As a aspect of recovery strategy for the beleaguered true estate sector, the Haryana Cabinet has granted relief to developers by declaring April and May a zero-interest period. During Zero Period, developers (as properly as entrepreneurs) will get relief on interest payment of renewal charge of license on delayed period, submission of fresh bank assure on account of grant of license and interest/penal interest on payment of installment of external development operates (EDC), state infrastructure development charges (SIDC) for the duration of this period, letter of intent/ permissions/ developing strategy approval/ extension of CLU permission and licenses and renewal of licenses, and associated compliances.
There is a substantial aggregate demand for housing in India driven by the all round rise in middle-earnings households, decrease interest prices, and favorable socio-financial dividends. Yet the extended-term bullishness of one of the biggest industries in India is contradicted by the present on-ground realities. Demand is muted and most of the developers are suffering from poor liquidity positions. Amid such intensifying crisis, policy assistance in the types of reliefs, discounts and subsidies is believed to be a welcome step.
Commenting on the exact same, Ankit Kansal, Founder & MD, 360 Realtors, mentioned, “The Haryana government has taken a prudent step by granting relief on interest and other time-bound compliances for April and May. This will help the industry, which is floundering in the face of the crisis, to bounce back and return to normalcy soon. The developers can pass on the relief to the allottees and thereby build resilience across the value chain. Such models, although rare, can spur other states to adopt them, as a part of their overall relief & resilience-building action place.”
Meanwhile, “the government should also look into other crucial areas such as price control of raw materials (cement & steel), direct policy supports such as a cut in stamp duty, and special investment windows for real estate,” added Kansal.
Nayan Raheja, Executive Director, Raheja Developers, mentioned, “The penal interest will be eliminated under the zero-period policy, allowing builders to restructure their finances. In many circumstances, developers will pass on the equivalent benefits to their allottees, ensuring that end-user sufferings are also eased to some degree. Labour across sites had become demobilized and remobilized losing at least 3 months of work time in the process. RERA should also provide additional relief on completion dates of projects.”
Developers say the step taken by the Haryana government will need to be replicated in other regions of the nation as well for smooth functioning of the realty sector.
Kushagr Ansal, Director, Ansal Housing & President, CREDAI Haryana, mentioned, “Though this time lockdown was not as severe as last year’s, the challenges were still there. Various real estate bodies have already come together to voice their concern over the likely delays and funding issues. The step taken by the Haryana government should be replicated in other regions also to ensure that the realty sector can function smoothly.”