Developers are hoping this week’s announcement will bring some relief.
Rajeev Talwar, chief executive officer (CEO) at DLF, said the risk weight attached to loans to affordable housing projects has to be commensurate with priority sector loans. The risk weight attached to real estate sector loans should not exceed 100 per cent. “Banks should fund all the components of real estate projects, including premiums, approval costs, the construction costs, and so on,” Talwar said, adding last-mile funding to developers may be provided through National Infrastructure Investment Fund.
Niranjan Hiranandani, chairman of Hiranandani Communities, said, “Stressed assets need funds for completion. There should be some arrangement for funds which can be used to complete projects.” If projects are completed, buyers will also get delivery of their apartments, he said.
Hiranandani said the cap of Rs 45 lakh is not adequate for affordable housing and not many buyers are benefitting out of it.
J C Sharma, vice-chairman of Bengaluru-based Sobha, said the definition of affordable housing should be simplified and uniform. “There are many definitions for affordable housing — house values should be of Rs 45 lakh and sizes should be 60 metres. It should be simplified,” Sharma said.
He also said there should be uniformity in GST
rates for housing. “The good thing is that the government understands that problem exits and trying to find out solutions,” Sharma said.
Kamal Singal, managing director and CEO, Arvind SmartSpaces, said the government has to bring certain GST
rates on some of the raw materials down. “One of the important raw materials (in realty sector) is cement, where GST
rates are very high. It needs to be brought down to 5 per cent. Apart from cement, other raw materials need to be brought down to around 12 per cent. Since now there is no credit available, the entire burden of GST is surging cost of production,” he said. The other thing on Singal’s wish-list is GST on rentals. "If leasing has to be de-bottlenecked, the 18 per cent GST on lease rentals is very high and needs to lowered too."