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Vaastu Fengshui and missing corners

Vaastu Fengshui and missing corners

When a house's energies match our body's energy, it lets us feel comfortable--there's a sense of security and confidence. Very often when we look for a house, we tend to settle in houses that have similar energies. However, this does not necessary mean that the house is good for us. As a study of how living spaces affect ones life, we can be certain that a child's behavior and responses are greatly influenced by its surroundings.

Our body responds and contains energy or "chi" that is sensitive to our surroundings. Likewise, a building's form, structure and interior layout reflect the energies that it embodies. As we continually interact with our personal space it has a profound influence on the quality of our lives both on a conscious and subconscious level. It is a mirror reflection of who you are and your life circumstances.

The internal environment that we live in plays an integral part in creating the external aspects of our lives. You regenerate yourself if your internal environment is a place of balance and harmony that nurtures your feelings of inspiration, security and peace. As with our human bodies the healthier the bodies of our buildings are, the more they empower and support us in living a rich, creative, and joyful existence.

When we adapt Feng shui analysis for a space the Feng Shui master does not confine the space to the eight compass directions alone but actually to twenty four directions of the compass dial and the observations of the landform, surroundings and the shape of the plot and the building decides the type of energy in that place.

Each sector of the house has a specific relationship to the occupants and in turn it has been observed that it does affect the health of the person over a period of time. Look at your house in relation to your body: -

• East and Southeast sectors signify energy relating to liver and the four limbs

• South relates to heart, blood circulation and head

• Northeast and Southwest represent Stomach

• West signifies lungs, nose and throat

• Northwest represents the organs as in West sector and in addition it also signifies throat and intestine.

• North, which also represents element Water, signifies kidneys, ears and intestine.

A building with a missing corner in one of the above referred sectors or even a cluttered corner with garbage pollutes the sector of the house and the specific energy and organs over a period of time.

Organizing your space properly and choosing the right property reduces the possibility of having buildings with missing corners and defective sectors.

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Monday, 7 November 2016

Structural stability

Structural stability

All buildings have to serve two important functions. They have to carry the loads (structural requirement) and provide livable environment to the occupants to enable them to be comfortable in the use of the building (functional requirement).

The building has to carry its own weight and external occupancy loads and those caused by the environment such as those caused due to wind or earthquake. The elements that bear these loads and transmit them to the foundation are termed as “structural elements”. A good performance of the structural elements such as beams and columns is of vital importance from the safety and stability points of view. Hence, they are designed and constructed with prescribed safety margins as per requirements specified in the Bureau of Indian Standard specifications. Their failure will cause cracking, yielding of steel and even ultimate collapse of the building.

The serviceability of a building depends on the good performance of the structural and the functional elements such as flooring, doors and windows, glass panels and partition walls. The functional elements are generally not intended to carry structural loads. Their failure to perform will only affect the use of the building and not its strength or stability. Their good performance is also equally important.

In a metropolitan city such as Chennai, most apartment buildings are made of reinforced concrete frames. In this type of construction, the structural elements comprise beams and columns which carry the loads. The partition walls and infill walls in these buildings are treated as non-structural and hence are not generally designed and constructed to carry structural loads. In such buildings, for good performance it is necessary to detail the junction structural and non-structural members with proper care. The deformation of the structural members under load should not be restricted by non-structural partitions or in-fills.

For good performance of both beams and partitions, a proper sequence of construction is essential. First building the infill or partition and that casting the concrete beam on top will make the dead weight of the concrete beam load the partition which is not correct. The partition is not supposed to carry the weight of the beam. Moreover, when the additional live load comes on the floor the deflection of the beam will crack the brick infill or partition.

To avoid this problem, first the frame should be completed. This should be followed by the erection of partitions and in-fills. Care should be taken to see that a structural gap exists between the frame and the in-fill. For functional convenience this gap can be filled by inert flexible material such as thermocol or pith.

Under no circumstance a structural member should be cut or chased or damaged in any way for any purpose including for taking services like electrical conduits, concealed wiring etc. This will weaken the element and may cause its collapse leading to the collapse of the whole building. However the services may be taken through the non-structural partitions or infills.

Bearing walls

This type of construction is undertaken in semi-urban and rural areas. All the main walls carry loads and also serve to provide functional requirement. In these buildings, though the partition walls do not carry structural loads, they cannot be either built or demolished without due consideration for overall stability of the building. Some times their weight may be required to provide stability against overturning failure. The main walls invariably provide the structural stability and carry loads. Hence, they cannot be damaged or dismantled for carrying conduits for electricity, etc.

