Investment why bank on a few let the entire basket work for you R Shares Bank BeES

Investment why bank on a few
 let the entire basket work for you 

R Shares Bank BeES


Budget or Luxury Homes - Which Is a Better Investment?

Budget or Luxury Property -  Which Is a Better Investment?

 by Mr.  Anil Pharande, Chairman - Pharande Spaces

This is a big question in every property investor's mind - do you stand to profit more from luxury properties or budget homes? Generally, lower-end real estate needs lower capital, which makes it especially appealing to small-time investors. Luxurious real estate, however, is an asset class reserved for people with a lot of capital to spend on a prime residential property.

So, what are budget properties?

Budget housing primarily targets the middle and lower-middle income bracket of buyers. This would include regular starter homes in emerging or non-prime areas. Such homes are cheaper and not top of the line, but they are adequate to meet the requirements of the mid and lower income groups. 

In other words, investors with smaller budgets can invest in such properties - though even the more well- heeled property investors in India often investing in bulk in budget housing projects to capitalize on the high-demand middle and lower middle-class marketplace.

Now that we have defined budget housing in a nutshell, what is high-end real estate and how does it compare as an investment with budget housing?

What is luxury property?

Luxury housing caters to the wealthy who have a predilection for first-class amenities and facilities, which they are not averse to paying a premium for. 

Basically, such properties must be exclusive, desirable and unique in many ways. 

Premium central location used to be a primary factor while selecting a luxury property - but with the new trend of extremely prime and ultra-modern projects coming up even in newer areas, this is no longer strictly true.

What exactly does exclusivity mean? After all, by virtue of every home having only a single owner, can it not be argued that all homes are technically 'exclusive'? 

Not really. As far as high-end real estate is concerned, exclusivity means closeness to other high-end residences, and suitable access to a variety of tasteful conveniences like five-star hotels, shopping malls, sports complexes, and parks.

In areas like Pune's PCMC where planned urbanization has preserved a lot of the available green cover, natural beauty is also an essential determinant in defining exclusiveness. While some buyers may favor mountainside views, others are more into countryside or lakeside and park views. 

In recent years, integrated luxury townships have been offering such features - and a lot more.

Generally, well-to-do luxury home buyers want the same things that all buyers for lower-end properties do, just on a considerably bigger scale. While budget home buyers are satisfied with rudimentary security, regular maintenance of the project and basic fixtures and fittings, luxury homeowners expect advanced facilities and project management that provide a seamlessly comfortable, convenient and visually enriching experience. 

They also expect round-the-clock electronic and human surveillance of the premises, smart security and convenience features in the properties, and top-grade international branded fittings.

Obviously, luxury properties cost a lot more than budget / affordable homes. The question is, do luxury properties make more sense investment-wise than budget homes? 

There are various schools of thought on this, with a lot of emphasis being laid on the fact that the highest demand in India is for budget housing.

However, market readings also indicate that the number of wealthy home buyers in India is on the rise - and these buyers all seek top-class, refined housing with all the latest amenities and facilities. 

Moreover, they are invariably not dependent on home loans and have enough wealth to make outright purchases. 

Simultaneously, a huge complement of India's highly cost-sensitive budget housing segment of buyers is sitting on the fence, waiting for declining home loan interest rates and a correction in property prices.
  Anil Pharande, 
Chairman - Pharande Spaces

Also, over the last couple of years, a volatile economy has significantly impacted pricing of luxury homes, making them more affordable.

Closing Verdict

It is fairly safe to say that both budget housing and luxury properties are finding buyers in India. It is certainly advisable to run an all-inclusive market analysis locally before embarking on a real estate investment, since the exact dynamics driving ROI on different property typologies differ on a market to market basis.

For instance, investment in a luxury integrated township in the Pimpri- Chinchwad Municipal Corporation make a lot more sense that investment in a small budget housing project, because luxury townships offer residents neighbours of comparable status and purchasing power, highly adequate facilities such as green open spaces, in-project schools and shopping malls and superlative project maintenance and smart home features at a unit level.

