What Is The Significance Of CIBIL Score For Young Homebuyers?

 April 2022

Are you planning to take a loan and invest in your first home as a Millennial but don’t know where to begin?

Work from home, nobody expected a “trend” to become a normal life routine. Shifting from conference rooms to conference calls, companies are seeing the upsides of working from home with low overheads and in the possible future there might be a chance of having a permanent remote team in every organization. Now that Work from home has established its roots in the work culture, what will it mean for the real estate industry? Well, because working from home, where you have to spend the majority of your day, has made people, especially millennials, realize that having your own space is quite important. Hence, they’re moving towards buying their own home instead of renting one. Now that millennials are looking to buy their own homes they’ll also be looking to get a home loan with a decent interest rate for which the market is moving in their favour. But, it’s an utmost important thing, especially as a young homebuyer to have your CIBIL score in check for the best possible interest rate on the home-loan.

What is a good CIBIL score?

A CIBIL/Credit score is a 3 digit number associated with an individual which defines the credit-worthyness of that individual. IIt ranges from 300 to 900, 300 being the worst and 900 being the best. If you’re an individual with a new credit history, let’s say 1-6 months, you’ll be assigned a number between 1-5, and If you’re an individual with no credit history, your credit score is simply -1, indicating a non-existing credit history. Lenders prefer that a customer's CIBIL score be around 700, if not 750 or more, when applying for a home loan.

Why is a good CIBIL score important for young homebuyers?

A credit/CIBIL score helps the lender determine your borrowing & repayment history, after a lot of documentations of your income report, salary slips, bank statements etc, an assurance is established between you and the lender. For any young homebuyer, a strong credit score is required for a home loan approval, whereas a low credit score may jeopardize/reduce the individual's chances of receiving the loan.

1. It reveals your credit behaviour. Lenders may assess how you handle credit by looking at the different sorts of loans you've taken in the past as well as the ones you're now repaying (when applying for the loan). Credit ratings are based not just on the loans you've taken, but also on how you've used your credit cards. Lenders can see how often you use your credit card, your credit utilisation ratio, and if you have returned your credit card bills, as well as past and current loans, on time and without default. As a result, your credit score provides your lender with a complete picture of how you manage all types of credit.

2. It determines your repayment history and capacity. When applying for a house loan, you must demonstrate your eligibility. One of the easiest methods to see if you are qualified is to look at your income. Lenders need you to meet a certain level of revenue. If you do not earn a specific amount of money each month, you may be ineligible for the loan. Your income and credit scores assist lenders in determining if you will be able to repay the loan on time, which is why lenders examine your credit score for a house loan.

3. It counts in the factors if you’ve any other ongoing loans. Borrowers who hold outstanding debts while applying for another are viewed as hazardous by lenders. A new debt entails more financial obligation, even if your salary remains the same. The lender determines whether you can repay a high-value house loan based on your credit score. They look at your loan to value ratio, which is the difference between your monthly income and the amount of money you spend on credit card bills and other loan EMIs. Lenders may deem you ineligible for a loan if your loan-to-value ratio surpasses 60%.

4. Your interest rate is determined by your CIBIL score. A loan is a borrowed money that must be repaid to the bank in instalments with interest over a certain period of time. This borrowed sum is divided into two parts: the principle and the interest. The principal amount is unaffected by the CIBIL score and remains constant. What fluctuates is the amount of interest, which is the principal plus the interest rate applied by the lending bank. This interest rate is determined by your CIBIL score. Banks will be more willing to lend you money if you have a good credit score. The usual requirement is a low rate of interest for applicants with credit scores of 750 and higher, with candidates with a CIBIL score of 850 receiving the lowest rate of interest. Banks will impose the highest possible rate of interest or refuse the loan application for candidates with a credit score of 550 or above. Most banks will not consider a loan request with a credit score of 500 or lower; those that do will impose interest rates of up to 30%.

How do you check your CIBIL score?

You can check your CIBIL score from Credit Information Bureau (India) Ltd, also known as CIBIL. It is the leading provider of credit reports and ratings for people. Individual financial data, such as loan and credit card information, is sourced by CIBIL from India's top banks and other financial organisations. This information is subsequently provided as a CIBIL credit report, also known as a Credit Information Report (CIR). According to RBI rules, you’re entitled to get one free credit report a year from your credit institution but, if you require more than that, you might have to pay a nominal fee varying from institute to institute. As a young home buyer who is applying for a home loan can be a very significant thing because it's the biggest loan you probably can apply for and not just in terms of principal amount but also the tenure of the loan can be 15 to 20 years.

Hence, you need to be really careful with what you’re getting yourself into while applying for a loan and a commitment that big. With lowest interest rates starting at 6.65% p.a at Kotak Mahindra Bank with tenure period of 1 to 20 years when the loan amount it upto 80% of the property value. In case the loan amount range over 80% of the property value, the interest rate starts at 6.85% Of course, going for a home-loan with the lowest interest rate you can get is an obvious choice because the total repaid amount will go down with the interest rate. Along with that, financial experts suggest young buyers to look for ready to possess or near completion properties as sometimes there is a huge delay in real estate projects. Young homebuyers need to keep these things in mind before taking a step towards their future home.

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Proptech Glossary Every Real Estate Professional Must Know In 2022

 April 2022

Proptech Glossary Cheat Sheet to all the updated terminologies in 2021. Since these Proptech Terms are so widely used, the first problem is figuring out what they actually denote.

The vocabulary (Proptech glossary) used to describe what is feasible is one of the most common sources of misconceptions about PropTech. For example, terms like AI, business intelligence, and ConTech are frequently employed without clear definitions of what they mean in the context of the business. Since these terms are so widely used, the first problem is figuring out what they actually denote. As a result, we've organised a Proptech Glossary Cheat Sheet that includes all of the revised terms for 2021. Some of them are as mentioned below:

