disruption, but the future of office space looks promising, the government considered supporting the real estate sector in order to improve the availability of Grade A office spaces. In 2019 office space absorption in 7 cities - Delhi NCR, Mumbai, Chennai, Kolkata, Hyderabad, Pune and Bengaluru amounted to 46.5 million sqft. However, industry experts hope that the demand will bounce back this year, as economic growth in the country strengthens. By: Shailaja K

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AP Govt to Deliver Developed Plots to Urban Middle-Class at Affordable Cost
AP Govt to Deliver Developed Plots to Urban Middle-Class at Affordable Cost

Chief Minister YS Jaganmohan Reddy decided to provide affordable plots to the middle class people in the State by developing non-profit government layouts. Affordable Plots to Urban Middle Class Jagan planned to launch a project for the middle-class urban families, which was similar to the Rajiv Swagruha scheme introduced in formerly undivided Andhra Pradesh during his father's regime, YS Rajasekhara Reddy. The Municipal Administration and Urban Development (MAUD) has been directed by Chief Minister YS Jagan Mohan Reddy to develop a plan for ensuring the delivery of developed plots to the urban middle-class with clear titles at affordable cost. The Chief Minister informed that as flats were provided under Rajiv Swagruha, as a part of a new initiative they will deliver plots. The concept is based on the urban middle class people desire to do something about it. When a family plans to buy land from private firms, a number of concerns about land credentials will arise. By developing the layouts and demarcation plots the government itself will have clear and litigation free titles. As the government does this on a profit-free basis, the plots are available at affordable prices. Through a lottery scheme the plots can be delivered to beneficiaries, and the minister instructed MAUD officials to discuss and draw up a strategy accordingly. By: Shailaja K

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Commercial Realty Space in Hyderabad to Observe Eight Million Sqft in 2021
Commercial Realty Space in Hyd to Observe Over Eight Million Sq.ft in 2021

The new year seems to be at a high point on the commercial real estate market of Hyderabad. According to estimates, the city already has transactions of about 8 million square feet (mn sq.ft) which are more likely to turn up in 2021. Hyderabad's Office Space in 2021 Here, a host of e-commerce, insurance and IT major players have opted to improve existing Hyderabad operations, with office space absorptions exceeding the 10million sq.ft mark. The city’s western corridor running through Madhapur, Gachibowli and Kokapet are some selected locations. The last year was just a setback in a strong market with a consistent focus. With many big deals coming up steadily on the market, the next 6 to 12 months are expected to rebound in Office Leasing. Currently, approximately 7 to 8 million sq.ft of space is in demand, and it is expected that office demand would improve with positive expectations over the long term. With almost 10 million square feet of new supply and about 8 to 9 million sq.ft of new demand, market conditions will continue to be balanced. Despite concerns of the Work-From-Home model (WFH) keeping companies from investing in physical spaces, developers are still hopeful of a steady recovery. While 25% of staff might still be WFH, industry experts strongly feel that the need for office space is going up. It is just temporary for the entire team to operate remotely.  There would be a need for wider areas with companies renovating their spaces to provide social distancing. Hyderabad real estate market is expected to cross the 20 million sq.ft mark in the next one and half years. By: Shailaja K

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Hyderabad Civic Body Plans for Installation of 950 Traffic Sign Boards
Hyderabad Civic Body Plans for Installation of 950 Traffic Sign Boards

