Tag Archives: Kumar Developers

The glass is still half full, but there is hope-I

Posted on by Track2Realty

By: Lalitkumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: The real estate sector is of strategic economic importance to India, as it is the second largest employment generator after agriculture and contributes about six per cent to India’s GDP. The sector with its backward and forward linkages to 250 ancillary industries has the potential to generate significant employment opportunities and provide a quantum jump to the Indian economy. Accelerating the growth in the sector can help turn-around the sluggish GDP growth witnessed in the last few years.

India would require about 11 crore housing units on a pan India basis by 2022. A demographic trend suggests that India is on the verge of large scale urbanisation over the next few decades. With more than one crore population getting added to urban areas, India’s urban population is expected to reach about 81 crore by 2050. Housing, a basic need for humans, could play an important role in accommodating high urban growth in India.

As per studies conducted by the Ministry of Rural Development and the Ministry of Housing and Urban Poverty Alleviation, it is estimated that almost a quarter of Indian families lack adequate housing facility. Housing in India varies significantly and can reflect the socio-economic mix of its vast population. In the last decade, there has been tremendous growth in the country’s housing sector, along with demographic changes, rise in income, growth in the number of nuclear families, and urbanisation.

Several issues affect the housing market such as absence of an effective policy framework for Economically Weaker Section (EWS) and Lower Income Group (LIG) housing, which is compounded with rising land cost, spiralling construction cost, and inadequate availability and reach of micro-finance measures. Every developer goes through a long gestation period of six to eight years of housing projects, accentuated by multiple approvals to be obtained from multiple authorities in a two to three years time frame.

Contrary to the general perception, developers wish to participate in large scale affordable housing construction; provided the government takes pro-active steps. Currently and in past the respective governments have taken piece meal actions which will not help the sector much. There are reports on record of government appointed committee on affordable housing. Now government needs to act.

Major concerns are lack of coordination between central and state ministries, regulatory reforms with a view to substantially increase the housing development capacity with respect to construction capability, labour availability, construction material, and housing affordability. Inadequate long-term funding across the project life cycle necessitating multiple rounds of funding for the same project has increased the cost of capital and time.

Further, the funding is not available for acquiring of land from banking sources. Rationalize multiple fees and taxes across project a stage which inflates construction cost by 30 to 35 per cent. High rate of migration from rural areas is stressing the limited urban infrastructure; sub-optimal usage of urban land (low FAR/FSI) has resulted in raising the cost per unit of built-up area.

Prioritise affordable housing, REIT and SEZ

Posted on by Track2Realty

By: Lalit Kumar Jain, CREDAI Chairman

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty: The alarm on a tough upcoming budget was sounded when the newly elected Prime Minister said that “time has come to take tough decisions in the interest of the nation. Prime Minister Narendra Modi is taking all due measures towards his vision of a ‘Shresht Bharat’, amidst some calibrated tough measures.

The recent rail hike announced by the government has shaken up the struggling real estate industry, as this will result in an increase in cost of raw material and developers will not able to increase property prices as the industry is already going through tough time. The sales have come down, home loans numbers are dropping, cash crunch is delaying the deliveries.

BJP manifesto talks of home for all by 2022. It is 6 trillion dollar requirement to service the housing deficit of 18.8 million housing shortage in India. This will further require about one trillion dollars towards infrastructure to support this development.

This does not include current development of .8 trillion dollars per annum by private developers in India.  So the housing market itself can be average about 1.5 trillion dollars per annum (about the same or little less than entire GDP of India currently)for coming 7 years. Currently it is 8% of GDP.

This also means employing about 20 million additional man power. Beauty is that this sector can easily generate interest of domestic as well as foreign funding agencies in various forms.

Then what is holding it back?

Apathy! Intentional ignorance, stigma and lack of understanding this sector. Globally the housing growth is barometer of health of economy. But in India discouraging housing is the theme of banking regulator. Such is the attitude that ministers and senior officials don’t even call the Housing Industry association for regular consultation on budget or discussing Health of Economy.