About The Author:

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

For media contact
Jay Kalghatgi
Client Interface - Copyconnect
Mobile: 9320142248


Private Equity Interest - Retail, Warehousing Saw Increased in 2016

Investors from China, Japan and Korea gung-ho on industrial development projects

By Mr. Anuj Puri,  JLL India

Apart from the favourite asset classes of office and residential, private equity (PE) has been taking increased interest in warehousing, logistics and retail real estate.

PE investors and overseas developers are already looking at opportunities to enter India’s industrial and warehousing sector by investing in various development projects.

Investors from other nations, in general, and Asian countries such as China, Japan and Korea, in particular, have shown a lot of interest industrial development projects.

A few key announcements that show their increasing interest are:

*  ‘Wanda Industrial New City’; Dalian Wanda Group

*  Industrial Parks by China Fortune Land Development Company Private (CFLD)

*  Development of smart cities by ZTE Corporation

*  Neemrana Japanese investment zone

*  Mandal Becharaji, Japanese investment zone

*  SUPA, Japanese investment zone

*  Chinese industrial zone in Vadodara

*  Ascendas-Singbridge exploring multiple portfolios of industrial and logistics parks across India.

With the implementation of Goods and Service Tax (GST), warehousing and logistics’ spaces will start to see a consolidation of assets. Unlike earlier (small assets in various states), developers will focus on the development of large-scale, technologically advanced warehouses.

Such assets will attract private equity (PE) investors, since they can deploy a larger amount in fewer assets, making monitoring easier. If they perform well, such assets can even fetch a better valuation when monetising through REITs or other ways.

Retail assets gaining attention

In the past few months, key leasehold retail assets across the country have come on the PE radar.

A few reasons include well-managed Grade-A malls starting to enjoy better occupancy with rent escalation on the cards, after a lull of six to seven years.
Such well-managed assets/ entities will attract investor focus.

A few key deals seen in 2016 were

*  GIC bought a 50% stake in Viviana Mall of Sheth Developers in Mumbai

*  Blackstone acquired the retail portfolio of Alpha G Corp through an entity level deal

*  Blackstone has progressed well in acquiring a stake in the retail assets of L&T in Navi Mumbai

* Blackstone buying 50% stake in Pune’s Westend Mall

Leasehold retail property usually has a higher probability of success as the developer is actively involved in the key functions of mall management, especially tenant management.

Various new regulations like easing foreign investment for single-brand retailers, longer shopping hours and an updated framework for establishing Real Estate Investment Trusts (REITs) have attracted the attention of various private equity funds like Blackstone, Xander, GIC, Morgan Stanley, towards the Indian retail real estate sector.

Various retail mall developers are also looking to sell their existing retail assets and raise funds for expansion.

About the author..
Mr. Anuj Puri, Chairman and Country Head at JLL India


Choosing and buying financial services NEVER TRUST A STRANGER


by Mr. Dhirendra Kumar,

Those who have a positive attitude towards what life brings them are more likely to be successful and happy. 

Or at least, that's the general opinion. Of course, when you meet someone new, it's better to assume the best about them, since most people are honest and sincere. 
Generally, things work out better if your default attitude is open and trusting.

Unfortunately, this is not true when choosing and buying financial services. As a rule, you should assume that everyone who is trying to sell any financial service to you is either hiding something or is actively lying. This may only be true 90% to 95% of the time, but it's better to assume the worst to protect yourself.

In order to make the right choices when you save, invest and buy insurance, you must educate yourself independently, and make your decisions yourself, without having to depend on what a salesperson is telling you.

Decades of interacting with the customers of financial services and observing how these industries work has left me with the strong belief that when it comes to dealing with them, distrust and suspicion should be the default attitude.

Why is this the case? Why is buying financial services different from buying, say a jacket, a pair of shoes, or a car? There are many reasons for this and while some are to do with specific issues with the way business and regulations are conducted in India, there is a much deeper reason that is fundamental to financial services.

