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Central, state government need to step in to save the real estate industry: Jaiswal

NITN | @notintownlive | 01 Jan 2020, 04:23 am

Central, state government need to step in to save the real estate industry: Jaiswal

Kolkata: Laxman Jaiswal, Chairman and Managing Director of Ascon India Infrastructure Limited, a real estate giant of Eastern India, recently outlined the measures that should be adopted to come out of the mess that the real estate sector is in present times, in the last quarter of the financial year and he felt that the measures were urgently needed for an immediate redress.

He said a few doses of vaccination to boost the ailing sector must be immediately made in form of  Stamp Duty and Registration at the rate of 8% and GST at the rate of 5% should be merged immediately, lnput Credit should be allowed immediately, Real Circle Rate should be imposed after survey of locality by registered survey agency, Transaction to allow minimum 10% plus minus on circle rate and Super Built up area to be abolished in Registration process by state Government which is also contradictory to the provisions of HIRA, the West Bengal state Government Act governing the real estate sector.

He felt that several not stated factors like profession tax, fringe benefits tax of staff, freebies to sanctioning authorities on many occasions are also impediments and these are not even taken into account and then developers are forced to purchase the construction materials from local people which are most often highly-priced inferior materials.

Over and above NBFC and banks are also not prepared to help the developers, he said.

Even in Denmark, banks are providing loans on the negative interest rate to encourage the Real Estate Business as there is so many ancillary industry involved in the said business, he added.

But the general perception in the minds of the public is that of the builders fleecing the customers, said Jaiswal. 

He felt that there are several reasons for the slump with a negative growth in the real estate sector. According to National Housing Bank data, property prices in Mumbai and Bengaluru increased annually by just about 7.5% and 5.75% respectively between June 2013 and September 20I7.

In Delhi, prices actually fell by -0.70% annually during the same period. But beyond the data, we hear numerous stories of investors in distress with their money stuck in delayed projects.

The entire realty ecosystem is struggling to cope with this slowdown. Demand in real estate started declining from 2013. By 2016, it had hit an all-time low. 

He concluded by stating that both the Central and State Governments are equally responsible for the decline of the real estate industry primarily thanks to the faulty tax structure governing the real Estate industry.

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