To enhance safety and convenience among the city commuters, the Greater Hyderabad Municipal Corporation (GHMC) is setting up over 950 traffic signboards in the three police commissionerates. These will be beside the existing 550 traffic signboards. Plans to Install Traffic Sign Boards in City Under Monthly Road Safety measures, the signboard project is being launched. During the entire month, the police and transport departments are organizing a range of road safety awareness programs. The traffic police in three police commissionerates indicated the need to put up more road signboards across GHMC limits. They addressed the same issue on December 21 at the convergence meeting in the city. A senior officer of the GHMC informed that a total of 868 traffic signboards are being set up in Hyderabad, 53 in Rachakonda, and 38 in police commissionerates from Cyberabad. It has set each board at a cost of Rs 4,000. Traffic Police have finalized the sites for the setting-up of the signboards and the GHMC is in operation. Over 400 boards were already installed and the remaining boards will be placed by the end of this month. The new boards measure 600x800mm, and the ‘Accident Prone Area’ boards are slightly larger and measure 800x600mm than those of the current boards. These signs are the conventional signs warning motorists regarding rules & cautions concerning pedestrian areas, places susceptible to accidents, etc. Of all, Hyderabad Police limits alone to have 76 ‘Accident Prone Area Ahead’ boards. The aim is to educate and instruct motorists in their safe driving practices. The officials believe that cautioning at footpaths and other signs would allow commuters to be more alert and prevent accidents. By: Shailaja K

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Developed Infrastructure Pushing Up Property Prices in Hafeezpet
Developed Infrastructure Pushing Up Property Prices in Hafeezpet

The residential demand in the Hafeezpet area has expanded in recent years because of the closeness to the IT corridor, six kilometres from Hitech City. Expectedly, a large group of migrants and locals in the western region of Hyderabad are near this mid-segment residential pocket. Adding to this, a flyover providing smoother commutes between Miyapur to Gachibowli and the MMTS connectivity. While this has led to a steady increase in people, the prices of land in Hafeezpet have also moved upward. Though there are few planned and executed players in this market, the mid-range segment is very prominent here and there is not too much land available. The prices of the residential properties vary from Rs 4,500 per sq.ft to Rs 6,000 per sq.ft, depending on the location. With identifying this enhancement, industry experts believe that Hafeezpet began attracting buyers owing to the tech industry. Before IT development, there wasn’t much hassle for people to own a land here. It was only in the last decade that people showed interest.  Hafeezpet’s rise was not expected, it is because IT investments have gained greater popularity towards Gachibowli and areas nearer to it. Overall, Hafeezpet has a strong potential growth in residential improvement and more projects from renowned builders are expected to be launched. By: Shailaja K

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Khammam Sports Infra to Get A New Look With Adding New Facilities
Khammam Sports Infra to Get A New Look With Adding New Facilities

Sardar Patel Stadium in Khammam to get a new look with beautiful arts and adding new facilities. Office space was set at the cost of Rs 1 crore and Rs 25 lakh was invested on constructing a skating rink, while Rs 3 lakh were spent on cricket turf wicket and the stadium on athletic sands. Plans to Upgrade Khammam Sports Infra The stadium played an important role in shaping the careers of many sportspeople from Khammam who excelled in state and national sports games and events. However, due to the incompetence of past governments, many facilities were lacking to train the players. Minister of Transport Puvvada Ajay Kumar came up with the idea of modernising the stadium and boosting the stadium facilities. He decided to develop the sports infrastructure of Khammam and implemented accommodation for sportspeople at this stadium, all they need are good facilities for sharpening their talent. Measures are taken to set up regular fitness tests and choices for more training for sportsmen. The stadium was built at Pavilion Grounds as part of the development of the sports infrastructure and opened last March by MA&UD Minister K. T Rama Rao. Proposed Infrastructure Development Works At the cost Rs 10 crores, a Haritha Budget hotel will be built near the TSRTC bus stand along the bypass road in the city. The 20-room hotel provides modern amenities and meets the requirements of Khammam visitors. The Telangana State Tourism Corporation is responsible for the construction of the hotel. A suspension  bridge over Lakaram tank with Rs 8 crore budget has been proposed, and the tank will have a floating musical fountain at a cost of Rs 2 crore. Ajay Kumar notified that the bridge is constructed by Girish Bharahwaj, a Karnataka bridge man known as bridge man of India. By: Shailaja K

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Govt Funds and Ready-To-Move Homes Demand Booming Realty Construction Process
Govt Funds & Ready-To-Move Homes Demand Booming Realty Construction Process

