10 Areas Where Cutting Red Tape Will Make Realty Attractive

We Indians love real estate and most of us would put all our money in property markets expecting this asset class to give us the highest returns. However, a recent slump in the sector shows investors and buyers are shying away from property markets and skyrocketing prices are not the only reason behind this. There are several other factors responsible for this.
 
In fact, speaking on Model Building By-laws, 2016, Delhi Lieutenant Governor Najeeb Jung last week said the bureaucratic hurdles were among the reasons dragging India's real estate down. While the government is already putting in place several measures to improve the state of real estate in the country, the government could make property markets more lucrative by improving the way its agencies function.

 
By simplifying the overall process
By the end of their home-buying journey, most home buyers are too fatigued to savour their accomplishment. The many offices that they have to visit and the many papers that they have to sign is a mind-boggling process capable of making even a mathematician and urban planner wary. For a layman, who does not even know how to proceed, the dream of buying a home, in many of the cases, turns into a nightmare.
 
By bringing down the paperwork
Government across states — this includes civic and municipal bodies — are working hard to cut down paperwork across procedures. This helps save them tress, apart from a variety of other advantages. But when you to go buy a house, the documentation work is never ending. Starting from property brochures to sale deed, by the end of it all, you forget how many papers you signed. Later, you might realise that keeping that huge bundle was not really that important, or not reading a particular document carefully has cost you so much.
 
By giving project approvals faster
At the World Bank's Ease of Doing Index, among the eight south Asian nations, India is placed seventh in terms of dealing with construction permits and at number four in registering property. Neighbouring Pakistan holds second and third position, respectively, in the two categories. This, to a great extent, explains project delays in India's real estate and home buyers' aversion to register their properties.
 
By bringing circle rates closer to market rates
The huge gap between circle rates (property rates set by the government) and market rates (the prevailing price of properties) is another cause why real estate might be losing its charm among investors. Home buyers have to often resort to using accounted money to do property transactions because the actual price they have to pay for a property is much higher than the prices set by government. As stamp duty and property registration charges are paid keeping into account circle rates, the government's revenue collection also takes a major hit because of the difference between circle rates and market rates of properties.
 
By waiving various taxes on under-construction properties
Many home buyers venture into investing in an under-construction project in India thinking they would enjoy the facilities of a brand-new house even if they have to go through a long wait. However, most of them are distraught when they come to know of the many taxes that the government levies on the purchase of an under-construction property. (This includes value-added tax and service tax.) The final tally of the money spent in such properties goes much higher than a home buyer may have initially expected.
 
By making home loans easily available from public sector banks
If you want to avail of a home loan from a public lender because the interest rates are lower in comparison with private lenders, you will find the scrutiny exercised by them nerve wrecking. Not to mention, you don't expect the officials involved in the process difficult to deal with.
 
By bringing more property-related services online
This is one area in which civic authorities are going the right way. However, this is true only of major cities of India. And, even here this is only a particular services that you could avail of online. Authorities have to catch up a lot in this regards, too.
 
By extending aid to make the process simpler for a layman
A home buyer's only guide to the real estate world is his property advisor. The government on its part has not been able to provide the assistance required to create informed home buyers. Home buyers in India need guidance from experts who do not have vested interest in the transaction as such.
 
By cutting down on the number of agencies involved
When you buy an apartment in India, it's not between you and the seller alone. You will again be mistaken if you thought this is a tripartite agreement among the seller, the buyer and the government. The number of government agencies whose due approval you would need to complete your home-buying process is sure to discourage you from making an investment and give yourself more time to brace up.
 
By bringing better co-operation among agencies involved
This is one of the primary cause of a home buyer's harassment. They are told to register their property at one office, while the water supply application will have to be submitted at another. Due to an absence of data sharing among various government agencies, home buyers have to make multiple visits to multiple offices to get a simple house job done.

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