CREDAI stresses policy and funding woes delaying projects in India

The Confederation of Real Estate Developers' Associations of India (CREDAI) – the apex body of private Real Estate developers in India organized CREDAI Finance Conclave 2021 in Mumbai to explore newer avenues of financing for developers by collaborating with Banks and NBFCs given the sudden rise in housing demand post COVID-19. The event acted as a central platform amongst the industry leaders across Banking, Finance and Real-Estate to create synergies between these industries to help reach their maximum potential in the coming years. Speaking on the occasion, Harsh Vardhan Patodia, President, CREDAI National, said, “India’s real estate industry is already on a great momentum to recover from the post-pandemic shock making it an ideal time for this platform. Two key industries are now partnering even more closely to find solutions to give an outlook towards construction funding, understand the perception of home loan lenders, RBI & government policies boosting the housing sector which is a big win for us. This will not only help us to strengthen relations with our partners but also lead to a better delivery time for the home buyers.”

The event was inaugurated by Shri. Deepak Parekh, Chairman, HDFC, LTD where he discussed how India’s real estate is at the cusp of a new growth cycle and with easy liquidity conditions and record low-interest rates, housing affordability is at its best over the last 50 years. He also emphasized that the ‘Borrow and Build’ model no longer works anywhere, and India is fortunate that it does not have any housing bubble troubles currently. Mr. Harsh Vardhan Patodia, President, CREDAI National, mentioned that the dynamics of finance in real estate are changing with the introduction of RERA & increased demand post- Covid. He also stressed on home buying psyche and impact of reduction in stamp duty and other taxes.

Mr. Satish Magar, Chairman, CREDAI National said COVID has been a great teacher which has changed the business dynamics and led to significant changes in customer buying patterns. He also mentioned that more and more milennials are now looking at investing in a house. He also reiterated the fact that the thought process of developers has changed with the introduction of technology in real estate and there is more financial discipline in the sector. Mr. Boman Irani, President Elect, CREDAI National, highlighted how financial institutions are the bloodline of the housing industry and the direct correlation between the relationship with financial institutions and the quality of homes delivered by developers. The event was aimed at improving the knowledge of developers in terms of technological advancements and financial tools. He also explained how the consumer psyche has changed and they are not looking for affordable housing but value for money. He also mentioned that this is the best year to buy a home for homebuyers because the interest rates are at their lowest and strong growth is being seen in Tier II & Tier III markets with reverse migration during the lockdown.

Some of the key topics covered during the event were:

• The future of construction funding for the next 2-3 years
• The role of family offices in supporting the industry from land funding to last mile funding
•  How property technology and startups can change how real estate sector functions
•  The growing need of warehouses to support the ecommerce boom in India
•  How low home loans are the backbone of the industry driving sales across the country
•  How to build resilience within an organization to navigate unprecedented situations
•  Given the current crisis, the aim is not only on affordable houses, but to provide customers with the best housing designs equipped with technology
•  Unlike the traditional real estate way of working, today, developers have websites and apps that guide the customers from locations to amenities and paperwork to buy a house
•  During this time, CREDAI is educating developers to understand various financial tools for ease in constructing houses.
•  Challenges to get permissions for real estate projects
•  Affordable housing in Mumbai
•  Working Capital for developers
•  Foreign funding will make real estate more affordable in the country

The pressing topics were covered through panel discussions and fireside chats with key figures from the industry sharing insights and knowledge on the same. CREDAI Members as well as bankers and financial experts from various parts of the country were also present at the conference making it a huge success.

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