Govt buy our unsold flats
Buy Our Unsold Flats At Current Rates: Squeezed Realtors To Ask Govt
In the first of its kind bailout demand, real-estate companies are planning to ask the Government to buy out their unsold flats at current market prices and sell these at a later date. The proposal floated by one of the big Delhi-headquartered and listed real-estate companies is one of the many ideas to be hard sold at the Planning Commission tomorrow.
A real estate company's chairman and managing director who did not wish to be quoted told The
Indian Express, "We will discuss this tomorrow with Planning Commission Deputy Chairman Montek Singh Ahluwalia." He, however, did not disclose the inventory position of the large firms in India.
According to Jaskirat Singh, owner of Delhi-based real estate broking firm Grand Real Estates, about 30-45 per cent of properties worth Rs 50 lakh and above launched over the last six months remain unsold for DLF and Unitech. In the case of Omaxe, it is 25-30 per cent, he said. These companies do not disclose their ready but unsold assets.
When contacted, a promoter of another leading Delhi-based and listed developer said this was not the only proposal on the table to bail out the sector. "We want states to enter into joint ventures with big real-estate players by offering land as equity. State-owned banks must also be directed to start disbursing home loans now that they do not have a problem of funds," he said.
To boost consumer demand and give a fresh stimulus to the sector, the companies are also seeking a further cut in interest rates on home loans. "It should be slashed to 6 per cent for loans up to Rs 5 lakh and to 7-7.5 per cent for loans up to Rs 30 lakh. What the public sector banks have done is grossly inadequate," a developer said. Tax incentives to home buyers must be enhanced and rental income be made tax-free to incentivise purchases, he added.
Stung by the liquidity crisis, real estate companies also want the Reserve Bank of India to refinance the cash gap in existing projects. Most companies are borrowing at rates over 20-22 per cent to complete ongoing projects. "But, now, loans from banks have virtually dried up," a promoter said.
Source: Indian Express 17,Dec/2008
In the first of its kind bailout demand, real-estate companies are planning to ask the Government to buy out their unsold flats at current market prices and sell these at a later date. The proposal floated by one of the big Delhi-headquartered and listed real-estate companies is one of the many ideas to be hard sold at the Planning Commission tomorrow.
A real estate company's chairman and managing director who did not wish to be quoted told The
Indian Express, "We will discuss this tomorrow with Planning Commission Deputy Chairman Montek Singh Ahluwalia." He, however, did not disclose the inventory position of the large firms in India.
According to Jaskirat Singh, owner of Delhi-based real estate broking firm Grand Real Estates, about 30-45 per cent of properties worth Rs 50 lakh and above launched over the last six months remain unsold for DLF and Unitech. In the case of Omaxe, it is 25-30 per cent, he said. These companies do not disclose their ready but unsold assets.
When contacted, a promoter of another leading Delhi-based and listed developer said this was not the only proposal on the table to bail out the sector. "We want states to enter into joint ventures with big real-estate players by offering land as equity. State-owned banks must also be directed to start disbursing home loans now that they do not have a problem of funds," he said.
To boost consumer demand and give a fresh stimulus to the sector, the companies are also seeking a further cut in interest rates on home loans. "It should be slashed to 6 per cent for loans up to Rs 5 lakh and to 7-7.5 per cent for loans up to Rs 30 lakh. What the public sector banks have done is grossly inadequate," a developer said. Tax incentives to home buyers must be enhanced and rental income be made tax-free to incentivise purchases, he added.
Stung by the liquidity crisis, real estate companies also want the Reserve Bank of India to refinance the cash gap in existing projects. Most companies are borrowing at rates over 20-22 per cent to complete ongoing projects. "But, now, loans from banks have virtually dried up," a promoter said.
Source: Indian Express 17,Dec/2008