In response to the growing demand of ready and near to completion homes made real estate developers to expedite projects delivery amid the challenges triggered by the outbreak of the Covid19 pandemic.  Government Funds Helps to Drive Realty Construction Activity The initiatives of the government including the major funding for stressed real estate projects through SWAMIH Fund and the liquidity generation measures of the Reserve Bank of India have driven these projects to be completed. As per experts report, in 2020, 190 housing projects throughout the country that were stuck and delayed, with more than 73,560 units completed. The delivery of ready-to-move inventory is the most key component in the present residential market situation and is expected to continue to be the major factor during 2021. The Indian real estate market has suffered from project delays in the last 10 years. This even had no effect on the implementation of RERA. In the course of the development of the Alternate Investment Facility in late 2019, a corpus of Rs 25,000 crore was interfered with by the liquidity crunch for developers. This method of financial leverage of the last mile has been applied to the Special Window for the completion of Affordable and Mid-Income Housing Projects. SWAMIH I was initiated by this government-sponsored programme with the objective to complete stressed projects and deliver them to buyers. The construction company has expanded considerably in all projects funded by the SBICAP Managed Fund. Government fundings enables developers to actively complete project construction, and they understand that sales can only be recovered once the project is finished, considering that most home buyers are now only searching for finished or almost completed houses. Even as two major projects are near completed and the occupational certificate is currently being applied, in the second half of this year more than 3,000 homes will be delivered in seven phases of other projects throughout the country. As per industry experts, these projects completions are great accomplishments in view of Covid 19's impact on real estate construction activity. By: Shailaja K

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GHMC Plans for Laying Weatherproof VDCC Roads in Different Parts of Hyd
GHMC Plans for Laying Weatherproof VDCC Roads in Different Parts of Hyd

The Greater Hyderabad Municipal Corporation (GHMC) planned to lay the VDCC roads in various parts of the city to prevent rainwater stagnation and ensure longevity. They implemented the latest technologies to boost highway connectivity to change the appearance and experience of city roads. The civic body has stepped up its efforts since last year in laying VDCC roads extensively across the city. Almost 80 kilometres of roads from the planned network of 247 km across GHMC limits have been developed so far. These roads are situated in colonies and stretches, where traffic is comparatively lower than major roads. Proposed Infrastructure Developments in Hyderabad A GHMC official stated that in recent months, VDCC roads have been laid down in some areas by the municipal corporation. These roads can be set in small distances of some half a kilometre or over one kilometre, where the problem is repeatedly with water stagnation or the distance is susceptible to repeated damage. At a few locations, VDCC roads replace damaged conventional bitumen roads in order to ensure durability and to prevent uneven surfaces. Modern technology has begun to deliver positive outcomes everywhere it is used. For example, earlier rainwater staggered in front of Google, Madhapur, but the road conditions improved after laying VDCC road. In view of this, the municipal corporation has now planned to lay extensive VDCC streets throughout the city and aims to implement the 247 km road network technology. The length of the road, which the city council has spent almost Rs.58 crore, is 80 km. As a whole, the municipal corporation aims for a net cost estimate of Rs. 187 crore for replacement of the current gravel and metal roads by a vacuum cement for 247 km of road length. There has been a plan to complete by March of this year the remaining road network. In the process of its efforts to ensure free pothole and blacktop roads in the city, the municipal bodies are already adopting CRMPs, involving private road maintenance agencies including sweeping operations. This project would take up 709 kilometres of main roads and other highways. By: Shailaja K

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How one can Avoid Real Estate Frauds
How to Avoid Real Estate Frauds?

