Thursday, 3 August 2017

THE DNA OF PROPERTY BUYERS IN PATNA REALTY MARKET.

"नहीं, भइया बोले की रेट फ्लैट का ज्यादा है ! आठ साल से भईया हमारे इसी इलाके मैं रहते हैं !! आला अधिकारी हैं गवर्नमेंट में ; सारी जानकारी रखते हैं। ...... 

Property buyers in Patna evaluate a lot of things before taking a plunge; and we respect the time and effort that they take in taking the LIFETIME decision.

In addition to serving the basic need of access to a decent accommodation, many property buyers in Patna also evaluate the economic benefits (such as saving on rent and capital gains) a property in Patna would deliver. Thus, while property purchase decision may or may not be out of necessity, the financial aspect is largely the driving factor behind a property purchase decision.

Other important consideration of home buyers in Patna apart from financial is the number of their relatives or friends or in local parlance; परिचित in that particular location.  We, Biharis are really social, though it is reducing with time and nuclearisation of our families. But still reference plays a large role in Patna property market.

The lady of the house plays a major role in Patna in buying FLATS particularly, not so much in land or commercial properties. It is also helpful if the children have their friends residing in that particular neighbourhood.” 
मम्मी मेरी बेस्ट फ्रेंड भी बगल वाले अपार्टमेंट में रहती है !!!  The children are very important in our nuclear families. As the lady and children are gaining bigger roles the Kitchen and Balconies are becoming deciding crucial factors.

The easier access of native village from the part of Patna where they are purchasing the flat too is important. The people from आरा , छपरा  will prefer western Patna, whereas people from नालंदा , बिहारशरीफ  will prefer Kankarbagh side of Patna. “हमलोग अभी भी गांव से जुड़े हैं !!”

The ATTITUDE of builders and their Accessibility is very important for home buyers in Patna. Gone are the days that the home buyers are ready to wait to meet to builders. If it is the manager only interacting with the buyer ; the buying probability reduces. "बहुत घमंडी है , छोड़िये इसको, दूसरा फ़ोन कर रहे थे। ....  

Yes the time has changed and buyers love humble, simple professional builders. No धिकावा will work that the builder is busy, they know you are on facebook…..or  गप  मार रहे होंगे , काम क्या है …

We think and hope that the transformative reforms such as Real Estate (Regulation and Development) Act, 2016, Prohibition of Benami Transactions Act, 2016, and Goods and Services Tax (GST), etc. will lead to higher transparency and efficiency in the real estate sector. Going forward, property buyers in Patna would be more confident while investing in real estate. Let us see what Property buyers look for in Patna real estate market.

The decision of a buyer to purchase a property competes with numerous other investment opportunities, such as gold, stock market and bank deposits. Real estate is amongst the most preferred asset classes for Bihari investors and it is estimated that real estate accounts for about 40 per cent of total household savings in Bihar.


With the availability of multiple units in Patna real estate industry, property buyers in Patna can now make an informed decision to help them take full advantage of their returns from residential properties in Patna. 

Tuesday, 1 August 2017

The Patna real estate in NEAR FUTURE.






Over the last decade, affordability to own properties in Patna have reduced 50 per cent, as the income growth has lagged behind the growth in property prices in Patna. Residential property in Patna currently accounts for over 85 per cent of the real estate industry in Patna and touches the lives of every one of us.

Real estate as the asset class spells hope, social status and a definite return on the investment, intended or unintended. Houses are the only asset class that the consumer purchases for self-use but benefits from value appreciation. A home in Patna is a product that is continuously usable from Day 1, continues to appreciate in value and gets the buyer the status of an asset owner. However, when the user turns seller he or she is often confused as to the final value since benchmark property rates in Patna have traditionally not been available. (See property rates inPatna).


Patna holds a strong potential for residential property market growth as there would be a significant property price appreciation in Patna over the next decade, with property market fundamental drivers, such as the SGDP, urbanization, income growth, savings rate, mortgage growth and affordability, expected to improve going forward in Bihar.

