Good morning, steel prices have rapidly softened, bringing a huge sigh of relief to the real estate and infrastructure sectors.
Prices have come down from a recent peak of ~INR 61,000/tonne to ~INR 47,000/tonne over a period of the last 45 days.
Reasons for this sharp decline in steel prices;
📉 Duty free import of some raw materials, including coking coal and ferronickel.
📉 Generally weak demand for steel during the monsoon season as infrastructure projects slow down across the country, and
📉 A 14.3% increase in iron ore yield in May 22 vis-à-vis May 21.
If the trend continues, affordable housing developers, whose margins have disappeared like glacial ice, can actually deliver their projects on time.
– Rahul Mishra and Anuvab Chattopadhyay
Homebuyers' Rights And RERA - What You Should Know
Are you aware that as a homebuyer, the 2016 Real Estate Regulatory Authority (RERA) Act gives you certain rights.
The chances that you're in the know are quite slim in this regard, as history tells us.
So, what are your rights?
1️⃣ Property Registration – Your developer cannot sell/promote the project without RERA registration. You have the right to get the RERA registration number.
2️⃣ Construction Agreement – Once the promoter gets the project plans approved, he/she will ink a construction agreement with you. Once this is done, nothing can be changed structurally and internally without your approval. This is your second right.
💡 Common amenities may only be changed if 2/3rds of the buyers agree.
3️⃣ Funding for Projects – Promoters have to deposit 70% of funds into a dedicated account. Withdrawals are allowed proportionately basis project completion level. You have the right (Section 4) to verify this before buying/paying any further money for your under-construction home.
4️⃣ The Last Lap – Section 19 states that homebuyers can take possession on the basis of the schedule promised in the agreement, with full right to withdraw applications and get refunds for non-completion.
💡 Section 69 states that all officers of the developer’s entity will have responsibility for company affairs at the time of disputes and subsequent company conduct.
In a nutshell
📌 Make sure you ask for the RERA registration number.
📌 Check for the dedicated bank/escrow account to deposit your money.
📌 Ask for a refund if the project stays unfinished within the committed timeline.
Awareness is indispensable since it’s your hard earned money at stake.
New Hurdles To Housing Affordability
The RBI has hiked its repo rate to 4.40%. Lenders (HDFC, PNB, ICICI and more) are increasing rates. Home loan borrowers will now pay higher EMIs. Will these impact home buyer sentiments?
What’s on the cards?
Lower home buying affordability in the long term, with property prices being hiked by developers to meet rising input costs.
Yet, the current momentum should continue in the short term due to an overwhelming desire for home ownership (after the pandemic) and pent-up demand.
And price hikes?
7.5% is the nationwide forecast. 4-5% in Mumbai and Delhi-NCR. 5.5-6.5% in Pune, Bangalore and Chennai. That’s over the next two years.
💡 Got a good deal? Buy now before subsequent rate and price hikes.
Weekend Conversation Starter
Boy, oh boy. This weekend's conversation starter tip doesn't even require you to say much. Simply flick out your phone and load this image to create an instant buzz in the room/on the bar.
If needed, carelessly throw in the line - "When someone says highest and best use of real estate, this is what they mean."
Want more engagement? Follow up line for 5X effect - “Left to Right, or Right to Left?” 🤣
Karnataka High Court Tells BDA To Mend Its Ways
🎳 Strike 1 - The Bangalore Development Authority (BDA) cannot auction Arkavathy Layout sites anymore, says a Karnataka High Court order.
🎳 Strike 2 - The Court feels that the “BDA cannot act as a private real estate company,” maximizing profits and lacking the required empathy to solve existing disputes.
A Quick Background
Justice Suraj Govindaraj responded to a petition filed by Indumathi and Hemanth Babu Shekar, heirs of G Babu Shekar. The BDA executed an absolute sale deed with him for a site on 7th February, 2017.
What Went Wrong?
😳 In 2021, the petitioners were informed of a new BDA road across their 4,000 sq. ft. site.
🤷♀️ Admitting their mistake, the BDA proposed an alternative land parcel at Nadaprabhu Kempegowda Layout, only 35 km away. (By real estate advertisement standards, that's just a 20 minute drive away, FYI.)
✅ The petitioners want sites to be allotted to them, instead of third-party auctions that fetch the BDA more money and guess what? The Court agrees.
What's Next - The June 7th court hearing on the matter.
The BDA’s Keyword - Empathy.
The believer is happy,
The doubter is wise.
– Alan Poe
Which line you take this weekend will make all the difference.
Have a great time and see you next week. 💚
☕ The Crew@Ginger Chai