Though we do not expect this government to do much in this budget due to time constraint and different priorities this time but I will fail in my duties if I do not say what needs to be done.

There are few key aspects that need to be considered by the new government.

Affordable Housing Policy in real estate is the need of the hour for the Indian Real Estate and the new government has a pivotal task in its hand to uplift the sector.

CREDAI as a real estate body suggests to the Finance Minister to implement recommendation of Task force of appointed by government.

Allow Tax (direct and indirect) concessions for affordable housing projects. Affordable housing to be treated as priority sector.

Presently, interest rates charged by the banks to developers and home buyers are at an all-time peak and need to be brought down. The interest rate at least for home buyers must be brought down below 7%. A reduction in the base rate (rate below which no banks can lend to the corporates or industries) is necessary to help banks lower their lending rates.

The Government should address these concerns in the budget, and this should be followed through by RBI in terms of easing the repo rates and relaxing other policy instruments such as the CRR, SLR, etc.to inject liquidity into the system. This is essential if the Indian economy’s key sectors such as manufacturing and real estate are to grow. 

There is a dire need for an industry status for the realty sector. The government is yet to consider it. Once industry status is granted, funding for the real estate projects will become easier and at lower interest rate. Banks will not hesitate to lend to the realty sector and this will also lead to faster completion of projects thus reducing property prices.

Another long pending issue in the sector is Single Window Clearance. Currently the approval process is very lengthy and takes around 1.5 yrs to 2 years for approval. Approval processes (single window clearance) to be simplified as the cost of delay in approval, adds further to customers spending by 25 to 40%. Gujarat has already implemented a single window clearance system which has given a boost to the sector in the state.

The Floor Space Index (FSI) or FAR rules were made decades ago. Changes need to be made in the Development Control Rules and higher FSI needs to be allotted to stabilize real estate rates. The current level of total tax component is 36 to 38% of sale value, which needs to be rationalized to make it affordable.

The budget document should support a proper REIT structure. If the long overdue in having a REIT structure is made it can generate almost 1 lakh crore worth equity replacing debt.

We suggest a special focus on rental housing to serve the needs of a huge section of the population that may not be in a position to immediately buy houses. Funds from global resources could also be invited for this. We call for special rental housing projects under the affordable segment, treating the expenditure as capital investment for long-term capital gains, exemption from Income Tax, Service Tax, VAT and Stamp Duty for rental housing. Even the rental income from these projects must be exempted from Income Tax as the indirect benefits are far too many.

Boost rental housing as well as commercial construction sector, accelerating growth and further reducing debt in India. The holding of large number of flats in affordable category for the purpose of renting out should have concessional tax regime.

For the economic growth of the country and the real estate sector government should encourage setting up of SEZ’s across country. SEZ has served its purpose giving boost to IT and manufacturing units. If our PM needs to make India a huge manufacturing hub, support to SEZ is inevitable.

Special Economic Zones (SEZ), once touted as tax/ duty free enclaves have lost their sheen due to withdrawal of Minimum Alternative Tax (MAT) and Dividend Distribution Tax (DDT) exemption. Investors in SEZs with a long term development vision are exploring avenues for exit or de notification. Restoring DDT and MAT benefits could help in salvaging SEZs.

Currently there are multiple taxes being levied on home buyers. We request the government to remove service tax as it further puts burden on the home buyer making property unaffordable.

We expect the government to reboot the regulatory framework surrounding real estate and put a mechanism for fast-tracking the process of developing projects. This in turn would boost the confidence of stakeholders in the real estate industry.

We suggest for reducing FDI eligibility limit to 20,000 sq meter and capitalization limit to 1 million USD. Broader base of FDI investment will enhance foreign investment and will be able to retain the funds with larger % of success.

All in all the need is the due attention and respect for business of Real Estate Development which will bring the desired growth in economy and job market.

 

Great expectations from polls-II

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By: Lalit Kumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: With a vision to make India a housing surplus nation from being the housing shortage country, CREDAI has been campaigning to make the business environment congenial for growth. But the realty bill, in its current form and shape, stifles the honest developer and scares away new entrepreneurs from entering the sector.