 Mr. Dhirendra Kumar,

This reason is that the input, product and output of a financial service business is all the same stuff money, and the only way they can earn more is by ensuring you get less of it. 

Think about that carefully. Let's say you are trying to decide on which midsize car to buy. There are choices at a wide variety of price points. You could buy one from Tata Motors for Rs. 7 lakh, or Maruti for Rs. 9 lakh, or from Honda from Rs. 13 lakh, or from Mercedes at Rs. 45 lakh. 

So is everyone except Tata overcharging? Not quite.

The deal is quite transparent. You will give an auto company a certain amount of money, in exchange for which, you will get some combination of performance, reliability, safety, gadgetry, prestige and whatever else you are looking for in a car. 

You pay money, and you get these things in return. If a car company wants to make more money, it can enhance the attributes that you value and charge more.

This has a really important implication: for a certain type of financial service, and a given competence with which it is run, the only way for the provider to make more money is to give you less of it. If the provider wants more of anything, whether it's profit or salaries for employees, or more dividends for the owners, it has to be eked out by reducing what you get. 

If they want to increase sales by paying more commissions to agents, that too is paid for by reducing your returns. Everything comes out of your pocket.

Do not think of this as some esoteric, conceptual model of financial services. This is what drives every interaction you have with your bank, insurance company, stockbroker, mutual fund, and anyone else trying to sell you their services.

Do not count on regulators to protect you either. 

In general, India's financial regulators are always well behind the curve in terms of stopping the malpractices that are rife in all these products.

The only way to stay protected is to educate yourself with knowledge and data that is not tainted by actually being generated by the same people. 

Always be suspicious of anyone who is selling a financial product, and let distrust be your default attitude. I know it sounds terrible, but that's the way things are.


Zerodha - Money lessons - Finance made easy for kids..!

Zerodha - Money lessons for tiny tots..

Teaching money skills to little children is not easy because it is a boring subject and they easily lose interest. But a set of books brought out by brokerage firm Zerodha might help inculcate financial literacy in a fun manner.

The 5 book series has stories that focus on key financial concepts such as the importance of saving, the impact of inflation and the need for banks. There is also a story that explains the concept of insurance, the role of taxes and how the stock markets work.

Children aged 7 to 10 years will find these books interesting as well as informative.

A spokes person of Zerodha said the company is committed to spreading financial literacy among children. In the pipeline are a series of books for older children in the age groups of 10 to 15 years and 16 to 19 years.


These SEVEN Mutual Fund Schemes Have Assets Over Rs. 10,000 Crore Each..!

These SEVEN Mutual Fund Schemes Have Assets Over Rs. 10,000 Crore Each..!

For asset management companies, large equity AUMs are a matter of prestige. Such schemes are in the spotlight and get the attention of the top management team. 

With inflows into domestic equity mutual fund schemes increasing through both lump sums and systematic investment plans (SIPs), seven schemes have crossed the Rs. 10,000-crore mark. 

These seven schemes put together account for Rs. 97,300 crore, which is about 19% of the industry's equity assets.

Financial planners say that in the Indian context, size has not been a deterrent for large and multi-cap funds, but needs to be monitored while evaluating midand small-cap funds.

ET takes a look at these seven funds whose assets have crossed Rs. 10,000 crore and have maintained a strong track record.

Src: ET, Prashant Mahesh

GOVT Sovereign Gold Bonds from Monday 2017, February 27 to March 3

 GOVT Sovereign Gold Bonds from Monday 2017, February 27 to March 3

The bonds will be sold through banks, Stock Holding Corporation of India, designated post offices, National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).
The Centre has decided to come out with the fourth series of Sovereign Gold Bonds 2016-17, which the Reserve Bank of India (RBI) will issue on its behalf.

Applications will be accepted from 2017, February 27 to March 3, an official release said. The bonds will be issued on March 17, 2017

The bonds will be sold through banks, Stock Holding Corporation of India (SHCIL), designated post offices and recognised stock exchanges NSE, and BSE.
The bonds will be denominated in gram(s) of gold with a basic unit of one gram. The tenor will be for a period of eight (8) years with exit option from the 5th year to be exercised on the interest payment dates.

