Why Kalyan-Dombivli will drive Mumbai's realty market

Both Kalyan and Dombivli have an industrial belt up to Badlapur. This provides very good employment opportunities for people residing around the region.

Buoyed by the positive sentiment led by the government, the Indian real estate market is at the cusp of a recovery. According to a report, the twin city of Kalyan-Dombivli, on the outskirts of Mumbai, will be one of the biggest beneficiaries of this boom.

The Kalyan-Dombivli stretch comes under Kalyan-Dombivli Municipal Corporation (KDMC) and forms a part of Mumbai Metropolitan Region (MMR). This respective location is witnessing the development of new residential projects at a fast pace. Developers that operate in this area include Lodha Group, Nirmal Lifestyle, Raunak Group, Laxmi Housing Builders & DevelopersLaxmi, Versat ile Housing and Mehta Group, among others.

Kalyan-Dombivli's real estate has recently witnessed a boom, primarily due to the increasing prices in Mumbai suburbs and growing demand for affordable housing in Mumbai. A proposal for extending the Navi Mumbai metro rail to Kalyan too has fueled the growth for housing in Kalyan-Dombivli, highlighted the report.

The twin city has large industrial belt to its south-east from Kalyan to Badlapur. There are several small and large industries concentrated in this region.

The availability of local trains from Dombivli has made it a prominent suburb of MMR. The region has seen a rise in population in recent years which reflects its increasing demand in the last few years.

The Maharashtra Industrial Development Corporation (MIDC) has developed a big industrial complex around Dombivli. Kalyan junction is currently one of the major railway stations on the central line of the Mumbai Suburban Railway network. It is also the third busiest station in the suburban railway network, after Thane and Andheri.

Factors driving growth:

The primary factor driving the real estate growth in the Kalyan-Dombivli is the sky-rocketing prices in Mumbai suburbs, coupled with the growing demand for affordable housing.

Mumbai continues to attract migrants who come to the financial capital with hopes of employment opportunities. This has increased the demand for affordable housing. Yet, the present capital values have led a huge gap in demand and supply, though there is unsold inventory of up to four years.

Property values in the Kalyan and Dombivli area offers projects within the affordable range. For example, the average property value in Dombivli East is about Rs 5,440 per sq. ft while it is about Rs 6,040 per sq. ft in Dombivli West. The average property value in Kalyan East is about Rs 5,230 per sq. ft while the average property value in Kalyan West is about Rs 5,920 per sq. ft, the report added.

Another factor driving demand is the availability of industrial belts and improving infrastructure around this area. Both Kalyan and Dombivli have an industrial belt up to Badlapur. This provides very good employment opportunities for people residing around the region.

The City and Industrial Development Corporation (CIDCO) has planned to extend its Belapur-Taloja metro rail service up to Kalyan and Ulhas Nagar. This is expected to give a big boost to the economy as well as real estate around Kalyan. MMRDA has also planned to lay down a road networks including a 29 km Kalyan ring road in Kalyan region.

Kalyan and Dombivli have very good connectivity to parts of Mumbai and other cities via the Kalyan-Shilphata Road, Agra Road and National Highway 4. This also increases the growth prospects of the region. The proposed Navi Mumbai International Airport is at a distance of less than 35 kms.

Kalyan-Dombivli realty market witnessed stagnation in property prices over the past few quarters which could be primarily attributed to the overall slowdown in the real estate market in the country.

However, affordable property prices, good connectivity to other key areas in the MMR and the various market trends go on to indicate that the region has good growth potential in the near future.

“With sentiment improving all around in the realty sector, the area is set to witness high demand for affordable housing. With various infrastructure projects in the pipeline, the realty market here is showing positive trends and it is expected that one can easily witness a price appreciation of about 20-25 per cent over the next few quarters.

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Taking Steps Forwards

MCHI-CREDAI explains the paradigm shift at the government level with ease of doing business for real estate industry

MCHI CREDAI says that it efficiently undertook the task of re-engineering the entire permission process owing to which a lot of positive changes have happened with the implementation of Ease of Doing Business (EODB). Some revolutionary changes can be witnessed where the impact of these developments and fast – track functioning, owing to digitization of approvals, would percolate down to every segment of society.