Terminology	Explanation
Accelerator	It is a cohort-based, rectified programme that incorporates seed funding, connections, mentorship, culminates in a public pitch event or demo day to help businesses expand faster.
Angel investor	This sort of investment usually occurs while a startup is in its early stages; it occurs when an investor, often known as a "business angel," supplies a firm with initial or expansion cash in exchange for a share of the company's ownership. Jeff Bezos, the CEO of Amazon, is one of the world's most well-known angel investors, having invested in companies such as Google and Uber.
Acqui-hired.	When a tiny, struggling business is bought solely for its employees. It's equivalent to obtaining the intellectual capital of a pre-assembled, talented team. According to a CBInsights acqui-hire analysis, internet companies accounted for 60% of all acqui-hired IT companies between 2012 and 2013, while mobile companies accounted for 38%.
Agile	A time-boxed, iterative method to software delivery that produces software incrementally from the beginning of the project rather than aiming to provide everything at once right at the end.
AIoT	The Artificial Intelligence of Things (AIoT) combines artificial intelligence (AI) technology with the Internet of Things (IoT) infrastructure to improve IoT operations, human-machine interactions, data management, and analytics.
Ambient Computing	It is a network of internet-connected "things" that can automatically adapt to business needs in real-time.
API	The term API refers to an interface that allows programmes to communicate with each other. It's a set of standards, protocols, and tools that make it possible for various software and hardware to work together.
Artificial Intelligence (AI).	Machines, particularly computer systems, simulate human intelligence processes. Learning (the acquisition of information and the rules for applying it), reasoning (the application of rules to arrive at approximate or definite conclusions), and self-correction are examples of AI processes.
Automation	Proptech firms from all across the world have devised revolutionary ways to automate buildings. Almost everything can be automated, from HVAC to lighting, security to appliance monitoring. Property owners and managers can control any of their building's equipment remotely using cloud-based dashboards and smartphone applications.
Augmented Reality	It is a real-time, direct or indirect view of a physical, real-world environment augmented (or supplemented) by computer-generated sensory input such as sound, video, graphics, or GPS data. Physical space is covered with virtual data in augmented reality.
Virtual reality	It is a simulated experience that might be similar to or completely distinct from the real world. The usage of virtual reality in real estate can be game-changing since it allows you to exhibit your home and organize site visits without the need for applicants to be present.
Autonomous vehicles	The era of self-driving cars is rapidly approaching. They're simply one form of the autonomous vehicle, which are cars that can perceive their surroundings and move from one location to another without the need for human intervention.
Backlog	A list of new additions, changes to existing features, bug fixes, and other actions that can be delivered to meet a specific goal.
Beacon	Beacons are small wireless transmitters that communicate signals to other smart devices nearby using low-energy Bluetooth technology. They are one of the most recent advancements in proximity marketing and location technology.
Bid-Management	Bid management is the process of automating the bidding process for digital marketing initiatives. Bid management software, often known as bid optimisation platforms, allows you to automate your CPC (cost-per-click) bids across many campaigns. You may produce earnings as well as brand recognition by combining a digital analytics solution with a bid management platform.
Big Data	It is a term used to describe extraordinarily massive data collections that may be computationally analysed to uncover patterns, trends, and relationships, particularly in the context of human behaviour and interactions.
Big Tech	In journalism, the terms "Big Tech" and "Tech Giants" have been used to refer to the largest and most dominating corporations in the information technology industry.
Blockchain	The backend technology that allows digital assets to behave like physical commodities is known as the blockchain. It makes it possible to conduct secure digital transactions. Brickblock's CEO, Jakob, explains it clearly and concisely as a "large database documenting transactions.
Bond Market	Buying and selling of thirty-year treasury bonds on a daily basis. Lenders pay close attention to this market because, as bond yields rise and fall, fixed-rate mortgages do roughly the same.
Bootstrap	Have you ever heard the phrase "lift yourself up by your bootstraps"? This phrase has evolved from it, and it now refers to self-funding through personal resources such as friends and family.
Bridge loan	A loan for a short length of time, usually between two and three years, until long-term finance, can be arranged. A swing loan is another term for a short-term loan.
Burn rate	How quickly you squander your money, to put it bluntly. Don't be shocked if you hear this term, sometimes known as a run rate, being thrown around at industry networking events.
Broker	A broker, by definition, is someone who works as an agent, bringing two parties together for any type of transaction in exchange for a fee.
Building Automation System (BAS)	A building automation system (BAS) is a hardware and software-based intelligent system that connects heating, ventilation, and air conditioning (HVAC), lighting, security, and other systems on a single platform.
Building Information Modeling (BIM)	It is a smart 3D model-based method that provides architects, engineers, and construction (AEC) professionals with the knowledge and tools they need to plan, design, construct, and manage buildings and infrastructure more efficiently.
Building Management Systems (BMS)	They are computer-based control systems that regulate and monitor mechanical and electrical equipment in buildings, including ventilation, lighting, power systems, fire systems, and security systems.
CAGR	CAGR, or compound annual growth rate, is a helpful metric for comparing growth across time. If you assume that the investment has compounded over time, it can be regarded as the growth rate that gets you from the beginning investment value to the finishing investment value.
Coworking	It is the sharing of equipment, ideas, and information in an office or other working environment by individuals who are self-employed or work for different businesses.
City-as-a-Service	Combines infrastructure-as-a-service (IaaS) and software-as-a-service (SaaS) technologies to serve as a city-wide platform for the implementation of smart city technology. Consider a city's operating system.
Convertible note	A note represents a percentage of a company's equity ownership. Convertible notes are used by some business owners to attract angel investors without having to value their firm. As soon as another investor joins, the note becomes equity.
Cloud computing	Cloud computing refers to the distribution of on-demand computing services, such as applications, storage, and processing power, over the internet and on a pay-per-use basis.
Co-living	Residential real estate products with common services and shared spaces are known as co-living, and they shift the focus away from purchasing and renting properties.
ConTech	Construction Technology, or ConTech, is a term that refers to the field of construction The manner in which PropTech will alter our physical surroundings. It concerns prefabricated or modular buildings, alternative and sustainable building materials, 3D printing, and robot bricklayers in terms of construction procedures.
CRE Tech	Commercial real estate (CRE) technology is quickly expanding in the real estate sector, as professionals work to revolutionise the current commercial real estate market. To ignite the buying and selling market, most of today's developing CRE technology employs big data, machine learning, and the Internet of things (IoT).
Digitalisation	Taking advantage of technical improvements and making use of data generated from properties is what digitalization in property management is all about.
Digital Disruption	The term "digital disruption" refers to the transformation brought about by new digital technology and business practices. Digital breakthroughs that influence products, services, business processes, and consumer behaviour can have a significant impact on how a company works.
Drones	Drones offer construction companies a bird's-eye perspective of worksite, materials, machinery, and people. Contractors are recording photos and videos with the autonomous flying aircraft to help optimise anything from grading plans and operations to finding variations between as-designed and as-built site plans.
Exit Strategy	Before or throughout their entrepreneurial journey, founders may design an exit company strategy. An exit is a method of transferring control of your business to another company while still repaying your investors.
Facility Management	In facility management (FM), professionals use the chance to reassess the use of space, advising asset owners and users on the most efficient use of buildings to meet changing workforce demands and improve asset monitoring and performance.