Investors will be compensated at a fixed rate of 2.50% per annum payable semi-annually on the nominal value. Launched by Prime Minister Narendra Modi in November 2015, the Gold Monetisation Scheme (GMS) and the Sovereign Gold Bond schemes aim at cutting down the huge demand for the precious metal.

While the GMS has seen tepid response, investors have found the gold bond scheme reasonably attractive.

Finance Minister Arun Jaitley had, in Union Budget 2015-16, announced the creation of a Sovereign Gold Bond as an alternative to purchasing metal gold.

Accordingly, three tranches of issuances had been undertaken during 2015-16.

Super-Rich Investors: Building wealth involves a whole range of smart strategies

One of the Best-Kept Secrets of the Super-Rich
 by Anisa Virji

Building wealth involves a whole range of smart strategies. Most rich people get that way by consistently doing the following five things:

*  They understand and manage their debt. They don't let debt manage them.
*  They are restrained spenders and aggressive savers, far outpacing their peers.
*  They invest in stocks and bonds with discipline.
*  Their primary focus is on increasing their active income. Usually, this comes from a business they know inside and out.
*  They invest in real estate and other 'outside the stock market' opportunities.

As you can see, investing in stocks and bonds is only one of five strategies you must follow to become rich.

Stocks are a great place to grow your wealth. It will mature slowly - you plant a seed, nurture it, and then you wait for it to grow into a tree for wealth.

But the more seeds you sow, the larger a forest of wealth you can develop.

And when you have those crores invested in the stock markets, then you can sit back and relax, satisfied that you have won the wealth game.

If you do not already have crores tucked away in value stocks, you need more seeds you need extra streams of income coming in.

Having extra income streams of income is one of the best-kept secrets of the super-rich.

Now, what if I told you that you could start making an extra Rs. 5,000, Rs. 50,000 and then Rs. 5.00,000 a month right now. 

And that money could go directly into your investment bucket, and help you build your forest.

I am offering you 
a side door to building wealth relatively quickly.

With a second source of money coming in, all the stress that comes with trying to stretch your regular income - whether from a pension, dividends, or even a paycheque - disappears overnight...

And that's why Mark Ford has created a series of only proven strategies that the average person - someone who does not make eight figures or have crores in the bank - can realistically do.

It's called the Wealth Builders Club. In my opinion, it is by far the best wealth-building blueprint that exists anywhere today.

You may have heard about the club before. Perhaps you were too busy to take a close look at it. Or perhaps you did look at it and decided it's not for you.

If so, I want to say this and bluntly: If you are hoping to achieve your goals simply by buying a few great stocks or by putting your money into gold or some other asset to take advantage of a economic boom, it's not enough.

You can do more. Invest in stocks by all means, and do it wisely. But don't stop there.

Yesterday I told you about 'Sunday money' - about how, for a few hours of work on Sundays, you could make thousands, tens of thousands, even lakhs, in extra income every month. And I promised you answers. Well, this is it.

This blueprint can show you how to make Rs. 10 to 50 lakh, maybe more in a year, part time, working from home in your pyjamas, using a skill you've been practicing since you were a kid. (I personally know more than a dozen people who have tried this one strategy and are making this kind of money doing it.

But that's just the beginning. It will also show you... to live like a millionaire while you are still working your way up. to avoid the mistakes most retirees make, and how to live completely debt-free. to set your children up for a financially sound life.

...and to make the time you need in your life to start achieving your life's goals NOW.

This blueprint gives you everything you need to get started. And so much more.

Sandesh P said: 'I would like to let you know that subscribing to the Wealth Builders Club is one of the best investments I believe I have made.'

If there's one investment you must make, let it be this. You regularly invest your faith in the markets, why not invest a little in yourself this time. You have nothing to lose and a whole new life of financial confidence to gain.


