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We highlight this week’s top real estate news:

* Realtors hopeful as HDFC too offers loans at 6.7 per cent: India’s biggest mortgage lender HDFC Ltd on Tuesday announced a festive offer in line with State Bank of India, offering home loans at 6.70 per cent, regardless of the loan amount for customers with a credit score of 800 and above. Last week, SBI offered a similar credit score linked home loan rate of 6.70 per cent.

This was followed by rate cuts from Punjab National Bank and Bank of Baroda. With corporate credit growth subdued, lenders are competing to increase their share in the high margin home loan market. Besides, competition, the ample liquidity in the banking system has brought down home loan interest rates to a historic 15-year low. Real estate developers expect the lower rates to boost housing sales this festive season, as homebuyers prefer to buy properties during the auspicious period, including Navratri, Durga Puja, Dussehra and Diwali.

HDFC's festival offer is applicable to all new loan applications irrespective of the loan amount or employment category and can be availed of between September 20 and October 31. "Before this special offer, the rate for salaried customers for loan above INR 7.5mn and credit score of 800 and above was 7.15 per cent and for self-employed was 7.30," HDFC Ltd said. (Source)

* Blackstone CEO shares plans to invest US$40 bn in India during meeting with PM: In a meeting with Prime Minister Narendra Modi on Thursday, Chairman and CEO of the Blackstone Group, Stephen Schwarzman spoke about how he is “very optimistic about India’s potential” and further discussed the promising investment opportunities in India.

During the meeting, Schwarzman stated his intent to invest in various sectors including real estate, education, fashion, packaging and housing finance. According to the statement released by the External Affairs Ministry, the American global investment firm emphasised working on the National Infrastructure Pipeline and National Monetisation Pipeline projects in India.

Further, Blackstone’s CEO explicated its vision to make India a ‘commercial real estate hub’ in the world. Blackstone, which had started its operations in India in 2006, has so far invested USD 60 Billion. The key areas of the company’s investments in India include private equity, real estate, education, fashion, packaging and housing finance. Notably, Blackstone Real Estate Fund is the largest owner of commercial real estate in India. (Source)

* Affordable housing! Karnataka government slashes 2% stamp duty on flats below INR 4.5mn: A deduction of 2 per cent is done. Earlier the stamp duty was 5 per cent, which has been reduced to 3 per cent now. This will be applicable to flats priced between INR 3.5-4.5mn. (Source)

* JM View: We do not believe the cut will have a meaningful impact on listed developers as the average ticket size for them tends to be higher (above INR 5mn). Even in absolute terms, a 2% benefit on INR 4.5mn amounts to INR 90K in savings which is not very high. Maharashtra stamp duty cut was more impactful as ticket sizes were much higher and discount was given for a short period of time. As per Propequity, 22% of units sold in CY20 / CY21 in Bangalore lie in INR 3-5mn bracket.

* Godrej Properties sells Noida project flats worth INR 5.75bn on launch: Realty firm Godrej Properties on Wednesday said it has sold residential properties worth INR 5.75bn in a single day at its luxury project in Noida. In a regulatory filing, the Mumbai-based firm informed that the company has sold 340 homes with an area of more than half a million square feet on the first day of launch of the second phase of its 'Godrej Woods' project. The total sales bookings in this project in the past six months have touched about INR 11.4bn.

* Hines to expand realty biz in India,aim for partnership with local builders: Bullish on demand for premium housing and office spaces, US-based realty firm Hines plans to expand its India business and is targeting to form at least three local partnerships for projects across major cities. Hines, a privately-owned global real estate investment firm, entered India in 2006 and has so far invested over US$ 400 million equity for development of projects across major cities.

In an interview with PTI, Hines India MD and Country Head Amit Diwan said the company is in an advance stage of talks with a few local builders and landowners for acquiring new projects through development management (DM) fee model or joint ventures. "We are witnessing a good demand for premium spaces in both housing and office segments. One of the fallouts of the COVID pandemic has been that people are moving towards quality products," he said.

The market share of quality and trusted developers are rising while others are finding it difficult in marketing their products, Diwan highlighted. "We are receiving numerous proposals from local developers and landowners for partnership. We are evaluating all proposals for tie-ups. We are in advance stage of talks for two residential projects in Gurugram and one in Noida," he said. Diwan said the company is also evaluating proposals of acquiring projects in Bengaluru, Mumbai and Pune. "We expect to close at least three deals, most likely in residential, during this financial year," he said. (Source)

* Retrofitting outdated office stock holds investment potential of INR 90bn: Landlords and developers are missing investment opportunities and have a scope to upgrade around 100 mn sq ft* of office space. The retrofitting of these assets has INR 90bn worth of unrealised value in the top six cities as per Colliers’ latest report, Revitalizing outdated buildings: A requisite. As per the report, the upgradation of buildings will make them more investible, which investors and developers can then bundle into a REIT. Currently, investors are betting on under-construction buildings due to a lack of readily investible asset. (Source)

* Novvy launches ‘buy-to-let’ investment product in Chennai’s Mahindra World City: Proptech startup Novvy Technologies Ltd, a real estate buying and investing platform, has launched a real estate investment product in the Mahindra World City project in Chennai, to offer “buy-to-let" assets for buyers in India and Indians living overseas. A block of 100 apartments within the Mahindra World City complex will be fully managed by Novyy on behalf of the buyers, where the company will provide asset management services to its buyers, including finding tenants, collecting rentals and maintenance of the properties. Mahindra World City, at Chengalpattu, Chennai, is developed by Mahindra Lifespace Developers Ltd.

Domestic and NRI investors can buy one-bedroom apartments at INR 2.04mn or 1.5-bedroom apartments priced for INR 2.5mn. “We chose Mahindra World City as our first buyto-let product in India for its exciting price point and the rental market that the region offers. There are over 65 corporates employing over 80,000 people in the vicinity, and supply outpaces demand. We are confident that investors will never have a dearth of tenants. In addition, rental yields in Indian metros are now capped at 3%, whereas rental returns in such regions is much higher," said Ashish Saraff, founder and CEO of Novyy Technologies.

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