Housing prices down 15-20%; no scope for further cut: CREDAI

New Delhi: Housing prices have fallen by an average 15-20 percent across the country in last 18 months and there is no scope for further reduction, realtors' apex body CREDAI said on Wednesday.

Housing sales have improved by 15 percent during the festive season helped by fall in price and lower interest rate on home loans, still about 25-30 percent of the total units launched are unsold, CREDAI President Getamber Anand told reporters here.

In order to boost the growth of the sluggish real estate sector, the association sought that the central and state governments rationalise tax structure on the property sector and adopt single-window approval for projects.

"We are seeing improvement in the demand. Prices have come down by 15-20 percent in last one and half years and there is no further scope for reduction," Anand said, adding that sales in this year's festival season increased by 15 percent.

On unsold inventories, Anand said the 25-30 percent of the total housing launched would be unsold at present but he did not give any number.

CREDAI has tied up with rating agency CRISIL for providing regular data on real estate sector including new launches, sales and unsold inventories.

Listing out industry's demand on tax-structure, CREDAI said the contractors should be held responsible for non- payments of PF/ESI to labourers instead of developers as the principal employers.

"We have been raided by the officials of provident fund department. If contractors do not pay, we are held responsible," Anand said.
CREDAI Vice President Rohit Raj Modi said there is a duplication of tax in form of ESI/PF as the industry already pays one percent labour cess to the government and about Rs 27,000 crore are lying idle in that account.

"We want ease of doing business. Compliances are too much, which delays the projects. We want single window approval and simplification of tax," CREDAI NCR President Manoj Gaur said.
On the proposed GST law, the association said the industry should not be subjected to both GST rate and stamp duties.

CREDAI President Anand said that out of the total cost, about Rs 350 per sq ft goes into taxation.

The association also questioned the directives of state level green panel SEAC to spend 2 percent of project cost on the CSR activities.

CREDAI would flag these issue with the representatives of central and state governments during its two-days annual conclave on December 16-17 in the national capital.