The Confederation of Real Estate Developers’ Association of India (Credai), the apex body for private real estate developers in India, today wanted the Government to consider reduction in interest rates to put growth and demand on a fast track and develop the housing sector.

It said this has been completely ignored by the successive governments.

C Shekar Reddy, President, Credai National, in a statement, said: “We at Credai appreciate the positive step taken by RBI to reduce SLR by 50 bps, which will release a liquidity of Rs 39,000 crore for the banks. We understand the central bank’s priority to fight inflation and bring it down. However, at the same time, the real estate industry also awaits proactive measures to stimulate the home purchase by bringing down the home loan rate. We hope to see reduction in rates going forward.”

“During the recent meeting with M. Venkaiah Naidu, Union Minister for Urban Development, Housing and Urban Poverty Alleviation, we sought support in awarding the infrastructure status to affordable housing, providing added incentives and tax reduction to the industry and home buyers, besides easing the norms for FDI in real estate sector,” he said.

Cut in home loan rates

The Government has been urged to take proactive steps to reduce the home loan rate to 7-7.5 per cent to stimulate the demand for housing and boost economic growth and job creation.

“To fulfill the requirement of pucca housing for all which requires about 30 million dwelling units by 2022, we hope the government and RBI work in tandem with policies to support growth and cheaper funding to the sector,” Shekar Reddy said.

The housing sector is poised to grow manifold in the next decade-and-a-half and will require a capital investment of about $1.2 trillion.

The RBI should liberalise the norms, increase the lending to the real estate sector in line with the global exposure of 24-32 per cent compared to the present 12 per cent and lower the interest rates so that this sector with the high multiplier effect can propel the economy to double-digit GDP growth.

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