NASHIK: The Confederation of Real Estate Developers' Association of India (CREDAI), Nashik will seek the government to reduce taxes and speed up the building plan approval and environment clearance process to make housing affordable, in the backdrop of RBI governor Raghuram Rajan advising builders to reduce rates of unsold flats the real estate sector.
The CREDAI has decided to approach chief minister Devendra Fadnavis in the next couple of weeks to urge him to take some measures for affordable housing. The association's decision comes following RBI governor Raghuram Rajan's advice to the builders to reduce rates of their unsold flats during a banking workshop held in Mumbai on Thursday.
Speaking to TOI, president of CREDAI, Nashik, Jayesh Thakkar said, "The RBI governor had recently advised builders to reduce the rates of unsold flats to boost the real estate sector, which is already facing recession for the past few years. The prices of cement, steel and other materials have increased a lot in the past few years. But instead of increasing the rates, we have already reduced the rates of flats by 10% to 20%, so far. Our profession will be at stake if we reduce the rates further. The central and the state governments have set a target of housing for all by 2022, but it will not be possible unless the government takes some efforts to speed up housing projects and reduce taxation."
He further said, "There is a need to speed up the building plan approval and environment clearance process. The building plan approval process takes more than four months, while environment clearance process takes a year or two. Delay in projects also leads to increase in their cost. The burden obviously goes on the consumers. Moreover, there is need to reduce the rate of interests for housing from the present 9.50% to 8% in the interest of the consumers. Moreover, we have to pay up to 14.5% in the form of various taxes like 5% stamp duty, 1% surcharge under Local Body Tax, 1% labour cess, 3.5% service tax, 1% Value Added Tax and 2% development charges, which leads to rise in property prices. Hence, the government needs to reduce taxation and speed up the building plan approval and environment clearance process if it really wants affordable housing. We have decided to approach CM Fadnavis in next couple of weeks for the purpose."
The CREDAI Nashik is also preparing a presentation on the measures needed by the government to boost affordable housing. Thakkar added, "The presentation on affordable housing is to be given to the CM during our meeting with him."