Bearing wall buildings though safe for vertical loads are weak under lateral loads. They are vulnerable for failure under out of plane bending during lateral loading. Therefore, to make the building act as one integral unit, they should be constructed with continuous plinth and continuous lintel beams. No brick pillar should be less than 600 mm in width. All openings should be reinforced on all sides. These simple precautions will ensure good performance of bearing wall buildings under lateral loads caused by wind or earthquakes.

Construction defects

In many sites the brick wall is first raised and then used as shuttering to cast the column or beam adjoining it. This will make the column or beam weak because the pores in brickwork will absorb the moisture from wet concrete making the w/c ration in the beam and column uncertain. The weakness will manifest in the cover concrete of the beam or column, leading to early onset of corrosion in the rebars.

The cracking in the walls of the buildings are many times attributed to following wrong constructions practices. It is important to pay attention to the details at the site of construction to ensure long and trouble free service of the infrastructure created. A conscious distinction should be made between the structural and non-structural items in a building and their requirements and performance. These defects when permitted during construction are difficult and costly to rectify later.

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Saturday, 5 November 2016

Prevailing Trends in Indian Real Estate

Prevailing Trends in Indian Real Estate

In coming years, India and China are expected to outperform the global markets with a growth rate in the range of 7-10%. This will benefit all sectors, particularly the real estate, which is closely linked to high growth in the economy.

A decline in property prices, falling interest rates and stability in the job market has helped the sector gain momentum once again. As developers realized that affordability was the key to lure buyers, they experienced with ‘no frills’ smaller apartment sizes. Projects that were launched in this segment received a good response, which indicated that homebuyers were waiting for a good opportunity to make an entry.

It is not only the listed players but also the unlisted players that have realized that affordable housing is the way to grow. Listed players who have committed huge investments towards low-cost housing projects are Unitech, Puravankara, DLF and Omaxe. Amongst the unlisted ones, Tata Housing is championing the cause of housing of the lower middle class. Following closely are Raheja of Delhi; Mumbai-based Matheran Realty, Lodha Group and others.

Global property consultancy firm Knight Frank has estimated that affordable housing requirement would be in excess of 2 million units across key cities in India and 80% of demand is expected to originate from the Rs 3-5 lakh income group. It is seen that real estate, sector is realigning its focus towards affordable housing and is estimated to reach a whopping market size of over Rs 3 lakh crore by 2011. With the sixth pay commission being implemented, those government employees who could not participate in the earlier real estate cycle will now be participants in the market. This, along with private sector employees who had postponed purchasing homes due to uncertainty in the market, would also be scouting for good bargains.

The combined effect of increasing sales and restructuring a major portion of debt has improve the liquidity position of most of the developers. An equally important timing of the upturn in the equity market opened another option of fund raising for these cash-starved companies. Realty stocks had corrected 80-90% over January ’08 – March ’09, but rebound back significantly. A number of builders including the likes of Unitech, Indiabulls Real Estate, HDIL., Orbit, DLF and Puravankara took advantage of this and either announced or raised foreign money in the past two-there months. This funding has come at the right time as it boosts the retail investors’ confidence in the sector.

As more funds become available, developers will divert all focus towards completing under construction projects. This, coupled with stable commodity prices, will help in faster execution of projects, leading to releasing of piled up inventory and rolling of the cash flow cycle. If the builders continue with a low price regime, then there is tremendous housing demand to be met. However if developers become too optimistic, as is visible, and start increasing prices, it could turn out to be a big blow to the industry, which is still recovering from its recent fall.

Despite the fact that stocks are still 20-30% off their highs, factors like strong balance sheet position, increased liquidity infusion, a stable government, and an improved employment scenario, suggest that there is a fair chance that going a head, the sectors fundamentals may improve. Though it might be premature to speculate a swift recovery at this point, there are convincing signs that show the sector is moving towards a revival.

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Friday, 4 November 2016

5 reasons why your home loan may get rejected

5 reasons why your home loan may get rejected

Builder not approved:

Not all banks fund loans for properties of all builders. It is critical to understand from the builders which banks have approved them and which have not, as it's possible that when you have decided to buy a property and go back to your banker and check, you realize that the builder is not approved with your banker making it impossible for you to get a home loan on the same from your bank and then you would have to go to a different bank.

Builder approved but property not approved:

This is another unexpected reason in home loan rejection, where a builder may figure in the list of approved builders of the bank, but a specific project launched by the builder may not be approved. In addition, there are cases where particular phases of the property( if it's a large project) may not be approved by the banker as well, so it's important to check if the builder, the project and even the phase of the project is approved by the banks to avoid unexpected home loan rejections.

