Real Estate Companies | Builders in Gurgaon - NEO Developers

Neo Developers Private Limited, the prominent real estate developer and builder in Gurgaon is offering residential, hospitality, farms and commercial projects in Gurgaon and its vicinity. It is developing a commercial project in sector 109, Dwarka Expressway, Gurgaon. We are committed to endlessly transform and develop to deliver the premier significance to our customers.

Budget 2015: Realty sector seeks more tax sops on REITs

To ensure success of newly created REIT (Real Estate Investment Trust) structure, property developers and consultants have sought more tax incentives in the upcoming union budget on investments through this route.

In September 2014, market regulator SEBI had notified norms for listing of new business trust structure REITs that would help attract more funds in a transparent manner into the realty sector.

The norms were notified after Finance Minister Arun Jaitley, in the last year's budget, had provided REITs the 'pass through' status for the purpose of taxation.

In its pre-budget wish-list, JLL India Chairman and Country Head Anuj Puri said: "Until vital changes to overcome the tax hurdles, REITs - which can literally be a life-saver for Indian real estate - cannot take off. In the interest of the real estate sector as well as the overall economy, the Budget must address this issue".

Realtors' apex body CREDAI Chairman Lalit Kumar Jain said: "We have got through pass through status. We need clarity with respect to double taxations". He also said the state governments should provide some incentives such as lower stamp duty on properties under REITs.

Global property consultant CBRE South Asia CMD Anshuman Magazine said the industry is anticipating taxation clarifications for REITs to begin functioning in the country. Much needs to be done on the tax structures of this instrument for it to become more efficient for domestic as well as overseas investors, he added.

"The proposed tax structure for India REITs is biased towards overseas investors and could potentially translate into multiple tax levels for domestic investors," he said.

Magazine listed other challenges, including a corporate income tax payable by the sponsor at the entry level followed by a possible tax leakage of 35-40 per cent on normal income, and a capital gains tax on the sale of REIT units by the sponsor at the exit level.

"All such taxation factors, among others, have in unison kept back market players from investing in the real estate sector through REITs," Magazine noted.

For REITs to become a success in India, CBRE said that issues like analyst coverage for this instrument in India, initial property valuations, and approvals of large bank loans for the holding trusts, need to be answered.

Stating that REIT market would require strong support from the government and existing investors, CBRE said: "The real estate investor community, hence, awaits clarifications related to taxation and regulations so that execution timelines and investment strategies may be planned ahead."

REITs, a new investment avenue in India on the lines of one in developed markets like the US, UK, Japan, Hong Kong and Singapore, can be listed and trading would be allowed in units of REITs like any other security on stock exchanges.

Source: PropertyatNeoDevelopers.Wordpress.Com

Foreign investors add Indian online property portals to shopping cart

Indian businessman Navin Bhartia's Internet habits make him a dream customer for billionaire foreign media moguls like Rupert Murdoch. The 45-year-old from Kolkata likes to buy homes online, sometimes without visiting them. In the last four years, he has bought five properties for 40 million rupees ($641,900) on Proptiger.com, partly owned by Murdoch's News Corp.

Foreign investors like Murdoch have already put more than $200 million into portals that help people like Bhartia buy homes. Spurring the interest is prime minister Narendra Modi's vow to provide a house to every Indian family by 2022 as the country's growing army of Internet users embrace e-commerce.

"Scale and growth of businesses like (online retailer) Flipkart are a proxy that consumers in India are comfortable doing transactions on the Internet," said Mukul Singhal, principal at India-China fund SAIF Partners, which has invested $10 million in Proptiger. News Corp has a $30 million stake.

India's Internet legion, already bigger than Indonesia's 250 million population and growing at an annual rate of more than 20 percent, has also lured property portal investment from the likes of Japanese telecoms-to-media firm SoftBank Corp. Last week Google Inc's Google Capital unit invested an undisclosed sum in a site called Commonfloor.com.

The need for long-term capital for start-ups like Proptiger and Housing.com also makes India more attractive for foreign investors compared with China, where local money dominates, according to one investor, speaking on condition of anonymity.

Indian home buyers by tradition work with local brokers. But in a vast country with a property market already estimated by KPMG to be worth $121 billion in 2013, the Internet offers people like businessman Bhartia the ability to compare house prices hundreds of kilometers away without leaving home.

"A single broker would have his own limited contacts...and he could have personal reasons for pushing a property. Online you get a very good and holistic view," said Bhartia, whose firm manufactures gas cylinders. He bought his last two properties without visiting them at all.

Prime minister Modi has already sought to make an impact on India's still largely unregulated property market by making the listing of real estate investment trusts easier. He has paved the way for more foreign investment in construction, and eased land acquisition rules.

"Real estate in India is very messy. There is a lot of information arbitrage and asymmetry. There is no credible pricing data and that is why there is a strong case for technology-based solutions," said SAIF Partners principal Singhal.

Driven by expectations that years of property market slowdown may come to an end soon, investment in property portals jumped five-fold to $193 million last year, according to data from Venture Intelligence. The research firm also expects India's housing market to grow to $158 billion by 2020.

Desperate to boost housing sales that have flagged as India's economy stuttered in recent years, property developers are tying up with portals to push transactions online with special promotions.

Developer Tata Housing, part of the $100 billion Tata group, in November sold homes worth more than 500 million rupees through a partnership with Housing. Buyers could see 3D models of the units, make a token payment online and complete the remaining purchase offline.

