The real estate sector in India is among the largest contributing sector in the country’s GDP. Despite having a immense potential, the sector continues to face various challenges effecting growth, transparency and buyer confidence. From regulatory hurdles to financial constraints, this sector has to come out oh these roadblocks to ensure sustainable growth.
1. Regulatory and Legal Compliances
While Real Estate Regulatory Act (RERA ACT) have been introduced lately to ensure transparency, many projects still faces approval delays because of very complex land acquisition processes and various clearances from different kind of government departments. This has showed adverse impact on project delivery and results in overall cost of the project sometimes making it unviable for the builder to continue resulting in complete halt.
2. High Construction Costs
Due to increase prices of raw materials such as cement, steel and labour costs the developer faces intense pressure on margins. These increase in cost sometimes passed on to the buyers, which in turn makes affordable housing impossible despite various government schemes like PMAY (Pradhan Mantri Awas Yojana).
3. Unsold Inventory and Demand Supply Gap
Large number of urban markets faces issues of unsold inventories because developer largely focusses on luxury segment but maximum customers belong to Mid-income and affordable housing segments. This results in supply demand mismatch and then piling up of unsold inventory.
4. Infrastructure and Connectivity Challenges
This is one of the major challenges which developer faces. There are large number of residential and commercial projects were launched in the areas having inadequate road network and infrastructure development but failed even after having a attractive prices. As buyer avoid places which do not have good infrastructure.
5. Cash Flow and Liquidity Issues
The real estate projects require significant amount of investment but due to various factors like restricted lending from banks, delayed payments from buyers and unsold inventories results in cash crunch. This results in various projects getting stalled at various stages.
6. Trust Issues Between Buyers and Developers
This is an historic issue wherein the country has seen a great amount of trust deficit between buyers and developers. Delayed project and unfulfilled promises has given rise to this problem. However, RERA has been introduced to dela with this issue but the work is still in progress.
7. Taxation Policy
Various kinds of taxes like GST, TDS, Registration Fees and stamp duty puts excess burden on buyers. Developers have to face frequent policy revisions which in turn impact their long-term planning.
Conclusion
The country’s real estate sector has a great potential to play a vital role in economic growth and urban development. However, at the same time it has to overcome the challenges such as regulatory delays, financial issues, unsold inventory, and buyer-developer trust deficit. By having a continuous reform, Technology adoption and focus on affordable housing, this sector can achieve the stability and regain buyer trust.
Disclaimer
The information provided in this article is for general awareness and informational purposes only. Project details such as pricing, availability, possession timelines, and amenities are subject to change by the respective developers. Buyers are strongly advised to verify RERA registration, legal clearances, updated pricing, and actual site conditions before making any investment decision. This article does not constitute financial or legal advice.
