The slowdown in the real estate sector for past few years has a lot to do with the trust deficit that has been created in the country and even many genuine end-users are waiting for the current dust to settle in the industry. There has been enough muck floating around with many builders delaying their projects. The news of buyers having to service the home loan and also pay rents simultaneously in delayed projects have dampened the mood in the country for purchase of property. There are many people who are undergoing this travail after investing the savings of their entire lives and yet there is no sign of delivery of their purchased property. There are sufferers in almost all parts of country in towns big and small.
Then there are several cases where the builder is not even traceable after taking money from the buyers. Such instances have further weakened sentiments in the property market. Until a proper mechanism is found that ensures timely possession of the purchased properties and the buyers are assured that the builder will not vanish, buyers may continue to choose to stay from buying under construction property.
The builders siphoning off money from the buyers to offshore entities and shell companies and making the actual buyers suffer is instilling little confidence among the customers. The current rate at which regulatory intervention is required in lapses by the real estate companies is only adding to the sentiments where the buyers are preferring to postpone their purchase.
There are several cases where even banks seems to have colluded with builders and given home loans to the people without carrying out due diligence of the project. The addition of the list of stakeholders of the industry which are now considered dubious is not helping the matters. This will only derail the recovery in the real estate industry that many are hoping for.
Then the construction quality of a number of builders is also adding to the woes of the customers who do get possession. This is causing whole lot of others to be wary of the purchases. A suitable check-system has to be put in place that will ensure the buyers that they will get a house of reasonable quality and there will be requisite safety for them and their families.
Along with the builders, the government and the judiciary will have a play a big role in building the road to recovery. The government has just formed a stress fund to bail out projects which are stuck but are more than half complete. But the government has to do lot more. It has to ensure proper administration in the real estate industry. Even RERA authorities need much more powers they currently have to take builders to task who do not keep their promises. Prevention of benami transactions, digitisation of old property records, making Adhar card mandatory for sale-purchase of property and bringing transparency in the real estate transactions are all responsibilities of the government and will pave the way for a vibrant market.