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Real Estate’s Hopes from The Upcoming Union Budget

Jun 25, 2024 by Sujata 0 Comments #Affordable and mid-income housing, #affordable housing, #Akash Pharande, #Better Finance Access, #budget home projects, #builders, #cash-flow, #CLSS, #credit guarantees, #economic growth and employment, #emerging areas, #Enhanced Credit-Linked Subsidy Scheme (CLSS), #Fast Track Infrastructure, #financial assistance, #financial stress, #financing, #First-Time Buyers, #GST rate, #GST Reforms For Developers, #homebuyers, #Housing for All scheme, #housing projects, #Indian housing industry, #Indian real estate sector, #interest rates, #Interest Subsidies and Housing Loans, #interest subsidy for housing loans, #land acquisition process, #land records management system, #Land Reforms, #LIG and middle-class, #low and mid-income, #metropolitan areas, #metros and railways, #mid-income housing buyers, #Pharande Promoters & Builders, #Pharande Spaces, #policies and tax incentives, #Policy Measures and Provisions, #Pradhan Mantri Awas Yojana (PMAY), #real estate investment fund, #regulatory reforms, #Rental housing, #Rental Housing Policy, #rental income, #Single-window Clearance, #single-window clearance system, #stamp duty, #tax breaks, #Tax Deduction for Housing Loan Interest, #The Union Budget

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By Akash Pharande, Managing Director – Pharande Spaces

The Indian real estate sector is a crucible of economic growth and employment. The sector stands at a crossroads as the government prepares to present its Union Budget. Though it has massive potential, the Indian housing industry still faces numerous hurdles.

To generate more growth and address the housing needs of the growing population, particularly in the low and mid-income segments, the budget must include tax breaks, regulatory reforms, and financial assistance measures.

Affordable and mid-income housing

Affordable and mid-income housing is the foundation of the real estate industry, meeting the urgent housing needs of the enormous LIG and middle-class population. To significantly boost this section, the following strategies are critical:

Interest Subsidies and Housing Loans: Widening the scope of the Pradhan Mantri Awas Yojana (PMAY) and raising the interest subsidy for housing loans is the need of the hour. Doing this will make homeownership more affordable. Reducing interest rates will also lower the financial stress put on aspiring homebuyers.

Enhanced Credit-Linked Subsidy Scheme (CLSS): Extending and improving the CLSS can provide financial relief to mid-income housing buyers. Both the income eligibility threshold and subsidy amount should be raised.

Single-window Clearance for Affordable Housing: A single-window clearance system for budget home projects will help considerably to make the incredibly complex approval process more streamlined and simple. This, in turn, would help to decrease delays in possession of such units and reduce the overall costs.

Tax breaks to lighten the load

Tax breaks are critical when it comes to making homeownership more approachable, and they can also encourage builders to take on new affordable housing projects:

Raise Tax Deduction for Housing Loan Interest: Raising the tax deduction limit under Section 24(b) of the IT Act is long overdue and the need of the hour. The deduction limit should be increased from the current Rs. 2 lakh to at least Rs.3 lakh or even more.

Reduce Stamp Duty: The government can encourage state governments to cut their stamp duty rates, which account for a significant portion of the cost of homeownership. Even a temporary decrease or waiver of stamp duty on affordable and lower-middle-income housing can boost demand and sales.

Incentives for First-Time Buyers: First-time homebuyers should get further sentiment boosters. For instance, the government can raise the deduction limit under Sections 80EE and 80EEA for such buyers.

GST Reforms For Developers: GST rates applicable on construction materials and services can help lower overall project costs for builders. Also, a reduced GST rate for affordable housing projects would help attract more builders to this vital segment and to pursue such projects.

Policy Measures and Provisions: Indirect Increases

Apart from direct financial boosters, the budget can introduce many policy initiatives that will indirectly improve sentiment in the housing sector:

Fast Track Infrastructure: This government is certainly determined to develop infrastructure like roads and public transport such as metros and railways. This helps expand the metropolitan areas and boosts affordable housing, which is usually developed in emerging areas where land is cheaper and infrastructure is still catching up. However, we need a much faster roll-out of such projects so that connectivity to such areas improves at a faster pace.

