Durga Shanker Mishra, the Housing and Urban Affairs Secretary on Friday stated that the government will think over the various demand of the real estate industry including the increase in deadline for completion of the projects by 6-9 months. He elaborated about the achievement of government in developing 1.12 crore houses under the Prime Minister Awas Yojana (PMAY), and talked about the Affordable Rental Housing Complex scheme for immigrant labors and workers, and about the creation of 100 smart cities.
Durga Shanker Mishra was addressing a webinar prearranged by realtors body NAREDCO.
NAREDCO’s council put multiple demands in front of the secretary to revitalize both demand and supply in the real estate as the sector has seen a major downfall due to COVID-19 pandemic.
The council has requested for extension of timeline by 6-9 months for the under constructed project under the realty law RERA. It has also asked for increasing timeline for all building permissions till March 2023. The council demanded for the rationalization of the government taxes on real estate, and management of the rising rates of cement and steel.
The council also requested for reintroduction of the interest subvention scheme and asked permission to allow input credit tax on GST paid in leased commercial real estate. The council has demanded to postpone the insolvency law for some more time, and further asked for the online environment clearance system.
Acknowledging the concern for extension of timeline for project completion, Housing and Urban Affairs Secretary guaranteed that he will “go in detail” to understand the issue.
He stated “If need be, we will take this matter to RAC (RERA Advisory Council),”
Though, Durga Shanker Mishra clearly stated that last year relief was given because of the enforcement of the national lockdown.
On high taxes levied by the central and state governments on real estate sector, Mishra instructed the ministry’s senior officials to look into the matter in detail. He said “We will try to reduce government levies,”
Addressing the concern of increase in prices of steel and cement, Mishra assured that he will discuss this issue with the concerned ministries.
Discussing about PMAY, he stated that 1.13 crore units have already been approved and out of which possession of 48 lakh houses is already given.
Durga Shanker Mishra updated that India’s ranking in ease of doing business related to real estate sector is enhanced to 27 from 186.
He stated that the new ranking in ease of doing business can be expected any time and is confident that “we will be in top-20”.
As stated by Durga Shanker Mishra, real estate sector contributes seven per cent to the gross domestic product (GDP). He added, Real estate sector is a USD 200-billion industry and very soon will become a USD 1-trillion industry with hasty urbanization.
Focusing on affordable housing, Mishra said the utmost housing demand comes from low-income group (LIG), and economically weaker section as this income group can only afford 2-3 BHK flats and not bungalows.
Discussing about the Central Vista Project, Mishra said that the new Parliament building will be completed by next year. He also refused the criticism about this development.
According to the NAREDCO President Niranjan Hiranandani, the construction process has slowed down because of the second wave, as only half of the work force is working on sites. He demanded that the deadline for completion of projects should be increased as it was done last year.
Rajeev Talwar the Chairman of NAREDCO requested that all consent related to the development of projects should be valid till March 2023.
Tata Housing MD and CEO Sanjay Dutt raised concern about the sudden hike in cement and steel prices. He said that the steel prices have increased more than doubled at the same time cement rates have increased by 50-70 per cent in the last one year.
He also requested for reintroducing subvention scheme, in which the developers are ready pay EMI on behalf of the homebuyers for a certain time period.
Neel Raheja of K Raheja group proposed demand related to commercial real estate and wanted input tax credit benefit.
Rajan Bandelkar from NAREDCO Maharashtra demanded increase in timeline for project completion by 6-9 months and to postpone insolvency laws for some time as the second wave has more negative impact on the sector as compared to the last year’s first wave.
President of NAREDCO Maharashtra, Ashok Mohanani was also the part of the meeting.
NAREDCO is a group of around 5,000 members and is one of the important associations for the real estate sector.