FinTech	FinTech, or financial technology, is a type of technology and innovation that tries to compete with traditional financial delivery systems. It is a new industry that employs technology to improve financial activities.
Hybrid App	A hybrid app is a software application that incorporates features from both native and web apps. Web apps that have been embedded in a native software shell are known as hybrid apps. Hybrid apps are popular because they allow developers to write only one piece of code for a mobile app while still supporting multiple devices.
Incubator	In contrast to an accelerator, an incubator helps startups in their early stages of development. It's essentially a company that helps new businesses get off the ground in the initial few months or years, usually in exchange for ownership.
Initial Public Offering (IPO)	An initial public offering (IPO) is when a startup's stock is first made available to the general public. A private corporation becomes a public company at this stage.
Lean Startup	When starting a new firm or releasing a new product, this strategy is used to swiftly and inexpensively validate a business proposition.
Location Intelligence	Location intelligence is a useful tool for real estate companies since it allows them to identify and evaluate neighbourhood trends. They utilise it to anticipate or estimate whether or not a particular sector is worth investing in.
GDPR	The General Data Protection Regulation (GDPR) is a regulatory framework that establishes standards for the acquisition and processing of personal data from European Union citizens (EU).
High-performance computing	A high-performance computing system (HPC system) is essentially a network of nodes, each of which has one or more processing chips and its own memory.
Infrastructure as a service (IaaS)	It is a type of cloud computing that uses the internet to deliver virtualized computing resources. Along with software as a service (SaaS) and platform as a service (PaaS), IaaS is one of the three primary categories of cloud computing services (PaaS)
The Internet of Things (IoT)	The Internet of Things is centred on greater machine-to-machine communication; it is based on cloud computing and sensor networks; and it is a mobile, virtual, and immediate link.
Key Performance Indicator (KPI)	It is an acronym for Key Performance Indicator. A measurable value that shows how effectively the organisation is achieving its main business goals.
LegalTech	The use of technology to assist law firms with practise management, document storage, billing, accounting, and electronic discovery is referred to as legal technology. Legal Tech startups are disrupting the legal profession by providing people with online software that reduces or eliminates the need to consult a lawyer.
MVP (Minimum viable product)	A process that entails the creation of a rudimentary version of a new product in order to satisfy the product's early users. After that, the product is enhanced with new features based on input from early consumers.
Machine Learning	The study of computer algorithms that improve themselves over time is known as machine learning. It is considered a subset of Artificial intelligence.
Near-field communication (NFC)	It is a collection of protocols that allow two electronic devices, one of which is usually a portable device like a smartphone, to communicate by bringing them within 4 cm of each other.
Non-disclosure Agreement (NDA)	A legal contract that protects a startup's secrets by requiring workers who disclose them to pay damages. NDAs can be used to safeguard proprietary code, formulas, and customer information, among other things. You can have a “one-party” NDA, in which one party receives sensitive information from the other, or a mutual NDA, in which both parties receive confidential information.
Property Data	Property data provides information about properties, including their function, value, and ownership. It's mostly utilised by data-driven real estate investors who want to make intelligent conclusions on where to put their money based on current property values.
Property management	The management of residential or commercial properties is referred to as property management. It encompasses all aspects of maintaining, growing, and managing an investment property.
Pitch Deck	If you've ever had to present an idea to your supervisor, you've probably tried your hardest to persuade them. A pitch deck, on the other hand, is a condensed form of a business plan that displays crucial numbers to potential investors in the hopes of persuading them to invest.
Pivot	The phrase pivot is used in the startup sector to indicate when a company suddenly switches paths after previously targeting a different market niche, similar to how it is used to describe a mechanism revolving on a central point.
Platform-as-Service	A type of cloud computing service that provides a platform for the creation and management of digital applications.
PropTech	Property technology (PropTech) refers to the application of information technology (IT) to provide information, conduct transactions, and manage various sorts of real estate, including residential, commercial, hotel, logistics, and land. It is intended to simplify and integrate processes for buyers, sellers, brokers, lenders, and landlords at all stages of the real estate industry.
5G	5G paves the door for more and higher-tech home tours given via augmented reality, smarter smart homes, and better-connected remote offices in the real estate industry. During video calls, annoying time lags and other interruptions should be eliminated.
3d printing	It's a method of forming the external and interior walls, as well as the roof, by injecting layers of material like cement onto a digitally defined structure.
QR Code	A QR code is a machine-readable code made up of an array of black and white squares that is generally used to store URLs or other information that can be read by a smartphone's camera.
REIT	A REIT is a business that owns, operates, or funds income-producing real estate.
Real estate marketing	Real estate marketing is all about showcasing your unique value propositions to the rest of the world in order to establish a brand, acquire clients, and close deals.
Scale-up	When your firm has increased in terms of size, geographic location, market, and so on, you can say you've scaled up. Scaleup is a word that refers to a business that has previously proven its product in a market and is financially viable.
Seed funding	Seed funding refers to the first round of tiny, early-stage investments from family members, friends, banks, or an investor.
Startup	Though there is no common definition of a startup, one widely recognised definition is a business in its early or growing stages, usually less than three years old and (if not already) profitable.
Smart Building	Any structure that uses automated processes to control the building's functions, such as heating, ventilation, air conditioning, lighting, security, and other systems, is referred to as a smart building.
Smart City	It is a city that uses information and communication technology (ICT) to improve the quality and performance of urban services like energy, transportation, and utilities, lowering resource use, waste, and total costs.
Smart Drains	Drains with sensors that give alerts when they are in risk of silting or overflowing, as well as fill rate data that can be used for extremely effective predictive cleaning operations.
Smart Grid	An improved electrical grid that gathers and acts on information such as supplier or consumer behaviour to improve the efficiency and sustainability of electricity distribution automatically using digital technology.
Smart Home	A smart house is a home with internet-connected gadgets that allow for remote monitoring and management of appliances and systems like lighting and heating
Software as a Service (SaaS)	It is a distribution model in which a third-party supplier hosts and distributes software to clients via the internet.
Term Sheet/Letter of intent	The non-binding agreement between an investor and a startup includes the basic terms and conditions for financing. A binding agreement based on the term sheet is set up once the parties concerned have achieved an agreement.
Unicorn	A corporation with a market capitalization of more than $1 billion, usually in the technology or software sector. Tesla, Airbnb, Instagram, and Shopify are examples of well-known unicorn startup companies.
Urban data platform	A unified digital environment for the aggregation of data across numerous geographic areas or civic functions of the city is provided by an urban data platform. Consider a single platform for gathering and sharing data about cities.
VC (Venture capital/Venture capitalist)	Firms provide venture capital to small, high-risk startup companies with large growth potential in exchange for equity. VCs are investors who work for venture capital firms and choose to invest in specific businesses.
Vesting	A process in which a right to a present or future payment, benefit, or asset is given or earned.
Virtual reality	Virtual reality technology is an excellent technique for realtors to market staged properties at a low cost. Virtual reality helps you to create amazing 3D real estate tours and stage properties for your clients to visit. It also enables real estate developers to market the completed product before it is built.