MCHI-CREDAI has made persistent efforts with MCGM and other government agencies and closely collaborated with the Chief Minister and Housing Minister of Maharashtra in creating guidelines for the manual which would provide a big boost to real estate industry in Mumbai and the MMR. The suggestions given by its team were almost considered in toto by the MCGM and were appreciated by the Chief Minister and the Municipal Commissioner.

It may be recollected that the central government had issued directives a year back to all the municipal corporations to take steps ensuring Ease of Doing Business. Since then MCHI-CREDAI with the support of central and state government is constantly making efforts to ensure Ease of Doing Business in all the related departments.

Lauding the BMCs move of online acceptance of any documents related to building proposals from May 15, 2016, which have been linked with the online system with the Airports Authority of India, archaeological department and railways, Urban Development Minister Venkaiah Naidu noted that it will bring revolutionary change in the perception about the system.

He also said that the Municipal Corporation has integrated many approvals like fire and water to prevent applicants from going to the departments. However, for Mumbai, there are two special requirements, coastal regulation zone and restrictions due to the national park being located within the city and integration with these two processes is under way.

Devendra Fadnavis, Chief Minister, Government of Maharashtra, noted that substantial reduction in the time period for approvals will ensure that the investment on projects does not increase due to cost overruns, which ultimately impacts the common man. This is a DNA change in the thought process, which would be visible at the ground level soon owing to implementation of Ease of Doing Business.

Dharmesh Jain, President, MCHI–CREDAI, said, “Our ground work and efficient implementation by Municipal Corporation would bring in transparency and improve efficiency in the real estate sector besides substantially improving the city's index in ease of doing business.”

Ajoy Mehta (IAS), Municipal Commissioner’s role has been very positive and significant in bringing out change in the working culture and his positioning of real estate industry as a client is huge perception shift. His initiatives would cut down time for the permission and speed up the procedure of acquiring approvals with desired speed and transparency. It will also help to cut down the costs of the houses ultimately. It would also remove red tape from the process and will give impetus to creation of affordable housing in the city and state, thus effectively catering to consumer demand for positivity and a relaxed atmosphere for doing business and reduce stress at so many points.

The paradigm shift would come from use of latest technologies not only for facilitating construction permissions but also to keep a watch on illegal constructions. Apart from this, Mumbai will have a single DCR for all cities which is under preparation to be put on a digital platform in coming two months. Architects will have options for getting NOC/ Remarks manually or online.

MCHI–CREDAI has requested to upload all the formats of EODB in AUTO DCR so that one can directly fill the fact sheet and submit report online to avoid all the duplication, which is happening at present.

Currently MCHI–CREDAI is working on environmental laws as part of DCR to be released in the next couple of months, which would be a big step forward.

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Small Apartments: Big Takeaways

With `smaller projects' being launched in phases replete with amenities that appeal to the new-age home buyer, are the days of the good old big-ticket projects over? We find out...

Manjeet Dabral has always been im pressed with big housing projects in Dubai and infact preferred to stay in one such apartment over there. On his return to India, he wished to live in one of the largest housing projects of Mumbai. However, he gave up on his dream soon. The maintenance of the large project turned out to be a huge challenge and he soon shifted to a smaller housing project.

“Creating consensus over basic issues in large housing projects is a huge challenge in a city like Mumbai. Forget the role of the developer's facility management team; even the residents do not agree on most of the things. I feel we are way short of global standards to live in larger housing projects and hence, living in a smaller building makes more sense,“ says Dabral.

The perception of this home-buyer might have been shaped out of some very specific reasons, but it is quite obvious that he is not alone in Mumbai today, who thinks that smaller projects are a better option than larger size projects. It seems, within the built environment of Mumbai's real estate market, not only the home-buyers but also the developers are realising the advantages of smaller housing projects as against the larger ones. And hence, the new fad is to divide the project into phases and make it into smaller projects.

At an outside view, it might give the impression that it is the execution challenge and the approval bottlenecks that are goading the developers to opt for smaller projects, but an even stronger driving factor is the realisation that the new regulatory regime, post the formation of the real estate regulator, would make it safer for the market to embrace the idea. Developers seem to agree with this. Vineet Relia, managing director, SARE Homes, agrees that breaking down the bigger projects into smaller phases or units has always been a better strategy in terms of both, money and time management. Since, according to the new laws, all such phases or units can be registered as an independent project; it will be easier to finish a small project in the stipulated timeframe.