Film Journalist Devimani Speaks on... "My Experiences on Film Journalism " February 25, 2017

Film Journalist
Speaks on...

"My Experiences
on Film Journalism "

Tamil Media Club...
Cordially Invites you...
for the Meeting
Saturday, February 25, 2017
by 06:30pm.
ICSA Center
Egmore, Chennai.

Tamil Media Peoples are welcome.

For more details 
V.Muthu Pandi
80561 50277

A Strong Case for Chennai’s Rental Housing Markets

A Strong Case for Chennai’s Rental Housing Markets

By Mr. Simon Selvaraj, JLL India

Chennai has grown exponentially in recent decades. It attracts an endless sea of people who keep moving in to the city, primarily for career and educational prospects. 

Employment, education, opportunities and lifestyle are magnets that keep pulling people into Chennai from all directions of the country.

This naturally has a profound impact on the demand for rental housing in the city.

High Levels of migration..!

Massive churn in urban area has turned out to be an intrinsic part of life for most of the city’s residents today. The total migrants into the urban areas of Tamil Nadu, as per 2011 census, accounts to 12.3 million - of this around 47% have duration of residence between 0-9 years. 

Thus, a fair portion of citizens in Chennai are tenants who do not necessarily want to buy a flat to live in the city.

Better quality of living..!

Rental housing allows residents to opt for a higher standard of living than their property purchasing power. A new apartment in the CBD of Chennai would cost around Rs. 75 lakh, while a person earning about Rs. 10 lakh per annum can afford a home costing Rs. 60 lakh in the more affordable suburban location. 

However, such an individual can afford a CBD-based home on rent within the same annual income. This makes it possible for a denizen of the MIG (middle-income group) to live in a HIG (higher-income group) flat, while the and LIG (lower-income group) individuals can comfortably afford to live in a MIG flat.

Increased affordability..!

Chennai continues to be an expensive city to buy a property. An average increase in property prices by 6-7% from last year has further constrained the affordability of owning a house. However, the rental trends in Chennai have seen only 2.5-5% annual increase over the past 4-5 years.

Tax benefits..!

Rental paid saves taxable income, as almost the whole portion of the rent paid can be saved by claiming it under Section 10 as HRA.

Mr. Simon Selvaraj,
JLL India
Offering greater flexibility and requiring less of a financial stretch than homeownership, renting is most common among young adults in whose lives changes in work and relationships are frequent.

Lower additional costs..!

Owning a house involves a down payment for the loan to the tune of almost 20% of the property value, and the EMI to be paid is often 40-50% of the monthly income. 

Property taxes are at about 1.5% of the property value and the regular maintenance and repair costs which account for 40% additional charges, as compared to a simple monthly rental for the same property.

However, hunting for a suitable rental house does come with its own set of challenges – not only to outsiders but also locals. 

Accessibility to work place, quality of neighbourhood, connectivity to other parts of the city, adequate living space, amenities, owners’ rulebooks and also certainly the budget and value for money being paid play a significant role in sound decision-making while searching for a good rental flat.

Narrowed down to the important rental housing hotspots of the city, here are the trends being currently observed in Chennai:

IT Corridor – Old Mahabalipuram Road

OMR continues to thrive as one of the preferred destination for the city’s Infotech population due to its proximity to various IT business parks and dedicated SEZs. With a slew of residential apartments and studios for singles coming up along this corridor, the burgeoning population of IT professionals has a logical influence on real estate and rental accommodations in this locality. Being majorly occupied by bachelors (sharing accommodations) as well as families of 4 to 5 members on average, Shollinganallur, Perumbakkam, Perungudi, Siruseri and Taramani retain average residential rental values ranging from Rs.12,000-18,000 per month for 2 BHK flats and Rs.15,000-30,000 per month for 3 BHK individual houses.

Contrasting GST and GNT corridors

Dotted with apartment complexes, educational institutions, SEZs and retail outlets, Grand Southern Trunk (GST) Road - the stretch between Perungalathur and Guduvanchery - is densely populated by a mix of working people and students. 

