While demand for sub Rs 50-lakh affordable housing prevails, market players cite increased land rates, escalated construction costs and low margins as key prohibiting factors.
Locals have witnessed real estate prices skyrocket from a historic low of Rs 6,000 per square yard (in 2020) during Jagan Mohan Reddy's regime to around Rs 40,000 to Rs 50,000 per square yard after elections.
India's real estate market is poised for growth across categories - residential, commercial, and rental. Currently valued at Rs 24 trillion, or about $300 billion, it is projected to surge to $1.3 trillion by 2034, and then grow further to $5.17 trillion by 2047, indicates a report by the Confederation of Real Estate Developers Associations of India (Credai).
The urban development ministry is expected to repeal the existing restrictions on real estate firms by allowing foreign investment up to 49 per cent, free of all conditions.
Credai is the apex body for real estate developers in the country and represents over 9,000 developers through 128 chapters in 20 states
Seek easing of asset classification guidelines for better credit flow.
The Land Acquisition Bill was cleared by the Union Cabinet on Thursday, making the consent of 80 per cent of owners mandatory for private projects.
Association points out that over 40 clearances from various agencies are required for real estate projects.
Mumbai's realty sector will protest against an alleged decision deficit and policy paralysis in both the state and central governments besides various pertinent agencies.
Builders on Friday blamed the Noida and Greater Noida development authorities for the current crisis and warned of similar problems in future due to their faulty land acquisition process.
"Minister Nath has agreed to hold the consultative dialogue from next week in the process of improving the working scenario between developers and the government sectors," he said at the ongoing CREDAI convention being held in Singapore.
Housing prices may rise by 5-10 per cent in the next 3-6 months as the cost of funds for developers is expected to increase following the Reserve Bank of India's decision to raise key policy rates by 25 basis points.
Undeterred by the real estate crisis after Dubai World's request to creditors for a standstill on repayment of its $60 billion debt until May, the Confederation of Real Estate Developers' Associations of India (Credai) has stuck to its original plan to hold its national convention during January 23-25 in Dubai.
Realtors' body CREDAI on Monday said the cost of construction has gone up by 20-25 per cent, mainly during the last 45 days, due to steep rise in prices of raw materials like steel, and builders will be forced to increase property prices from next month by an average 10-15 per cent. CREDAI-MCHI, the Maharashtra chapter of CREDAI, demanded that the central as well as state governments consider giving relief to the industry by reducing stamp duty and GST rates, besides allowing input tax credit (ITC) to developers. The association said it would not advise member developers to stop construction works as of now, but if the price rise continues then builders would have no option but to halt works at project sites and defer purchase of raw materials.
Speaking on the sidelines of a seminar organied by Confederation of Real Estate Developer's Associations of India in Kolkata, S C Kumar, senior advisor, Leadership in Energy and Environmental Design said, as many as 160 real estate projects across India, with nine in Kolkata, have got LEED recognition. The Leadership in Energy and Environmental Design green building rating system has been developed by the US Green Building Council.
About 25-30% of total units launched are unsold across country.
The association demanded that the interest rates for developers as well as home buyers should be brought down to boost realty sector, which is facing a slowdown in demand.
Owing to the risk perception attached with the segment by banks, the residential realty segment has been increasingly relying on non-banking financial companies and housing finance companies to raise debt financing, reports Abhijit Lele.
CREDAI Chairman Lalit Jain said a long term status quo on interest rates would not help prospective home buyers.
SBI, the country's largest lender, first announced a rate cut of 0.25 per cent in its home loan rates on Thursday, forcing HDFC, the second biggest home loan financier, to respond.
he hike in service tax rate from 12.5 per cent to 14 per cent will increase the costs of buying
However, the realty players will have to pursue their long-pending demands with the state government for abolition of the Urban Land Ceiling Act, speedy approvals to expedite redevelopment of Maharashtra Housing and Area Development Authority buildings, development of cluster development, rental and affordable housing.
Real estate loans could become NPAs for banks.
Realty firms and consultants hoped however that this would be the last round of monetary tightening by the central bank.
The most experienced administrator in the country seems to have sat back and allowed bureaucrats and policemen to manage the lockdown, observes Jyoti Punwani.
The earlier ambiguity over bifurcation of the state had affected the real estate business.
The government has relaxed the norms for allowing foreign direct investment (FDI) in the construction development sector. It is expected the move will boost affordable housing projects and smart cities across the country.
Real estate veteran Saket Mohta gives the the most comprehensive 11-point checklist
I-T lens on current account deposits over Rs 12.5 lakh. All the news and more post demonetisation.
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