Once you've identified what's accessible to you and what works for your business, you're ready to go on to the next phase, which is putting everything together. The optimal solution is to pick a system that can integrate with the greatest components available. This means you'll never have to sacrifice functionality, and you'll be able to access all of your chosen solutions through a single end-to-end system. Proptech transforms the real estate sector by making resources, tools, and systems more accessible and affordable. As you may be aware, staying updated on the latest Proptech Glossary or Terminology can assist you in determining if you are making the most of the tools you now have or whether you need to upgrade to more efficient ones. ALSO READ: China Urges Banks To Steady Housing Market & Avoid Speculation To Curb Evergrande Risk

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Maharashtra forest department begins demolition of structures inside mangroves

 April 18, 2022

Mumbai

While ‘Mission Begin Again' applies to all walks of life post the lockdown phase, the state forest department has also enthusiastically vouched for it by recently starting a special demolition drive of illegal structures within the areas notified for mangroves in and around the Mumbai Metropolitan Region (MMR).

Just last week, several concrete structures inside the notified mangrove area were demolished by the mangrove cell officials at Kopri in Thane. More demolitions are expected here and also around coastal areas, such as Juhu, Versova, and parts of Navi Mumbai, where there are notified mangrove forests.

Additional principal chief conservator of forests (mangrove cell) Virendra Tiwari, said, “It was surprising to see pucca concrete houses built illegally inside the notified mangroves at Kopri.

Our officials are undertaking field inspections at all notified reserved forests to check for such illegal shanties and houses so that demolitions can be carried out. We are following the earlier Bombay High Court orders that mangroves are protected forests and hence no illegal encroachments or structures should be allowed in them.”

Environmentalists have welcomed this determined move by the forest department, though they feel that a lot more needs to be done in order to fully protect Maharashtra’s green coastline.

“It’s good that the mangrove cell has started demolishing illegal structures inside mangroves and is taking legal action on the encroachers. I also want to urge them to revisit the demolished sites regularly to ensure encroachers do not return,” said Director of Vanashakti NGO, D Stalin, who is also the member of the high court-appointed wetlands and mangroves panels.

Debi Goenka of Conservation Action Trust (CAT) echoed similar views on this issue. “The PIL of Bombay Environment Action Group had resulted in the landmark interim court order of 2005, and the final verdict of 2018 -- that all mangroves must be protected in the state. So, it is good that demolitions have restarted in mangroves areas, but I feel that the officials must also take a look at those mangroves that are not yet notified, in order to safeguard them from encroachments.”

“The action against encroachments on mangroves is a welcome step and, in fact, the mangrove cell is bound legally to protect the sea plants that protect the coast from high tides and act as an efficient rain forest,” said B N Kumar, Director of NatConnect Foundation.

The slum encroachment, though, is a matter of concern and just a tip of the iceberg as compared to destruction happening across other parts of the coast such as Uran, Kharghar and Ulwe, Kumar added.

The greens pointed that the mangroves ought to have been handed over by various agencies to the forest department for conservation as ‘reserved forests’ as per the high court ruling of September 2018. Yet, the process has been slow even three and half years after the judgement, Kumar regretted. The state government and the High Court-appointed mangrove protection and conservation committee have also issued directives to government agencies to quickly complete the process of transferring all mangroves to the forest department.

Vast stretches of mangroves under JNPT and NMSEZ have been destroyed in Uran, with no official agency acting against them despite the high court judgement. The FIRs against NMSEZ and the lone instance of imposing a penalty of Rs 1 lakh on JNPT are negligible as compared to the irreparable destruction, NatConnect explained.

“Mangroves are rich breeding ground for a variety of aquaculture, and the local fishing community lost their source of survival,” lamented Nandakumar Pawar, Head of Shri Ekvira Aai Pratishtan. All our complaints to the authorities have fallen on deaf ears as large-scale violations of the provisions of the environmental clearance have gone scot-free, Pawar said.

The MCZMA itself just passes the buck to the district coastal zone committees which do not seem to bother about the violations, Pawar added.

“The sad part is,” Kumar argued, “even the HC-appointed committee directives have been ignored and as a result of which debris on mangroves under NMSEZ is yet to be removed, choking and killing the vital sea plants.”

In Kharghar, too, local activists Naresh Chandra Singh and Jyoti Nadkarni have been complaining against the encroachment on mangroves and unauthorised prawn farming. “Inspections have taken place with no action whatsoever,” Nadkarni said.

“We wonder why and how agencies such as Cidco turned a blind eye to the encroachment,” Singh said.

The issue assumed a serious turn recently when a lady birder was abused and threatened by goons at the Kharghar illegal prawn farm site.

While Cidco has not taken any action to protect the mangroves, the forest department hasn’t stepped in either. “It is the issue of jurisdiction and our hands are tied as it is Cidco’s area,” a forest official said.

Maharashtra has over 32,000 hectares of mangroves -- 16,984 hectares of which are now declared as protected forests. Over 13,000 hectares of mangroves, including the 900 ha stretch under Godrej, are privately owned mangroves. Cidco recently handed over small patches of mangroves totalling about 350 hectares; it has over 1,000 hectares which is yet to be transferred to the forest department for protection.

Kumar pointed out that hundreds of hectares of mangroves under NMSEZ are yet to be accounted for. “On our complaint, Chief Minister Uddhav Thackaray has asked the forest department to look into this which, in turn, passed on the buck to the mangrove cell,” NatConnect said.

Following a contempt petition filed by Vanashakti in the Bombay High Court, JNPT was literally forced to admit that it has 913 hectares of mangroves in its project area and the port promised to hand over sea plants to the forest department after getting a high-resolution satellite imagery.

Meanwhile, there is no accountability for the thousands of mangroves buried for the JNPT SEZ project, Pawar pointed out, and suggested that the forest department just go with the official coastal zone maps and take over the mangroves. “If they wait for agencies like Cidco, we will only lose more mangroves to land sharks,” he warned.



If one just drives past the Vashi toll naka, off the Thane Creek, the irony cannot be missed. Hundreds of healthy mangroves have been uprooted and pushed aside by gigantic machines on both sides of the road, for the developmental project of extending the bridge over the sea.

