It’s Raining – Forest Land in Mulund

Mulund also fondly known as Prince of Suburbs is in for a great activity in coming days. With Oberoi Realty, Runwal and Nirmal Lifestyle now getting a clean chit from the Supreme Court to go ahead and develop their respective properties, which earlier fell in the Forest Zone.

Mulund as a micro market has a lot to gain with this as a lot of people like to reside in the city limits of Mumbai and there is a virtually a very short distance between Mulund and Thane.

The most important thing which all these lands offer is the Greenery around the location and the very fact it is closer to the hills it offers scenic views which are not found otherwise in most of the suburbs across Mumbai.

With property prices in Mulund scaling above 11000 mark, it will be interesting to see the kind of mix of configurations the developers come out with and how quickly who will launch will be the biggest beneficiary as the absorption levels in Mulund may be quiet less compared to a Borivali or Thane because it is tucked away in one corner.

Also, the infrastructure impact in Mulund is limited and the only one road which has yet to make in roads is the Mulund Goregaon Link Road. Once the same is done, then there could be a great convergence as the Western Suburbs will then connect well with the Eastern Suburbs.

Ideal configurations for Mulund would be 1, 1.5, 2 and smaller 3 BHK.

Sandeep Sadh

Mumbai Property Exchange Pvt Ltd.

Mumbai Lease markets to grow by 10-15%

Mumbai is the financial capital of India and nearly most of the Fortune 500 Companies and India’s top Corporate Houses have a base here in some form or the other. With Real Estate prices becoming higher and reaching the highest peak point it may be difficult for a lot of people to buy property here.

For instance, if some one is looking to buy a house in Mumbai, and the approximate budget is say 1 CR and he is Salaried then the following are the financial needs.

Assuming he goes for a ready possession home, he has to pay.

Around 30 Lacs Down Payment which includes 20% Down Payment, 5% Stamp Duty, 1% Vat, Rs.35000/- Registration and 3.09% Service Tax etc.

Balance Rs.70 Lacs Loan will cost him approximately Rs.75,000/- as EMI per month Which typically means, the Individual or even considering a Business Man, Salaried Employee, even with a spouse working, must earn close to Rs.150,000/- per month to survive the next 10-20 years.

Owing to this the current market is reeling under pressure and also in coming times the lease rental market will grow at a healthy place. The current returns in the real estate market are around 3 to 5% depending on where your apartment is.

A few indicative capital values and the rents today :

1. Oberoi Splendor – Jogeshwari East – Capital value – Rs.2.50 to 2.75 CR – Rental Value – Rs.65,000 to Rs.80,000/-

2. Oberoi Springs – Andheri West – Capital Value – Rs.2.75 to Rs.3.25CR – Rental Value – Rs.75,000/- to Rs.100,000/-

3. Lodha Bellissimo – Parel – Capital value – 9 Cr + Rental Value – Rs.225,000/- to Rs.300,000/-

4. Raheja Vivarea – Mahalaxmi – Capital Value – 12 CR + Rental Value – Rs.300,000/- to Rs.375,000/-

It has also been witnessed that in the current market scenario the Exclusive properties are yielding a return of around 2% on the current market value, however, most investors or home buyers have bought the property at least 30 to 60% cheaper or more and hence the returns come to around 5 to 7% or even more in cases where apartments are done up well and given to Expats.

The moving ticket size is the 1 and 2 BHK Transactions in any suburb today, where in the rent values start from a mere Rs.7000/- going upto Rs.40,000/-

The lease markets over the years is poised to grow and Mumbai Residential Lease market will continue to see a robust growth.

Sandeep Sadh – CEO – Mumbai Property Exchange.com

Mumbai lacks lifestyle apartments today

If you are coming from overseas to buy a property in Mumbai with No Fuss and s real plush looking building then you are in for a real shock today.

The ready possession buildings with Top quality maintenance are a handful across Mumbai.

Recently I was with an Expat family, they looking for an apartment on lease with a budget of around 10000 US Dollars a month. It was a tough experience for me to match their need of a large 4 BHK in Bandra or South Mumbai which would be in Top shape.

Thr apartments available either are too old and need a complete make over or the buildings inside and outside is not so well maintained as it should be to command the price.

We hope that this changes in coming times with the new launches with swank amenities across Mumbai.

A few buildings which qualify today for top expats:

1. Beaumonde
2. Vivarea
3. Imperial Towers
4. Kalpataru Horizon
5. Raheja Bay
6. Narain Terraces
7. Kubilisque
8. Ashok Towers
9. Bellissimo
10. Jivesh Terraces

Oberoi Realty: Strong base

The real estate sector continues to face a number of challenges, and this is the reason that analysts have rated as ‘above estimates’ the 1% net profit growth by Oberoi Realty, a Mumbai-focused builder. Another reason for this enthusiasm is the stable operating numbers. The company’s realisation increased by 8% on a quarter-overquarter basis, despite a 5% fall in volume during the same period. The occupancy rate at Oberoi Mall was stable at 95%, while the occupancy for Commerz also rose marginally to 83%.

Oberoi Realty also has a steady project pipeline in place. It has already received approvals for its Esquire project at Goregaon under the revised development control rules (DCR), and expects to start construction within a few weeks. The Oasis project in Worli has started and the same is expected to reach the 25% construction threshold in 2013-14 itself. However, the Mumbai commercial real estate market is still struggling with oversupply and, therefore, the demand for Commerz II is not as robust as it was for Commerz I. To mitigate the problem, Oberoi Realty is planning to convert some of its commercial projects to residential ones, and this should provide the much-needed visibility for the coming quarters.

The company is also considering foraying into other important markets. To begin with, it is planning to make an investment of 150 crore in the National Capital Region, and additional investments will be on the basis of its success. This implies that success on this front should act as a major trigger for the stock. The firm is still waiting for the environmental clearance for its Mulund project, and any news on that front can be another trigger. As of now, the strong execution history and high-end construction quality differentiate Oberoi Realty from other players. The low-cost land bank—since most of the land was acquired before the recent spiral in prices—is another positive factor for the stock. However, new land acquisition may be at a higher cost and this may dilute the cash holding and higher margins.

Given the strong cash flow and increasing earnings visibility, analysts feel the stock deserves a re-rating. While most real estate stocks have rallied in the recent past due to the expected cut in interest rates, Oberoi Realty underperformed because it is a debt-free company and, therefore, is unlikely to be a major beneficiary of the rate fall. Due to this, the gap between the company and other high debt peers has come down once again, thereby offering a good entry point.

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