“There are developers who are already working on the same model. What amenities need to be added in the smaller or larger project is completely at the discretion of the builders, as there is always a cost attached to all these benefits and facilities. Since townships are planned communities, they always offer better amenities than the standalone properties, but are 10-15 per cent costlier,“ says Relia.

The question is whether the small projects can give the kind of amenities that large projects offer. The opinion is divided but Rohan Agarwal, managing director, Geopreneur Group, maintains that the developers face a lot of problems while constructing a small project. But they still strive hard to give amenities in these projects too, as it is the need of the hour for the customers who are looking to buy a new house.

Analysts point out that the developers have done their cost and benefit analysis and have come to the conclusion that there are four main reasons in Mum bai, why they should adopt this model of breaking up larg er projects into smaller ones.

One is that it is often challeng ing to manage the large amount of cash flows in larger projects. If the developer does it in parts, he has to manage the cash flow in smaller amounts, which is more easier. Secondly, with a very large project, there comes the sales challenge of a large inventory. This inventory can also lead to a pile-up inventory when the market is sluggish. Smaller projects open fewer inventories and when that is sold, it also helps generate funds for the further construction of the project. The third reason is that the developers also consider an appreciation over a period of time. Hence, if they do it in phases, the project in the later phase might be able to avail the appreciation in price.

And last, but not the least, smaller phases can give a better control of operating processes, which enables the developer to concentrate on the quality of work. Arvind Nandan, director, South Asia, Colliers International sums it up by adding, “The developers are doing a smart thing by going back to the drawing board and executing what they are capable of, instead of getting into large-scale projects where the execution risk has always been very high. It is not only smaller developers but also large ticket developers who are trying to adopt a business model where disclosures are easy to comply with. It is a good thing for the home-buyers too, who in any case, are no more ready to wait endlessly due to the delays. In my opinion, it is a phase of consolidation and the market will definitely get more mature out of this process.“

In a nutshell, whether it is the execution risk or the regulatory risk ahead, the developers are in creasingly realising the advantages of dividing the larger projects into ividing the larger projects into smaller ones. This sounds well for the home-buyers since the execution timeliness and the fiscal management of smaller projects are more realistic as against the larger ones.

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Residential Sector on an Upswing in Q1 2016

Residential unit launches are up by 25 per cent in Q1 2016 vs Q1 2015; and affordable segment launches have risen 6-fold, stated a report released by Cushman & Wakefield recently

The first quarter of 2016, witnessed the launch of approximately 31,200 units, across the top eight cities in India, recording an increase of 27 per cent year-on-year, stated a report released recently by property consultants Cushman & Wakefield. The residential market, which saw a slump in launches in 2015, saw a remarkable comeback in the first quarter, backed by a six-fold rise in launches in the affordable housing segment, which saw an addition of over 10,950 units during Q1 2016, as developers foresee greater demand in this highly price-sensitive segment.

The affordable segment accounted for approximately 35 per cent of the total launches during Q1 2016. Over the last few quarters, the share of affordable housing has constantly increased as developers and investors are viewing this segment more favourably. Affordable housing segment comprised of 22 percent of the total unit launches seen in 2015, up from its share of 17 per cent in 2014. In the same time, average launch prices have witnessed some decline across major cities, making the new projects cheaper than those launched 12- 24 months back. “Developers have come to realise the vast potential of what was untapped in ithe affordable housing segment. They have now come to recognise the potenetial of the segment and are expecting greater momentum in demand in the affordable segment as Customers are seen to be more price-sensitive in the current market,” says Shveta Jain, executive director, residential services at Cushman & Wakefield.

Mumbai witnessed a significant drop in launch prices of close to 35 per cent in Q1 2016, as against to those launched in Q1 2014. The average launch price for affordable units de clined by 36 per cent in Q1 2016 from Q1 2014 to approx. 4,300 per square feet (psf), as developers look to attract the buyers in the low-cost segment in Mumbai. Developers have also been adopting a strategy of offering residential units in smaller sizing in order to attract buyers.The average unit size of affordable units was seen at approximately 850 sf, an 11 per cent decline over a period of 2 years between Q1 2014 and Q2016. During the current quarter, launches in Mumbai accounted for 17 per centof total launches (across 8 cities) at 5,360 units. This represents an increase of 35 per cent, in Q1 2016, as compared to Q1 2015. During the quarter, the affordable segment accounted ‘for only 5 per cent of total launches in the city.

