Commerce minister asks developers to sell properties at reduced rates
The Union Minister of Commerce & Industry Piyush Goyal has asked real estate developers to reduce prices and sell their inventory rather than wait for the market to bounce back.
“If any of you feel that government will be able to finance in such a way that you will be able to hold longer and wait for the market to improve; the market is not improving in a hurry. Things are seriously stressed and your best bet is to sell,” Goyal said in a video conference organised by developers’ body NAREDCO.
The government is trying to offer some concession in ready reckoner rates, but regardless of that happening, the minister suggested that developers will have to sell their stock. Goyal reminded developers that those who had sold the inventory, were less leveraged or had repaid their bank loans had survived the downturn, while those who were saddled with large loans and held on to their pricing had suffered.
According to the minister, developers will have to make a choice whether to be stuck with inventory and default with the banks or they could move the inventory and look at it as a bad decision or an unfortunate situation and move forward.
Among various measures announced by the government, it has so far allowed 6-month extension in completion timelines for realty projects and has extended the credit linked subsidy scheme (CLSS) for Middle Income Group (MIG) by one more year until March 2021.
It has also advised states, union territories to extend time-bound realty permissions validity by 9 months.
Apart from reducing policy rates, the Reserve Bank of India (RBI) has so far allowed a moratorium of total 6 months on payment of all loan and interest installments.
June 04, 2020