April 06, 2021 - CREDAI Bengal Homes
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April 06, 2021
CREDAI Bengal Daily News Update | 06.04.21
Newspaper/ Online The Economic Times (Online)
Date April 05, 2021
https://economictimes.indiatimes.com/industry/services/property-/-
Link cstruction/housing-sales-up-44-per-cent-in-january-march-2021-
across-8-cities-report/articleshow/81916448.cms
Housing sales up 44 per cent in January-March 2021 across 8 cities:
Report
"71,963 units were sold during Q1 2021, 44 per cent more than in Q1 2020. This healthy
growth in sales also encouraged developers to launch new projects which are reflected in
the 76,006 units launched during the quarter, substantial growth of 38 per cent year-on-
year," Knight Frank India said in a statement.
Sales of residential properties across eight major cities grew 44 per cent in the January-March
period this year to nearly 72,000 units as demand recovered, according to Knight Frank India.
Mumbai Metropolitan Region (MMR) and Pune performed well on the back of the Maharashtra
government's decision to reduce stamp duty.
"71,963 units were sold during Q1 2021, 44 per cent more than in Q1 2020. This healthy growth
in sales also encouraged developers to launch new projects which are reflected in the 76,006 units
launched during the quarter, substantial growth of 38 per cent year-on-year," Knight Frank India
said in a statement.
As per the data of sales bookings in primary residential markets of eight major cities, housing
sales in Mumbai rose 49 per cent year-on-year to 23,752 units in January-March 2021.
Pune saw a 75 per cent rise in sales to 13,653 units.
In south India, housing sales in Bengaluru went up 18 per cent to 10,219 units, while sales in
Hyderabad rose sharply by 81 per cent to 6,909 units. Chennai witnessed 36 per cent growth to
4,058 units.
In the Delhi-NCR market, sales were up 24 per cent at 6,731 units.
Housing demand in Kolkata increased by 22 per cent to 3,596 units during January-March 2021,
while Ahmedabad saw a 34 per cent rise in sales to 3,045 units.
Knight Frank India Chairman & Managing Director Shishir Baijal said, "Q1 2021 saw a
significant rise in sales across the key markets, led by Mumbai and Pune - the two markets that
received substantial backing from the state government in the form of reduced stamp duty".
Other cities also recorded a rise in sales of homes due to a shift in attitude in homebuyers that has
now started to prefer ownership, he added.
"That, coupled with home loan interest rates at multi-decade lows of sub 7 per cent, a substantialcorrection in apartment prices, as well as an increase in household savings, seems to have convinced homebuyers that this was an opportune time to purchase their properties," Baijal said. However, he said the recent spike in COVID-19 cases in the country has to be factored in for the future. "We are yet to understand the complete impact of the 'second wave' on the economic activities and resulting wealth creation," Baijal said. He hoped that the governments would take note of the possible challenges and address them to ensure India's economic growth is minimally impacted. ____________________________________________________________________________________________
Newspaper/ Online Financial Express (Online)
Date April 06, 2021
Link https://www.financialexpress.com/industry/second-covid-wave-likely-
to-hit-momentum-of-housing-sales/2227518/
Second Covid wave likely to hit momentum of housing sales
As the housing sales momentum across top eight markets in India improved for the second
consecutive quarter in a row, Knight Frank on Monday said the increasing sales volume
was able to check the intensity of decline in prices during the recently concluded January-
March 2021 quarter.
As the housing sales momentum across top eight markets in India improved for the second
consecutive quarter in a row, Knight Frank on Monday said the increasing sales volume was able
to check the intensity of decline in prices during the recently concluded January-March 2021
quarter.
However, the real estate consultancy expressed concern over the sales momentum in the April-
June 2021 quarter as India faces a strong second wave of Covid infections and the discount on
stamp duty in Maharashtra is over.
Knight Frank India chairman & MD Shishir Baijal said: “While sentiments have remained largely
positive in the first quarter, leading to consistent rise in home sales, the recent spike in Covid
cases has to be factored in for the future. We are yet to understand the complete impact of the
second wave on economic activities and resulting wealth creation.
Mumbai and Pune collectively accounted for 52% of the total sales of close to 72,000 units sold
across the top 8 cities in Q1 2021.
