Put self-regulation mechanism in place: VP to real estate sector

| | New Delhi
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Put self-regulation mechanism in place: VP to real estate sector

Friday, 15 February 2019 | PNS | New Delhi

Expressing concern that the real estate sector had recently come under severe scrutiny by the Apex court and statutory Consumer rights bodies due to some unethical practices followed by certain players, Vice President M Venkaiah Naidu on Thursday called upon the industry bodies to institutionalise a code conduct and a self regulation mechanism to curb unethical practices in the segment.

Addressing the young entrepreneurs and professionals at the 3rd YouthCon organized by realtor’s body CREDAI here, Naidu pointed out that the sector had come under severe scrutiny by the apex court and statutory consumer rights bodies due to some unethical practices followed by certain players.

Naidu said that the growing NPA in real estate had not only affected banks but also dried up bank loans to the sector from 63 per cent in 2013 to 17 per cent in 2016, thereby accentuating the stress.

“You owe as much to your customers and the workers as you do to creditors and suppliers. More than financial viability, it is social obligation and trust that is at stake”, he said.

Quoting the recent report of CAG on real estate sector, the Vice President said that 95 per cent of the real estate developers, builders and agents did not have mandatory PAN. He also pointed to surveys from the sources like CREDAI and RERA and said that out of around 3000 entities surveyed; more than 500 didn’t file Income Tax Returns.

Saying that the CAG report must be the point of reference, Naidu wanted the industry to promote digital transactions and enhance transparency and ethical facet of the sector.

Considering that the real estate sector contributes 7.9 per cent to the GDP of the country and provides employment to more than 50 million people, he said that a transparent and predictable regulatory regime was essential to strengthen the real estate market by creating greater confidence in the consumers.

Naidu said that the sector was essential for healthy, inclusive and equitable growth of the economy. The Vice President added that programmes like AMRUT, HRIDAY and the pioneering initiatives like 100 Smart Cities, Housing for all by 2022 and PMAY present a great opportunity for the sector.

He wanted organisations like the CREDAI to take lead in imparting the skill-sets required for new employment opportunities.

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