Land Reforms: Simplifying the overall land acquisition process will help developers speed up their supply of new projects. There is an express need for an open and effective land records management system that reduces disputes and, therefore, project delays.

Better Finance Access: Developers always need access to financing, but smaller and medium-scale players are at a bigger disadvantage than big players. The budget could consider announcing a separate real estate investment fund and also credit guarantees to such builders so that their cash flow improves.

Rental Housing Policy: Rental housing would benefit from favourable policies and tax incentives for those who cannot afford to buy homes. Implementing a model tenancy law and providing tax breaks on rental income would help a lot.

The Union Budget is an ideal platform and opportunity for the government to give teeth to its Housing for All scheme. While the original 2022 deadline was not met, it is not too late to revive this dream and make it a concrete reality. The Indian real estate sector certainly looks forward to such boosts for both homebuyers and builders.

About the Author:

Akash Pharande is Managing Director – Pharande Spaces, a leading real estate construction and development firm famous for its township projects in Greater Pune and beyond. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer of townships in the region. With the recent inclusion of Puneville Commercial into one of its most iconic townships, Pharande Spaces has taken a major step towards addressing Pune’s current and future requirements for fully integrated residential-commercial convenience

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Greater Pune – A Urban Expansion Benchmark by PMRDA

Jun 11, 2024 by Sujata 0 Comments #affordable housing projects, #Akash Pharande, #Greater Pune, #Haveli, #Hinjewadi, #industrial hub, #IT, #IT hub Hinjawadi., #Junnar, #Khed, #Lonavala Municipal Councils, #Maharashtra’s favourite tourist destination., #MahaRERA (Maharashtra Real Estate Regulatory Authority), #Manufacturing, #Maval, #middle, #modern amenities, #Mulshi, #new housing projects, #Pharande Spaces, #Pimpri, #Pimpri-Chinchwad Municipal Corporation (PCMC), #PMRDA, #Population Growth and Urbanization, #Pune, #Pune Municipal Corporation (PMC), #Pune's population, #services sector, #Shivajinagar, #Social Infrastructure, #Talegaon Dabhade, #The Pune Metropolitan Region Development Authority (PMRDA), #upper-middle-class homebuyer, #Urban Expansion

By Akash Pharande, Managing Director – Pharande Spaces

The Pune Metropolitan Region Development Authority (PMRDA) oversees an extensive and strategically significant territory now collectively referred to as Greater Pune. It covers both urban and rural regions.

The two key territories under Greater Pune are the Pune Municipal Corporation (PMC) and the Pimpri-Chinchwad Municipal Corporation (PCMC). PMRDA also governs the pivotal Talegaon Dabhade and Lonavala Municipal Councils – the former a strong and growing industrial hub, and the latter arguably Maharashtra’s favourite tourist destination.

Beyond these municipalities, PMRDA also administers numerous suburban and rural areas which are vital for Greater Pune’s expansion and development. These include the rapidly developing industrial hotspots Chakan and Pirangut, as well as Pune’s pre-eminent and pioneering IT hub Hinjawadi.

Among the rural areas are Mulshi, Maval, Khed, Haveli, and Junnar, which are important for their agricultural contributions and potential for future development. Known for their scenic landscapes, Mulshi and Maval are already attracting considerable real estate development.

As can be seen, Greater Pune is vast and diverse and showcases PMRDA’s governance across many major urban centres, IT hubs, industrial zones, and rural areas.

Over the past decade, Greater Pune’s exponential growth stands as a strong testament to PMRDA‘s strategic planning and robust implementation of development initiatives. But is this pace of growth really necessary? Let’s look at the facts.

Population Growth and Urbanization

As of 2024, Pune’s population is estimated to be around 7.35 million in the metropolitan area and approximately 4.44 million within the city limits. Its vast talent pool across all employment categories is Greater Pune’s greatest asset, and this population needs to be accommodated.