The mid-segment accounted for the majority of launches, with launches in the segment spread across the eastern suburbs,Thane and Navi Mumbai. “With strong emphasis’on affordable housing by the government; ‘tax incentives extended by the government, as well as the cautious approach by end-users, developers' are betting on the affordable segment,” concluded Jain.

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A Remarkable Comeback

Residential unit launches were up 25% in Q1 2016 over Q1 2015 while affordable segment launches rose six-fold as per the all-India property market research conducted

The first quarter of 2016 witnessed launch of approximately 31,200 units across the top eight cities in India, recording an increase of 27% year–on–year, according to property consultants Cushman & Wakefield. The residential market, which saw a slump in launches in 2015, saw a remarkable comeback in the first quarter, backed by a six-fold rise in launches in the affordable housing segment, which saw an addition of over 10,950 units during Q1 2016 as developers foresee greater demand in this highly price-sensitive segment

Key Segment

The affordable segment accounted for approximately 35% of total launches during Q1 2016. Over the last few quarters, the share of affordable housing has constantly increased as developers and investors are viewing this segment more favorably. Affordable housing segment comprise 22% of total unit launches seen in 2015, up from its share of 17% in 2014.

Price Proposition
 
In the same time, average launch prices have witnessed some decline across major cities, making the new projects cheaper than those launched 12- 24 months ago. Mumbai witnessed a significant drop in launch prices of close to 35% in Q1 2016 as against those launched in Q1 2014.

Mumbai Market The average launch price for affordable units declined 36% in Q1 2016 from Q1 2014 to approx. 4,300 per square feet (psf), as developers look to attract buyers in the low-cost segment in Mumbai. Developers expect rationalization in launch prices in this highly price-sensitive segment to increase the sales velocity in the segment.

Size Strategy
 
Developers have also been adopting a strategy of offering residential units in smaller sizing in order to attract buyers. The average unit size of affordable units was seen at approximately 850 sf, a 11% decline over a period of 2 years between Q1 2014 and Q 2016.

Launch Pattern
 
During the current quarter, launches in Mumbai accounted for 17% of total launches (across 8 cities) at 5,360 units. This represents an increase of 35% in Q1 2016, as compared to Q1 2015. The mid-segment accounted for the majority of launches, with launches in the segment spread across the eastern suburbs, Thane and Navi Mumbai. During the quarter, the affordable segment accounted for only 5% of total launches in the city.

Betting on the segment

“Developers have come to realize the vast potential of that was remaining untapped in the affordable housing segment. They have now come to recognize the potential of the segment and are expecting greater momentum in demand in the affordable segment as customers are seen to be more price-sensitive in the current market. With strong emphasis on affordable housing by the government, tax incentives extended by the government, as well as the cautious approach by end-users in other segments, developers are betting on the affordable segment," said Shveta Jain, Executive Director, Residential Services at Cushman & Wakefield.



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Thane's Housing Market Sees Consistent Growth

According to Report, Thane has come forth as one of the most attractive regions for investment in Mumbai owing to its exceptional connectivity, excellent infrastructure support and flourishing commercial as well as residential markets.

Previously, Thane was known as an industrial hub, but now due to several factors it is favouring as an upcoming realty destination. If we look at the real estate growth in Mumbai for last three to four quarters, it is clear that Thane has emerged as the face of real estate growth in Mumbai when compared to Navi Mumbai and MMR (Mumbai Metropolitan Region). As per data, average capital values in the zone have recorded an average growth of 1 - 2 per cent in the last one year. This can be attributed to its growing commercial, residential, retail and infrastructure development.

Realty in Thane is witnessing a healthy growth for the last few years owing to improved infrastructure, excellent connectivity and thriving commercial and residential activity. Various highways, proposed mono railway project, affordable housing market and good connectivity to Mumbai make Thane an attractive destination for investment. Not just new but many reputed developers are also moving towards the fringes of Thane for building there projects.

