Real Estate

Offload unsold inventories, don't hang on to it: Union minister Puri tells builders

Updated : November 27, 2020 09:41 PM IST

Housing and Urban Affairs Minister Hardeep Singh Puri on Friday asked real estate developers to offload unsold inventories and said he will again write to chief ministers of various states requesting them to reduce stamp duty on registration of properties to boost housing sales. Addressing a virtual conference organised by realtors' body NAREDCO, the minister said the circle rates need to come down.

"I think time has also now come to offload some inventories. Don't hang on to it," Puri said as he emphasised that it would spur economic activities and benefit developers. Puri said the finance ministry has recently relaxed income tax rules increasing differential between circle rate and transaction value to 20 per cent.

Recently, the government announced changes in Income Tax rules to allow primary or first sale of housing units of up to Rs 2 crore at a price that can be 20 per cent below the stamp duty circle rate. Earlier, the law restricted differential between circle rate and agreement value at 10 per cent. The move was aimed to help builders clear unsold inventories.

"This 20 per cent will lead to greater economic activities. All of you should step up now. Get rid of inventories," Puri said, adding that circle rates need to come down. Talking about stamp duty, Puri said he had written to chief ministers on this issue.

Maharashtra and Karnataka governments have cut stamp duty on transactions of immovable properties to boost sales. Initial estimate suggest that there has been good response to the move, he noted. The sales registrations in Maharashtra for September 2020 has surpassed pre-COVID-19 level and recorded highest registration for the calendar year at 1,19,834, the minister said.

Further, Puri said that he would write another letter to chief ministers and give a "renewed push", citing the experience of Maharashtra. Responding to concerns over delays in environmental clearances, Puri asked builders to share the exact problem and that he would write a letter to the Union Environment Minister if it relates to the central government.

The minister also said that he would push for extending the deadline for Credit Linked Subsidy Scheme (CLSS) for middle income group. It is currently valid till March 2021. On the demand for allowing financial institutions to set up stress fund, Puri said, "it is a great idea and I am wiling to make recommendations".

The minister expressed satisfaction about the implementation progress of Prime Minister Aawas Yojana (PMAY) and the recently launched Affordable Rental Housing Complexes (ARHC) programme as well as scheme for street vendors. These schemes are being seriously implemented and regularly reviewed at the highest level, he added.

Puri, who is also in charge of the civil aviation ministry, talked about the civil aviation sector at the event. He expressed confidence that domestic air passenger traffic would touch pre-COVID-19 level by the end of this year.

"When we opened domestic civil aviation, we were at a point of 30,000 passengers a day. Two days ago, we registered 2,38,000 in a day... between now and end of the year, we will be at pre-COVID-19 levels of 3,00,000 plus," he said. Domestic commercial flights were suspended for two months from March 25 as part of efforts to curb spreading of coronavirus infections.

He also said that the economy is reviving. "In most areas of economic activities, we are almost at pre-COVID-19 level or even higher," he added.

Offload unsold inventories, don't hang on to it: Union minister Puri tells builders

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