Protect Yourself from Real Estate Scams Wherever there is a lot of money involved, there will be frauds and scams. When planning to buy property, you need to take care that your hard-earned money is not lost in real estate scams and frauds. How do I protect myself from real estate scams - is a big question in the minds of homebuyers. Don’t freak out, but just exercise a little caution, conduct a bit of due diligence and know-how to avoid real estate frauds. Read about the types of property frauds, real estate fraud prevention guidelines and information on who to report real estate scams to. Types of Real Estate Frauds Before going into how to avoid fraud when buying a house, it is important to understand the types of property frauds. Delay in delivery is one of the more common types, where the project turnaround time is not as per the commitment, and there is undue delay in project completion and handover,  Another very common type of fraud is changes in specifications mentioned in the agreement. It could be with respect to the carpet area, interiors, exteriors, materials and fittings used.  The necessary licenses and permissions for the construction of the building may not be procured and sale agreements and deeds are executed beforehand.  There could be hidden clauses in agreements that are not favourable to the buyer. Title/ownership of the land is not straightforward, or it may be disputed, which will ultimately put the buyer’s investment in jeopardy/ Real estate agents and brokers may oversell a property in undeveloped areas on false promises of quick development, high appreciation or high returns. Fraudulent sales where the same property is sold to multiple buyers. Another type of fraudulent sale where a person who is not the owner is posing as owner and executing the sale. How Do I Protect Myself From Real Estate Scams After knowing about types of property frauds, it is important to know how to avoid fraud when buying a house. Firstly you need to be aware of some real estate fraud prevention guidelines.  Secondly, you need to be aware of who to report real estate scams too.  How to Avoid Real Estate Frauds So what are the strategies to avoid real estate frauds? Here are a few real estate fraud prevention guidelines so that you can know how to avoid fraud when buying a house: Don’t be in a hurry to buy. Conduct due diligence.  Check from various sources regarding the rates in the area, and make sure you are being quoted the fair price and not more. Builders may tell you that there are only a few units left and you need to quickly decide, or offer you discounts for booking quickly. However, you take your time to check and decide. If you are investing in an underdeveloped area, make double sure if the area will really develop in the near future or at least a decade down the line.  Some areas really never develop even after two or three decades. Talk to your family, friends, and any real estate experts in your circle. Parameters like the distance from the airport, proximity from  IT parks, and a review of which areas have developed in the past decade should give you an idea if the area that you are planning to invest in will really develop. Do not go simply by the images presented in the website, ads, brochures and pamphlets. Make a visit to the site and see for yourself. Ask neighbours and shopkeepers in the area for their views on the location and locality. Check the track record of the developers, ask for references of previous buyers to confirm their reliability, read online reviews, Google them to find any evidence of fraud in the past. Check if the project is approved by banks for loans, because that is a good indicator of reliability, as banks approve projects only after a thorough inspection. Ask for copies of permissions, approvals for the project, as well as that of the title deed. Be sure that the ownership or title are not disputed. Read the documents carefully, multiple times, to understand every clause and its implication. Ask your family members also to read the same, so that they can spot something that you may have missed.  If possible, also have it read by a legal expert who can caution you against anything that is worrisome in the document. Subsequently, talk to the builder/seller about the clauses or lines that you are not comfortable with, and have them changed. Keep visiting the construction site and keep an eye on the materials being used. Carry a measuring tape with you and measure the rooms to verify if the length and breadth are as per the plan. To protect yourself from delay in project completion, ensure that the construction timeframe and a delay clause is clearly mentioned in the agreement. Who Do you Report Real Estate Scams To  To protect you from real estate scams,  here are a couple of arrangements made by the government. RERA Act, 2016 The Real Estate Regulatory Act, (RERA, 2016) is meant to protect the interest of home buyers by providing transparency on builders and projects.  RERA is specified in each state to regulate the real estate sector. To protect you from real estate scams, RERA requires developers to register themselves and also the project, before advertising any project, commencing any construction or executing any sale.  Builders need to submit all the original documents with RERA. They also need to escrow 70% of the amount taken from buyers, that they can withdraw as the project progresses, with due certification from architects and project engineers. This ensures that the project is genuine, and it is moving forward towards completion. So who do you report real estate scams to? You can report to RERA, as it also acts as an adjudicating body for redressal of disputes and fast resolution. They have a website in each state. Class Action with NCDRC When all buyers are affected by the same cause, on the same project and are seeking the same relief,  they can file a class action suit with the National Consumer Disputes Redressal Commission (NCDRC), provided all the buyers have made complete payment and there are no defaults. In conclusion, make sure that the builder and the project are registered with RERA, and take all the precautions necessary to avoid real estate frauds.

