Realty players hope Modi to bring in faster reforms in the sector
The brand new Modi Govt which was sworn in on May 26, 2014 has brought a wave of hope among the real estate sector along with other sectors. Lalit Kumar Jain who is the chairman of Confederation of Real Estate Developers Association of India (CREDAI) mentioned that the market sentiments were low in the last few years and the real estate sector was reeling under the burdens of debt, slow sales, high inflation of building materials, liquidity crunch, labour problems etc.
‘’Housing for all’’
BJP’s manifesto shouted the slogan of ‘’Housing for all’’ by 2022. Mr. Jain also suggested that since the margins are low, the budget housing projects fail to attract the developers. However if the approval process is initiated in the center and strictly followed by the states, then the efficient and accountable governance can lure the builders for such projects too. He also requested the government for a single window system of approvals, which will cover the administrative, banking, tax and legal aspects.
Removal of Bureaucratic Red-tape
Most of the real estate and infrastructure projects get trapped on bureaucratic red tape and get delayed causing huge financial loss to the developers. Global realty consultancy Jones Lang LaSalle (JLL) is hoping that the new government will expedite the process of granting regulatory approvals.
JLL’s latest report states that the land acquisition parameters for the developers should be relaxed to expedite the housing projects. Also the pending Real Estate Development Regulation & Development Bill should be passed in the next session of parliament.
The residential property segment is suffering due to low demand and high inventory with the developers which has resulted in severe liquidity crunch. Due to high interest rates on home loans and inflation, the home buyers were apprehensive to invest in properties in the last few years. However if there is availability of funds from both domestic and foreign investors, then the money flow will be smooth in the residential realty sector and the home buyers will find the confidence again to invest in properties. This will bring an end to the liquidity crunch which the developers are facing now- The report added.
Source- The Hindu Business Line
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