WHO HAS BEEN BUILDING AHMEDABAD?

The Forbes Magazine has tagged Ahmedabad as one of the fastest growing cities in the world with a vision of global stemming powerhouses. For the city which has been synonymous to the term ‘development’, there have been a few builders who have played a vital role in our ever expanding high class infrastructure.

There are many many more who deserve to be on this list, but here are a few of the one’s in the limelight for the right reasons!

     1.Swagat Group:-

Swagat Group has been focusing on constructing luxurious bungalows, villas, condominiums and residential complexes from high end to affordable housing and commercial cum office establishment.

In the journey so far, the group has successfully completed with a total constructions area of around 60 lakh sq ft and boasts of having more than 6000 valued customers.

The projects stand today as hallmark of quality, carving a special position for the group in the hearts of their customers.

     2.Bakeri Group:-

The Bakeri group is a firm that believes in optimum utilization of resources and conserving energy. It has always focused on building affordable edifices that promise to redefine the way the buyer lives. Bakeri has been designing its projects keeping in mind the average population rise. The group has landmark projects like Sakar series, Shilip, Suramya plotted development and Shrinandnagar in its kitty.

     3.Shree Balaji Group:-

Under the dynamic leadership of Ashish Shah, Shree Balaji Group is scaling a new horizon of excellence. Amongst its innumerable projects are Shree Balaji Agora Mall, Shree Balaji Green Valley, Shree Balaji Villa Patan, Shree Balaji Heights and so on..

     4.bSafal:-

Founded in 1995, bSafal has always been centered around on simple mantra – “know your customer as well as you know yourself”. From simple product features to entire residential complexes designed around a basic need, b Safal has stood true to its mantra and delivered magic every single time. Some of the ongoing projects of the group include Parishkaar I and II, Paarijat Residences, Samprat Residences and so on.

     5.Adani Group:-

Since its inception as a trading house in 1988, the Adani Group has diversified into dynamic business groups such as infrastructural development and FMCGs.

A pioneer in international trading and infrastructure development, the Adani Group is continuously engaged in maximising potentialities by synergising its multiple businesses.

After proving their mettle in high growth sectors like infrastructure, global trading, logistics and energy, it is their constant endeavour to deliver high returns to their stakeholders. And in the arena of Real Estate, leading the way in Ahmedabad is the Adani Group, with over 600 acres of luxury called Shantigram.

Shantigram is being developed as an integrated township, by Adani Township & Real Estate Company in association with Saumya Construction Pvt. Ltd.

     6.Pacifica Companies:-

Pacifica, the real estate conglomerate is an inspiration powered by fresh ideas to reposition real estate, shape new boundaries of reality and innovate continually. Founded in 1978, Pacifica has always been a signature statement of global life spaces. It is due to this unequaled expertise in developing great ideas that has gained global recognition.

     7.Sun Builders:-

During the three decades of glorious track record, Sun Builders Pvt Ltd has set numerous landmarks etching a concrete name for itself in the progress of Ahmedabad. With avant garde approach and cutting edge expertise in designing bricks into impressive residential spaces, splendid commercial properties and plotted communities the group has successfully completed nearly 40 prestigious projects in Gurukul, Drive-in area..

     8.Deep Group of Companies:-

Deep Group of Companies, a front runner company mainly engaged in construction as well as development of real estate business in Ahmedabad and surrounding areas since 1980 has adopted “Indraprasth” as a brand name! Their upcoming projects include Indraprasth 8, Indraprasth 9, Indraprasth Corporate, Heliconia and Al-Burooj.

SAFETY TIPS FOR REAL ESTATE AGENTS!

Our blog has always and mostly talked about property related news, properties in Ahmedabad, latest trends in real estate and so on…

But, there is one very important topic – related to real estate – which we tend to overlook; and that is Real Estate Agent Safety.

In our country, there are many who choose to become real estate agents… the commissions are high and people are always going to look for a place to live; so the workflow is good too.  

But, we cannot forget, that these agents; men and women alike have certain risks attached to their work.

