During Covid-19, the government assisted the real estate industry in revitalising it.
The recent epidemic has been challenging for the real estate sector, struggling due to RERA, demonetisation, and GST regulations. In this context, the epidemic and the resulting lockdown brought everything to a halt, halting all types of activity and bringing numerous firms to a halt, all of which resulted in an economic downturn. The real estate sector was not immune to the effects of the global crisis. We saw a drop in property sales in India, which is concerning. The real estate sector is India’s third-largest employment, behind agriculture and manufacturing. As a result, it became critical for the government to begin efforts to revitalise this sector, which is crucial in boosting economic growth.
Governments have also made micro and macro steps in the past to revitalise the real estate market. In recent times, initiatives and policies such as the implementation of RERA, the Pradhan Mantri Awas Yojana (PMAY), GST, the Smart Cities Mission, the formation of real estate investment trusts (REITs), and various other subsidies and tax exemptions have been implemented, with the expectation that they will have a long-term impact. In this context, as a new decade began, it was thought that the real estate business would make a breakthrough as a result of these reforms. However, the outcomes were not as encouraging. For example, it was believed that the introduction of RERA would hasten the recovery of India’s real estate market. Still, it only benefitted a few states, like Maharashtra and Delhi.
The government implemented a few initiatives to assist the real estate industry during the lockout. For example, the Reserve Bank of India granted banks and lending institutions a three-month embargo from March 2020 to May 2020, which was eventually extended till August 2020, to help lessen the epidemic’s damage and assist borrowers and developers under monetary strain. The Maharashtra government opened an olive branch to the state’s developers by lowering the stamp tax on real estate transactions. It resulted in a 3% reduction in stamp duty. The UP government followed suit, intending to boost the real estate sector. They also enabled building operations to continue, offering assistance to on-site workers and waiving penalties for developers in the event of a COVID-infected individual. The federal government attempted to assist, issuing advice to all states and their separate RERAs to regard the COVID19 outbreak as a Force Majeure and extending the completion and registration dates of all RERA projects.
The epidemic has already lasted seven months, and while limitations have relaxed, it is not going away. Social separation and masking will now persist indefinitely until a vaccine is found. However, realtors are grappling with coping with the obstacles posed by the epidemic. In such a circumstance, moves done by the federal and state governments would undoubtedly aid them in their recovery.