Credit bureau issues:

Most customers do not check their credit scores and are mostly oblivious to the same, there can be some old payments missed by the customers or some past challenges the customer may have had, which they have forgotten about. The same can be adversely affected one's scores, and a poor credit score and performance can lead to rejection of home loans. It's very important that customer regularly check credit scores and fix issues if any, around poor credit history immediately.

Valuations related rejections:

Imagine a scenario where one is buying a house from the resale market. The buyer and seller mutually decide a price of the property and the buyer decides to go for a home loan to fund the purchase. At the time of sanctioning the home loan, the bank would fund the loan basis the valuation of the property as ascertained by them rather than the price decided by the buyer and the seller. If the valuation amount is higher than the mutually decided price then there is no issue, however, if the value is lower, then the bank may choose to give a lower loan amount than required, or may reject the home loan application as well.

Legal check rejections:

The bank does a detailed check on the property before giving a home loan which goes far beyond just ownership related legal checks that most buyers of property focus on. The bank checks on encumbrances, property documents, sanction plans, construction plans, government body checks and clearances and tax paid receipts, among others, along with ownership checks. These are mostly not carried out by buyers in a mutual agreement between the buyer and seller, and can lead to home loans on these properties getting rejected, if the bank does not feel comfortable basis these documents. It's extremely critical for buyers to try to do an elaborate check on the property before applying for a home loan on the same.

Consumers who look for home loans should understand the importance of the product, as most people take this as once in their lifetime and pay the loan for nearly 20 odd years of their life. In such scenario, it is critical to cover all bases from all angles to ensure that the home loan process happens smoothly.

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Thursday, 3 November 2016

Post-retirement investment options

Post-retirement investment options

If you have just retired and are looking to deploy the retirement money, the simplest option may seem like bank fixed deposits.

However, you may miss out on other superior options available to build a diversified retirement income portfolio that also returns well.

Here is a low down on your options and the suitability of each such option, based on your tax slab.

Post Office Senior Citizens' scheme

At 8.6% per annum (from April 1, 2016, but subject to reset every quarter), this is the best rate that a 60-plus investor can get in the present scenario.

This rate will be fixed for five years - that is until maturity - even as new rates (linked to government security yields in the market) will be announced every quarter. This is an ideal option for multiple reasons:

One, the post office interest rate will likely remain higher than bank interest rates.

Two, the quarterly interest payout gives you the needed income flow.

Three, it is eligible for deduction under Section 80C of the Income Tax Act, in case you fall under tax bracket and want to avail deduction. In fact, in the year of your retirement, when you still remain in the high tax bracket, this can be an ideal 80C investment option.

Four, in later years, although the interest is fully taxable, given that you will fall under lower tax brackets, than in your earning years, the post-tax returns won't be terrible.

Five and very importantly, it is sovereign guaranteed. Remember, even bank deposits (and your savings account together) carry insurance and only up to Rs 1 lakh. The only drawback is that there is limit of Rs 15 lakh that you can invest (across all accounts, individually or jointly) at any point. Besides, TDS will be deducted for all interest payouts exceeding Rs 10,000 a year (similar to bank). Hence, make sure Form 15H is submitted if you are below the taxable limit for senior citizens.

Suitability:

It is suitable for all retired investors across tax brackets. It remains an ideal investment option in the year of retirement, especially to avail Section 80C tax benefit.

Bank fixed deposits (FDs)

If not for anything else, the relationship that you have with your bank and the services that you will avail there, especially as a senior citizen, will entail that you park some money in bank deposits. While you will enjoy special rates for senior Citizens, this is certainly not the best time to lock a majority of your funds in banks. The interest is taxable at your slab rate. Here again, submit your Form 15H to avoid TDS if you are not within the taxable limit.

Suitability:

Bank FDs are a good option to diversify. They are better if you are not a tax payer. If you are one, ensure you keep your exposure to this avenue limited in a low interest rate scenario such as the present one.

Corporate fixed deposits

Do not scout for high returns in this space. Go for two to three well-known NBFCs, which are also governed by RBI to ensure you park your money in safe avenues. As the interest rate is likely to be higher than bank FDs, this is a must have for diversification purposes. While interest rates have fallen in this segment as well, they still remain higher than bank deposit rates.

Suitability:

Good diversification option for investors who are not in the tax ambit and are in the low tax bracket. For those in the high tax bracket, the post tax returns will not keep pace with cost of living, especially medical expenses.

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Wednesday, 2 November 2016

State affordable housing policy, a step in the right direction

State affordable housing policy, a step in the right direction

The timing has been right. The Karnataka government has cleared the affordable housing policy (KAHP). The Cabinet has passed the earlier housing policy of October 2013 by incorporating sensible modifications and additions in its efforts to provide "affordable homes" to the needy.

