It’s time for a re­fresh­ing break

The va­ca­tion homes seg­ment is grow­ing and dis­play­ing im­mu­nity to larger mar­ket forces and changes in the eco­nomic en­vi­ron­ment

HT Estates - - FRONT PAGE - Van­dana Ram­nani

Many mid­dle-class buy­ers in In­dia who would rush to book ho­tels in hill sta­tions to beat the heat or en­joy snow­fall sea­son are now look­ing for in­vest­ment op­por­tu­ni­ties in hol­i­day spots – hills or beach re­sorts. Most of the buy­ers are typ­i­cally those with well es­tab­lished res­i­den­tial prop­er­ties in ci­ties, who are well set­tled in their jobs and earn over and above ₹ 50 lakh per an­num.

To lure such buy­ers, de­vel­op­ers are of­fer­ing prop­er­ties with cost op­tions rang­ing from a few lakhs to crores. Many of them are also tar­get­ing se­nior cit­i­zens.

Even though the real es­tate sec­tor is still in the process of re­cov­er­ing from de­mon­eti­sa­tion, the week­end or va­ca­tion homes seg­ment is show­ing at­trac­tive growth. That’s largely be­cause this seg­ment has been im­mune to larger mar­ket forces and changes in the eco­nomic en­vi­ron­ment.

A week­end home is pur­chased only af­ter one’s pri­mary home is se­cured. If the first home is debt- free and one has suf­fi­cient re­serves, then in­vest­ing in a week­end home makes per­fect sense, says a real es­tate con­sul­tant.

En­try bar­ri­ers are usu­ally high in many hill states. For Hi­machal Pradesh, the big­gest chal­lenge is avail­abil­ity of land, clean ti­tle and per­mis­sions for those who are not res­i­dents. Get­ting a prop­erty is vi­able only in places such as Shimla, Kasauli, Dharam­sala and Kullu, which means there is only 1% us­able land in the state. Around 30% of land is owned pri­vately and the rest by the gov­ern­ment. Most im­por­tantly, only about 1% to 2% own­ers are keen to sell and only 20% is clean ti­tle land.

For Manav Singh, chair­man, Im­pe­rial Hold­ing Group, who has a 50-acre project, Au­ramah Val­ley, near the Naldehra Golf Course, the bar­ri­ers pre­sented an op­por­tu­nity.

“We started con­struc­tion about three-and-a-half years ago. It all started with friends ask­ing me to build a place for them in the hills as they found it dif­fi­cult to buy land be­cause of clar­ity of ti­tle and avail­abil­ity of land. Not to men­tion the chal­lenges as­so­ci­ated with con­struct­ing a house and then main­tain­ing it. I de­cided to look at these bar­ri­ers for land de­vel­op­ment and turn chal­lenges to op­por­tu­ni­ties,” he says.

Non- Hi­machalis want­ing t o buy prop­erty Hi­machal Pradesh have to ap­ply for per­mis­sion un­der sec­tion 118 A of Hi­machal Pradesh Te­nancy and Land Re­forms Act.

“T his project has been li­censed by the town and coun­try plan­ning depart­ment and buy­ers get a guar­an­teed free­hold apart­ment,” he says.

Most of Au­ramah Val­ley’s res­i­den­tial units have been sold. In the first phase, 50 units were sold out which 30 were de­liv­ered. These in­clude 2BHK of 1,600 sq ft, cost­ing ₹ 1.1 crore to ₹ 1.45 crore. There is an ad­di­tional charge if buy­ers take higher floors. A du­plex (4,600 sq ft) costs be­tween ₹ 2.7 crore and ₹ 3.1 crore. Vil­las (5,000 sq ft to 6,000 sq ft) cost be­tween ₹ 5.6 crore and ₹ 6.5 crore.

The com­pany is launch­ing se­nior homes as part of the sec­ond phase. These will in­clude 14 units of 700 sq ft to 1,000 sq ft and will be at­tached to the club­house and cost ₹ 65 lakh on­wards.

“Buy­ers have been vet­ted by the screen­ing com­mit­tee. The en­tire project will be de­liv­ered by 2020,” he says.

The com­pany also in­tends start­ing a 24X7 pick up ser­vice from Chandigarh by heli­copter. Own­ers will be mem­bers of the heli­copter club and get dis­counted rates.

Myst, a joint ven­ture be­tween Tata Hous­ing de­vel­op­ment Co. Ltd and Im­pact Pro­jects Pvt Ltd, is lo­cated on the Kasauli hills of Hi­machal Pradesh. The first phase of the con­struc­tion will be over by the end of this year and phase-2 is un­der con­struc­tion. Phase 1 and phase 2 will have over 100 res­i­dences. These in­clude dou­ble- level, two-bed­room town­houses and five-bed­room mul­ti­level vil­las.

“Prices start at ₹ 3.35 crore. Typ­i­cally, this seg­ment, has dis­played a cer­tain im­mu­nity to larger mar­ket forces, and we have seen that de­mand con­tin­ues to grow steadily backed by larger dis­pos­able in­comes, con­stant in­no­va­tion and the need for pe­ri­odic re­treats. The sec­ond home mar­ket is grow­ing rapidly and has not been im­pacted by re­cent eco­nomic/pol­icy de­velop- ments be­cause of the very clear seg­ment of HNIs who are buy­ing such prop­er­ties,” says Ra­jeeb Dash, head, cor­po­rate mar­ket­ing, Tata Hous­ing De­vel­op­ment Com­pany Limited.

For those plan­ning to buy a sec­ond home, here’s a word of ad­vice.

“The mar­ket is still at­trac­tive if con­sid­ered on a long- term ba­sis, pro­vided buy­ers sort out their own in­vest­ment plans and put their fi­nan­cial house in or­der,” says Ash­winder Raj Singh, CEO – res­i­den­tial ser­vices, JLL In­dia, adding af­ter de­mon­eti­sa­tion, only those with le­gal source of in­come are in­ter­ested in buy­ing a sec­ond home. Bud­get 2017 has also capped the tax ben­e­fits on the pur­chase of a sec­ond home.

AU­RAMAH VAL­LEY, HI­MACHAL PRADESH

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