“The destruction of the Vashi toll naka mangroves has been done legally for the bridge development project; however, it is still sad to watch these hardy green sea plants that have survived all odds being trampled for infrastructural development,” said Kumar.

Vijay Singh, Mumbai Mirror, Navi Mumbai

Mumbai: Fire safety scrutiny fee for buildings jumps up to seven-fold

 April 18, 2022

The BMC has increased fire safety scrunity fee by up to seven times for issuing no-objection certificates to developers for highrises, both residential and commercial. The revised charges are applicable to new buildings and existing ones if there is any revision in the plan, amalgamation of units, change of user and activity, said a circular recently issued by the BMC.

In absolute terms, for most projects it could go up to Rs 50,000 to a few lakhs.

According to the circular, the fire safety scrutiny fee for buildings having a height of up to 32m tall (between seven to 10 storeys) has been increased from Rs 43/sq m to Rs 100/sq m for residential structures and Rs 200/sq m for commercial ones. Residential and commercial buildings having a height of 32m-70m will now have to pay Rs 200/sq m and Rs 300/sq m, respectively instead of Rs 65/sq m.

Similarly, for residential and commercial structures 70m-120m tall, the charge has been increased to Rs 300/sq m and Rs 400/sq m, respectively from Rs 65/sq m. The fee has been hiked the highest for buildings that are taller than 120m-from Rs 65 to Rs 400/sq m for residential structures and Rs 500/sq m for commercial ones.

The one-time fire safety scrunity fee is calculated on the basis of the structure's built-up area. So, a builder of a 32m-tall building spread on 1,000 sq m of area currently paying 43,000 will now end up paying Rs 1 lakh.

Though Municipal Commissioner Iqbal Chahal had not announced any new taxes or hike in existing taxes in the BMC budget last year, he had said that Mumbaikars will have to shell out more money for fees and charges.

The BMC had also announced that it would soon collect scrutiny fees for granting permission to provide fire and life safety measures in buildings, a fire service fee and set up a fee revision authority to decide the increase in rates of civic services.

"Considering the exponential increase in the capital value of buildings, the proposal is under consideration for a major revision of fire safety scrutiny fees. This will fetch additional revenue for the BMC to strengthen the infrastructure of the Mumbai Fire Brigade," Chahal had then said. The BMC is expecting to generate an additional revenue of Rs 140 crore from the revised scrutiny fees.

But BJP Leader Vinod Mishra, who had taken up the issue of BMC's failure to levy fire service charges last year, said the hike must be gradual. "The BMC must revise this scrutiny fee structure; it should increase marginally every year over a period of five years. This kind of five-fold hike in just one year is not fair. Builders will pass on this added cost to buyers," he said.

Chaitanya Marpakwar, TNN, Mumbai

Reasons Gated Communities Are Growing In Popularity In Real Estate Market

 April 2022

Gated communities are the latest housing trend and are much in demand amongst homeowners all across the country. Gated communities are now being associated with luxury living at its best. Owing to the rising demand for gated communities various coveted and established property developers are investing in building ultra-modern gated communities that are the current market trend and home buyers' needs of today. Among such popular gated communities is Godrej Meridien Sector 106 Gurgaon which offers myriad amenities to its homeowners. Given below are a few reasons gated communities are getting popular over time.

Modern Structure

The great draw to gated communities is their modern structure. The place offers additional security compared to flats, townhouses, etc. The use of modern technology with controlled entry and exit from the main entrance, CCTV camera, etc at every corner of the compound aids in controlling criminal activities within the area. Security is slowly becoming a modern-day rising concern and with the gated community it is easier to feel safe.

Gamut Of Amenities On Offer

Gated communities come with a gamut of amenities on offer swimming pools, gyms, tennis courts, auditorium, WIFI connection, convenience stores etc that are part of the integrated project. The residents can enjoy these amenities without having to travel far. These types of amenities are not always present in other residential buildings or societies. However, one has to note that these amenities are not free of cost for residents. They have to pay a monthly maintenance fee to use all the amenities within the community.

Top Quality Construction

Another advantage of buying residential property in a gated community is that the builders use high-quality construction materials for building structures. gated communities are known to be luxurious properties and hence builders like Taj, Godrej, etc use the premium quality raw material to ensure that the structure has flawless finishing's to attract high-end home buyers. The quality construction ensures that the building will be durable for a long period. Residential Projects in Sector 106 Gurgaon is a new project that provides 3, 2, and 4 BHK apartments and Penthouses to home buyers at competitive rates.

Sense Of Community

A gated community provides community space for residents to celebrate festivals, functions, etc. It allows residents to get together and know each other and become a part of each other life. Today people have busy and hectic work and home schedules and have less energy to go out and make friends but with community living it becomes easier to mingle and make friends. The sense of community is another reason gated communities are rising in popularity today.

Gated communities today are not only luxurious but also promote sustainable living through initiatives like rainwater harvesting, water- treatment plant, the use of energy-efficient lighting, etc. The builders are also working hard to ensure that gated communities come with environmentally friendly measures to make them more appealing to home buyers and also reduce the carbon footprint on the planet

However, when you are looking to buy a residential property in a gated community you must opt for a reputable builder to ensure value for your investment. Gated community residential properties can be expensive therefore make sure that your property has all the high-end finishings and amenities that you are looking for that meet your lifestyle requirement. You can also hire a real estate agent to help you find a gated community in a reputable neighbourhood within your budget. Make sure that you conduct proper research on the preferred residential property in the gated community to make an informed investment decision. You can also compare the prices of penthouses within the gated community of various builders to get the best deal.

TO KNOW MORE ABOUT RESIDENTIAL TOWNSHIP PROJECTS IN THANE VISIT REAL ESTATE THANE CREDAI MCHI THANE UNIT

CHS's NOC not needed to sell, rent flats, says Maharashtra housing minister Jitendra Awhad

 MUMBAI: A flat owner does not require a no-objection certificate from the housing society to either sell or rent a flat, reminded state housing minister Jitendra Awhad, speaking up against increasing prejudices in society.

"Housing societies will not issue you an NOC if you want to sell your flat to someone from the minority community, a Dalit or from a backward community. There are unwritten rules that flats in a particular society can be sold or rented to only a person who is a vegetarian, Jain or some others. This is illegal. The cooperatives department has clarified that no NOC is required and residents can complain to the deputy registrar," he said.

‘Even banks insist on hsg soc NOC for loans’

State housing minister Jitendra Awhad, who is the NCP MLA from Mumbra, said all that a flat owner needs from a housing society at the time of selling a flat is a no dues pending certificate.