Firstly, being a real estate agent is not a ‘desk job’. It involves a lot of ‘house showing’. 

These houses can be located anywhere.. and might need showcasing at any odd hour too!

However, with a number of agents being raped, robbed and murdered while showing homes and other properties, it is necessary to be up to date with security tips. Better armed than sorry….

A lot of real estate agencies have implemented safety measures for their agents, however, at an individual level – there are many things you can do to minimize the risks of an attack on yourself. 

     1. Verify the identity of your client:

    

    You should always ask for a cell phone number and id proof before entertaining a  client. To verify, call the cell number at a random time! If it is going to be your first   meeting, ask for a scanned copy of his or her id proof to be mailed to you in advance.

     2. Do not meet unknown customers at a property:

Never meet a potential customer directly at the property. Follow the first step to avoid unnecessary hassles later on.

   3. Leave a soft copy of your schedule for the day…specifying which property you will be viewing with whom:

Give someone in your office an itinerary of properties you plan to show and tell them to check in as often as possible by calling you. You can also use certain pre-decided ‘code phrases’ to alert your office about uncomfortable situations or emergencies without your customer knowing what you have communicated.

For example – “help!” can be communicated by using the code word “please check the red file on my desk…” This will alert your office which will then head out to help you.

     4.  Insist on using your own car for viewing properties:

Never get into a car with someone you don't know. Use your vehicle for showings or ask your customer to follow you in another car. If by any chance you encounter a threatening situation while driving, either hit the brakes hard suddenly of purposely ‘create’ a minor accident… this will create public attention giving you time to report the attack or escape. Remember to be as noisy as you can.

Finally, pay attention to little things like keeping your cell phone on vibrate mode to avoid detection; keeping the local police station’s number on speed dial, carrying pepper spray of a small pocket weapon for self defense, letting your customers enter a room while you stay by the door and paying good attention to exits.

In such matters, there is only little knowledge can do. 

One needs a strong presence of mind and an even stronger instinct. Be sure to trust your instincts… if you feel uncomfortable about a person you have to work with, alert your office immediately!

Never compromise with your safety! Hope you stay alert and vigilant at all times… 

COMMERCIAL INVESTMENTS...

There's an old joke in commercial real estate: If you think nobody cares you're alive, just miss a few mortgage payments!!!

Investing in commercial property is not something we think of doing easily. When we hear the word investment, normally the first thing which comes to our mind is a home. After all, shelter is one of the primary needs of man.

It is quite natural to start out investing in a home, as we are more accustomed to the same – but with the demand for land increasing with each day, commercial property too would be a sensible option for a secure future.

Firstly, a commercial property is always valued differently… and more than a residential property because the income that it produces is directly related to its usable square footage.

Secondly, the cash flow is much more in commercial investments and their leases are generally much longer.

Thus, if you ask a real estate professional about the benefits of investing in a commercial property, chances are that you will trigger a monologue on how such properties are a better deal than residential properties!

To start with, there are three ways to invest in commercial real estate:

     1.Buy office space from a developer

     2.Buy shares of a commercial developer from the stock market

     3.Invest in a real estate fund focused on commercial real estate.

Before plunging headlong into a deal, one needs to weigh one’s options well.

You as an investor must first verify and establish the location and its demand-supply and other market dynamics. This is very essential to ensure a smooth and profitable investment.

It is also a must to verify the credentials of the developer, quality of construction and management, access to public areas, connectivity and potential for future growth. 

Whether you intend to use the property or simply purchase it as an investment, these factors will only ensure higher returns in the future…

If you are just investing with the motive of ‘extra income’, you must be careful about --

1.The break-up of cash flows

2.The vacancy factor

3. Miscellaneous expenses like maintenance, property tax and building insurance

4.Lease term, lock-in period and expiry dates

5.Long term capital appreciation potential

6.Refurbishment, refinancing and re-positioning potential

[source : DailyBhaskar]

The biggest reason why you should be looking at commercial investments is that the rental yield it gains is usually 9-12% compared to 3-4% for residential properties.