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KTR Initiated Free Water Supply Scheme in Hyderabad
KTR Initiated Free Water Supply Scheme in Hyderabad

On Tuesday, 12th Jan,  KT Rama Rao, Minister of the Municipal and Urban Development, launched a free drinking water supply scheme in Hyderabad. No water bills will be issued to domestic slum consumers in the city with effect from December 2020 under the 20,000 litres of free water supply scheme. Officials will not insist on the fixing of water metres, and slum residents consumption is measured using the water metres of slum dockets. Every individual domestic customer must be equipped with water metres at their expense to make use of the scheme. The usage up to 20 KL per month, per metre readings, is free and everything beyond, shall be charged with effect from December 2020 according to the relevant tariff. The officials stated that HMWSSB will issue the list of empanelled agencies for water metre setup. By: Shailaja K

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Land Bank Digitization Initiative Started in Visakhapatnam
Land Bank Digitization Initiative Started in Visakhapatnam

On Friday, 8th Jan YSRC Rajya Sabha MP V Vijayasai Reddy started the Visakhapatnam Metropolitan Area Development Authority (VMRDA) automated change detection analysis for land management' (land bank digitisation) initiative at the VMRDA office. The VMRDA has outlined four land spaces for the pilot project under the initiative include 137 acres in Madhurawada and 91 acres in Paradesipalem in the Vizag suburbs. Speaking on this event, Vijayasai Reddy stated that after monitoring the initiative and technology for two months, the VMRDA will enhance the initiative to other areas. Previously, the project's urban development authority gave a presentation on the technologies being used in the initiative and how the programme would identify the changes made to VMRDA's land areas. Chief Minister YS Jagan focused on the security and protection of all government lands. Metropolitan Commissioner P Koteswara Rao of the VMRDA said the system would detect any physical changes made to the land or any encroachments and would send an SMS and an e-mail to the officials concerned. Within the jurisdiction of the VMRDA, this may also help identify unauthorised layouts. By: Shailaja K

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Telangana Government Implemented New Revenue Act in Assembly
Real Estate
10 Sep 2020 | 857 Views
Telangana Government Implemented New Revenue Act in Assembly
With a big step towards the implementation of the New Tax Act to revamp the Telangana Revenue structure, the Chief Minister K Chandrasekhar Rao on Wednesday 9th Sept 2020 introduced the new Revenue Bill, which he calls Telangana Rights in Lands and Pattadar Transfer Books Bill 2020. The Government stated that the purpose of the new Act is to provide people with transparency and corruption-free land services and property documents. It will make land transactions transparent and ensure that no official work is carried out about corruption. The new act's ultimate strategy is to pursue revolutionary reforms in land administration. Key Points of Proposed New Revenue Act  The newly created Dharani portal will digitise and survey every inch of the property so that one person is not able to encroach the lands of others. All lands or property details will be accessible online and will also avoid illegal transactions. The multiple servers at many locations will be developed as part of a backup mechanism and disaster management technologies for the stability and security of the Dharani portal.  The new law abolished the discretionary power of the officers to register the land and property.  A total of 590 tehsildars will act as joint registrars in the state and also concurrently register and mutate agricultural land.   The existing 141 sub-registrars will register and convert non-agricultural land. The whole registration process is digitally carried out, the entire registration process will be completed within an hour of uploading documentation and updated in real-time. The certificates such as encumbrance certificates, income certificates or caste certificates can be downloaded directly from the portal.  To avoid conflict when deciding on legal heirs of properties, the Government also planned the incorporation of family tree information in portals from each household.  Now there will be no revenue courts and that all tehsildar magisterial authorities, revenue division officers, and collectors are withdrawn to deal with the land disputes. If there is some conflict over any property, people have to go to civil courts and will be settled by fast-track tribunals. The new revenue act in Telangana will help in eliminating corruption and provide hassle-free service to farmers and general people. By: Shailaja K