Amidst coronavirus outbreak, the realty players have appealed to the Centre to provide relief to the cash strapped industry to stay afloat.
Confederation of Real Estate Developers' Associations of India (CREDAI) has called for relief in interest and principal repayments falling due over the next 3 months, relaxation in special mention account criteria, waiver of penal interest, COVID 19 force majeure under section 6 of RERA and reprieve on coercive measures for tax collection.
This is necessary as the sales velocity and the receivables were hit drastically leading to default/delay in fulfilling financial commitments and the falling stock prices have forced buyers to skip installments payable on their purchases of real estate.
CREDAI in its representation to the Centre further said that the construction work has come to a standstill and delays in procurement/delivery of construction material and labour disruptions will cause delay in completion of ongoing projects.
CREDAI representative told FPJ,'' The Centre needs to put off all interest and principle repayments falling due over the next three months and recover it over the next nine months. The penal interest charged by banks and financial institutions need to be suspended for a period of one year or until such time as it takes for the pandemic to abate.''
He said the Centre needs to instruct banks and financial institutions to provide additional funds for real estate projects to meet the enhanced cost of material and slow pace construction work.
Further, CREDAI has urged the Centre to issue an advisory to the Real Estate Regulatory Authorities in the state to extend the time of completion of real estate projects and exempt the penal charges for a period of one yer. COVID-19 should be included as ''force majeure'' under section 6 of the Real Estate (Regulation & Development) Act.
Further, the realty players has appealed to the Centre that coercive measures for tax collection involving raids and surveys without any basis be kept in abeyance for a period of three months to enable the sector to deal with the COVID 19 crisis.