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Indian Real Estate News : Kolkata
Realty sector looking for better days
Source: The Times of India May 30, 2014
The new Union urban development minister promised to streamline the housing sector as soon as he assumed office.

VIVEK SHUKLA outlines some points that deserve his urgent attention

The Union minister for Housing and Urban Poverty Al leviation, M Venkaiah Naidu, promised that the top priority of his ministry would be to set up 100 new smart and safe cities in the country. Another priority is housing for all by 2020 for which Public Private Partnership (PPP) as well as Corporate Social Responsibility (CSR) will be encouraged.

By 2050, half of the Indian population will be living in urban areas for which there is an urgent need for planned urban development. Naidu's ministry will also have to work fast in creating infrastructure for satellite towns of big metropolitan cities. Even within those mega cities, efficient drainage, better sanitation, waste management, water recycling, etc, are crying for attention. The new minister must first get a proper account of the current state of the real estate industry in the NCR, if wants to make a difference. A recent visit to Raj Nagar Extension in Ghaziabad, once billed as a great place to live, will be a real eye opener.

You will notice a series of projects under construction with gleaming billboards of realty companies outside each project site announcing the salient points. But, inside, you may not see much activity. These buildings look like ghost buildings. The Indian real estate industry is facing a series of challenges: Lack of clear land titles, absence of title insurance, absence of industry status, lack of adequate sources of finance, shortage of labour, rising manpower and material costs, delays in approvals and procedural difficulties, among other. Hopefully, the Modi government which rode to power promising that "acche din aane waale hein" (good days will be here) must give a new lease of life to the housing sector.

"I think that the new government will take the necessary steps to make the market viable for sellers and buyers again. There are a number of reforms that could achieve this. For instance, the new government can put mechanisms to fast track residential project approvals.

This would go a long way in increasing supply and keeping property rates rational, especially in the larger cities," Alimuddin Rafi Ahmed, the MD of ILD developers, said.

Experts say that it is high time that the approval process be speeded up for affordable and mid-income housing projects, so that Indian real estate can narrow down the massive and long-standing supply deficit in these segments.

Aroon Kumar, an author, says that most of the governments have done little worthwhile to boost the affordable sector, and that the new government must not repeat the mistakes of previous governments.

The Indian real estate sector has traditionally been an unorganized sector but, of late, it has been slowly evolving and adopting a corporate culture. The sector is embracing professional standards and transparency with open arms.

The major established players in the NCR are DLF, Unitech, Hiranandani Constructions, Tata Housing, Godrej Properties, Omaxe, Parsvnath, Raheja Developers, Ansal Properties and Infrastructure, Mahindra Lifespaces Developers Ltd, to name a few.

"The government needs to speed up infrastructure development in order to boost the sector. Many key projects are heavily delayed or pending; infrastructure is extremely important when it comes to making real estate development viable in newly emerging areas as well as established areas that have stagnated due to infrastructure deadlock," Sanjay Khanna, the director of Kailash Nath Projects, says.

As for the widespread malpractices in the sector where buyers are regularly duped by unscrupulous builders who palm off projects that have no approvals, the onus is as much on the buyer as it is on the government to put in place a regulator.

"A regulator can surely correct a lot of foul play in the sector; hopefully, the new Modi government will streamline the realty sector and bring in a regulator at the earliest," Sameer Jasuja of PropEquity says.
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