Being well-connected by road and rail to the southern cities of Tamil Nadu, this stretch also witnesses tremendous infrastructure activities with rail overbridges, a proposed new mofussil bus terminus and a planned elevated 8-lane corridor.

The average rental values of spacious houses in this residential neighbourhood with quality educational and healthcare institutions in close proximity range from Rs. 7,000-12,000 per month for 2 BHK flats and Rs. 10,000-20,000 for 3 BHKs.

Grand Northern Trunk Road - a 10 km drive down the stretch from Madhavaram Bypass to Red Hills - is strikingly dissimilar to the GST Road. This corridor is more about container terminals, warehouses and some realty activity. 

The steady growth in infrastructure and connectivity as well as availability of water resources has encouraged leading industries to set up their bases along GNT Road.

However, there is currently lack of road infrastructure projects, and a perception of North Chennai and the IT hub at Ambattur as having very little impact on this stretch. This has led to comparatively less enthusiasm among people to move in to this location. As a result, employees working in the industries along this stretch can find more affordable rental housing in the range of Rs.5,000-8,000/month for 2 BHK flats and Rs.10,000-16,000 per month for 3 BHKs.

Pulsating Pallavaram–Thoraipakkam Road

Connecting the key corridors of OMR and GST, the Pallavaram-Thoraipakkam Road has vast employment opportunities and residential rental affordability. 1 BHK developments (average unit size 550 square feet) account for about 8% of the total housing supply in this area. 

The yield rate in this micro market is 2-3%. Offering a number of rental options ranging from studio-type apartments to 3BHK flats, villas, and row houses, the average rental values in this micro-market falls between Rs.10,000-15,000/month for 2 BHK flats while 3 BHK options are rented out for Rs.12,000-25,000 per month on an average.

Moving Westward..!

The peaking residential rental values in city’s central locations have led people to turn to the west for affordable living. 

The western quadrant is predominantly driven by business people as well as industrial and IT employees due to its excellent connectivity to Central Chennai, Mount-Poonamallee Road and Ambattur office districts. After construction of Outer Ring Road, connectivity has improved significantly.

Expected infrastructure projects, including completion of the Metro Rail Corridors, revival of the Maduravoyal flyover, etc. will keep drawing occupants towards the west. Premium residential developments and the presence of multi-national companies in Sriperumbudur and Oragadam have also been major demand drivers in these localities.

The west zone including Porur, Maduravoyal, Manapakkam, Thiruverkadu and Poonamalle offers decent houses with average rents in the range of Rs.10,000-12,000 per month for 2 BHK flats and 3 BHKs between Rs.15,000-25,000 per month.

A Winning Scenario

Rental housing not only addresses housing needs but also helps to reduce the completed unsold residential inventory on the market. 

The reduction in this number is a clear indicator that the market is maturing. With this in mind, the recent Union Budget has levied tax on developers on the notional rental income on completed unsold inventory after 1 year.

Apart from the fact that rental Housing is affordable and offers a better living standard, it is also correctly viewed as a solution to achieve the Government’s vision of Housing for All by 2022. 

The growing shortfall in housing is a serious challenge, and its scale makes the success of any single approach like buying/owning a house difficult.

On the other hand, housing situated far away from employment hubs and social infrastructure is unlikely to induce much demand. Through rental housing schemes, PPP model and Government subsidies, housing for the EWS (economically weaker sections) and LIG can even be made available to people drawing monthly income below Rs. 7000 per month.

With budget provisions, residential REITs and the growing demand for rental housing 2017 will witness the rental market finding its place in the real estate scenario, opening more options for the rental occupiers and assured returns for owners.

About the author..

Mr. Simon Selvaraj, Local Director - Strategic Consulting (Chennai) JLL India

 For media contact
Arun Chitnis
Head – Corporate Communications & Media Relations
JLL India
Level 6, Amar Avinash Corporate Plaza
Bund Garden Road,
Pune 411001.
Tel: (020) 3093 0441 Fax: (020) 4019 6101
Mob: +91 96571 29999