Construction Industry News
Project delay is the most common problem in India among medium and small builders. The lockdown situation across the country made it difficult for developers to meet project completion deadlines. However, now that the market has started to open up, it is time for the real estate industry to make that big leap towards solid efforts to meet project completion deadlines. The government has made concrete efforts to support the sector through its Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects (SWAMIH) fund. The SWAMIH fund has been so helpful that developers queue up for the fund to complete their stalled projects and hand over keys to long-suffering buyers. So far, Swamih has delivered 1,100 homes across five projects, and going forward, if there is no Covid disruption this year, it is expected to deliver 10,000 homes that are stuck this financial year. The Swamih team does extensive technical due diligence before embarking on any project. They follow a two-way approach, with preliminary approval given based on information available from the developer. Later, a desktop forensic due diligence and then intensive due diligence by 4-5 different companies on various aspects of the project including corporate, legal, forensic, title and ESG approvals determine the final approval.
In the past, studies have shown that project delays are the biggest reason to reduce the number of passive buyers. The real estate sector is currently experiencing good growth. Maharashtra is the best example of witnessing a spike in registrations despite the second wave of the coronavirus pandemic, especially after a cut in stamp duty and home loan interest rates to just 6.60%.
With Swamih's initiatives, we can hope that the Indian real estate sector will recover at a better pace than expected.
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