It stands to reason that the region’s real estate sector has been booming. According to data from MahaRERA (Maharashtra Real Estate Regulatory Authority), there has been a consistent rise in the launch of new housing projects. In 2023 alone, Pune saw over 50,000 new homes launched, while Pimpri-Chinchwad added 20,000.

Prominent real estate developers have been having a field day – or rather, a field epoch – launching massive projects to aid this expansion. Given that home seekers in Greater Pune are looking for options across categories, a large number of these projects offer modern amenities that cater to the middle and upper-middle-class homebuyer segments.

While the supply of affordable housing projects has been more muted due to decreased demand, the market is replete with options even in this category.

Infrastructure Development

Across the length and breadth of Greater Pune, PMRDA has consistently focused on infrastructure development as a cornerstone of the region’s urban growth. One prime example is the Pune Metro which, in just the first phase, will connect key areas like Hinjewadi, Shivajinagar, and Pimpri. The reduced commute time creates more housing demand across all areas.

Additionally, the 128 km Ring Road will decongest city traffic by giving Greater Pune an alternative road travel route and connecting various parts of the region across major highways and economic zones. For Pune’s economic triple engine of IT, manufacturing, and the services sector, this spells gold and will massively boost trade and commerce. According to recent reports, absorption in Pune’s commercial office space reached 6.5 million square feet in 2023.

Sustainable Urbanization

PMRDA‘s commitment to Greater Pune includes a strong focus on sustainable urbanization. It has now made it mandatory that green spaces and energy-efficient designs be included in all new projects. Also, digital infrastructure, smart transportation, and efficient waste management have been prioritized.

Social Infrastructure

The growth of Greater Pune extends beyond just economic and infrastructural development. PMRDA is keenly aware that for overall quality of life and livability, adequate social infrastructure to support its growing population is of paramount importance. Not surprisingly, the region under its aegis boasts top-grade schools and colleges, hospitals, and recreational amenities.

To summarize…

Under the able administration of PMRDA, Greater Pune’s urban expansion has emerged as one of the most impressive success stories of planned growth, economic prosperity, and sustainable development. It sets a new benchmark for urban and urbanizing India, demonstrating how strategic governance and innovative planning can create a thriving, modern metropolis.

With continued focus on infrastructure, sustainable development, and quality of life, Greater Pune is poised to be a model city for the future, embodying the aspirations of a rapidly urbanizing nation.

About the Author:

Akash Pharande is Managing Director – Pharande Spaces, a leading real estate construction and development firm famous for its township projects in Greater Pune and beyond. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer of townships in the region. With the recent inclusion of Puneville Commercial into one of its most iconic townships, Pharande Spaces taken a major step towards addressing Pune’s current and future requirements for fully integrated residential-commercial convenience

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The Future of Urban Living – The Sustainable Communities of Tomorrow

May 20, 2024 by Sujata 0 Comments #Akash Pharande, #Amenities, #Amsterdam, #and recreational facilities, #Berlin, #city planners, #Commercial, #compact urban forms, #congestion, #cycling, #Dubai Marina, #Europe, #Hamburg, #Hong Kong, #India, #Infrastructure, #integrate residential, #Integrated Living, #integrated townships, #JLL India, #Masdar City, #master-planned communities, #neighborhoods, #Netherlands, #New York, #North America, #Pharande Spaces, #pollution, #Portland, #public transportation, #Punggol, #self-contained integrated projects, #self-sufficient, #Singapore, #Stockholm, #sustainable urban development, #Sweden, #Tampines, #The Global Scenario, #Tokyo, #United Arab Emirates, #urban planning, #Vancouver, #walking

By – Akash Pharande, Managing Director – Pharande Spaces

Akash Pharande, Managing Director - Pharande Spaces

I travel a lot to understand how different countries address their urban sprawl because we use such insights to design integrated townships here in India. In fact, one result of these travels was our partnering with a globally acclaimed architect who helped us recreate a global residential experience in India.