There are a few areas that still need attention from the policymakers to restrict uneven/unplanned growth in the property market in Patna, which puts pressure on the available resources and infrastructure —thereby impacting the property prices and affordability of houses in Patna.

Real estate developers in Patna have become more cautious. They have started aligning their business strategies with the changing dynamics of the industry. For example, the new residential supply has been controlled cautiously owing to headwinds in the real estate over the past two–three years. Further, the ticket sizes of housing units in Patna have been reduced in order to make housing units more affordable.

A majority of the demand lies in affordable and mid segment housing in Patna and potential buyers falling under this category usually depend on home loans/mortgage to buy their homes. Hence, increase in loan disbursement support the demand for real estate Patna which will lead to the growth in Patna property market.

Property prices have witnessed moderate or negligible growth after inventory overhang reached 24-30months in Patna during Kuldeep Narayan Era. Micro-markets, such as Gola Road which have limited number of residential projects, have though continued to witness high inventory overhang without any corresponding impact on property rates.


Thursday, 20 July 2017

READY TO MOVE IN FLATS IN PATNA


The property prices in Patna keep fluctuating year by year. However, in the last three years, the property prices in Patna have been stagnant. Despite of this no change in the price, home buyers in Patna are still in two minds about buying new apartments in Patna. One of the basic reasons behind these two thoughts is due to delay in the delivery of existing residential projects in Patna, which eventually creates a lack of confidence in the minds of buyers. Why not! when the delays are greater than three years. Yes, years and not months. This is also affecting the decision of investors in Patna who may consider it as loss of investment. The after effects of “Kuldeep Narayan era” in Patna real estate continues.
Now with the GST coming into the effect, this has further affected the decision. Under GST, the tax for under-construction project has shot up to 12 per cent. The developers in Patna will be bearing the burden of GST, which will certainly pass on to the home- buyers in Patna.
This is one of the reasons why home buyers in Patna are choosing ready-to-move projects that are less risky in all terms. These ready-to-move homes carry a good resale value also offering less risk compared to under-construction properties in Patna.
Buy Sell Rent Patna

Let us evaluate why ready-to-move homes in Patna are the better choice than under-construction residential projects in Patna:
Tax Benefit:
One can avail the tax benefits from the first day of purchase of the property.
Save on Rentals:
This is the primary benefit the home owner will earn by investing on ready-to- move homes in Patna. If you're not planning to move soon and would like to wait for more years, then you can start earning by renting the home. The house rents are fixed according to the location, amenities available and the quality of new the project. Many home owners usually end up renting the home, especially if invested in Patna.  This will also help you to repay the EMI for loan taken for the flat in Patna.
No Waiting Period:
One of the prime advantages of ready-to-move homes in Patna is that there is no waiting period. With the project already completed, you just have to complete the procedures of buying a home and other things related to the purchase.
EMI and possession starts simultaneously:
The best thing about possession ready home in Patna is that you have to pay only EMIs on home loan immediately, and would include no other payments. In case of under construction property, EMI usually starts after completion of construction. However, if there is any delay in the construction, then the EMI will start once the home loan gets disbursed. However, in some cases, the buyer may cancel the property in Patna due to financial strain .
You get what you see:
Since the housing complex is in ready possession, you will find no changes in the property as seen in the booklet or images. In many cases, the under construction project design may change during construction than what you have seen in the booklet or brochure. In case of ready to move homes, you can get feedback from the residents, examine the location and learn about the residence first hand.  

To conclude we will add that if you're planning for ready-possession property in Patna, evaluate your financial condition, documents required to purchase and about the developer in Patna. If the developer is esteemed, then banks will surely approach you to get yourself a loan. Home buying is a lifetime affair, but buying after good research and considering the long term return will be fruitful.

Sunday, 9 July 2017

Fresh innings for Patna real estate!!