According to news reports, in 2010, the demand for office space across India was 30 million square feet – 50% higher than it was in 2009. Today, the demand is much higher!

…After all, the pride of ownership, benefits of longer leases, and the cash flows… isn't it good enough to invest?!

After all, investing in commercial property is a high-adrenaline and high-returns game that residential real estate investment does not always guarantee! 

FACEBOOK MARKETING TIPS FOR REAL ESTATE PROFESSIONALS

Before we being with the ‘real’ marketing tips for real estate professionals, here are a few amazing facts about the social networking giant – Facebook – which prove why it is still one of the most sought after marketing strategies!

  1.  Monthly active users now total 901 million (up from 680 million a year ago)

  2.  One in 7.7 people in the world have a Facebook account.

  3.  Daily active users are up to 526 million (up from 372 million last year)

  4.  Monthly mobile users now total 488 million

  5.  Eighty-three million monthly active users accessed Facebook solely from mobile in the month ending March 31, 2012

  6.  300 million photos are uploaded to the site each day

  7.  3.2 billion Likes and Comments are posted daily

  8.  Hosts 125 billion friendships

  9.  Facebook hosts 42 million “Pages” with 10 or more likes.

It is a known fact that many businesses have thrived thanks to this giant social network, including Real Estate professionals. However, in order to win a game, you must not only learn the rules but stick to them as well!

This article is for those Real Estate professionals who wish to take their Facebook pages to the next level.

  1.  Your Facebook page should be easy to remember and must have your brand name in it. For example, our page is called ‘Property News Ahmedabad’.

  2.   It is always wise to add real user testimonials, acclamation  achievements and awards to your page. This is more appealing to your page visitors; and it immediately interests them!

  3.  Videos work wonders! If you have a good video showcasing your skills and work, you need not put it into words! Make a good video and upload it to your profile.

  4.  Start with a bang! Play quizzes, photo caption contests or offer discounts on popular products to those who follow and participate actively!

  5.  Hyperlink parts of your page to your website. This will increase traffic on the page. You can also add excerpts of your website and share with members.

  6.  Your profile picture should contain the main logo or identifiable symbol of your business.

  7.  You can use the “YouTube for Pages” app to share your YouTube videos on your Facebook page.

  8.  Always post useful, authentic and up-to-date information. People like to read ‘quality’ rather than ‘quantity’.

  9.  It is always a great idea to sometimes share non – work related leisure material like fun events or bizarre news! It makes a good change!

  10. Blog. Regularly. And connect your blog with your Facebook page.

  11.To engage your fans with your posts, share questions and encourage them to   comment. 

  12.Once you get a good response from your fans, make sure you manage to hold it by replying regularly and promptly to their comments / queries / suggestions and the likes.

Facebook is a very rich marketing medium that is loaded with great features. It would be unwise to not use it to its potential! What say you?!

TENANTS – INVESTMENT OR HASSLE?

With MNCs, Corporate Houses and Institutions luring us away from our homes to larger, more progressive cities, PGs and rentals have gone up significantly in the last few years. In earlier times, when cave men existed, people went looking for food… today; people have to go looking for work! 

At the same time, he needs a place to stay … a place which is light on his pocket, fulfills his basic requirements and also ensures he does not miss his family!

Thus the concept of ‘PGs’ and ‘tenants’ clicks really well.

However, not many know that in order to keep tenants in one’s house legally, it is necessary to follow certain steps. For example, once a home is rented out to tenants, it will be treated as ‘commercial’…meaning electricity bills, water bills, municipal taxes and the likes will all have to be paid at commercial rates.

Although there are thousands of homes today in various cities of India which fail to register legally and pass themselves off as ‘residential properties’. They do not have the required permissions or licenses. They might get away with these tricks but when it comes to requesting legal intervention due to tenant problems, they fall in their own trap!

Everyone is looking for an easy way to earn money – and what better way than renting out our property? It gives you monthly returns… and if you’re lucky, your property is taken care off too!