However, my main takeaway from this globetrotting has been far less positive – the alarming rate at which rampant urbanization is challenging even the most glamorous world cities.

As cities’ populations overflow, traditional urban infrastructure groans and often crumbles under the strain of housing demands. Did you think that overcrowding and declining living standards are the order of the day only in India? Far from it – it is a global phenomenon.

The Global Scenario

In the thronged streets of New York, Tokyo, and Hong Kong – and even in Berlin, Hamburg, and Stockholm – urban sprawl running wild is in evidence everywhere. In India, we have accepted congestion, pollution, and stressed infrastructure, but be aware that very few countries are exempt from them anymore.

Across the world from Asia to Europe to North America, local governments and expert city planners are implementing the only viable solution. You guessed it – integrated townships.

In Singapore and the United Arab Emirates, self-sufficient, self-contained integrated projects have in fact been at the forefront of urban planning for many decades. Singapore, in particular, is famous for master-planned communities such as Punggol and Tampines, which integrate residential, commercial, and recreational facilities to create vibrant and self-sustaining neighborhoods.

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In the UAE, integrated developments like Dubai Marina and Masdar City deliver comprehensive living and working environments for residents. In Europe, Sweden and the Netherlands have embraced the concept of integrated townships to promote sustainable urban development.

Stockholm and Amsterdam have pioneered eco-friendly neighbourhoods that prioritize walking, cycling, and public transportation while incorporating green spaces and mixed-use developments.

In North America, integrated townships have gained traction in response to urban sprawl and the growing trend for more walkable and inclusive communities. Vancouver in Canada and Portland in the United States have implemented policies to encourage mixed-use development and compact urban forms.

This approach has given rise to highly integrated neighborhoods that provide everything their residents will ever need – living spaces, offices to work in, as well as shopping malls and recreational amenities.

Integrated Living – No Alternatives

If this sounds like a marketing prospectus for a modern integrated township in India, it’s because while we certainly haven’t pioneered the concept, we have certainly caught on to it big time. And for good reasons.

A report by international property consultants JLL India entitled ‘Livability quotient – a paradigm shift in India’s emerging cities’ puts it very aptly – “A balanced lifestyle contributes highly to the livability quotient of a city or township,” it states. “Amenities for leisure and recreation such as sports facilities, gymnasiums, clubhouses, malls and shopping streets are considered lifestyle amenities and are much appreciated by users.”

“Townships managed by private developers have an advantage over cities managed by local governments. The high level of interaction that happens between a township developer and customers naturally enables a focused delivery of services.”

I guess there’s no better way of putting it. As our larger cities draw more and more inward migration because of their employment prospects, we certainly need better solutions to house everyone. India’s growing upper-level middle class expects to find housing that multi-tasks and delivers on their lifestyle preferences.

What better solution for this than integrated mixed-use developments where they can seamlessly transition between living, working, and leisure activities without enduring long commutes?

As the successful eco-cities of Scandinavia and the master-planned communities of Singapore and the UAE demonstrate, integrated townships are a concept whose time has come – and is, in fact, by now an imperative in India.

intergrated township

A Long Way to Go

As Anarock Property Consultants put it, the growing demand for integrated townships in India has risen even more in the wake of changing housing preferences post-pandemic. However, despite the increased interest, integrated townships still represent only a fraction of the total housing supply in India. Since 2010, only about 2% of all housing projects in the top seven cities fell in this category,

Clearly, we are missing something important here.

India is a nation at a crossroads in its urbanization journey. Rapid population growth, rural-urban migration, and fragmented urban planning have spawned a host of challenges, from sprawling urban sprawl to choked traffic arteries and polluted air. The need for holistic urban planning has never been more pressing.

Integrated townships offer hope amidst this urban chaos. With the government’s ambitious plans to create smart cities and revitalize urban infrastructure in a country where land scarcity, fragmented development, and outdated infrastructure are the norm, there is quite simply no other solution.

Without integrated townships, the status quo in India is frankly unsustainable. With every passing year, our trajectory of urbanization is spiraling further out of control – with far-reaching consequences on our society, our environment, and our economy.