Real Estate Patna


Things are looking up for real estate sector in Patna with proposed implementations of Real Estate Regulatory Act and Goods & Services Tax along with lower home loan interest rate regime. This sentence is qualified by the increase in number of queries on our Patna property portal www.buysellrentpatna.in. The feel good factor is also being supported through fiscal benefits offered to taxpayers and home-buyers in Patna. The sentiment is expected to turn positive and instill confidence among home-buyers, which is extremely important for the revival of the real estate industry in Patna.

The Union Budget's gift of infrastructure status to affordable housing is a game-changing move that will open up more institutional sources for developers in Patna to raise funds at competitive price. The budget has also given leeway to developers in Patna to build bigger houses and extended the time of completion of affordable housing projects from 3 years to 5 years. We strongly believe these moves will encourage leading real estate players in Patna to enter the affordable housing segment going forward thus creating a lot of potential for institutional funds to participate in Patna real estate.
A lot of churning will happen in the times to come because of the implementation of various policy changes and it is important to see how developers in Patna recalibrate their businesses to the changing environment and whether buyers in Patna capitalize the opportunity of the various reforms and change their status quo position of “wait and watch” to buyers.
In the first half of 2017, the residential sector in Patna has been largely muted and there is pressure on prices of Property in Patna. With consumers in a wait and watch mode, demand could be subdued due to a mind-set that property prices could undergo reduction along with a substantial loweringof home loan interest rates. Since buying a house is a discretionary need –a need that can be postponed, it is anybody's guess that the real estate sector in Patna will be the slowest to recover from the impact of new regulations vis-à-vis other sectors.

The after effects of demonetization coupled with legislations like the RERA, GST bill and Benami Transactions (Prohibition) Amendment Act,2016, will further increase transparency and reliability within the Patna realty sector. Furthermore, this will also see a boost in institutional funds flowing into the sector at competitive rates, which will enable Patna real estate to come out of the woods.

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Friday, 23 June 2017

A GIFT FROM NRI Son to A BIHARI FATHER

Mr. Bihari is a proud Father. His only son is in USA; the land of prosperity; and is very prosperous there. He is working for one of the best consulting firms of the world and after 15 years is on a senior position. The son is well settled NRI or we should say NRB (Non Resident Bihari) drawing five figure monthly salary. The son’s only son goes to a Private school; he has bought a KOTHI in USA spread in half acres or in Bihari terms 16 katthas. (1 kattha=1361 sq.ft in Patna). Additionally Mr. Bihari and Mrs. Bihari frequently visit their son. The son too flies to Patna once in two years for a month or so.

There are only two scenarios where Bihari middle class parents are really proud of their son. If they are settled in a job outside Bihar, the greater the distance of settlement from Bihar the better or the son has a Government Job. For daughters the Bihari parents in addition to these two criteria for sons have another criterion. The daughters married to these worthy types of NRBs or Government officials.

Buy Sell Rent Patna
www.buysellrentpatna.in

Mr. Bihari is well past 65. He is retired. In the last decade or so he has travelled to USA many a times. If you ask him to compare Chicago, where his son lives, with Patna; as a gentleman he smiles and replies, “Let us not do it.” In Patna Mr. Bihari spends most of his time at home, reading. He is a vivid reader. Apart from reading one more regular feature of his everyday living in Patna is the morning walk at Botanical Garden and evening walk at Children’s Park Shrikrishnapuri. He has a gang of friends at both these places. They walk for hours.  They walk and they talk and they talk and they walk in the morning and evening. This part of Patna routine is what Mr. Bihari misses when he is with his son in USA. He admits that he also misses the food and a number of relatives and functions.