Thane was known to be an alternative destination for those who could not afford to purchase a house in Mumbai. However, it has turned out to be not just an attractive destination but also a case study in urban development. With respect to appreciation potential, physical and social infrastructure, rental market, total liveability index and launch to sales ratio of the housing projects Thane fares better than Navi Mumbai and MMR (Mumbai Metropolitan Region).

Thane has been selected as one of the smart cities to be developed in the country. This has further given a boost to the real estate sector here. The area provides for all segments of housing be it luxury, affordable or mid segment. Also people from the city are shifting towards Thane in search of homes that are competitively priced but do not compromise on amenities and open space.

Growth Drivers

1. Relative affordability
Thane has emerged as the preferred choice for real estate investment due to the relative affordability it offers as compared to Navi Mumbai and MMR (Mumbai Metropolitan Region). Since prices have sky rocketed in Navi Mumbai too, which was earlier considered as the affordable cousin of Mumbai, buyers have now started moving towards Thane. One can find affordable housing projects on the fringes of the city which offer compact 1 - 2BHK units with amenities like piped gas, gym, club house, swimming pool, security, rain water harvesting, intercom facility, etc.

For instance, capital values in major residential pockets in Navi Mumbai like Belapur, Kharghar, Panvel and Ulwe range from Rs 6000 - 9000 per sq ft while emerging locations in Thane such as Ambernath, Badlapur, Kalyan and Khapoli ofefer properties at Rs 3500 - 6000 per sq ft approximately. These localities are also potential investment destinations as these have witnessed a healthy appreciation in the last few years.

2. More budget housing Launches
While Mumbai is reeling under the pressure of low sales and unsold inventory, residential sales in Thane are on the rise. Established developers like Lodha Group, Rustom Developers, Omkar Realtors and Aura Group. Have launched their affordable housing projects on the peripheries of Thane.

3. Infrastructure and Connectivity
What has worked out for Thane as an affordable and preferred realty market is the continuous improvement in infrastructure with the addition of new roads and flyovers, providing better connectivity by rail and road to other locations of Mumbai," adds Maulik Sheth. Some of the important projects include Santacruz - Chembur Link Road, proposed fourth phase of the metro, underground tunnel from Manpada to Borivali, two proposed monorail lines that will connect Thane with Dahisar and Kalyan respectively. At present there are seven flyovers for which work is in progress which will connect Thane with Dahisar and Ghodbunder with Bhiwandi.

With the proposed smart city project the realty landscape in Thane is set to improve further. Thus, thus seems to be a good time to invest here as property prices will only upwards from here.

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Gain Multiple Advantages

Invest in a home on Akshaya Tritiya, one of the four most auspicious days of the Vedic Calendar, instead of gold

In a cosmopolitan city like Mumbai, where technology and time constraints tend to influence most decisions, the balancing act between a modern approach and traditional values is managed rather well and with good reason.

The initial driver is a desire to keep the senior generation happy. If buying a big ticket item like a home on an auspicious day can ensure family harmony, why not? Also, even the least religious Mumbaikar prefers to have God on his side and doesn’t mind waiting a few weeks to ‘coincidentally’ conduct an important acquisition on ‘Akshaya Tritiya.’

Traditional Significance
Regardless of the motives involved, there is a visible trend of Mumbaikars scheduling important purchases for this day. The word ‘Akshaya’ in Sanskrit means imperishable or eternal. Any project initiated or valuable item purchased on this day, is therefore said to bring success or good fortune. Akshaya Tritiya is considered one of the four most auspicious days of the Vedic Calendar.

Akshaya Tritiiya is very auspicious, in fact it is said that there is no inauspiciousness phase during this day so doing ‘good’ things can be done at any time without referring to planetary positions for an ‘auspicious’ phase. Since Indians definitely believe in starting a new activity or purchasing an important item like gold or property on an auspicious day and during an auspicious phase, Akshaya Tritiiya meets all their requirements.

Mindset Shift
While buying gold on the auspicious occasion of Akshaya Tritiiya has been a tryst with tradition, a modern day Akshaya Tritiya investment is probably more likely to involve a visit to a new housing project or township site office rather than a jewellery store. There are several logical reasons why people prefer to invest in real estate instead of going the traditional jeweller route.

