The Confederation of Real Estate Developers’ Associations of India will survey the number of partially completed projects across cities.
It will submit the list to D. K. Mittal, Union Financial Services Secretary.
This follows a series of meetings that the developers’ body had with the Secretary and chairpersons of banks.
Mittal told commercial banks to focus on funding partially completed projects and development of projects in small towns on a priority basis, according to the realty body. Mittal has also asked Credai to survey unsold housing stock in cities in batches so that a decision would be taken on unlocking their value.
The Secretary presided over a joint meeting of the Indian Bankers Association and Credai office-bearers here at SBI on Monday.
The meeting was called to understand the problems faced by developers in funding of projects. Apart from SBI, banks such as HDFC, NHB and Bank of Baroda participated in the consultative meet, Credai said.
Addressing the media, Lalit Kumar Jain, National President of Credai said, “All bankers more or less agreed that besides banking, other factors such as project approval delays, land availability and even FSI restrictions should be addressed.”
The survey will be entrusted to a reputed agency to ensure accuracy of the findings, he said. Jain said bankers also felt that the approval process should be speeded up by sensitising the states.
Restructuring debt
On the issue of restructuring the realty debt, it was felt that it has to be addressed by RBI, the banking sector regulator.
Bankers also insisted on the ‘one-project one-bank’ norm and opening of escrow accounts. In metro cities, the developers should have one lead banker, he said.
Jain also reiterated Credai’s suggestion to reduce the rate of interest on home loans to seven per cent in order to boost demand. All other expenses, such as stamp duty and taxes, should be added to the overall cost of project and buyers should be funded up to 90 per cent of the total cost.
Further, real estate project funding should be at 10 per cent interest rate and not at 15.5 per cent. The risk weightage of 1.25 given to real estate should also be reduced, he added.
shanker.s@thehindu.co.in