Mr. Bihari is in mid 60s but his ambitions are still soaring. He with his retirement funds and with the help of his ABLE son wants to get a KOTHI in Shrikrishnapuri area. We call him ambitious because prices in Shrikrishnapuri are about a Crore for a Kattha of land. Secondly the inventories are rare and the demand is more. The property rates reflect the same.  And it is not Mr. Bihari alone but few colonies of Patna like Shrikrishnapuri, Patliputra and Rajendra Nagar are still the STAR property sites for possessing in Patna. Why not!!! They are few better places of living in Patna.

On Patna ka Apna Property Portal, www.buysellrentpatna.in,  Mr. Bihari’s son sitting in USA  found a property in Srikrishnapuri to his and his father’s liking. The property was spread in 3.5 katthas of land with a beautiful garden and an old Bungalow. They saw the Pictures and then the site visit was conducted. They liked it. Now, the game began….NEGOTIATIONS!!! It took three months to reach the final price of 4 Crores and ten Lakhs. Paperwork was readied by BuySellRentPatna.in. Shrikrishnapuri is housing society so a bit more of paper works. Then both the parties came to Patna at the fixed time and the property exchanged hands.

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Digital Patna real estate

The interesting part was that the seller too was an NRB. His parents’ had bought it. He has been brought up on this property only. His parents were no more and he is proud Green card holder. He no more wants to come back to Patna. Phew!!! Migratory birds on both sides of the deal.


As consultants we were happy, we got our 2% each from both the parties. But as A Patnaite the heart questioned, what is this really happening, when we will be proud of staying in Patna and working in Patna. When will Patna Middle class stop flying away from their NEST.

Wednesday, 1 March 2017

Roads in Bihar and real estate prices in Patna….



real estate prices in Patna

Source: RBI, Ministry of Roads, JLL REIS
The correlation between building road infrastructure and restricting house prices to moderate levels in Indian metros is shown in the above graph.

Length of road construction is known to have a direct bearing on real estate anywhere in the world and our Patna is no exception. But what is the correlation of Roads and prices in Patna real estate market? Does road building check property prices in Patna or they help them to rise?

As road lengths increase and there quality improves , connectivity improves across a wider geography – thereby attracting new project launches at lower price points away from the centre of Patna. An example is the connectivity of Bihta with Patna through the road. Another example is the flyover built above the Raza Bazaar area; it has made western Patna, Danapur, Khagaul, and Shaguna Mode more accessible as residential property market option. This has reduced or better say checked prices in central Patna. This would also help increase affordable housing projects near Patna in areas like Sampatchak, Bihta and Phulwarisharif.

This holds for intra city connectivity but what about roads built to connect Patna with other areas of Bihar?

If more roads are constructed to connect the state capital, Patna, with other parts of Bihar, property prices rise in Patna as the demand for property in Patna increases from people all over Bihar. The very best example has been the construction of Gandhi Setu in 1980s. It led to introduction of APARTMENT culture in Patna.

Currently, the only solution to the problem of urban housing shortage in Patna is building new infrastructure to connect more outer areas to the city centre. We at BuySellRentPatna.in feel that when new roads are constructed across rural and urban areas in Patna, the spread of development happens over a wider geography. These potentially bring down the premium that certain urban centres in Patna command for having better connectivity. This is particularly true for our infrastructure-starved city, Patna.


Fortunately, road infrastructure has emerged as a key focus area for the current state government. The young Deputy CM of Bihar, is keen on improving connectivity in and around Patna at a greater pace. According to media reports earlier this year, he has an ambitious plan to connect Patna with the most distant part of Bihar within Five hours. This is expected to improve freight movement, ease traffic bottlenecks and improve inter-city connectivity in the state. It will be interesting to watch residential property price movements in the coming years in Patna after completion of a number of road highways and bridges in and around Patna. We say so because as soon as roads are laid the adjacent land owners start demanding prices in multiples of previous price, and real estate prices in Patna are driven therefore more so by land component than construction and other soft costs. Strict restriction in land usage in Master Plans with no change permitted later would help set right the property prices in Patna. 