But like everything in this world, renting out your property also comes with its list of pros and cons. Let us try to examine some of them…

First and foremost, the extra income generated is the primary pro to renting out a home. You can ask around, do your homework and determine the best rent you can ask for your property. The rent also depends heavily on the facilities you provide.

The next benefit to renting out a home is the advantage of having someone look after it! It is always better to have someone maintain the property than let it lay unused and gathering dust.

Sometimes, if you’re lucky, for a small rent concession, your tenant might also be willing to do your odd jobs… like cutting the grass, shoveling snow, weeding, painting, cleaning and many other routine maintenance items. This is not a written clause and depends solely on your personal ‘people’s skills’!

On the down side, renting out part of your own house might cause you loss of your private life.

And the biggest con of renting out your house is something every land lord dreads – bad tenants! Imagine, if your tenant turns out to be a nightmare with loud music, bad smells or even simple sloppiness… you might face complaints from the society concerned.

Remember to always check the local ordinances and laws prior to renting out a room in your home or a home in general. 

Some jurisdictions may frown upon this practice... especially in a country like ours… and the last thing you need is a possible fine or getting in trouble with your authorities. 

PROPERTY DISCOUNTS - FOR REAL?

With the most festive part of the year around the corner, the first word which comes to our minds is ‘discounts’! From groceries to cars … from clothes to homes… no matter what the commodity, it is smartly discounted to lure buyers!

“Pay 50% now and nothing up to completion of property”; “Pay full payment now for the plasma TV and get 10% off on total price!”

From buy one get one free trousers to buy home get office free at “Ummat” – the first ever property show exclusively for Muslims at Ahmedabad, no one is wasting time in offering the heaviest discounts and weirdest schemes to hit sales.

Even real estate companies and brokers have started raising their sales pitch. But are these deals for real or a ploy that developers use to raise money and to prop up sales? Read on to find out …

The real estate market in general has been struggling to keep up with falling demands since the last couple of years…and now with the festive season round the corner, everyone who had held back their grand plans of purchase during the slowdown are now looking to grab the lowest rates offered.

While banks are less likely to provide funding to developers, left with no other option, developers have to raise funds by offering existing or prospective customers discounts and interest subsidies.

According to Business Today, “burdened by debt, between 2007-08 and 2011-12, the net profit of 12 listed realty firms has declined 67 per cent, mainly due to rising interest costs.”

On one hand, developers are on a roll if they get 10 – 12% of the payment for a project… but, buyers benefit only if the project gets completed!

Read more about his here – RISKY REFUNDS.

Moreover, as the interest earned is shown as a “discount” against the property price, there is no tax liability on the buyer's part. If the money is invested in a bank fixed deposit, the interest earned is taxable.

Whether you are giving 6 installments at one shot or a ‘token booking amount’ of 10%, the more money you give to your builder, the more you are taking a risk.

There is also a phenomenon called the ‘one payment – no installment scheme’ where you are required to pay an x amount at one shot as a ‘pre-launch’ discounted offer! 

Newspapers and hoardings shout out these ‘unbelievable prices’ and ‘limited discounts’ to make you run and book your home even before the project takes off!

Read more about this on - BUYING A HOME? DON'T LET SAMPLES FOOL YOU!

What we fail to see is the huge risk in investing at this stage as several approvals are yet to be taken, the project may be delayed or even scrapped. 

So what does one do? Well, stay vigilant of course! Discounts do not generally indicate traps, but the real estate industry itself is full of ‘un-licensed’, ‘un- authorized’ developers who are there just to take people for a ride!

Keep your eyes open, try to find out details about the developer and his past projects… and you might find, discounts are really not so bad after all!

MAKE YOUR HOME A MAGNET!

When a buyer walks into your house, the first few seconds are enough for him to decide whether he really wants to buy it or not.

…because the first impression is the last impression!

Like it is fondly and widely said for ‘food’…people eat with their eyes first; the same stands true in the case of a house too! If it doesn't appeal to the eye, you might as well forget about it.

While it can be understood that no house can be perfect, it is not impossible to try and achieve near perfection…or at least, to make a house look appealing and alluring.

