Good morning, the recent past has been quite eventful for the real estate sector.
For instance, the sector is learning that online experiences have a limit when it comes to homebuying, while skyrocketing material cost is pushing housing towards an inevitable price hike.
In a big relief to aggrieved home buyers, the Supreme Court has turbocharged RERA by upholding its powers.
And, please hold that salad, El Salvador has just announced its plan to build the world's first ‘Bitcoin City’.
Somethings Can't Be All-Virtual
Here's something that got us thinking.
While the pandemic raged and lockdowns ran amok across the globe, ecommerce boomed, people stocked up on digital gold, and the stock market inched to new highs everyday.
Let's leave aside travel and other services that were untenable but in reality, purchases of all sorts continued right through our dark days.
However, home sales tanked across the world. Could it be that no matter how good virtual reality gets, home buyers are still not buying till they land up and see what their home-to-be looks like for real?
Real Estate Just Has To Be Experienced
Some things, you just have to see for yourself. They have to feel like they are yours and when it comes to highly involved purchase decisions, like, buying a home, there is no online experience that can replace what a human offers you in person, at the site.
Take the example of Zillow - one of the world’s largest digital real estate companies. Earlier this month, it shuttered its home-buying division.
In one sip, the company that showcases homes and allows you to compare, contrast and even contact agents to set up appointments, tried to convert to an actual brokerage and, in three years, called the movers and packed up.
All its digital prowess, reduced to zero as it ran out of manpower and its iBuying business kept losing billions till it had to be given the elbow.
For Real Please
Home buying is more than a transaction; it is a large decision that impacts everyone in your life.
Trusting it to an algorithm, a metaverse, an online form or someone sitting behind a screen in Bengaluru to tell you what your home in Dubai, Delhi or Mumbai is worth just doesn’t seem like the most personal way your biggest purchase should be handled.
And that's why it isn't working
The reason a realtor/agent/broker will always be the best option for buying or selling your home is the emotional component that you get to share when you successfully complete your transaction.
We are humans after all and this is a home we are talking about.
And its just doesn't cut it because you can’t smile with a confirmation screen, you can’t hug an email, and you can’t shake hands with a device.
Just Add Colour
We've left the top 20% of this awesome image of Ooty - from the 1950s, for your Monday blues as well. Go on then, any colour you like.
Image - [@IndianHistoryPics]
Is Turbocharging RERA Going To Work?
Known only to suffering home buyers, here's something that's been happening with RERA orders - builders are simply finding jurisdiction loopholes in RERA's authority to prevent aggrieved home buyers from getting the ordered relief.
The Backstory
Per MoneyControl, the real estate market of Uttar Pradesh in general and Noida-Greater Noida in particular is a hotbed of consumer grievances, and some estimates say that nearly 40% of all homebuyer grievances in India are from this market alone.
It is, therefore, no surprise that even when the Real Estate Regulatory Authority proposes to clean up the market, the builders devise their own means to oppose it.
More and more, builders have been challenging its orders and RERA’s legal jurisdiction. The settled principle of law under RERA, that should ideally not even be debated is continuously challenged to increase litigation.
Who's There? The Supreme Court
Experts say that the recent Supreme Court judgement has resolved certain contentious issues that builders have been continuously challenging.
- First, which projects come under RERA - The apex court carified that the projects that didn’t have Completion Certificate (even if with Occupancy Certificate) as on May 1, 2017 fall within the ambit of RERA.
- Second, a key issue decided by the apex court is on the amount to be deposited by the developer with the Appellate Tribunal before its appeal is admitted against a RERA order. This deposit is now 100% of the amount payable by the builder.
- Third, the apex court has held that pre-existing contracts (i.e. contracts in existence prior to RERA coming into effect) will be read as per RERA and thereby the legislative has the power to make an Act retroactive and therefore RERA does not violate the Constitution of India.
Will It Work?
Legal minds think that some of the strongest defiance from the builder community to RERA have been based on one or more of these three core issues.
With the core gone, at least half of the disputes that saw a spanner in the works of justice, should automatically disappear, and builders will have to fall in line.
📌 A pinned topic now, we will keep you posted on RERA's turbocharged avatar as time goes.
Soon: The World's First Bitcoin City
In June this year, Latin American country El Salvador made history as the first country to name Bitcoin legal tender.
Currently, millions of dollars of remittances to Latin America are being done using cryptocurrencies and this widespread use and acceptance is pushing all kinds of businesses to accept cryptocurrency as payment.
Why stop there? It's time to build the world's first 'Bitcoin City' feels El Salvador.
Time For A Modern Alexandria
Likening the plan to cities founded by Alexander the Great, El Salvador leaders plan the Bitcoin City to be circular, with an airport, residential and commercial areas, and feature a central plaza designed to look like a bitcoin symbol from the air. 😲
Bitcoin city is being planned in the eastern region of La Union, and it would get geothermal power from a volcano and not levy any taxes except for value added tax.
Funding A New Metropolis
Per Reuters, Samson Mow, chief strategy officer of blockchain technology provider Blockstream, clarified that the first 10-year issue, known as the "volcano bond", would be worth $1 billion.
This would be backed by bitcoin and carrying a coupon of 6.5%. Half of the sum would go to buying bitcoin on the market, he said. Other bonds would follow.
After a five year lock-up, El Salvador would start selling some of the bitcoin used to fund the bond to give investors an "additional coupon", Mow said, positing that the value of the crypto currency would continue to rise robustly.
"This is going to make El Salvador the financial center of the world," he said.
📉📈 Despite it's notorious volatility, Bitcoin is actually more stable than certain Latin American countries’ fiat currencies, FYI.
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Excerpt from An Ode To Barbecue Potato Chips;
Do you want to eat them? No, it’s more frenzied than that—this desire has the flavour of addiction.
You want them all at once, immediately, stuffed into your mouth and shattering gorgeously between the millstones of your molars.
You want the entirety of them. And then you want it all over again, until you feel ill.
See you tomorrow morning. Eat healthy. 💚
☕ The Crew@Ginger Chai