Wednesday, 1 February 2017

2017:- A watershed year for Patna real estate

Patna Property



It all began in 2013 and then 3 more years 2014-15-16 that Patna real estate has gone down and down searching not for growth but the BOTTOM. A screener that can be used to measure the “freefall” is that a leading English Daily, Times of India, closed the publication of its monthly property supplement for Patna due to lack of interest of readers and more important revenues. We have named these down and down years the Kuldeep Narayan Era of Patna real estate after the erstwhile Municipal commissioner of Patna for major part in these years. 

As it seemed that the U turn for Patna real estate has arrived in the last half of 2016, the number of new real estate regulations and Demonetization by the “King of India” bombed Patna property market to take it to new lows. What is in store for Patna Realty Market in 2017 in light of introduction of regulations like RERA, Benami Transaction Prohibition, REITS, GST, lowering interest rates, lackluster interest of State government for Urbanization and industrialization, shift of focus on Affordable housing and of course the Demonetization. In one line, we are going to see PATNA REAL ESTATE decidedly demarcated into categories called GOOD, BAD and UGLY in 2017. The entry barriers will rise and the survival of the “adopter of changes” will be the story of the year.

We prefer to start with the UGLY so that we close the article on good note; Happy ending principle.

The Ugliest part of Patna real estate is Patna Nagar Nigam itself. What we mean can be realized by visiting the website of Patna Nagar Nigam, further verification can be carried by visiting its office and the last straw could be if you ask for any information regarding Patna real estate, not to speak about the experiences of the Patnaites having some or any work at Patna Nagar Nigam. The Patna Municipal Commissioner or the Mayor cannot even tell exactly that how many occupied Apartments exist under its own area. Pity!! The more saddening part is that they are hell bent NOT TO IMPROVE EVEN A BIT. It is rotten to the stage that it should be dismantled at once and a NEW organization put in its place. Patna is without a TOWN PLANNER for decades, yes Patna Nagar Nigam has no Town Planner; JUMBO!! Let us stop here for better and not discuss Master Plan, Smart city and many, many other issues. The cities have moved to Big Data, Predictive Analysis, AI, BOT, IoT, BlockChain but Patna Nagar Nigam has moved to medieval ages. We say medieval because in Ancient India Patna was one of the best cities of the world. (refer, Indica by Megasthenese).

If anyone thinks that the Demonetization has dried liquidity in Patna Real Estate the most, “Rethink !!”. RERA (real estate regulation act) as a regulation; which still has not been notified by the state government of Bihar; is going to dry liquidity by about 60% in the real estate business of Patna. We do not see anybody really prepared in Patna Realty sector to be able to answer that. So we see issues coming up which will be not easy to handle once the state government notifies RERA. The biggest impact it will have will be on launch of new projects; RERA demands financial prudence and Patna property lacks it in abundance. The builders and developers in Patna will have to wake up or EXIT. To add, initially buyers will have their share of pains due to RERA, as if they did not have enough in last three years, it will invite number of new litigation and litigation means TARIK par TARIK… though with RERA unfair trade practices with be negligible and it will bring professionalism in the long run.

Buy Sell Rent Patna


The third most populous state and the highest density population wise among states (when not considering UTs and Delhi) of India, Bihar had an impressive growth rate in last decade, more due to low base rate effect though. The urbanization of the state is only 11% and there are no signs that the state government has any intentions to focus on this parameter, we have been sleeping and we will keep doing so. Patna is yet not in the Smart city list!!!  Not only URBANIZATION but our state Bihar has failed to attract industries too in the last decade. Even the service sector too seems to be stagnating in the recent years. But natural the employment rates are falling in one the youngest areas of the world. With it will falter the domestic consumption story of Patna and the bad news in Gulf will pound it further. On the other hand, a bit by the government can turn the story around. The fast growing young population of Patna has very little household debt and the finance industry is maturing day by day in Patna that will suit the borrowing needs of Patnaites. Added to this will be the repeated rate cuts by the RBI in 2017 and we have perfect conditions for Home purchases!! Additionally investors all over the world and India are desperately chasing yields and Patna could be that speculative play. INVESTORS in BIHAR, are we kidding, Not at all, 2017 is the right time for Bihar to woo INVESTORS from CHINA and JAPAN. Bihar needs to fully focus on these two countries and the ball will start rolling. They need us as much as we need them. All this will lead Patna’s middle class to come to its own and sure to demand housing to suit their tastes.

