The real estate sector having been down for majority of last year, the government is trying hard to bring in measures to have a more positive trend in this sector with the onset of the New Year. The real estate market in Chennai has gained momentum in the last quarter of 2014 and the government would like for it to continue into positive boost. Though many builders are promoting flats in Perumbakkam, Velachery, Porur and other suburban areas, the demand seems to be increasing only at a slow pace. Government needs to introduce new reforms and ensure their prompt implementation to revive the real estate sector. The industry body, the Confederation of Real Estate Developers' Association of India (CREDAI), also sought "political will" for reforms.
The main reason for taking immediate steps in real estate is because now there is a positive trend and if people do not make use of this and find ways to promote this sector, there is no assurance for a quick revival of the same. Many things can be attributed as to being the blocks in revival of the real estate industry. Rising prices of steel and cement continue to be a cause for concern and the Centre needs to take steps to regulate the prices. The continuous fall in fuel prices is not translating into price reduction of cement, steel and even transport. In spite of slowdown in consumption, we saw a huge rise in cement and steel prices. The government needs to regulate steel and cement prices just as the power regulators monitor tariff. Prices of cement, steel rods, bricks and other input materials have increased by 30 per cent over the last three years
Besides rising prices, high lending rates by banks have hit the realty sector severely. With a lot of positive outlook and hopes shown by the new government and it is anticipated that land, administrative tax and banking reforms will be executed without further delay. The government should have its intervention in order to promote low cost home buyers and help in increasing the purchasing power of people on the whole.