Have you every toured another home? What was your very first thought … negative or positive? Mostly negative…because people tend to notice the glass half empty first.

In the same way, people tend to note the downside of your property first…does the house smell good? Is it lit up well? Are there any pet remains?

I’m sure most you must not have given this a thought.

When we purchase a home for ourselves, we put in all our time and energy in decorating it. Then why are we so careless when it comes to maintenance?

Here are a couple of things which are guaranteed to turn off not only visitors and relatives but also potential buyers or renters… These are simple things… if taken care of regularly; your house will remain good as new for a longer time.

Remember, after shopping around for the lowest mortgage rates, people tend to walk away from a house they like because it needs a few minor repairs… why give them that chance?! Keeping clean is one thing and keeping ‘in good shape’ is another…

    1.Paint – There is nothing more disgusting than watching peeling, cracking, and ‘moisturized’ paint on the wall of the house you want to buy! It’s really not that expensive today…you can use your artistic side and give your house a makeover using brand new paint. Not only will it look great, it will also make your house look ‘younger’! 

    2.Wallpaper – Just because your great great grandmother had hand-picked the wallpaper in your drawing room, it does not need to be there for centuries…that’s not classic, that’s ancient!!! Wallpapers and tapestries get outdated and should be changed regularly… remember, wallpapers just don’t stick to walls to make them look pretty...they also give your house and ‘ambience’! 

     3.Cabinets and Showcases – Cabinets and showcases highlight your most priced items. It would be a good idea to highlight them too! It is always a great idea to paint and re-paint showcase borders or cabinets every few months to keep them looking good as new. Using neutral colors is a great option if you do not wish to spend a lot of money…

     4.Unfashionable / Outdated furniture – There is a thin line between fashion and bizarrely crazy; and that line mustn't be crossed! Ancient stuff looks cool as long as its placed aesthetically.. or the house is of a particular theme… otherwise it is nothing short of an eye-sore. Period. 

     5.Windows and Doors – Windows and doors are probably the first things people notice when they enter a room. They must be well maintained and well painted at all times. Glasses which are broken or cracked should be replaced immediately. It is windows and doors that are responsible for lighting up or keeping the house in the dark. Be careful about choosing good curtains and drapes too! 

RISKY REFUNDS!

When Bhavesh Patel booked his dream home with an upcoming project near S G Highway, Ahmedabad, he wasn’t expecting anything to go wrong!

When he invested, he didn’t see what was going hinder possession of his dream home. The slowdown in the economy has directly and/or indirectly affected the real estate market greatly.

Thus, as expected, the project he invested in got shelved. The result – indefinite delays, loss of money and not to forget the frustration he is going through.

This is the story of thousands of people who are left helpless and frustrated because of delays. The worst thing is that they do not get any refunds on the hard earned money they have paid for their dream home! There hasn’t been one day Bhavesh has not followed up for his refund … or tried to meet the builder. Unfortunately, that does not seem to be working.

When stuck in such a situation, there is hardly anything one can do. One – court case; Two – out of court settlement by networking with similar victims; Three – Accept the delay; Four – cancel the booking and claim for a refund.

Most people prefer the last option for obvious reasons. The catch is that there is hardly a case where the full amount of the deal is returned.

What is becoming a matter of great concern is that there is no law – no norm which binds such refunds of cancellations. The amount refunded eventually varies from builder to builder. Refunds basically depend on three factors—developer's agreement, reason for requesting the refund and the market situation. 

So, what does one do?!

Builders tend to ‘charge’ more money in the name of ‘registration’ by demanding Rs 10,000-50,000 to facilitate the process. This is besides the stamp duty and legal registration costs.

The law, on the other hand, has no rules and laws for this and it is universally agreed that once signed, one is legally bound to follow the agreement.

To avoid getting stuck, it is recommended to pay the booking amount by cheque rather than cash. This will ensure receipts.

Another handy tip is to approach the builder with a valid reason for backing out of the property and claiming the refund. It is found that developers are more open to humanitarian grounds rather than other things.

Most importantly, one must be very careful of the agreements and papers and their authenticity. These must be clearly read and verified.