How can you expect the industry to grow if you discourage it at all stages of business? We, developers have decided to say ‘No’ to corruption and not to bribe any officials. Many may have laughed at us since it is impossible to get things done in the existing system of the necessity to acquire multiple clearances with human interface at each and every step.

On the one hand, banks are discouraged to lend to real estate developers while on the other cost of funds from non-banking sources is prohibitively high. CREDAI has also volunteered to work with the Indian Banks Association on the proposed committee on housing sector which was mooted by the Finance Minister.

The current size of the real estate industry is estimated to be about 180 Billion USD with a CAGR of 18-20 per cent. For the past two years, however, liquidity in general and access to bank credits in particular has been restricted due to a variety of risks. Therefore, just as any other sector of the economy, the real estate sector has also found it difficult to tap bank resources and bank credits.

It estimated that out of the huge investment in the organized real estate industry funding by the commercial banks is negligible. Banks and finance companies are still wary of financing real estate sector as RBI always keeps it in the negative list. It is ironic that while home loans are a top priority, the home developers are not.

We do understand the concerns over prevailing high prices of houses. It is a typical egg-and-chicken scenario. The general sentiments in the market and the economy are preventing buyers to move and developers are unable to bring down the prices because of very high cost of construction.

The other key factors that add to the high cost of realty are the ever increasing local municipal taxes, ready-reckoner rates for deciding stamp duty, cess and even VAT. For instance in Mumbai, the financial and real estate capital, the burden on developers has risen on account of fungible area. The cost of labor has gone up by as high as 60 per cent over the past two years.

CREDAI pleaded for declaring housing as a priority sector at par with infrastructure and suggested that home loans be given at 7 per cent for the low income groups and economically weaker sections. Similarly, the margin money contribution for availing home loans should be reduced to 15 per cent from the prevailing 20 to 30 per cent. We suggested a rollover provision of loans to real estate. 

The NPA norms should also be modified to allow this accommodation by the banks, housing finance institutions and financial institutions. We also want removal of the disparity in risk weights. Risk weight assigned to real estate projects should be reduced at par with other industries for the purpose of credit-disbursal by banks.

Most importantly, we need mindset reforms and people at the helm must be willing to take decisions. Senseless procrastination must be done away with. For instance, the environment department has been just sitting on files for inexplicable reason. The department’s stubborn attitude has cost the developer community and ultimately the buyers as the delays have resulted in cost hikes.

With this background, we do hope that the new government that comes to power will look at the real estate industry as a priority sector since we the developer community meet the most important need–after food and clothing-of a human being. We need comprehensive and big ticket reforms and only a strong and decisive government can help save the nation from the current state of stagnation.

Great Expectations from polls-I

Posted on by Track2Realty

By: Lalit Kumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: Elections are part of a vibrant democracy. And like everyone else who is part of this democratic system, the developer community also pins hope on the upcoming elections. We are, in fact, watching all development with bated breath. We will keenly follow the five Assembly elections to be followed by the general elections of 2014 without any bias and in a totally unattached manner with no political affiliations whatsoever.

Now, let me come down to the brass tacks. For long, the real estate industry has been hit by policy paralysis at the Centre and the indecision on the part of many responsible departments. Whatever little positive developments that we witnessed at the Finance Ministry level, the negative mindset at other levels has plagued the housing industry. This happened, sadly though, despite all the lip sympathy that we got from the powers that be and promises with hollow slogans like ‘Housing for All’ and ‘Affordable Housing’.

We at CREDAI have been relentlessly battling on all fronts for a transparency in all deals but at the end of the day we got only a raw deal and one-sided policies. On the one hand the yawning gap between demand and supply for housing has gone up to 18.3 million, while on the other we have not witnessed any concrete steps to make housing affordable for the people in general. Worse still, real estate developers have been unfairly branded as breeders of black money as if we are the cause and effect of all evils and the rest of the world is full of holy cows!

