Realty sector welcomes stimulus for stalled projects, but says more needed to boost demand

To provide relief to aggrieved homebuyers, the government will set up a special window to provide last mile funding for housing projects which are non-NPA and non-NCLT in the affordable and middle-income category. Here are the reactions to governments decision.

New Delhi: The government's decision to set up a Rs 20,000 crore stressed assets fund for those residential projects that are non-NPA and not under NCLT will provide relief to lakhs of homebuyers, but it should have done more to boost housing demand, property developers and consultants said on Saturday.

They ruled that the government has not adequately addressed the issue of demand slowdown and lower sales. Builders were also hoping for an increase in the price cap of affordable housing to beyond Rs 45 lakh.

To provide relief to aggrieved homebuyers, the government will set up a special window to provide last mile funding for housing projects which are non-NPA and non-NCLT in the affordable and middle-income category. In the fund, Rs 10,000 crore will be contributed by the central government and roughly the same amount will come from outside investors.

NAREDCO President Niranjan Hiranandani said the announcement of Rs 20,000 crore fund is a welcome step as it will ensure completion of many affordable and MIG projects stuck because of last-mile funding requirements.

On the rider that this fund will cater to only non-NCLT and non-NPA projects, he said this announcement will not solve the problem of delayed/ stalled projects and affected home seekers in locations like Delhi-NCR.

"Announcement made by the honourable Finance minister is too little and too late. Actually, we were expecting a big boost for the industry. The Central Government and all the government are interested in housing for all by 2022, if that has to be inforced and actually going through the cyclical action that is taking place in the real estate market we are seeing a little bit of pick up in the industry and this is the time we need a lot of stressed assets to be managed," Bengaluru CREDAI Chairman Suresh Hari said.

Suresh Krishnan, President-Elect Tamil Nadu CREDAI said even tough Nirmala Sitharaman has given 10,000 crore for completion of the project they have also put two conditions. One is they should not be NPA and the other is that in non of the case there should be NCLT.

He further added that most of the affected projects at least 50 per cent of the projects are underline. So in order to help, there is a need to reschedule it.