Beyond just bricks and mortar, integrated townships also serve as catalysts for economic growth and building strong, wholesome and supportive communities. They provide local employment opportunities, reduce dependence on city centers, offer higher returns on investment, and provide a holistic solution to the many challenges we face in our cities.

About the Author:

Akash Pharande is Managing Director – Pharande Spaces, a leading real estate construction and development firm famous for its township projects in West Pune and beyond. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer of townships in West Pune. With the recent integration of Puneville Commercial into one of its most iconic townships, Pharande Spaces taken a major step towards addressing Pune’s current and future requirements for fully integrated residential-commercial convenience.

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Commercial Integration – Reshaping India’s Residential Landscape

By – Akash Pharande, Managing Director – Pharande Spaces

Akash Pharande, Managing Director - Pharande Spaces

One important feature changing how people live and work in India’s fast-urbanizing terrain is the incorporation of commercial areas into residential townships. While this concept – which combines residential areas with workplaces, shops, and recreational areas – is not new, its uptake has sped up recently, particularly in the wake of COVID-19.

Evolution and Origins

Mixed-use projects are nothing new to India; even in pre-independence India, residential areas and bazaars coexisted together. But in the early 2000s, integrated townships, as they are now known, started to take off. Encouraged by India’s economic expansion and rapid urbanization, developers realized the benefits of creating an all-encompassing residential experience for the growing middle class.

This trend became even more evident after the 2008 financial crisis. This is when forward-thinking builders began to seek out ways to make projects more profitable and desirable. Including residential and commercial areas into one complex promised to boost footfall in retail malls by providing a captive market for retailers. Office buildings within the same precincts gave homeowners the possibility of walking, bicycling to work, or taking a short drive there with no traffic woes to contend with.

The COVID-19 epidemic kicked off a major move towards remote work, less crowded residential areas with sufficient greenery, the convenience and safety of having necessary retail outlets within easy reach, and small commutes to work. In short, the pandemic solidified the already strong attraction for integrated townships.

integrated township

The Coworking Revolutions

Residential-commercial complexes like integrated townships are becoming all the more relevant because of the increasing popularity of coworking. If we take Pune as an example, the relevance and impact of coworking is hard to miss.

This city has evolved massively from its previous tags of ‘Oxford of the East‘ and ‘Pensioner’s Paradise’. Pune’s vibrant educational institutions and IT/ITeS sector generate and attract more and more young professionals and millennial entrepreneurs. Simultaneously, even some of the biggest MNCs in Pune have been looking at cutting costs after COVID-19.

Coworking spaces are the logical solution to bring down corporate costs and provide a fertile environment for collaboration, networking, and creative engagement. The most successful ones are located in and around residential catchments, so their availability in integrated townships is a win-win proposition.

Pune has been seeing steady growth in the coworking segment, with more operators of varying sizes constantly entering the fray. Especially after COVID-19, the coworking solution has found favour with many companies as well as the city’s growing young population. Pune’s thriving startup culture has contributed hugely to its growing popularity, as have the gig economy and service-based companies such as digital marketing, automobiles, and blockchain.

Not surprisingly, leading property consultants reported that 2021 saw a no less than 30% increase in demand for integrated townships over the same period the year before. Where work-from-home (WFH) has become ingrained, especially in metros and tier-1 cities, this rise is significant. Compared to exclusively residential projects, mixed-use townships have seen higher residential sales following the epidemic.

work-life 2.0

Integrated commercial-residential townships are growing in popularity in India because of:

– Work-Life Balance: Integrated townships encourage a healthy it by merging living and recreational areas, and minimizing travel time to and from work. This is something that the modern workforce appreciates more and more.

– A Sustainable Lifestyle: Sustainable living is becoming more and more important to urban Indians. Mixed-use townships lessen the need for driving and therefore have a lower carbon footprint overall. The more modern integrated townships also offer advanced green features such as wastewater recycling, use of solar lighting and heating, green areas to act as lung space, and proper cross-ventilation in flats to reduce cooling costs in summer.