Take the case of real estate reforms. The government came up with the Real Estate Regulatory Authority (RERA) that seeks to punish only errant developers for project delays and ignoring the wrong doings on the part of other stakeholders. We have no answers to questions like: who will take care of delays in project clearances? Who checks corruption at all levels of bureaucracy? What happens if buyers themselves delay or default payments? Then came the Land Acquisition Act that makes the cost of the most important ingredient of real estate and infrastructure prohibitive.

The half-baked reform agenda has failed to protect the interests of consumers taking into account all stakeholders, including the authorities. Much more could have been achieved without any controversy and even without incurring additional cost by focusing on the housing sector. CREDAI has over 8,000 members through 18 member associations, pan-India. We represent the voice of the industry, yet our viewpoint was ignored. We represented to the government that the regulatory bill was incomplete and even one-sided as it seeks to punish errant developers while ignoring the defaulting buyers and corrupt and procrastinating officials.

CREDAI has been relentlessly campaigning for all-round reforms especially administrative, land, fiscal, tax and banking reforms that will boost GDP growth, ensure transparency in clearances of housing projects and provide homes to all. We also suggested steps like single window system to eliminate human interface that breeds corruption and make funds available to both developers and buyers at reasonable and affordable rates of interest. The single window system of clearances that was already introduced in Punjab and other states like Karnataka and Andhra Pradesh are moving in that direction. It is time that the Centre also took initiative and drew guidelines for all States.

The reforms must also include provisions to punish officials who are either corrupt or just sit on files to draw a vicarious by inordinately delaying proposals from developers. For instance, the environment departments cause green terror by not approving proposals for months and years. We presented a ten-point action plan to rejuvenate the real estate sector, which will help the economy to grow at much faster rate since realty contributes to the growth of 200-plus other industries, including transport at every stage.

It does not require rocket science to realize that real estate is capital and labor intensive which makes it the largest employer after agriculture. We heard on the oft-repeated demand for reducing the housing prices. We at CREDAI have already appealed to our member developers to consider reducing the prices to the extent possible. On the issue of unsold stocks, we ourselves have asked member developers to start selling even at rock bottom prices. No prudent businessman likes to sit on unsold stock and we too have several constraints as the cost of construction has been zooming with no signs of any control and hence we urge to look into this issue seriously.

…to be continued

Realty weathering brand positioning challenges-III

Posted on by Track2Realty

By: Lalit Kumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: A McKinsey report to the Government of India on cost of approval had clearly pointed out that the costs incurred on account of various approvals could constitute anything up to 40 per cent of the sale value. Such is the enormity of the problem of approvals and that the challenge of negativity that we suffer from.

By the government’s own admission, the real estate sector in India constitutes about 11 per cent of the GDP and as former Finance Minister and now President of India Pranab Mukherjee said, “A large number of transactions in the real estate sector are not reported on account of very high levels of property transaction taxes, commonly in the form of stamp duty.”

To quote Mukherjee, “Investment in property is a common means of parking unaccounted money and a large number of transactions in real estate are not reported or are under-reported. This is mainly on account of very high levels of property transaction taxes, commonly in the form of stamp duty. High transaction taxes in property are one of the biggest impediments to the development of an efficient property market.”

That was well said. We sincerely hope that the government takes some positive steps. But the recent budgetary announcements have not brought any cheer to the sector to help it perform well. On the contrary, we witness a punish-the-builder attitude prevailing in the corridors of power.

We were extremely disappointed as the Finance Minister missed out on affordable and rental housing and banking reforms in his budget speech.

While we are happy that P Chidambaram accepted the suggestion for home loan interest incentives for sub-Rs 25 lakh buyers, we were expecting a lot more.

Project finance is yet another major problem and here the negative weightage given by the RBI to builders’ image (read brand). Our grouse with the Finance Minister is that he has not given any directions to the RBI.

Developers’ life would become much easier if we are given the infrastructure status and we are happy that Union Housing Minister Ajay Maken has supported this.

Revival of real estate is a must for rejuvenating the economy since the sector supports over 200 other industries. Every rupee invested in real estate sector, contributes to addition of 78 paise to GDP. Pompous it may sound. In other words, brand real estate contributes to brand India.