"Over a period of time, this has led to all kinds of conditions being imposed, which divide society," he said. The NCP Mumbra MLA was speaking up against hardening prejudices - the recent ban on sale/consumption of meat during Navratri being a case in point.

In 2014, the state cooperatives department issued housing bye-laws, where it is explicitly stated that no NOC is required for letting out or selling a flat. Bye law no. 38 of the cooperative housing society rules states that for sale and purchase of flat, NOC from the society is not required while bye law no. 43 states that NOC from the society is not required to sub-let the flat. The bye laws also say that if a person needs the NOC, it must be issued within 30 days.

Ramesh Prabhu, chairman, Maharashtra Societies Welfare Association, said as due diligence, it is always advisable to take an NOC from the society to avoid any future hassle. "The NOC is required in case there is some issue such as dues pending, dispute between heirs, or the property has been attached by the income-tax department, etc. Even banks insist on the NOC for housing loans as the society would be aware of these issues," he said.

Prabhu said obtaining an order from the deputy registrar in case a society refuses to give an NOC is a time-consuming process. "If the government is really serious about ending such discrimination and harassment, it must issue a Government Resolution making non-issuance of NOC a cognisable offence," he said.

Increase in stamp duty in Mumbai affecting real estate market

 The Maharashtra Government recently announced to impose Metro cess from April 1 2022. An additional 1 percent cess will be levied on all property purchased from April 1 in Mumbai, Pune and Nagpur. | FPJ Correspondent

The residential segment was the only silver lining in an otherwise tepid 2020 for the real estate sector. While residential sales were adversely affected between April and June 2020 due to the uncertainty resulting from the COVID-19 virus outbreak; they bounced back strongly between October 2020 and March 2021. The market demonstrated a commendable recovery by recording huge sales in Q3 and Q4 of 2020/21.

The Maharashtra Government recently announced to impose Metro cess from April 1 2022. An additional 1 percent cess will be levied on all property purchased from April 1 in Mumbai, Pune and Nagpur. This cess is for funding the Metro rail projects and transport-related projects in the state. The 1 percent Metro cess is expected to augment revenues of the Metro rail services and service the loans, which funded the Metro project. The cess will take the stamp duty on property registration from 5 percent to 6 percent in Mumbai and from 7 percent in Pune, Nagpur and Thane.

Mumbai witnessed 96 percent of pre-COVIDsales in Q4 2021, according to a report by JLL, and sales increased by 30 percent and 130 percent on a year-over-year basis in 2021. Demand momentum appears to be returning, and purchasers in the affordable and mid-segment will feel additional cost burdens during such a time. In the current market recovery, the Metro cess will be detrimental. While we understand that Metro Works need to be properly funded by the State Government to de-clutter the cities and ease traffic, we need to rationalize why the burden of such costs have to be borne solely by Homebuyers.

Further, the timing of this decision should also be brought into question; It has only been 2-3 quarters since residential sales volumes have seen increase. Buyers seem to be shaking off the COVID-19 uncertainty and returning to making purchase decisions. Maharashtra is already one of the most expensive states to own property and increasing transaction costs are bound to affect volumes.

At a global level, we are dealing with a war which has further affected already high input costs for developers. Both Steel and cement prices are trading at all-time highs and other input costs are also on the rise. Keeping this in mind, a reduction in sale volumes and/or sale values could provide very detrimental for the real estate industry.

Therefore, placing the burden of funding metro works on new homebuyers was probably not the best way to raise money for metro construction work. This could have been done in several other ways. One such way would have been to marginally increas property tax. Keeping in mind the number of people that pay property tax, the increase would have to be so miniscule that it wouldn’t have affected the day to day lives of individual or family. With a wide base, the collections would also have potentially been higher. Further, it would also be a more equitable way to treat the matter as the metro, once constructed, will eventually benefit everyone and not only those who purchase homes.

Luxury real estate market to see robust growth in 2022-23. Should you invest?

 April 11, 2022

The coronavirus pandemic had slowed down the investment spree in the real estate market but the reopening of the property markets has led to an increased interest of the uber-rich in the real estate sector. According to a recent survey, the HNIs and the ultra-rich investors are very keen on investing in the property market, especially in the properties segment of over ₹5 crore.

Analysts believe that as the real estate market is resurgent and positive of a robust recovery in the year 2022-23, the luxury real estate market will naturally pick up and aid in the overall real estate recovery cycle.

If the metro cities of Delhi and Mumbai are taken as samples, the year 2021 saw multiple property deals worth over 100 crores.

“The commercial capital of Mumbai is preferred by the ultra-rich. In this case, the short term stamp duty waiver announced in the wake of the Coronavirus crisis played a huge catalyst for the high-end property transactions. The High Net Worth Individuals (HNIs) made use of the occasion and saved a significant amount in stamp duty charges. We believe that the high-value investors who are continuously on the lookout for high-end properties go for only branded and established developers with a proven track record. It makes sense as the investors do not want to run into any trouble due to the procedural flaws from the developers’ side," said Annuj Goel, MD, Goel Ganga Developments.

Nakul Mathur, MD- Avanta India said Delhi has remained the hot favourite of the uber-rich. Multiple deals of up to ₹1000 crore were registered in the capital in the year 2021. Areas such as Lutyens’ zone, Vasant Vihar and South Delhi remained the hot real estate destinations. We believe that trend will remain the same in the upcoming year.

Suren Goel, Partner- RPS Group said one trend that will rule the luxury market is the preference for ready-to-move-in properties. The luxury investors are wary of believing in promises of under-construction properties and want immediate possession.

Kitchen steel rack designs: 7 ideas for your dream kitchen

April 2022

If you are remodelling your kitchen, you should start with the essentials, before taking down or building any walls. Prioritise your storage needs. This is where kitchen steel rack design comes into play. You can keep your kitchen organised with steel racks and shelves.

Best kitchen steel rack designs for an organised kitchen

Here is a list of top kitchen steel rack designs that would transform your kitchen.

1. Basic kitchen steel rack design

Are you looking for a place to store your teapots, mugs and other crockery sets? Consider this stainless kitchen steel rack design with two levels for separating your utensils. Place your teacups and pots on the top half of this stainless steel rack and your plates, spoons and bowls on the lower half. This rack is simple to use and can be placed anywhere in the kitchen.

2. Kitchen steel rack: Space-efficient hangers

You may choose a two or three-tier hanging kitchen rack to keep all spice jars together. This shelf is made of stainless steel, ensuring its longevity and corrosion resistance. As you will be hanging this rack in the kitchen, you can utilise the vertical space to store jars and containers that are normally placed on the kitchen counter.

