The outbreak of corona virus has impacted the real estate sector which was already lacks demand. Union Minister Nitin Gadkari on Wednesday exhorted real estate players to sell unsold housing units, even at no-profit-no-loss, to boost their liquidity condition and save interest cost on loans. Gadkari who holds MSME portfolios supported and advised the builders to send representatives to ministries of housing and finance as well as the Prime Minister’s Office (PMO) to suggest ways to deal with the present crisis.
In his address at a webinar organised by the National Real Estate Development Council (NAREDCO), Gadkari said that developers are sitting on huge inventories and they should sell flats at ‘no-profit, no-loss’ or whatever price they get for a liquidity boost and then move ahead.
“The real estate industry should adopt new technologies and reduce their construction cost which will help the sector to generate more demand and sell inventory at a low cost,” he added.
NAREDCO national President Niranjan Hiranandani said: “His suggestion about real estate developers also diversifying from plain residential real estate to infrastructure and new asset classes like warehousing, infrastructure, logistics to keep liquidity flowing and functional was a brilliant suggestion.”
Real estate sector was compared to automobile sector explaining how it has reduced cost and operate on benefitting from their customers. Nitin Gadkari If this strategy is put in use for real estate sector then clients are needed.
Central and State government are taking interest in boosting liquidity which will eventually lead them to negotiate with the builders. Suggestions from leaders came in to get under road construction projects or open own housing finance companies. But on the other hand builders are waiting for prices to go up to 35000-40000rs per sq.ft mainly in Mumbai.
There are plans to build townships on the Mumbai-Delhi corridor, Gadkari stated. He asked not to be greedy and book a price to sell off the housings and that they would receive premium sooner or later. This is the time to understand and boost liquidity in the sector as well as economy and sell it at no profit no loss price.