All talk about affordable housing, but we do precious little about achieving it. We have suggested workable means. The nation urgently needs to scale up the delivery of housing which can be achieved with the help of proven technology that can be imported from aboard.

The Finance Minister seems to have gone for revenue generation through the high tax route and not by the growth-oriented economy.

CREDAI has been campaigning for Special Housing Zones on lines of SEZ, but sadly there has been no movement on this. We strongly feel that the extension of facilities that are given to SEZ be granted to real estate and that could easily help in making affordable housing a reality.

At the end, can we sincerely hope that conditions that are conducive for conducting a business with honesty would be created by all concerned? No prudent developer wants to be in business to earn ill will!

Realty weathering brand positioning challenges-II

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By: Lalit Kumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: It is said that this sector encourages black money and corruption, which is sad and upsetting for all developers/entrepreneurs who put in their best efforts to run the business.

There are various critical issues in real estate development such as lack of industry status, inordinately long approval process, archaic rules and regulations, lack of affordable finance and inadequate land availability leading to high prices that hamper the credibility of the real estate sector.

One of the biggest problems that a developer faces today is on timely execution. And, this is where he gets into, not just one or two, but a host of troubles. Any delay, even if not in his control, tarnishes his image and the brand suffers.

The developer community and CREDAI have been pointing out that there are over 40 clearances that a developer is supposed to get which leads to human interaction with over 150 officials at various stages. Any delay at any stage obviously gives rise to greasing of palms as the developer is always anxious to finish his project in time and avoid delays.

Some recent developments do indicate that the government could be moving in the right direction of adopting a single window system for all real estate related clearances. Punjab has shown to the world that the single widow system can do wonders. Karnataka and Andhra may be heading in that direction. The reforms move can easily be rolled out in other States and Union Territories once the Centre issues guidelines.

We at CREDAI have suggested reforms in four key areas that impact the real estate – Administrative, Land, Tax and Banking. Experience in several countries has clearly demonstrated that real estate reforms have resulted in increased availability of housing stock that made prices stable, where as in India the serious issue of affordable housing has been reduced to a joke. Even government board built houses are beyond reach of the common man.

Real estate is a highly capital intensive industry and any delays would only add to the interest burden for developer who scrupulously tries to avoid it since the increased costs would lead to cut in is margins and rise in the cost for the customer. This again impacts the brand.

The other key factors that adversely affect the real estate sector are related to issues in land transactions, corruption related to approvals and license process, power in the hands of officials and threats to stop work, the political system and above all the taxation methodology. It is in this context that we appealed for the Prime Minister’s intervention to bring about a solution rather than indulging in a blame game.

…to be continued

Realty weathering brand positioning challenges-I

Posted on by Track2Realty

By: Lalit Kumar Jain, Chairman, CREDAI

Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty Exclusive: Brand building and maintaining the brand image is a big challenge for any business, and more so for in real estate where one has a direct contact with the end user. Moreover, brand positioning of the business of real estate is dependent on the overall eco system where demand and supply is dependent upon a host of external factors such as the state of the economy, government policies, etc.

Hence, the real estate industry is such an industry where brand building is a systemic, long-term process. Home buyers always invest in a brand which has been built after years of trust. And trust and goodwill are the basic elements on which the real estate sector in India runs. However, developers in India are finding that brand positioning has become a daunting task as the sector is marred by the image of being most corrupt.

The real estate sector in India has since time immemorial been embroiled in a fight of image. The sector is seen to be a breeding ground for black money and corruption. This is very sad as developers alone cannot be considered corrupt. They are basically victims of the system and not certainly any kind of beneficiaries.

While it is easy to create a poor perception and projection of the entire industry, my basic premise is will such a poor branding thrust upon the sector going to help anyone? After all, a house is not only the basic necessity of human beings, after food and water, but it is the costliest investment that an average Indian makes. One does not change houses as frequently as one changes cars or mobile phones.

Traditionally, Indians have a lot of emotional attachment to their houses which is why either you make or break your name with it. Just as a lot goes into buying a house, plenty goes into building a house. A committed and sincere developer literally puts his life into his real estate project, unless he is a fly-by-night operator.