An IT park has been announced (only announced) for Patna recently, at last!! Though the IT sector has peaked a bit all around world. We are preparing for the second round of IT boom. The important thing is at least we now recognize that IT is required in Bihar. Similarly if the government realizes that there is boom in business Park development all around India BUT Patna, it will be better. Patna sorely needs Business Parks due to the poor infrastructure in our venerable city and suburban development is creating entirely new business and residential neighbourhoods.

Property Rates Patna


REITs are still to see the light of the day in India and India is struggling to create REIT market for years. Therefore we do not foresee any REIT getting involved in the next two years in Patna real estate. Hopefully in 2017 REIT gets a start in India. Once it takes off on national level Patna can after a year or too can attract Chinese conglomerates to enter through this route too. That is why we are saying to start wooing them from this year only. Because in corporate investment, it appears that China’s most forward-thinking companies would see the similarities with their own nation and Bihar – and want to profit from them.

After a long haul of policy paralysis, Patna real estate is set to transform from a HUS -HUS market( no body shares information) to transparent one. The sector had perception failure till now, but the new regulations with a bit of support from the government will be instrumental in instilling more transparency in the sector and confidence among the home buyers in Patna. 2017 will be the year of implementation and digitization for the realty sector. The realty market of Patna will witness Digitization not only for payments but for whole processes involved, marketing, sales, office automation, vendor management etc. The re-sale market will subside in the background by the end of 2017 and the primary market will start dominating by the year end and more so by next year. These new regulations and decreasing interest rates have considerable potential to change the way Patna real estate sector works. The reforms are set to bring transparency and build a robust ecosystem. There will be a definite advantage to responsible developers in Patna and a game changer for others. Besides these, a couple of announcements seemed to be made in the passing but is extremely crucial to this sector. These were the intent to digitize land records at a greater pace in Bihar, change in arbitration norms for construction industry and setting up of a government committee to look into the strategic sale of government assets that include land and manufacturing units.  All these changes too, we perceive to be the game changers for the industry in coming years.

Growth In Patna


2016 ended with lower new launches and sales volumes in Patna realty market. But at the same time Patna property market has lesser unsold inventory due to complete ban on passing building maps and other permits in the past. While the stated prices of property still remain elevated in Patna, transaction prices have fallen by 10-15% and even more on case to case basis. It is a tough market. Even though builders may not be giving discounts openly, behind closed doors, negotiations are on. Discounts have increased significantly in the secondary market and distress sales are becoming increasingly common in Patna real estate. One more reason that demand for property in Patna has been stagnating is that during the last decade property prices in Patna have risen strongly, while salaries have not kept pace. Houses have become unaffordable, so sales aren’t picking up.  The situation may take two more years to stabilize on this parameter, with the green shoots becoming visible after a year. The interest cuts too will help the cause. Te correction in property rates in Patna was overdue and once they get correctly priced the rental yield too will be close to the cost of borrowing and will increase further investments. 

We should not forget that the Patna property market has certain systemic issues because the market is built on speculative ground and the basic financial and execution discipline required by a developer is absent. The only trigger that will get Patna real estate back on its feet is execution and delivery. Consequently, we believe that the Patna real estate sector will emerge stronger, healthier and capable of long periods of sustained growth, provided adequate policy/regulatory support.

Patna ka Apna Property Portal




Piyush
Founder
www.buysellrentpatna.in
Patna ka Apna Property Portal