The Indian Real Estate & Construction sector has ever since been one of the most magnanimous fabrics of the India Inc. However, the sector has seen crippled times in the recent past where it went through a serious crunch of a major reputational loss from all corners. Right from the developers’ end to the consumer, there have been sagas of mistrust and gloomy times all across. But was that all that the sector could have in its fate that is expected to touch US$ 180 billion by 2020?
Thankfully, the answer is No.
Let us not forget the era of 100 Smart Cities and the visionary to make Housing for All possible by 2022 has just begun and no way would this be achievable without the sector getting back to shape.
The recently announced Real Estate & Regulation & Development Act 2016 brings in a perfect recall what the sector had probably forgotten – Consumer is the King and will always remain so. It so much so means that the sector will see a paradigm shift from a seller driven market to a buyer driven one.
While the act empowers you and me as consumers but how far has the act been a good piece of news for the developers? While the sector may be thankful to finally come out of a regulatory orphanage but does the new regulatory facia mean good for the sector? Will the proposed Tribunal lessen or add furthermore to the cumbersome processes the sector has ever since been going through in terms of legal and regulatory hassles?
Yet another pain point that the sector has been weening through is the financial crunch. With massive land banks in place and projects underway construction, there has been a vicious situation that the developers have been amazed with. Lack of funds, poor financial management, discouraging response from foreign investment community, loss of consumer’s interest have been some of the reasons behind.
Nevertheless, there a sea of change in the business environment keeping in mind recent consolidations and regulatory changes that the government has introduced. Right from FDI to REITS the MAKE IN INDIA led governance campaign seems to be backed up with friendly moves in the practical sense as well. India has now become a more investor friendly market as far real estate is concerned. But will the sector be able to maintain the transparency and accountability it needs.
While the canvas is painted with the right blend of colours now, one can’t ignore the unaddressed issues and challenges that the Real Estate sector is still looking forward to be heard soon. Here are some of the many;
While there are whipping penalties on project delays but yet no sign of relief or commitment on the delay in approvals and seeking clearances. On one hand we see floodgates opened up for foreign investments, but on other hand lock of funds with rules like 70% parking funds. The centre – state conflicts have already begun over RERA and related aspects, developers still seek clarity on which way would they need to go.
It is such and many other cross roads that The Indian Real Estate Sector is at amidst a mix of positives and negatives. The Lex Witness 5th Annual Edition of The Real Estate & Construction Legal Summit 2016 scheduled for 27th May 2016, Le Meridien, New Delhi brings together various stakeholders of the governance and legal machinery of the country to see how best the existing challenges can be tackled with and foster the growth within the sector.