Developers, therefore, are aware of the importance of meeting their commitments, meeting deadlines, maintaining quality and above all doing walk-the-talk which also means sticking to the promises made.

Theoretically, all this sounds very simple and straight. But in practice this becomes an insurmountable task. At the risk of being branded as a pessimist, I would like to stress that brand managers at developers’ offices have a daunting task in maintaining the image of their companies, give the current scenario of clutter and restrictions under which we operate.

…to be continued

CREDAI appeals for high power realty committee for major projects

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Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty: Citing the inordinate delay in obtaining approvals for projects that is stalling growth of the real estate sector and also the economy of the country, Lalit Kumar Jain, Chairman CREDAI and CMD, Kumar Urban development Ltd, urged the Union Government to form a high power realty committee to accelerate big ticket realty projects worth between Rs.200 Cr and Rs.1000 Cr.

Real estate projects with investments above Rs. 1000 Cr. have been routinely facing inordinate delay in securing approvals. This hurdle has been created by the Central Government’s directive which makes it mandatory for all developers to obtain an environment clearance certificate before launching projects.

Jain said the government could appoint a high level committee for realty sector on the lines of the Steering Committee for infrastructure projects worth over Rs 1,000.

He pointed out that the delay in obtaining environment clearance for big ticket real estate projects has become a major deterrent for developers. For instance, in Maharashtra alone, more than 1,200 proposals with an estimated investment of over Rs. 1 lakh crore are stuck in EIA (Environmental Impact Assessment) clearance.

“Although the Government has issued a circular to clear such projects in a time bound manner, it is taking more than 17–18 months to obtain approvals. This delay not only affects the real estate market but also the GDP of the country. Government’s own data shows that real estate contributes 6.3% to GDP,” he said.

Jain said that many real estate projects are stuck for the want of clarity or SOP (Standard Operating Procedure). For instance, a high rise committee has been absent in Pune for last one year. Similar issues exist across the country.

CREDAI had earlier submitted a workable plan to the state government to initiate realty reforms like single window clearance and online approvals. Online approvals and single window clearances will significantly reduce the housing cost as the approvals will be faster. It will also reduce red-tapism, which has been a huge obstacle to clear approvals on time.

A high power committee meant exclusively to expedite real estate projects will also help in bringing about much-needed transparency in the industry. Jain explained that all four pillars of democracy need to work in tandem to generate efficiency in the system and promote economic growth.

Jain urged that the government should plead with courts not to obstruct growth under the garb of non transparent practices, but provide guidelines that will create SOP to develop an efficient and transparent system. If this would have been the objective in steel, coal, 2G and sand mining, then India’s economic story would be different.

CREDAI threatens to move court against NGT sand mining ban

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Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty: Describing the National Green Tribunal (NGT) populist ban in sand mining as arbitrary and anti growth , developer’s apex body CREDAI Chairman Lalit Kumar Jain has threatened that the developer community is considering appropriate legal options to challenge the order.  The nationwide stay on sand mining from river beds by the NGT adds to the ever increasing burden on the real estate industry.

Jain said it is shocking that NGT thinks sand mining causes floods in rivers. Silting, on the contrary, allows free flow of rivers and prevents floods.

“Sand is one of the most essential inputs for any construction. Planners, while issuing building permissions must also assess the requirement of material like sand or metal. The ban might serve the populist purpose, but it is a retrograde move as it harms the nation’s growth,” he said.

“I do not think it is proper for any authority to pass orders without giving opportunity to concerned parties like the developer community. The ban will also increase result in sand smuggling add to the growth of sand mafia, instead curbing it. One most important point that one has to remember is that plaster quality particularly in urban areas and coastal cities like Mumbai is worsening by the day because of non availability of quality river sand. It is common knowledge that the use of sand mine with mud and pollutants from the creek are adversely affecting the quality of construction,” he added.