“Increasing sales volumes have also arrested the intensity of the y-o-y fall in residential prices of
most markets, while Hyderabad and Delhi NCR have seen a marginal growth in prices compared
with a year ago,” Knight Frank India said in a report.
The incidence of developers giving indirect discounts/freebies has been a key factor in spurring
sales in 2020, but this has been observed to have reduced significantly in Q1 2021. In fact, on asequential basis housing prices remained stable in most cities and recorded an increase in the case of Chennai and Hyderabad, it added. For instance, property sales in Delhi-NCR rose 24% y-o-y in Q1 2021 to 6,731 units, which helped the region check the intensity of price decline as at the end of 2020 prices had fallen by 4% y-o-y. This is against prices appreciating, albeit marginally by 1% y-o-y, during Q1 2021. Similarly, in the case of Chennai, prices were down on an annual basis by 9% at the end of 2020, but with the city reporting a 36% y-o-y growth in apartment sales during January-March 2021, the intensity of price decline softened with rates down by just 2% Y-o-Y at the end of the quarter. For Mumbai, the percentage of decline in prices at the end of 2020 and at the end of January- March 2020 remained flat at 3%. While in the case of Pune, the city managed to check the percentage of decline in prices from 5% y-o-y at the end of 2020 to 3% y-o-y during Q1 2021. Overall, developers sold 71,963 units in Q1 2021, 44% more than in Q1 2020. This healthy growth in sales also encouraged developers to launch new projects which is reflected in the 76,006 units launched during the quarter, a growth of 38% y-o-y. _____________________________________________________________________
Newspaper/ Online ET Realty (Online)
Date April 06, 2021
https://realty.economictimes.indiatimes.com/news/industry/builders-
Link step-up-covid-19-precautionary-measures-at-construction-
sites/81924990
Builders step up Covid-19 precautionary measures at construction
sites
Some developers have already been making efforts to vaccinate workers, provide food and
shelter at the site itself and also make arrangements for the workers’ families by providing
a creche in order to avoid a repeat of reverse migration witnessed last year.
Real estate developers are stepping up existing precautionary measures to comply
with Maharashtra government’s partial lockdown directives to ensure safety of construction
workers at their sites.
Some developers have already been making efforts to vaccinate workers, provide food and shelter
at the site itself and also make arrangements for the workers’ families by providing a creche in
order to avoid a repeat of reverse migration witnessed last year.
Following the return of labourers starting late August, realty developers have been making these
arrangements and are confident that they are well-equipped and prepared this time based on the
scenario experienced last year.
“We are in a better state of mind today with past learnings, increased immunisation and focus on
well-being, vaccination shots in offing, adaptation to the new normal way of living and working
and productivity in revival mode,” Niranjan Hiranandani- National President of realtors’
body NAREDCO, told ET.
According to him, the industry is equipped now to tackle the on-ground situation with better
safety gears and precautionary measures in practice.
Developers will be responsible for in-situ construction labourers on site to ensure their healthcare
protocols, vaccination drive, regular health check-up & well-being, food and sanitised shelter,
social distancing as per the norms, mobile creche operational for their kids etc to ensure smooth
production.
The Confederation of Real Estate Developers’ Associations of India (CREDAI) has already
announced providing free Covid-19 vaccination to over 2.5 crore construction workers at the sites
of its over 13,000 developer members across 217 Indian cities and towns.