Such websites, which charge subscription fees or a percentage of the sales price, still account for a fraction of home sales in India. For investors like News Corp, though, the Internet logic is inescapable.

"India's digital demographics are a key factor in looking at this space," said Raju Narisetti, vice president of strategy at News Corp. "More of the research, decision-making and increasingly the early part of the journey of buying a home is all happening on the Internet."

Source: PropertyatNeoDevelopers.Wordpress.Com

What’s causing the delay in single-window clearances?

If the new government actually provides hassle-free approvals to housing projects, residential prices can come down by 30% to 35%.

The Indian real estate market is in dire need of single-window clearances for residential projects, and this is something that the new government must action on a priority basis. The process of project approval must be revised so that developers can launch more projects and increase supply, which will help in keeping prices down. Owing to its specific structure, the current system is completely counter-productive. The lack of a streamlined projects approval mechanism is a symptom of India’s retrograde bureaucratic machinery which causes untold losses to all stakeholders.

It is a well-known fact that real estate is one of the major contributors to GDP, and this sector cannot perform optimally in a scenario where a bewildering multitude of agencies are involved in processing approvals for real estate projects.

If we study the massive numbers of clearances and approvals that are required for residential projects in India, the challenges that developers have to face become very apparent. The old English proverb ‘there’s many a slip between the cup and the lip’ is very apt here. The extensive efforts that a developer in India has to put in before a project is even approved for construction are not well understood.

Moreover, the procedural complications only increase once a project is cleared for development. A project can face a road block at any stage between construction commencement and completion because of some government department or the other delaying clearance or approval.

Developers face multiple repercussions because of these delays. In the first place, delays adversely affect the gestation period in terms of returns. Secondly, delivery timelines play a big role in determining the attractiveness of a project in relation to investors. The amount of confidence that end users place on a developer is directly proportionate to the pace of delivery.

Now expectations are big on the present government, which has assured the Indian real estate fraternity that it will pay due attention to its issues.

Prime Minister Narendra Modi has made it his mission to make housing affordable to all, but it is difficult to see how this can happen when the currently employed multi-agency approach to project approvals adds as much as 40% to the cost of constructing projects.

If the new government indeed provides single-window approval to housing projects, residential prices can come down by 30% to 35% as a result, says a real estate expert.

The introduction of a single-window housing project approval system would make it possible for residential developers to increase the supply of housing, which would not only help in addressing the country’s massive requirement for housing but also increase the government’s revenue collections from increased stamp duty and registrations.

Also, increased housing supply will mean healthier competition among developers, which will result in more rational and uniform pricing. Greater competition will also boost innovation in project designs.

These considerations combine to make a very compelling case for the government to finally make single-window approvals for housing a reality.

Source: HT Estates, Nov 29, 2014, Page 07

Third party rights over profits from property

Claimants can get maintenance under Section 39 of the Transfer of Property Act.

Most of the times we hear of cases where the wife, children or dependent family members of a person make claims of maintenance out of the property owned by an individual. The dispute between the members of a family aggravates when the owner of such property transfers his property in favour of a third party.

The answer to this is embodied under Section 39 of Transfer of Property Act, 1882 (TPA). This section is applicable only in cases where a third party has the right to receive amounts for maintenance or advancement or marriage purposes. It may be noted that the right of a person to receive maintenance, advancement amounts or marriage expenses out of profits of immovable property is created when a sum is fixed and charge upon property is created either by a decree of court or by an agreement or by law.

Let us take an illustration of this situation.

A is married to B. After few years of marriage A and B separate. The terms of separation as agreed between them mention that A, out of his specific immovable property, will pay for maintenance of B. However, in order to avoid paying maintenance to B, A transfers his property to his friend C by way of gift. C is not aware of the claims of B. Here, the question is: what rights and claims does B have against A and C? And what are the liabilities of C in respect of claims of B?

As per Section 39 of TPA where the transfer of property in favour of a transferee (ie C) is made out of gratitude, ie no consideration is paid by transferee to the transferor (ie A), then third party (ie B) rights can be enforced against transferee (ie C) even though the transferee (ie C) may not have prior notice of the same.

Therefore, in the above illustration, B can enforce her rights to receive maintenance out of the profits of a property even when the property has been transferred by A to C. Also, absence of notice of B’s rights in the property cannot be taken as ground by C to deny B’s rights/entitlements.

However, this Section protects a bona-fide buyer who has purchased the property for consideration. This means that if the property is transferred to a person for consideration and that person does not have notice of any third party rights then such rights cannot be enforced against the buyer.

For example, if in the above illustration A transfers the property to C by way of sale for which consideration is paid by C to A, then in that case B may not be able to enforce her claim/right against C, if C has no notice of B’s claim/right.

The term notice used in this section is generally interpreted in broad connotation. It includes within its meaning knowledge and awareness of third party rights. A person having knowledge of existing rights of third party can be considered to be aware of the deal. Notice could be either expressed or implied, but where the rights are conferred by law, then same is presumed to be known by all.

However, this Section does not stop or prevent a person from transferring his property. A person with immovable property is free to transfer his property to anyone. A person may also transfer his immovable property where a third party is entitled to receive maintenance from the profits arising out of such property. However, such transfer will not extinguish the rights of the third party in the property and these rights can be enforced in accordance with Section 39 of TPA.

Source: HT Estates, Nov 27, 2014, Page 06