Positive Trends In Real Estate Market Of Bangalore

Market of residential property in Bangalore witnessing an absorption of 4

,182 residential units in first quarter of 2012 against 3,370 residential units in las quarter of 2011.

According to Mr. Jones Lang LaSalles quarterly survey: Estimated that 25 residential property of Bangalore were launched in first quarter of 2012 while eight residential property comprising 1,009 residential units across different sub markets were withdrawn from active stock as they were completely sold out.

Number of factors have recently mitigate the hardships faced by home buyers earlier. Delay on the part of end users in acquiring a home will only be at a higher cost now. Time are changing and there are several factors that will reduce the issues faced earlier while investing in a home.

Reserve Bank of India (RBI) has cut the repo rate by 50 basis percentage points paving the way to making home loans cheaper. Banks and Housing finance companies are expected to reduce the lending rates shortly. Bank has already offered to re-price its existing home loan at a lower interest rate. Under this option, receiver can switch the prevailing floating rate that is at discount to the prime lending rate. Receiver has to pay a one-time switchover fee of one percent of the outstanding loan. Few banks have slashed their lending rates by 75-175 basis percentage points and the rate cuts will be applicable to new receivers.

Price of residential property in Bangalore are inching upwards across all micro-markets with the land, input and labour costs are soaring day-by-day. Taking into account the price increases of the four key construction components - Cement. Labour, Bricks and Steel - there is an 18% gross rise in construction costs over the last two years.

Besides, new residential property of Bangalore improved connectivity levels and infrastructure development will only up the soaring land costs every year. The State Government too revised guideline value for registration which will only add on to the housing costs. Any kind of delay on the part of end users to enter the market would only be at a higher cost later. The increase in the service tax rate from 10.3% to 12.36% will increase the costs of production for developers.

A substantial trend is the availability of built units in select locations and the large residential property developed by builders led to construction unabated, as a result home buyers can plan their purchases of residential property in Bangalore accordingly.

Time is also appropriate for those who showed their keen interest to invest in the affordable housing category as the lending norms and fiscal sops extended in the Union Budget for 2012-13 provide ample scope for end-users to strike a bargain deal. An External commercial borrowings (ECBs) have been allowed for low-cost housing, Developers will be able to lower their interest cost now as there is a significant difference in the interest rates between here and other countries.

In order to encourage NRIs to invest in residential property of Bangalore some developers have earmarked property management divisions within the entity to take care of properties during their absence in India. Besides, professionally managed property management companies are increasing in Bangalore which will enable NRIs and PIOs to invest in real estate without any hassles.

by: lokeshmanu24

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