– Profitability for Developers: Integrated townships with commercial components baked in are a lucrative proposition for developers. The added appeal and convenience factor of these projects usually makes them more expensive than ordinary residential projects; however, Indians today are willing to spend more on a sustainable, convenient, and hassle-free lifestyle. Also, there is considerable brand value involved in creating and sustaining modern integrated townships, since such projects require specialized knowledge and considerable capital to build and maintain.

– Policy Support: Integrated townships are encouraged and promoted by Indian government programs like the Smart Cities Mission, and sustainability factors are also incentivized for both homebuyers and developers. Mixed-use integrated projects in suburban areas are also actively encouraged by the government because they help decongest urban areas.

– Buyer Preferences: The pandemic changed consumer preferences considerably. More and more Indians are choosing to live in spacious, uncluttered, and health-promoting projects that provide quick access to workplaces and the requirements of daily living. Mixed-use integrated townships negate most of the stresses and health hazards of inner-city life. They are also ideal for remote working scenarios.

The Future of Mixed-use Townships

The trend of developing residential- and commercial projects is not only a durable one but the very call of the future in India. Companies’ growing acceptance of remote working arrangements will increase demand for residential developments that meet professional requirements even more. Moreover, the continuous urbanization and increasing disposable incomes in India point to a long-term interest in these kinds of living arrangements.

The boundaries dividing residential and commercial areas are blurring as urban India develops. More than just a real estate fad, integrated townships are the logical answer to the evolving demands and lifestyles of contemporary Indian society. Their increasing popularity is bringing about a profound change in urban planning and development—a move toward a more comfortable, sustainable, convenient, and all-encompassing residential experience.

About the Author: Akash Pharande is Managing Director – Pharande Spaces, a leading real estate construction and development firm famous for its township projects in West Pune and beyond. Pharande Promoters & Builders, the flagship company of Pharande Spaces and an ISO 9001-2000 certified company, is a pioneer of townships in West Pune. With the recent integration of Puneville Commercial into one of its most iconic townships, Pharande Spaces taken a major step towards addressing Pune’s current and future requirements for fully integrated residential-commercial convenience.

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How Housing Prices Are Set (No, It’s Not Arbitrary)

Mar 6, 2024 by Sujata 0 Comments #Akash Pharande, #Construction Costs, #Cost of Land, #Demand, #Pharande Spaces, #real estate

By – Akash Pharande, Managing Director – Pharande Spaces

The Indian housing market is in continuous boom mode, with more people that ever aspiring for homeownership and developers vying for their attention. However, one thing that still tends to haunt many buyers’ minds is the lack of clarity when it comes to the prices of homes. While homes by good developers are selling at a fast clip, many buyers still feel that the prices are set arbitrarily.

Let’s explore how real estate developers arrive at the prices for their properties. For this, we first need to understand a concept and process called ‘price discovery’.

What is Price Discovery?

Price discovery is the process by which the market determines the value of a particular product. It applies to almost all products, including smart phones, costlier household items like air conditioners, refrigerators and television sets, and so on.

You have doubtlessly noticed that the prices of some of these items tends to fluctuate according to the demand for them, the state of the economy, time of year, and even the weather. Even gold items, where the price of the basic raw material is determined by its market value, also experience price hikes during the festive season.

But if the economy is in doldrums and disposable income is low, even gold items will sell at a discount because of lower demand.

In the context of real estate, price discovery determines the prices at which properties reasonably sell. In India, the process of price discovery for residential real estate is complex, as it involves several factors. One of the most important factors is the cost of land.

The Cost of Land

Land is a finite resource, and its availability is limited. The cost of land can vary widely depending on its location, the availability of basic infrastructure there, and what kinds of developments the area has already seen. For all intents and purposes, there is no such thing as basic cost of land – while there may be certain basic benchmarks, the prices of different plots even in the same area can vary widely.

Developers do influence the cost of land through development activities. Announcing new projects can increase land demand in nearby areas, especially if the development enhances the area with amenities and infrastructure. Less directly, the demand from developers for land in a certain area tends to drive up the price quoted by the landowners.