Money Matters
The first is a basic concern about getting your money’s worth. Buying ornaments is to put it politely, dicey unless if one is dealing with a really top-level jeweller. You never know how much carat gold the ornament is really made of and would have to largely go on trust, a commodity that is in extremely short supply these days! Add to that the making charges that would be deducted in case one has to return the item for cash and its obvious why this route is no longer preferred by the discerning investor.

Future Needs
The other and bigger problem for Indians is that gold ornaments or coins with religious symbols/ images have a sentimental value. Selling them, even in times of the direst financial crisis is considered akin to a loss of honour. While certain Bollywood films do have scenes where a wife’s jewellery is pawned to help a family tide over a bad financial period, one would be hard pressed to see such scenarios being enacted in real life.

Usage Patterns
Gold ornaments are usually relegated to bank lockers and taken out on rare occasions and returned immediately thereafter. To sell them is like parting with a family heirloom and signifies the end of all that’s positive. Wearing them at functions is again a risky affair with the threat of being robbed in transit or at the venue or heaven forbid, at home itself.

Multiple benefits
In comparison, real estate offers a much more practical option. One is absolutely sure of the value of what is being purchased and there will be no loss in terms of ‘making charges’ as there is in buying gold jewellery. So the smart investors are opting for the safe and practical real estate Akshaya Tritiya investment this year on Monday, May 9, 2016, following the new golden rule.

Facilitating the process are special offers, new launches and innovative financial schemes that address the needs of home seekers to a much greater extent. These are especially offered on this day to encourage fence-sitters.

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Thane Scripts a New Realty Tale

Due to great infrastructural facilities and availability of open spaces and excellent connectivity the micro-markets of Thane are turning into realty hotspots.

 Thane has risen on the realty map of Mumbai in a very short span of time. Sunita and Vishal Khare, who are software consultants and have been living in a rented apartment at Chembur for the last four years, are among the new generation of buyers who now no longer want to stay on rent and instead wish to buy their own home in Thane. When they contacted a local real estate agent, they told him specifically to search for a flat in Thane and even if it is a re-sale flat, they are completely fine with it. Vishal explains, "If we are going for a resale property in a good area, we know the property titles are clear. The necessary social infrastructure is ready and we would not have to struggle every day for our daily necessities. Besides, Thane has emerged as a destination where residential development is complemented with strong infrastructure and improving connectivity. Hence, we want to invest in this area."

Manohar Bapat, a local broker in the area says, "For the last three years, the market had been sluggish in Thane. In this period, there were many buildings ready for possesion, which were available but there were not many buyers. Due to enroachment of private forest land and other clearance issues, home buyers were looking at areas that were 'popular' and wherein the buildings had a clear municipal title."

But now the scenario is gradually changing with buyers opting for areas, which were earlier considered `far flung' due to the improving social infrastructure and connectivity. According to Ramesh Nair, COO business and international director, JLL India, "Thane's residential property market has the unique advantage of being able to cater to almost every income group. Many areas in Thane like Vasant Vihar, Ghodbunder Road, Majiwada and Waghbil have become key attractions for buyers. But some of its newly emergent locations also show clear signs of superior town planning, very likely induced by learnings from other markets like Navi Mumbai. Today, Thane has clearly defined precincts for the upper-middle class of home-buyers. Thanks to intelligent land purchasing and planning, some of the major developers are now able to launch large integrated residential projects, which offer a lot more than just baseline amenities and facilities. Thane's excellent connectivity to Mumbai by road and rail has also helped boost its overall stature and desirability in the realty market."

Ateev Gala, executive director, Vijay Group agrees, "Thane Municipal Corporation (TMC) and the government bodies have planned many new infrastructural projects as well for improving the connectivity of the area with the rest of the city. The approvals have also come in and both, the developers as well governing bodies, are working to make Thane a self-sufficient city. The upcoming metro project, an improving railway connectivity and the growing IT and commercial space, have boosted Thane's realty quotient." Also, after the Kapurbawdi fly over has become operational, it has considerably reduced traffic congestion in this region. The proposed monorail, which will connect Thane to the western suburbs in its next phase, is yet another major draw for this location.

