The arrival of Real Estate Bill was great relief for real estate sector. Home buyers, who were worried about the delays and project completion, are now considerably attracted towards home buying. With measures to promote transparency and bringing accountability are lined up, the builders are also facing the heat. Time has arrived for builders to prove their credibility and support towards the new bill and play their role clear in regulating the real estate sector.
Prompted by the rules and regulations of the new bill, builders are drastically switching their process of construction. Rather than refinancing the existing projects or repaying the loans, builders are raising funds to speed up the construction work of their pending projects to escape from re-registering their projects under the new regulator. Builders feel that re-registering their ongoing projects will consume more time. The legislation of the new bill received the Presidents assent, but it might take almost a year to enforce all the provisions mentioned.
It is not only to escape from the lengthy and complicated procedure, but speeding up the delivery of projects is also the only solution to overcome the cash burden for builders. The cash flow has dried up and since banks are less inclined to play the ball for builders, the only way to resurrect the cash inflow is to finish the projects and deliver it. By timely delivering the projects, builders also want to redeem their slumping reputation in the fast competitive market. This is indeed something to cheer for home buyers.
The consumer sentiment in the property market is more tilted towards completed projects. According to a research, 56 percent of 17,000 under construction projects in top 27 cities in India are at least 60 % complete. This means, buyers are having a large number of near to possession homes in the market and with more enthusiasm from the builders, the list will soon increase considerably. With large number of builders queued to raise funds in banks, NBFC has also entered to finance for construction.