“CREDAI MCHI and our over 1,800 developer members are currently overseeing and
implementing various safety initiatives and measures to ensure adequate preparation in view of
the new set of restrictions imposed by the state government to combat the spread of the virus. We
are grateful to the authorities for not putting a halt on construction activities and assure all theefforts to ensure the safety of our workers and employees at the construction sites,” said Deepak Goradia, President, CREDAI-MCHI. In addition to the basic accommodation, food and refreshments amenities, CREDAI MCHI is also beginning a vaccination drive for all our workers to ensure maximum safety and restrict transmission. Industry observers believe that amidst the rising Covid19 cases across key states, developers are trying to keep construction activity unaffected as much as possible but higher number of vaccinations hereon will be helpful. “Given that the average age of construction labour in India is 32 years, it is imperative that the government opens the vaccination drive for all. This will help developers to get their workers vaccinated and thus keep construction activity unaffected, invariably helping the economy,” said Santhosh Kumar, Vice Chairman - ANAROCK Property Consultants. According to Hiranandani, the digital platforms are fully leveraged for customer communication, online sales & marketing and tapping new markets to keep the business continuity plan intact during this period limiting the impact on sales activity. The government of Maharashtra on Sunday night announced that construction will be allowed only for projects where labourers are living on site with restriction of movement outside, except for the construction material movements. It has also directed that everyone engaged in the activity to get vaccinated at the earliest and until then must carry a negative RTPCR test result certificate, which will be valid for 15 days starting from April 10. Any default on these measures will attract a fine of 10,000 for the developer and repeated defaults may lead to closure of the construction site till existence of notification of Covid19. Construction workers, who would test Covid19 positive cannot be discontinued from work during the absence for this reason and will get full wages. ________________________________________________________________
Newspaper/ Online ET Realty (Online)
Date April 05, 2021
Link https://realty.economictimes.indiatimes.com/news/regulatory/governm
ent-introduces-pre-packaged-resolution-process-for-msmes/81912685
Government introduces pre-packaged resolution process for
MSMEs
The latest move comes less than two weeks after the suspension of certain IBC provisions
ended. The suspension -- wherein fresh insolvency proceedings were not allowed for a year
starting from March 25, 2020 -- was implemented amid the coronavirus pandemic
disrupting economic activities.
The government has amended the insolvency law to provide for a pre-packaged resolution
process for micro, small and medium enterprises. An ordinance was promulgated to amend
the Insolvency and Bankruptcy Code (IBC) on April 4, according to a notification.
The latest move comes less than two weeks after the suspension of certain IBC provisions ended.
The suspension -- wherein fresh insolvency proceedings were not allowed for a year starting from
March 25, 2020 -- was implemented amid the coronavirus pandemic disrupting economic
activities.
As per the ordinance, it is considered necessary to urgently address the specific requirements of
Micro, Small and Medium Enterprises (MSMEs) relating to the resolution of their insolvency,
due to the unique nature of their businesses and simpler corporate structures.
According to the ordinance, it is considered expedient to provide an efficient alternative
insolvency resolution process MSMEs to ensure a quicker, cost-effective and value maximising
outcomes for all stakeholders, in a manner which is least disruptive to the continuity of their
businesses and which preserves jobs.
"... in order to achieve these objectives, it is considered expedient to introduce a pre-packaged
insolvency resolution process for corporate persons classified as micro, small and medium
enterprises," it added.
Soumitra Majumdar, Partner at J Sagar Associates, said the IBC Amendment Ordinance 2021,
makes available the pre-packaged route to genuine and viable cases, to ensure least business
disruption.
"While modelled on debtor-in-possession approach, it vests significant consent rights to the
financial creditors, such that the mechanism cannot be mis-used by errant promoters.
"Further, adopting the plan evaluation process akin to Swiss Challenge, it retains competitive
tension such that promoters propose plans with least impairment to rights and claims of creditors,"Majumdar noted. IBC provides for a market-linked and time-bound resolution of stressed assets. ________________________________________________________________
Newspaper/ Online The Economic Times (Online)
Date April 05, 2021
https://economictimes.indiatimes.com/industry/services/property-/-
Link cstruction/up-rera-postpones-national-lok-adalat-due-to-covid-
19/articleshow/81916025.cms
UP RERA postpones National Lok Adalat due to COVID-19
The UP State Legal Service Authority had sent a proposal to organise a National Lok Adalat
on April 10, July10, September 11 and December 11.
The Uttar Pradesh Real Estate Regulatory Authority (RERA) has decided to postpone the
National Lok Adalat keeping in view the increasing cases of Covid-19.
The National Lok Adalat was proposed at Lucknow and Greater Noida on April 10, to resolve
disputes of homebuyers.
“Uttar Pradesh State Legal Services Authority has informed that the National Lok Adalat is being
postponed keeping in view the increasing cases of Covid-19. The advance date of the said event
will be informed in time,” UP RERA said in a statement.
The UP State Legal Service Authority had sent a proposal to organise a National Lok Adalat on
April 10, July10, September 11 and December 11.