3. Lift-up Pegasus kitchen steel rack design

If you are seeking a contemporary method to keep your dinnerware, this steel lift-up Pegasus rack may fit your needs. This Pegasus includes a lift-up mechanism with racks for plates and cups. You can now neatly and securely arrange your white ceramics or glass jars on the top rack space and your coffee or tea containers and cups on the bottom rack of this steel kitchen shelf. This Pegasus kitchen steel rack design is ideal for those who want to keep their ceramics out of the reach of children, to avoid breakage and mishaps.

4. Kitchen steel rack design for sink

This kitchen rack may be positioned above or next to a kitchen sink. This type of single-shelf kitchen steel rack design can save space on the kitchen countertop. It is also ideal for the empty space on the wall. These racks are made of stainless steel and come in a variety of colours to complement the decor of your kitchen.

5. Full-length kitchen steel rack design

Are you looking for a rack to keep your belongings or exhibit your plants? Check out the stainless steel kitchen rack shown below, for inspiration. You may use such full-size stainless steel rack shelves to store vegetables and fruits. It can also be used to exhibit crockery and plants or to store spices. These kitchen steel racks are a fantastic method to showcase your valuable China and antique dishes.

6. Kitchen steel rack design: Simple hanging hooks

Install this useful wall storage rack, preferably against a white wall, to hang your kitchen accessories like cutting boards, wooden or steel serving spoons, or spatulas. These storage options are open, have a breezy appearance and are durable and compact. When not in use, keep it dry. Wipe it clean regularly to prevent dirt from accumulating on the rods. Apart from being visually appealing, such hanging racks also offer versatility, because they can be easily adjusted.

7. Kitchen steel rack design for stacking dishes

This kitchen steel rack design is something that every kitchen can use. A dish rack improves ventilation and drainage, which shortens the drying time. Allowing the dishes to dry in the air is also a healthier alternative than towel drying, because you never know how clean or unclean the towel is. However, after finishing, fully dry the rack to avoid rusting. You will be able to maintain your kitchen looking brand new this way.

Rental Properties: Pros and Cons

March 2022

Rental Properties: An Overview

The idea of buying a home or apartment to rent out for profit may sound alluring. But buying a rental property for income and long-term capital appreciation can have its ups and downs. For example, the housing market can fluctuate depending on location, supply and demand, and the economy.

Financially speaking, in order for the rental property to be really profitable, the return you reap should be greater than what you could earn in conservative investments, such as bonds and dividend-paying blue-chip stocks, because of the real risks involved. And on the human side, not everyone has the ability to manage property and tenants.

Pros of Rental Properties

There are several benefits to owning a rental property. They include:

Tax Benefits

The Internal Revenue Service allows you to deduct many expenses connected with rental property in the categories of:

* Ordinary and necessary expenses

* Improvements

* Depreciation

This means that you can deduct your insurance, interest on your mortgage, maintenance costs, and physical wear-and-tear on your property.

Depreciation may produce a nominal loss, which in turn you may deduct against other income. In other words, you may achieve net positive cash flow from the rental income minus expenses and still have a net loss for tax purposes. But be aware that depreciation also reduces the cost basis of a property for calculating capital gains when you sell your property.

In addition, the 2017 Tax Cuts and Jobs Act offers a number of tax benefits for landlords. If you own a flow-through entity (also known as a pass-through business) and operate it as a sole proprietorship, limited liability company, partnership, or S corporation, you now may deduct an amount equal to 20% of your net rental income—as long as your total taxable annual income from all sources after deductions is less than $250,000 for singles or $500,000 for married couples who file jointly.

Seasonal Rentals

If you rent your property seasonally, you may use it yourself for 14 days per year—or 10% of the number of days that you rent to others at a fair market price—and still be able to deduct your expenses.

Renting Extra Space

You can also treat a room or area of your home—such as a garage, basement, or accessory dwelling unit—like a rental, writing off a percentage of the mortgage interest and other expenses against its income, although you should be aware of the potential pitfalls of renting out extra space, including local zoning rules.

Cons of Rental Properties

There are also drawbacks to owning a rental property. They include:

Lack of Liquidity

Real estate is not a liquid asset. Even in the hottest market, it can easily take several months to complete a sale. And if your timing is driven by an emergency or other unexpected event, your need to sell fast might not garner the best price.

Rising Taxes and Insurance Premiums

The interest and principal of your mortgage may be fixed, but there is no guarantee that taxes will not rise faster than you can increase rents. Insurance premiums may also spike, as they have in the wake of natural disasters.

Difficult Tenants

Despite your due diligence in vetting prospective renters, you could wind up with tenants who are not ideal. For example, they could be needy or demanding, pay late, forget to turn off the water, and so on. Or they could be destructive, in which case the depreciation allowance in the tax code may be sorely inadequate. You can, however, always add a rider to the standard lease form that spells out rules about occupancy, pets, smoking, tenant insurance, and the like. A security deposit can also be helpful here.

Neighborhood Decline

In an ideal scenario, your investment property will flourish amid other well-maintained dwellings and local amenities will improve. As a result, your cash flow will increase steadily and your costs remain stable. However, neighborhoods can change and your investment could depreciate over time. You should pay attention to the local politics where you invest, just as you would where you live. With some due diligence, you can minimize this exposure.

Unfavorable Changes to Tax Code

The tax code is not immune to change. It could change in ways that would either reduce or eliminate some or all of the tax benefits for homeownership and flow-through businesses.

Landlord Role

Being a landlord is not for everyone. You may feel shy about increasing rents or be protective of the way others treat your property, which can lead to conflicts. You may even become friends with your tenants or they already may be family or friends. If you cannot be firm about rent increases or property care, for example, you could wind up collecting rent that is well below market price, or with a property that is undervalued.

Upkeep

In maintaining a property, minor and major repairs arise. Some property owners can save money by doing the work themselves. However, most lack the time, tools, or skills for home repair. Expect to shell out periodic contractor fees.

Special Considerations

Whether you are buying a primary home or a rental property, it is important to consider what's happening with mortgage interest rates. Low fixed-rate mortgage debt is generally a good hedge against inflation. If you are a landlord, periodic rent increases are one way of offsetting inflationary rises in property upkeep expenses.

Home loan guide: How to decide the lender and tenure of your home loan?

 

March 2022

Should you choose a home loan from a bank or a housing finance company? What are the loan tenures and interest rates that you can avail? Housing.com gets answers from experts in a webinar on ‘How to decide lender and tenure of your home loan?’.