The urgency of a concrete policy by the government was more pronounced to immediately align with Prime Minister Narendra Modi's pet policy of Pradhan Mantri Awas Yojana (PMAY) under the credit-linked subsidy scheme (CLSS) which has the mission of providing two crore and four crore houses in the urban and rural areas, respectively, by 2022.

The KAHP in its new avatar lays stress on the state participation through Public Development Agencies (PDAs) - Rajeev Gandhi Rural Housing Corporation Limited (RGRHCL), Karnataka Housing Board, BDA, BBMP, Karnataka Slum Development Board. The RGRHCL is doing significant work in the affordable housing space.

The KAHP is applicable only to urban areas. The beneficiaries would be below poverty line (BPL), economically weaker sections (EWS) and low income group (LIG) households living as residents in urban areas for a period of not less than one year, fulfilling certain income criteria. The final selection of the beneficiaries under affordable housing schemes is by the state- level nodal agency (SLNA).

The KAHP has designed seven models of affordable housing to cater to different sections of the target group. The purpose of the beneficiary-led house construction and enhancement is to upgrade kutcha houses (walls with grass, mud, unburnt bricks) to pucca houses (brick, concrete, with mortar and metal). The beneficiaries will get a grant of Rs 1.5 lakh under the PMAY scheme.

For the beneficiary led new construction - specially designed for construction of a new pucca houses with direct financial assistance - will get additional financial support through the various ongoing schemes of the state government under the Basava Housing, Indira Awas Yojana, Vajpayee urban housing scheme along with the popular Credit Linked Subsidy Scheme (CLSS) of the Central government.

Two other models are dedicated for upgrading and redevelopment of slums by providing basic infrastructure such as water, drainage system, roads and lighting. Three more models - plotted development of sites with houses, group housing and township projects and affordable group housing - in partnership with private developers are thoughtfully and scientifically designed to boost the housing stock to cater to the urban poor. The paradigm shift and game changer of KAHP is the active involvement and participation of private developers under the PPP model by granting benefits and incentives to the builders.

The State government seems to have understood the dynamics of housing activity. Providing housing to the needy can no longer be the sole monopoly of the state. The builders, by partnering in these "non-remunerative ventures," get adequately compensated by the government by way of additional Floor Area Ratio (FAR) equivalent to the built-up area of the AHUs and additional transferable development rights (TDRs), by which builders can build extra floors and sell at commercial rates.

The KAHP proposes reduction in stamp duty from 7 to 5.5%, single window appro-vals with clear turnaround time for sanction of building plans, land conversions, issuance of commencement, completion and occupancy certificates. Housing activity through linkages with 200 ancillary industrial units will have multiplier effect on the economic development of Karnataka with positive impact on employment, income and savings.

There are certain critical inconsistencies, anomalies and show stoppers in the KAHP. The eligibility definition of an affordable housing unit is between 161 sft and 646 sft carpet area on a plot dimension 269 sft-1076 sft. The Central government under the CLSS has removed this requirement as cost of construction varies from place to place.

There is an anomaly in the income criteria too. Annual income of household up to Rs 1.5 lakh and Rs 3 lakh is the criteria considered for EWS and LIG by KAHP whereas it is double at Rs 3 lakh for EWS and Rs 6 lakh for LIG under CLSS. This is serious as it affects the very cherry-picking of the beneficiaries.

A large portion of households in the income band width of Rs 3-6 lakh per annum gets excluded from the scope of the KAHP. This will impact the beneficiaries who are eligible for an upfront subsidy of Rs 2.2 lakh by way of direct transfer under the CLSS if the AHU is in one of the 231 towns specified in the 30 taluka of Karnataka.

Woman as title holder

The KAHP should also incorporate woman of the household as one of the title holders of the property to be a beneficiary under the CLSS which has a rider that the applicant should not own any other residential property in the country.

Though the policy attracts private developers with additional TDRs and FARs, the condition that the FAR has to be "consumed" on the same site on which the AHUs are built for their commercial use will neither be attractive nor practical. Coexistence of residents of different economic and social strata would be difficult and can lead to social strife.

The affordable housing projects should be taken up within the city on government land. Under the PPP, the government should offer land at reasonable rates within the radius of 10 km to private developers to build quality affordable houses. Otherwise, the fate will be similar to certain projects wherein the houses are lying vacant and in dilapidated condition for want of occupancy.

The government should eliminate corruption which is rampant in the beneficiary selection stage. Also to be eliminated are middlemen and multiple funding of the same asset. Quality construction needs to be adhered to through fair practices code. Otherwise, the noble intentions of the new housing policy will be defeated.

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