It is also responsibility of the district collectors to issue permission for sand mining to match the requirement of the construction industry, for which they issue certificates. The ban will lead to delays in project completion, thereby increasing the cost by threefold as it will have to be imported from countries such as Pakistan and Cambodia to bridge the shortfall in supplies.

Besides realty sector, sand is an important ingredient in infrastructure projects like mass rapid transit systems and metro projects. It is also a primary constituent in core sector projects such as power plants.

He said as it is the industry unduly burdened with the huge increase in sand prices over the past three years. Instead of forcefully banning, the government must focus on finding alternative solutions in the nation’s interest.

Real Estate Regulatory Bill may become breeding ground of corruption: CREDAI

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Lalit Kumar Jain, Kumar Developers, Delhi NCR real estate, Bangalore Real Estate, JLLM, Jones Lang LaSalle Meghraj, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.comIndiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India Property, Track2Media, Track2Realty, ravi sinha, india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, KP Singh, DLF, Unitech, Emaar MGF, ndtv.com, ndtv, aajtak, zee news, india news, property news, real estate news, 99acres.com, 99 acres, indianrealtynews.com, indianrealestateforum.com, Indiabulls real estate, BSE, Bombay Stock Exchange, Mumbai Real Estate, India PropertyTrack2Realty: CREDAI has raised apprehensions that the the Real Estate Regulatory Bill approved by the Union Cabinet CREDAI has expressed fear that it could encourage corruption instead of curtailing the social menace.

CREDAI Chairman Lalit Kumar Jain expressed his views on the subject based on the press release from the Union Cabinet and added that he would provide detailed observation after receiving the draft legislation.

Jain said the real estate sector definitely needs a regulator on the lines of the one controlling telecom, banking, stock markets and insurance sectors.

He lauded the intent of the Housing Minister but said that the discretionary powers for registering or deregistering projects and adjudication by a bureaucrat could become breeding grounds for corruption. Moreover, the provision for criminal prosecution of developers could lead to the exit of professional and qualified developers.

“Our fear is that those with expertise to handle political influencers will only survive, thus leaving the all important industry in the hands of corrupt people,” Jain said and called for regulator covering all stakeholders like defaulting customers, the approving authorities and financial institutions that fund projects.

“How can anyone blame the developer if a project is held up due to approval delays or funds for that matter?” he asked.

“CREDAI has worked hard to advise the ministry to come out with appropriate comprehensive Bill with teeth to direct all stakeholders including approving authorities which will protect consumers while enhancing quality environment for the business,” he pointed out. Otherwise it will be an added establishment with huge costs, serving no purpose other than adding cost, thereby making tenements costlier.

Jain welcomed the statement of Ajay Maken, Union Minister for Housing and Urban Poverty Alleviation, that the Bill provides for a uniform regulatory environment to protect consumer interests, help speedy adjudication of disputes and ensure orderly growth of the real estate sector.

“Also, the promotional role of the proposed Regulator like standardization in the sector carpet area, checking money trail and curbing money laundering, professionalism and promoting planned development are music to our ears,” he quipped.

On the provision in the Bill for mandatory deposit of 70% of the cost in an escrow account, Jain pointed out, “This is impractical.”

The construction cost of the project varies in different markets. For instance, in micro markets as in prime areas, the cost of construction may be around 30% where as in suburban areas it could be a high at 80% of the entire cost elements. The provision should be based on the ratio of the extent of the construction cost so as to ensure timely completion of projects, and prevent fund diversion.

Otherwise, the growth in the sector will get arrested as the reality of the day is that funding for land purchase is just not available from banks, thanks to the negative weightage given by the RBI for real estate finance.

He explained that the Bill provides for a speedy and specialized adjudication mechanism to settle disputes by an officer of the rank of joint secretary. This is also not practical since the judicial process is a specialized task and hence an expert of the field only can redress the disputes. Or, it should be left to a judicial officer and not bureaucrats, in any case, who may be influenced by higher-ups or corruption.

The Bill should have aimed at catalyzing domestic and foreign investment into the real estate, thereby contributing to enhance economic activity and increase in GDP growth. Sadly, this is missing, Jain added.

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