CREDAI Haryana Seeks Waivers from State Government to Boost Realty Sector

The real estate sector has been hit hard due to the COVID-19 outbreak and is facing huge losses. What’s worse is that the situation is expected to worsen. In the face of this problem, the Haryana Zonal chapter of CREDAI has approached the state government and appealed for certain relaxations for the developers. These include waivers and relaxation in rules to ease the situation.

Property sales have fallen drastically as a result of the pandemic. Naturally, people would rarely buy homes during such an outbreak. Moreover, a number of start-ups and smaller firms related to the realty sector are now shut during the lockdown, which is hindering the real estate industry. Inflows from financing sources like the banks and NBFCs are also falling drastically and is expected to become negligible soon. This would once again make the realty sector bounce back into a liquidity crisis.

The realty sector is the second largest creator of employment in India. The impact that the pandemic would have on the sector unless necessary steps are taken would have a huge negative impact. Moreover, up to 10% of India’s GDP comes from the real estate industry. This would also affect the Indian economy. Along with the industry, the stakeholders would also have to face considerable losses. The finances and the sales have been gravely impacted in the ongoing pandemic. Finances from NBFCs, banks and other financial institutions will be negligible.

In the past few years, the real estate sector in India plunged into a liquidity crisis and was going through a slowdown. Property sales had fallen due to a decrease in the purchasing power of the investors. The credit crunch has resulted in a growing inventory of unfinished projects, which made the banks and NBFCs hesitant to grant finances. A major reason behind this was the several tax and other economic reforms brought about by the central government. However, the short-term effects of these reforms were receding, and with relief funding and other measures taken by the government, the real estate sector was starting to recover. Unless the state government allows the relaxations, the real estate sector would undergo unprecedented damage. It is being hoped that the needful measures would be taken and the situation would improve over time.