More influential developers, such as those who build massive townships and industrial projects, can also influence zoning and land use changes. This increases land value by enabling more profitable developments for other developers. Large-scale developments can bring about broader economic growth, which attracts businesses and residents, thereby increasing demand and therefore land costs.

In markets where some developers hold large land parcels, they control the supply, and this will also influence pricing. And, of course, government policies also play a key role.

But whether they are responsible for the current land prices or not, developers must factor in the cost of this finite resource when setting the price for their properties.

Construction Costs

Another important factor that influences the price of homes is construction costs. The amount of money a developer spends on construction materials, labour, and other expenses can vary widely depending on the city, location, nature of the project, and quality of the materials used.

The third factor will again vary depending on whether the project being developed falls into the luxury, mid-range, or affordable housing category. The cost of relevant labour hinges on its ready availability in the area.

If the project’s location is remote and the developer breaking completely new ground there, construction labour needs to be brought in from far off and be accommodated. In the case of high-density development areas, labour tends to be more readily available.

Demand

The third factor that affects the price of housing is the demand for it. This can vary significantly depending on the location of the project and whether the project addresses the actual requirements of the target clientele. For example, a luxury development in an area largely defined by low-cost housing is unlikely to see much organic demand.

Also, demand will depend on the developer’s brand value and the amenities offered in the project. Even with good brand backing, the right location and appropriateness of the project, a developer must set the ticket sizes of his homes reasonably so as not to be ‘priced out of the market’ – meaning that prices must be in line with similar projects by other developers in the area.

To summarize

Given the complexity of these factors, it is not surprising that the process of price discovery in the Indian housing sector can often seem arbitrary and opaque. Developers must consider multiple factors to set the price for their properties.

One common strategy used by many – but no means all – developers is to set a base price for their properties but be open to negotiate on it with individual buyers. There is usually more scope for negotiation in the case of projects which are not seeing much sales volumes.

Finally, developers often provide discounts or incentives to buyers who purchase earlier in the project’s development cycle. This encourages buyers to commit to purchasing homes before construction is complete, helping developers to improve cash flows and reduce their financial risk.

Each developer must consider the unique factors that affect the price of their properties and come up with a pricing strategy that is appropriate for that particular project. But conveying these various factors to every single customer is not feasible – finally, home buyers are interested in buying a home and not in the challenges that the developer faces.

It is also pertinent to note that the market also tends to be self-correcting. If developers set excessively high prices, the demand for their properties will be lower than they expected. On the other hand, if a developer sets the prices too low, he may miss out on a good profit margin.

But few home buyers today are willing to be patient to see if prices in a particular project will correct. In fact, most buyers are looking for ready-to-move homes precisely because they’re not willing to wait. This means that the developer must come up with the right pricing strategy right off the bat.

If you’ve found a good home option in the right location, in the right project by the right developer, and the price corresponds to your budget, it is safe to assume that the developer has done his homework and that ‘the price is right’.

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2024’s Top Choice for Home Buyers – Why Pune is Winning Hearts

Jan 2, 2024 by Sujata 0 Comments #Akash Pharande, #Pharande Spaces, #Pune

By – Akash Pharande, Managing Director – Pharande Spaces

As the veil lifts on 2024, property end-users and investors in and around Pune are firming up their New Year’s resolution to achieve home ownership this year. It’s certainly the perfect time for it. According to real estate consultants Anarock, Pune and MMR were the top-selling housing markets in 2023.

In Pune, approximately 86,680 homes were sold in 2023, states Anarock, second only to the Mumbai Metropolitan Region’s impressive sales of 153,870 units. Pune‘s high ranking in housing sales is not surprising. The city offers a lot more than just more attractive price points compared to Mumbai. But the price factor certainly matters.

Pune’s Price Advantage

In Pune, you can find a 1BHK apartment ranging from Rs. 35 to 45 lakhs, depending on the area. In contrast, a similar 600-700 square foot apartment in Mumbai would cost around Rs. 80 lakhs to 1 crore. Property prices in Mumbai are typically 30-40% higher than in other Indian cities.

