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How can I track a housing project in India from Dubai?
Builders are required to post periodic updates on Rera website
A tower crane operates at a residential construction site in Mumbai, India. — File photo
Question: I am planning to purchase a property in Bengaluru. Being located in Dubai, I am not sure whether I will be able to keep track of the development of the project. This has delayed my decision to invest in a residential property.
ANSWER: The real estate regulatory authorities are planning to integrate the entire real estate sector whereby the websites will be linked to the Rera website. Further, the websites of permission granting authorities, like the municipal corporations, fire fighting department, water, gas and electricity authorities, etc. will also be linked. In course of time, this will make the Rera website a composite one which will deal with every issue of real estate development. The quarterly project report, which real estate developers are required to submit to Rera would be put on its website. This would enable home buyers like you to check the track record of developers and monitor the progress of the project on a real time basis.
Question: My son, who has just taken up a job in India, has taken a home loan. The interest rate has been increased last month and the period of the loan has been increased by the bank. This would mean that he would have to repay the loan even after he reaches the age of 60. Will this not impose a burden throughout his working life?
ANSWER: With the increase in interest rates in the last one year, most borrowers are paying the same equated monthly instalments but will now have to do so for a longer period of time. The Reserve Bank of India has been concerned over the unreasonable elongation of the tenor of home loans. It has therefore directed banks to inform the borrowers about the impact of interest rate hike by providing an option of resetting the interest rates or switching to a fixed rate or giving an option for early repayment of the loan. RBI has advised that it is prudent to avoid unduly long elongation which may camouflage the underlying stress in a loan. The extension of the tenor has to be for a reasonable period.
In many cases, the existing housing loan is given for a period beyond 30 years. Therefore, an option should be given to the borrower to either prepay the loan or increase the EMIs. However, some bankers are of the view that a temporary extension of tenor of the loan may not be a cause for concern as interest rates move in cycles. Therefore, if the interest rates are cut after two or three years, the loan period may revert to the original tenor. However, all are of the view that an option should be given to the borrowers to prepay the loan as and when there is an increase in their income or they earn windfall gains on sale of any asset. The Reserve Bank has also expressed the view that floating rate loans by bankers should not be given unless the written consent of the borrower is obtained.
H. P. Ranina is a practising lawyer, specialising in tax and exchange management laws of India.
Question: Some of my friends in the Gulf are thinking of shifting to India to set up data centres. Would this be a wise move considering the large investment involved?
ANSWER: Data is now being generated across organisations in terabytes, which requires mammoth data centres. As the AI workloads rise, there is a need for data centres to get larger and more sophisticated. This has attracted big conglomerates and niche players into the data centre business in India. One of the prime locations is Mumbai on account of high voltage power distribution network, proximity to submarine cable landing stations, and dense fibre connectivity. Chennai is also preferred on account of its undersea cable network. Data centres are also being set up in Tier 2 cities as enterprises and industries are now increasingly relying on edge computing for low latency applications. These cities also have lower operational costs including real estate, power and labour. Some entrepreneurs with deep pockets are investing in a big way to attract data of entities from surrounding countries and make India a hub in the same way that Singapore has been for the Asia Pacific region.
H. P. Ranina is a practising lawyer, specialising in tax and exchange management laws of India.
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