.....As the plot thickens

                             …..As the Plot thickens                                                                         ( also published in  )   While plotted development has its advantages but it also runs the risk of expanding cities horizontally without creating housing supply. The tax structure should be rationalised to increase the supply of housing and not just of empty plots          ------------------------------------------------------------------------------------------------   During the last two years, almost every segment of real estate has experienced some action. While the quantum of growth may remain a subject of dispute but what would certainly have consensus is that the most action-packed growth has been seen in the plotted developments category. The reasons are multitude. However, before that a flashback on the brief history of plotting in India.     Till about 1930s, land was largely owned by the rich landlord community and most of their holdings co

Why ‘Rent v/s Buy’ debate is losing traction

  Why ‘Rent v/s Buy’ debate is losing traction     A few years back, Rent v/s Buy remained the hottest topic for debate on real estate – be it in social media or be it among home seeking couples. The proponents of Rent (typically the husband in home debates) would argue that when the rent costs just 2% of the capital value borrowing at 9% to buy home did not make sense. The other side would support its case through the long term appreciation that real estate has delivered over years.    Interestingly, such debates are now more conspicuous either by their absence or by their significantly reduced intensity. And this is despite the fact that neither the number of rental transactions have shrunk nor have the number of home purchases    So, why has this debate been losing steam ?       A decco at the composition of home seekers market throws some light. Home seekers today comprise :   a)      The Young Home Seeker   This segment comprises those in twenties and discovering their life which

Real Estate : Derivatives is the way to go

    Real Estate : Derivatives is the way to go     Vanilla products can take real estate achieve a limited target. As asset markets mature, one needs to look for product-innovation to deepen the market as well as to address the evolving need of new kinds of customers                      - - - - - -    - - - - - -    - - - - - -    - - - - - -    - - - - - -    - - - - - -    - - - - - -    - - - - - -    - - - - - -    Real Estate business today is in a complex situation. High Capital requirement. High interest rates….and yet few lenders Higher land valuations. Rising constructions costs…and still marginal increase in finished good prices.      Large tax for exchequer. Huge employment for society….. but…thin profits for the sector   How does one approach a complex situation as this ?   L’Hospital rule ( or Bernoulli’s rule) in Calculus says that when computing limits of a complex function is not possible through normal means, its derivative may provide the answer.   And to me this 17