To put it in percentage terms, real estate in Mumbai is, broadly speaking, 75.21% more expensive than in Pune. This makes Pune a far more accessible market for a broader range of buyers and investors. However, there is no doubt that the affordability factor is gradually decreasing because Pune has seen steady price appreciation.

According to a recent report, 2023 saw the average housing price in Pune rise by 11% increase, reaching Rs 5,208 per square foot. This rise was attributed to improved demand in the housing market. Predictions suggest this trend will continue in 2024, making Pune a magnet for investors seeking long-term value growth.

But apart from prices, Pune wins over Mumbai in several other ways.

dream achieved.

Why Pune Succeeds Consistently

Pune continues to deliver the perfect balance of lifestyle and investment value compared to Mumbai. The city offers superior space with more spacious residential options – a distant dream in most MMR areas except the farthest suburbs. Pune is ideal for families and individuals wanting a better quality of life through larger living spaces.

Pune‘s strategic location and improving transport infrastructure also make it highly attractive. The city’s proximity to Mumbai is a defining advantage. At the same time, Pune‘s education, healthcare, and entertainment facilities contribute to a higher standard of living. Additionally, Pune‘s IT parks, commercial hubs, and strong services industry continue to transform the landscape, attracting job seekers and investors.

While buyers and investors have many options in Pune, some areas stand out for important reasons. One getting considerable attention is Punawale.

Punawale – Standout Housing Hotspot

Punawale, within the Pimpri-Chinchwad Municipal Corporation (PCMC) in Pune, has seen remarkable growth, emerging as a preferred housing destination. Like Pune, Punawale has seen substantial price appreciation due to its strategic location, infrastructure development, and surging demand for quality housing.

Unlike other locations, Punawale caters to diverse segments, from affordable housing to luxury projects.

The area has well-planned roads, efficient public transport, and easy access to schools, hospitals, and shopping. This infrastructure makes Punawale more appealing than many Pune areas.

The PCMC Edge

Overall, PCMC outperforms Pune Metropolitan Region in several aspects. PCMC implemented a rational master plan focused on sustainable, balanced development. This urban planning foresight resulted in better-managed residential and commercial spaces, efficient utilities, and less congestion, making areas like Punawale more livable.

PCMC emphasizes green, open spaces. The area has parks and gardens, contributing to a healthier, more aesthetically pleasing environment. These green spaces provide much-needed recreation and relaxation, a rarity in many urban areas.

Punawale maximizes these advantages. It is home to West Pune‘s most outstanding integrated township, which has been a game-changer for its real estate market by enhancing the overall real estate value proposition and setting new residential space standards for the region.

The transformative power of outstanding developments is well-established, and India has several examples of this phenomenon. The entire socio-economic structure of the area changes for the better.

Superior Connectivity

A standout feature of Punawale is its connectivity. Well-linked to key Pune areas and other cities via roads and highways, proximity to the Mumbai-Pune Expressway and major arterials enhances the appeal for commuters and those wanting easy access.

Quality of Life

Infrastructure, connectivity, green spaces, and a high-grade township have significantly uplifted Punawale’s quality of life. Residents enjoy a balanced lifestyle with modern amenities, nature, and community focus.

Punawale’s transformation into a real estate hotspot resulted from strategic planning, infrastructure development, and visionary projects. Growth is based on urban convenience, connectivity, and green space – the future of sustainable urban living.

The Future Beckons

Ongoing and planned infrastructure projects, coupled with demand for quality housing, strongly support Punawale’s future growth. Improved road connectivity and public transport have played a pivotal role in boosting values. Easy access to major employment hubs like Hinjewadi IT Park and MIDC industrial belt has made Punawale a hotbed for home seekers valuing easy commutes without compromising quality of life.

For end-users and investors, Punawale brings everything together. With consistent growth in values and enhancements in quality of life and connectivity, Punawale is a standout real estate destination in 2024.

Tag: Pharande Spaces