Sachin Mirani, director, Squarefeet Group, says, "Thane is attracting the attention of home-buyers as well as developers alike. In the near future, affordably priced properties in Thane will experience a steady rise in rates. In addition to all this, Thane is also endowed with multiple renowned schools, multi- specialty hospitals, shopping malls, avenues for recreation and enter-tainment, fine dining restaurants and eateries within an easy reach. While this area remains among the more affordable ones around Mumbai, there will be a steady rise in rates as development catches up with planning and existing supply getting absorbed by the buyers." But many buyers who have invested in the area in the last five years, also caution that before anybody makes a purchase, it's important they exercise due diligence by checking the documents thoroughly and making sure the area has strong infrastructure and connectivity. James Joseph, who bought a 2-BHK flat in Majiwada, four years ago, says, "Till date, we are facing a lot of problems due to an irregular supply of water. Besides, our area is not as well connected too to the railways station as compared to other areas. Hence, it's important that the authorities should look into all these problems before giving the permission for new buildings."

Talking about the popular areas in Thane, Shailesh Puranik, managing director, Puranik Group says, "At present, it is the Ghodbunder Road, which has become one of the most favourite destinations among home-buyers in view of excellent connectivity and infrastructure facilities it enjoys although nothing can take away from the GETTY IMAGES fact that it has taken a lot of years and efforts on part of both, the government and the developers, for the area to become live able."

But for most of the realty experts, even the upcoming areas of Thane, are going to give better returns, provided the area has good infrastructure. Vikram Kotnis, founder and managing director, Amura Marketing Technologies says, "Thane, as a destination, has definitely picked up, given the rates and the infrastructure being developed there. Hence, I am sure, in the coming time, besides the 'current favourite' localities, the remaining areas will also do well and attract the attention of buyers and developers alike."


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Real Estate Bill is an act now

The Real Estate (Regulation and Development) Bill, 2016, became an act on May 1, kick-starting the process of making rules as well as putting in place institutional infrastructure to protect the interests of home buyers in India.

While acknowledging that the act is a positive development, property experts said the new rules should address problems faced by builders in getting sanctions and approvals in a timely manner. "Government authorities should also be made accountable for time bound approvals through the rules that will be made," said Anshuman Magazine, managing director of property advisory firm CBRE South Asia.

He said that if this happens, it will be one of the major steps towards the recovery of the Indian real estate market and will improve the confidence of both consumers and institutional investors - domestic or foreign. "Of course, it should not become another hurdle for development, which will then raise property prices in the long term," said Magazine.

The Ministry of Housing & Urban Poverty Alleviation notified 69 of the act's 92 sections that come into force from May 1. Rules for implementing the provisions of the act have to be formulated by the central and state governments within six months - by October 31 - the maximum period stipulated in Section 84 of the act.

The housing ministry will make the rules for Union Territories while the Ministry of Urban Development will do so for Delhi. The key to providing succour to home buyers will be the setting up of Real Estate Regulatory Authorities, which will require all projects to be registered, and the formation of Appellate Tribunals to adjudicate disputes.

According to Section 20 of the act, state governments have to establish the regulatory authorities within one year of the law coming into force. These authorities will decide on the complaints of buyers and developers in 60 days. The act seeks to protect the rights of home buyers, mandates registration of projects, including those that have not got completion or occupancy certificates.

Registration will require builders to set aside 70% of the funds collected from buyers and pay interest in case of delays. Any officer, preferably the secretary of the department dealing with housing, can be appointed as the interim regulatory authority.

Once the regulators are set up, they will get three months to formulate regulations concerning their functioning. Real Estate Appellate Tribunals need to be formed within a year - by April 30, 2017. These fast-track tribunals will decide on disputes over orders of the regulators within 60 days.

A committee chaired by the secretary of the housing ministry has started work on formulation of model rules so that states and UTs can frame their rules quickly, besides ensuring uniformity across the country. The ministry will also will come out with model regulations for the regulatory authorities.

The remaining sections of the act that have to be notified relate to aspects such as the functions and duties of promoters, rights and duties of allottees, prior registration of real estate projects with the regulatory authorities, recovery of interest on penalties, enforcement of orders, offences, penalties and adjudication.

Considering that there 12 months left for the regulatory authorities to be set up by the states, builders are expected to speed up work to avoid the stringent provisions of the new real estate regulatory act.

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