According to UP RERA, Lok Adalat was to be conducted through online complaints filed before
the bench under Section 31 of the RERA Act in which mutual agreement is possible, or an
application for agreement has been filed by a party, will be taken up.
“Through Lok Adalat, homebuyers will get the opportunity for transparent amicable settlement
and speedy disposal of their cases. The Lok Adalat will hear the same cases where settlement is
possible on the basis of reconciliation agreement and the cases which have been pending for a
long time,” Rajesh Kumar Tyagi, Secretary, UP RERA had said.
____________________________________________________________________________________________Newspaper/ Online ET Realty (Online)
Date April 05, 2021
Link https://realty.economictimes.indiatimes.com/news/regulatory/chennai-
3-6-dip-in-property-registrations-in-2019-2020/81907022
Chennai: 3.6% dip in property registrations in 2019-2020
According to official data with the registration department, revenue to the tune of 10,643
crore through stamp duty and registration fee was recorded between April 2020 and March
2021.
Property registrations in the state threw surprises during 2020-21. While the value of land
registrations dropped by 3.6% when compared with 2019-20, the number of documents registered
went up by 4% compared to the previous year.
According to official data with the registration department, revenue to the tune of 10,643 crore
through stamp duty and registration fee was recorded between April 2020 and March 2021.
The data revealed that the Chennai zone comprising the
city, Chengalpet, Kancheepuram and Tiruvallur districts had revenue dropped by more than
1,000 crore when compared to 2019-20, which is a dip by 21.4%.
The Chennai zone used to contribute about 45% of the total revenue through property registrations
across Tamil Nadu during the pre-Covid times.
"The Chennai zone records the highest property transactions in terms of value. But, in 2020, it
plunged and it had an impact on the overall revenue through land registrations," the official said.
The number of documents registered decreased by 11.6% in the Chennai zone.
________________________________________________________________Newspaper/ Online ET Realty (Online)
Date April 05, 2021
https://realty.economictimes.indiatimes.com/news/residential/very-
Link positive-demand-revival-in-residential-sector-mohit-malhotra-godrej-
properties/81916652
Very positive demand revival in residential sector: Mohit Malhotra,
Godrej Properties
"Definitely for the residential market, the COVID-induced work from home is a very
positive development. People have understood the importance of homes. We have spent
close to a year at home."
People are looking to buy homes, buy larger spaces and it has an implication for us from a
product development perspective. But from a demand perspective, it has led to a very positive
revival for the residential sector, said Mohit Malhotra, MD & CEO, Godrej Properties. Edited
excerpts:
What has been your outlook on the fact that there has been no extension of the stamp duty?
Do you think that volumes will likely sustain, will the revival be impacted quite significantly
on account of this roll back?
We are present across four cities and stamp duty cut has been only in Mumbai and Maharashtra.
We are seeing demand revival across the four geographies, across the key cities. It is not just
because of the stamp duty cuts which happened in Maharashtra. Real estate is at all-time high in
terms of affordability, interest rates are all-time lows. So, people are seeing this as a right time to
buy homes and people are understanding the value of homes in this COVID times.
On your specific question on stamp duty, yes there will be a temporary phenomenon in
Maharashtra where the volumes could go down for a month or two. But from a long-term
perspective the demand is very much in place and we do not see it as a long-term issue. Demand
revival is pretty strong and across geographies.
When you say demand is picking up, are you talking about volume growth or value growth?
I am talking about volume growth.
When you say volume growth is picking up, in which category is it specifically picking up?
Is it at the entry level, mid-luxury or luxury demand?
Largely the demand has been pretty stable and strong in the mid-income segment, which is the
bread and butter for us. If you look at from a price point perspective, anything outside Mumbai
between a price point of 35 lakhs to a crore is what we classify as a mid-income and that has seen
very strong demand over the last few quarters. That has been very stable and we remain very
bullish in that segment.
