In a bid to counter the slump in sales in the real estate sector, the Confederation of Real Estate Developers Associations of India (Credai) has put forward a plan to the Prime Minister to enable reforms in the sector and help revive it.
Home sales registrations continued to decline in the period between January 2012 and June 2012, although by only 3.4 per cent when compared to the same time last year. To tackle this decline, the real estate developers’ body has put forward ten key points and wrote an open letter to the PM, which they say will help in dealing with the stagnation in the housing sector and work towards rejuvenating it.
The first and most important of the plan is setting up a single window clearance. “Developers are forced to deal with close to 140 officials at various stages to obtain 40 plus clearances. We know that corruption creeps in wherever there is a human interface,” said Lalit Kumar Jain, president of Credai, adding that in such cases, “the cost of flats increases by as much as 40 per cent”.
The association also demanded that the government increase FSI in metros like Mumbai by as much as 4, or even more, given the land-locked nature of the island city. “There is no space in the city to build. Hence, the consumption of lower FSI should attract premium charges by Municipal authority.”
Other demands included, a lowering of loan rates for economically weaker sections. “The interest rates on home loan, especially in affordable category, cannot and should not be more than seven per cent. Also, the current guidelines by the Reserve Bank are anti-housing industry, as the cost of finance is very high that in turn makes housing costlier,” said Mr Jain.