The way forward for Real Estate sector
Real Estate sector has been in the doldrums for quite some time. Over the last 3 decades, the prices have appreciated to more than 20 times. Whether you accept it or not, it is a fact that there were a huge amount of cash transactions in the real estate sector wherein the builder would reduce the price for payments made in cash from the buyers aka black money. This would reduce the agreement value and corresponding stamp duty would reduce. The builders used to divert funds from one project to another and used to increase the value on the completion of each slab. This way there were many projects which were not completed on time and the consumers had to suffer. They would stash this black money and use it without paying any tax. The builders would procure the plot of land for peanuts and develop the land after getting the requisite permissions from the authorities. They also charge a huge amount in the name of Development charges citing Landscape development, garden etc, from the consumer. The prices quoted per square foot are exorbitant and beyond the reach of the consumers. The flats offered are very small compared to the super built up area quoted and price charged on the same. To provide justice to the consumer, RERA was introduced with stringent measures to provide flats based on carpet area and completion of projects on time and not allowing to transfer funds meant for one project to another. This was also to reduce the price and get a proper flat measured on carpet area. However despite all this, the avaricious and greedy builders have increased the prices abnormally despite earning huge profits over the last several years and still procuring the land at dirt cheap rates. There are no buyers as the builders are quoting astronomical prices.
You can call it Karma strikes back. It is high time the builders pass on the benefits to the consumers. To start with, the prices should be reduced by 70% for 6 months and then by 60% for the next 6 months and so on. This way over a period of 4 years the prices will stabilise and demand will pick up. The salaried consumer even after putting in 20 years service has not earned a crore. This is gross amount without deducting expenses. The prices have to come down drastically for demand to pick up. more
The Coronavirus episode with its lockdowns should and will contribute towards change/shift in our thinking mode towards life and living.
And that will affect not just the real estate business. more
No doubt, Real estate owners made money by escalating price and other charges at the completion point of project or handover time. Builders grossly violated all rules on their whims and recovered all additional cost from consumers. It was a jungle raj even a decade ago. Now it got reversed. Builders are luring customers to get the flats booked. Misdeeds never leave anyone unhurt. Builders first clean up the desk and then may request for some relief. Such fall out in economy sometimes teach good lesson to cheaters. is it not a good relief to customers? more
Mr. Vaidya Nathan. It seems to me that yours is "WISHFUL DAY DREAMING". more
Real estate needs stimulus. May be in the form of softloan again mortgage to create liquidity more
Land is precious and pollution is to be avoided.To preserve both no bulifing activity to be allowed with 1000ft if any river or lake banks.Also only apartments to be allowed no individual house in urban areas.we need not give any concessions for building houses as it is a wasteful money with no good return and governments should function only in rented buildings and as no huge office space needed to function under digital set up and egovernance more