The luxury demand in Mumbai picked up very significantly thanks to the stamp duty cuts but
whether that demand will continue to remain buoyant or not is something which is difficult to
guess right now because stamp duty cut did play a very significant role in the luxury markets.If I look at raw material, they have gone through the roof. One side demand is coming back, but for your balance sheet are you getting pricing power back? You are right, the prices of steel, cement have started to go up. Steel has significantly gone up. We will need to pass on some of these costs to the consumers. Now, from a percentage of top- line perspective, the cost is not very significant. Even if there is a 20% rise in the price of steel and cement, it translates between 1% or 2% of the top line. So, passing some of the small numbers is something which we would need to do as a developer community because margins are already very thin. The real pricing power of taking price hikes significantly is couple of months away. Just to put it in perspective, it has been almost eight years of downward cycle in our industry. Most geographies have had price cuts or actually prices remained flattish. So if you adjust for inflation, the prices are really low. However, couple of months of volume growth and then the pricing power will be back for us in the market. Help us understand what is currently your launch pipeline and your response to recent launches, especially in Delhi NCR. We did close to 11 launches in second half of the year and we had very successful launches across the cities. We had launches in Bangalore, where we launched a plotted development which was a sellout. We had a plotted launch in both NCR and in Pune, which was again a very big sell out. Multiple successful launches in Pune and Mumbai. Now specifically coming to NCR, we actually had a launch in the central Noida market and that project was a record sale where we sold close to 500 crores in a very short period of time. We have seen very strong demand in that particular project and also across cities. The launches have really done really well over the last few months and we expect this trend to continue. Going forward would you be acquiring more land parcels? Is there a strategy which is put in place one year into the pandemic? We had a shift in strategy almost four years back, where we took a call to invest more capital in the real estate market as a part of our counter-cyclical investment strategy. If you see, we have done only three rounds of fundraising over the last four years and have deployed significant amount of capital in the market. We just did another round of QIP in the last quarter and have the cash available in the balance sheet today to pick up more projects. We think there will be a mix of joint ventures and outright purchases which we will be using this capital to invest in. What will happen to evergreen sectors like start-ups and IT? Are you witnessing any change in demand patterns in cities like Bangalore, Chennai, or even Gurgaon? We are largely a residential player. What you just described is a pretty strong headwind for commercial development across the country. Again, the jury is out to know what is the impact of work from home for the commercial market. But definitely for the residential market, the COVID-induced work from home is a very positive development. People have understood the importance of homes. We have spent close to a year at home. I have never spent so much time at home. People are looking to buy homes, buy larger
spaces and it has implication for us from a product development perspective. But from a demand perspective, it has led to a very positive demand revival for the residential sector. When will the investor comeback in equity markets? Do you see the trend changing now that affordability is back? As builders you will say bullish things, but let us hear the reality. The investors have walked out of the real estate market for almost five years now. It is very typical of any downward cycle. At the peak, 80% of the sales started to happen to investors. Since almost a year back, almost 90% to 95% of the sales was happening to end-user only. This shift typically happens in any cycle. There is nothing new here. But for last one year during COVID we have actually seen some bit of investor demand trickling in. If I look at our overall portfolio, almost 20% to 25% of sales today are investors. So they have started to come back in the market. Lot of people today have a view that the prices have bottomed out and the probability of prices going down from here, vis-à-vis cycle turning and giving positive return, the probability is in favour of the cycle turning. We are seeing investors slowly and gradually coming back in the sector. In next 12 months, what kind of million square feet project are you likely to launch and are also likely to give OCs for? I would avoid any forward guidance at this point of time. We are rapidly growing as organisation. If you see our past trend, we have been growing at a pretty rapid pace. This year we are pretty bullish and optimistic, so no reason why growth should slow down. But I would be avoiding any future guidance. How do you see things evening out as on the demand front the news is good, while on the input side the news is bad? Typically, when you launch a project, you lock the pricing and they do not change. What happens to the existing projects which were launched six months to one-and-a-half years ago? Will that start affecting your profitability in the medium term? As I said, even if you take a very extreme view on commodity prices like steel and cement, the impact on margin is around 1%. That is something for the previous launches we will absorb. Again, at the time of launches we sell between 70% to 80%. So, balance inventory is something where we will look at passing on some of these inflations to the consumer. Overall there might be an impact at close to a 1% level for the past sales which are locked. For the future launches, we will see how much of this can be passed on to the consumers depending on how the pricing is shaping up in the market. ________________________________________________________________
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