For prospective home buyers, opting for a home loan is a significant step in their home-buying journey. With several banks and financial institutions in the market today, selecting the right lender is not an easy decision to take. Often, a borrower may be more inclined to choose a lender offering the lowest interest rate. However, there are other crucial factors that need to be considered to ensure a comfortable loan repayment experience. Emphasising this idea, experts at a webinar conducted by Housing.com on the topic ‘How to decide lender and tenure of your home loan?’ shared valuable insights to help individuals make an informed decision on picking the best lender and home loan tenure.

The panelists at the webinar included Sanjay Garyali (business head – housing finance and emerging market mortgages, Kotak Mahindra Bank) and Rajan Sood (business head – PropTiger.com). The session was moderated by Jhumur Ghosh (editor-in-chief of Housing.com News) and co-branded by Kotak Mahindra Bank.

Where can you get a home loan?

Speaking on the importance of preparation for a home loan, Garyali said, “One of the key parameters one has to look at, is the credibility of a financial institution. A home loan may not be the only product that a customer may seek from a financial institution. One must look at whether the lending institution gives visibility on multiple products as, subsequently, a customer may like to change the tenor and rates, opt for a top-up plan on the existing loan, or go for another loan from the same company. So, one should not look only from the perspective of the home loan interest rate when choosing a home loan.”

Typically, an individual may prefer to get a home loan from a bank where he or she is already a customer. For such regular customers with a good track record, banks may also provide flexible options in terms of rates in the future. It can be a private bank, a public sector bank or any NBFC that an individual may be considering for a home loan. Broadly, one must see whether that company is capable of catering to the multiple needs of a customer in the long run, he added.

Highlighting the fact that the association between a home loan borrower and the lender is a long-term one, Rajan Sood remarked, “Buying a house is one of the biggest decisions of an individual in his or her lifetime. One of the important decisions related to it, is choosing a lender for a home loan. However, the decisions around choosing a lender specifically for a housing loan and for other financial products that one may opt for in the future, cannot be taken separately.” He suggested that home buyers look at the rate of interest offered by different lending institutions, as the foremost thing when seeking a home loan. Another crucial factor that borrowers should see is the loan amount that one is eligible for, as decided by the lending institution. He further added that there are other factors to keep in mind like processing fees, prepayment terms and conditions, the company’s track record, the ease of documentation and the quick turnaround time, before going ahead with a lender.

The shift towards digital experience in the home loan journey

Bringing attention to the digital preparedness of the financial institutions and banks, especially in this current pandemic scenario, Jhumur Ghosh said, “Home loan applicants do not want to go through a lot of paperwork and they want the process to be done in a streamlined manner. Customers today are opting for banks that are digitally prepared, making lives simpler for those opting for home loans.”

Garyali concurred that banks were taking steps to make things convenient for customers. He also highlighted the emerging industry trend of assisted journeys pertaining to home loans and secured lending, where customers look for personalised support and face-to-face interactions with their lenders.

According to Sood, the preference of home buyers towards the digital medium has increased during the past three to four years. “As far as the pre-qualification process for the loan is concerned, most of the customers prefer the online mode. Financial institutions have been focusing on innovation around providing a digital experience for customers. About 50% of the overall home loan process is happening online. If a financial institution can provide an in-principle approval, based on the information provided by customers online, the keenness to close property deals significantly goes up. However, the overall home loan process cannot be completely done digitally and customers prefer the assisted part of the process.” he observed.

What are the buyers’ preferences?

Usually, real estate developers have tie-ups with financial institutions for providing home loan solutions for their customers. Garyali observed that smart home buyers today, who are digitally savvy and have access to information online, prefer to negotiate with the developers on property rates while weighing their options on lenders who provide them with the best home loan options. Agreeing that home buyers view these aspects separately, Sood shared that many home buyers prefer such tie-ups since that reduces their efforts in independently looking for a lending institution.

Ghosh advised that home buyers must keep their options open and decide, after analysing the different scenarios.

Should you go for a shorter loan tenure or longer tenure?

While choosing the right lender is one aspect of the home loan journey borrowers are dealing with, many are also unable to decide the ideal home loan tenure. One must note that opting for a longer loan tenure helps one repay the loan over a longer period, with the EMIs becoming quite affordable. On the other hand, a shorter loan tenure will result in higher EMIs. According to the experts, tenure is a key factor in choosing the loan amount one may be eligible for when taking a home loan. Going for a relatively longer tenure will help one get a higher loan amount for the same salary. The panelists advised that choosing a suitable home loan tenure normally depends on a person’s financial situation and requirements.

Things to remember when opting for a home loan

According to the experts, many home-seekers find applying for a home loan a viable option since it offers various tax benefits. Home loan borrowers are eligible for tax deductions on principal repayment and the interest component and other tax benefits on taking a joint home loan. The experts suggested keeping these points in mind when opting for a home loan.

Sharing more insights on home loan eligibility, Garyali talked about how lending institutions viewed salaried individuals and self-employed individuals differently when assessing their eligibility. He said, “Around 75% of the home loan market comprises customers belonging to the salaried class while the remaining 25% belong to the self-employed category. It is easy to arrive at the eligibility of salaried individuals, as they have a fixed income from salary. On the contrary, for self-employed individuals, the bank or financial institution must get into the nitty-gritty of verifying the various sources of income and several other aspects, thus taking a longer processing time on the part of the lender.”

Fixed rate vs floating rate

As per the experts, certain banks and financial institutions offer a fixed rate for a home loan for a specified period. However, that may mean a premium over the prevailing floating rate, which does not make financial sense for borrowers. On the other hand, the floating rate does not depend on the external environment but varies based on the RBI’s repo rate. In the current regime, experts felt that since the home loans have been linked to the benchmark set by the RBI, it should give customers the confidence to opt for floating interest rates.

Pre-approved loans: Are they beneficial?

A pre-approved loan is where a lender sanctions a loan for a borrower before selecting a property. As per Garyali, pre-approved loans may be merely beneficial for zeroing in on a property and knowing one’s eligibility for a home loan amount. Sood pointed out that pre-approved loans help prospective home buyers since that establishes a sense of confidence and makes them well-acquainted with the entire home loan process.

Responding to how long the low-interest rates may last, Garyali talked about retail inflation and its impact on the home loan interest rates. He said that interest rates may go up and that borrowers would need to assess the situation and decide whether it was the right time for them to go for a home loan. Sood noted that home loans are long-term investments and interest rates may change as they are linked to the RBI’s repo rate. However, he said that any change in home loan interest rates may not significantly impact a prospective home buyer’s decision of purchasing a house.