If your builder is unable or is not refunding your booking amount, you can request shifting to a complete project by the same builder. Many people are accommodated in this manner.

If you’re heard the phrase ‘majority wins’, you can make the phrase work in your favor too! Look around for people in a similar state and negotiate hard as a group.

The bottom line: when it comes to refunds, there are no rules and you'll have to fight it out with the builder. But if you do your homework well, you can give a good fight.

Here are a few handy tips, from various sources of the internet, to keep you safe from such traps --

• Familiarize yourself with the sale deed before going to developer.
• Give a good reason for withdrawing from a project; financial problems work best.
• Consider shifting to another property by the same builder.
• Network with other buyers in the same project.
• Ask the developer for a written document specifying the deduction.
• Don't pay cash while booking the property and ask for a receipt. Use cheques.

REALTORS® v/s AGENTS

For many, the two terms “Realtors® and Agents” mean the same thing!

Actually, that’s not the case.

People tend to use the term Realtors® and real estate agents interchangeably, but that is incorrect.

These two words which are spelt differently and sound different also have different meanings!

Although both terms are licensed to sell real estate, the basic difference is that a Realtor® is a member of the National Association of Realtors® while a real estate agent is not.

The National Association of Realtors®, was founded in 1908, and has more than 1 million members all over the world. These Realtors® are expected to subscribe to the Realtor® Code of Ethics.

The Realtors® code covers ethical requirements that deal with all the aspects of the job, from working with consumers and fellow agents to writing truthful advertising. This code is strictly enforced on Realtors® and contains 17 articles and standards of practice.

While there is no evidence or guarantee that all Realtors® are morally or ethically better than real estate agents, it is an attempt by the industry to regulate and monitor the events and happenings of the real-estate industry.

Here is a list of certain noteworthy things that a Realtor® can / cannot do that normal real estate agents generally are not seen adhering to :-

1) They have to take a pledge stating they will always put the interests of their customers and buyers or sellers before their own and address them with honestly and integrity.

2) They must not exaggerate / brag / misrepresent or conceal any important facts while the process takes place.

3) They must be cooperative with other brokers / agents when it is in the best interests of the client to do so.

4) They cannot provide professional services in a transaction where the agent has a present or contemplated interest without disclosing that interest.

5) They cannot charge a commission or accept fees from a third-party without the seller's express consent or knowledge.

6) They cannot mix their funds with their client’s.

7) They must ensure that all documentation regarding the deal is comprehendible and easily accessible to clients.

8) Members cannot discriminate against someone on the basis of race, color, religion, sex, handicap, familial status, or national origin.

9) Realtor® must be competent, must conform to standards of practice and must not under any circumstances provide services they are not qualified for.

10) Must be honest about advertisements and listings. 

11) Must not practice law unless they are a lawyer and must cooperate if charges are brought against them by another individual.

12) They also cannot solicit another Realtor’s® client(s) nor can they interfere in a contractual relationship.

THE A TO Z OF LOANS…

Loans. We all know what loans are and how relevant they are in today’s world. Everything is getting ‘crazy’ expensive while salaries remain stagnant. Needs and demands know no limit and thus we all at some point in our lives resort to good old loans… credit cards or personal loans… house loans, cars loans and educational loans… we are no stranger to these terms. 

This article is not going to technically explain what and why are loans or the usual finance jargon. This topic is meant to deal with other options one has instead of the normal cliché phenomenon of loaning from banks…taking loan against securities like property, assets, shares, and gold.

Where the interest rate of a personal loan ranges from 16 to 24%, the interest rates for these loans range from 12 – 14%...thus, they are much cheaper!

    1. Loans Against Shares

To get such a loan-

The shares which you own should be on the approved list of your lender bank.

The shares should be fully paid up.

This is a good option for those who need to fulfill immediate financial needs while preserving their investments.

    2.Loans Against Property

The minimum eligible criteria which you need to fulfill to get this loan are -

Your income, savings, debt obligations

Cost/value of the property mortgaged

Your repayment track record for other loans, credit cards, etc.

   3. Loans Against Gold 

Gold loans are easy to get at low interest rates. All your need to do is, to pledge your gold ornaments or coins to banks or financial companies.

   4.Loans Against Fixed Deposits

Instead of breaking fixed deposits, one can opt for taking loans against them. Usually, banks lend up to 75% to 85% of the deposit amount as loans with a rate of 1% – 2 % interest higher than the one of the FD.

   5.Loans Against Employers

Sometimes, you can also approach your employers for providing you loans while adjusting the repayment in salary. One can also request for a cash advance on salary, in case of urgent financial needs. No paper work, no interest rates.

Loans against securities are easily payable, have low rates of interest and are convenient for small to medium to large requirements.

Generally, these loans do not require tedious documentation or complicated paperwork and are fast, clean and efficient.

The most important part about such loans is that they provide us with only a fraction of the market value of the asset as a loan….and thus are flexible.

…But the bottom-line is, that a loan is at the end of the day, a debt and must be taken cautiously!

ONE HOUSE. MANY LOANS.

In lieu of buying homes, people went to the extent of breaking fixed deposits, emptying provident fund accounts and what not…

…And, now, considering how real estate prices have gone up 3- 4 times than what they were a couple of years ago, we feel it was worth it!

If you already own a property, celebrate! You’re a real-estate crorepati! 

Today, there are several options to earn from and unlock the value of property…!

Did you know there are more than one types of loans which you can take on your property?! There are a lot of banks stumbling over each other to offer mortgages…at interest rates much lower than other loans.

As for the other methods, here is a quick list of 8 ways that will help encash your house –

     1.Home Equity Loans – can be used for anything—education, medical costs, marriage, starting a business etc. The tenure is up to 15 years, interest rate 13-14% and the amount is 50-65% of the current value of the property.

     2.Home Improvement Loans – can be used for the internal and external repairs or the extension of your existing home structure by adding a storey. The tenure is up to 20 years, interest rate of 11 – 13% and the amount is 85% of total property for extension and up to 100% for renovation.

 

     3.Short-term Bridging Loans can be used for the interim period between the sale of an old house and purchase of a new one. The tenure is up to 2 years, interest rate of 12 – 14% and the amount up to 90% of the total cost of the new property.

     4.Property Overdraft Accounts which can be used for any purpose at the discretion of the borrower. The tenure is 5 – 10 years, interest rate 13 – 15% and the loan amount up to 65% of the total value of the property.

5.Top-Up Home Loans can be used for anything. The tenure is up to 20 years, interest rate being the same as the one on the home loan and the amount up to 70 % of the total property value minus the outstanding amount on the home loan. If you are still in the process of paying EMIs on your home loan, you can take a “top-up” loan.

For example –

User A loaned Rs 30 lakh at a 12% interest rate for 20 years...and has repaid regularly for 3 years.

Considering that the current value of the property has gone up to Rs 50 lakh, 70% of its total value, which is the maximum limit of the top up loan, would be – Rs 35 lakh.

Now, the outstanding loan amount is deducted from this, in User A's case, three years into the loan User A would have repaid a principal amount of Rs 1.31 lakh…thus the remaining amount would be Rs 28.7 lakh.

Thus, Rs 35 lakh – Rs 28.7 = Rs 6. 3 lakh.

This is the maximum top up loan amount User A is eligible for. 

     6.Home Con Version Loans can be availed for acquiring another property by selling the present one. The tenure is up to 20 years, interest rate the same as the home loan and the amount depends on the cost of the new property.

     7.Loans against rent, once again, can be availed for any purpose depending on the needs of the borrower. The tenure is up to 3 – 5 years, interest rate of 13 – 15% and amount up to 80% of the total rent receivable over the lease period.

     8.And, finally, Reverse Mortgages which too can be used for any purpose. The tenure is 10 – 15 years, interest rate 11 – 14 and the amount up to 65% of the current property value. 

...But, the bottom line in bold letters is that we mustn't treat our homes like a ‘cheque book’. Mortgage loans or top up loans... At the end of the day they too are debts!