Realtors will find new means to raise money for projects

Welcoming the measures adopted in the stimulus package giving a boost to the realty sector, realtors said it will go a long way to uplift the sentiments. With fresh funds being allowed through external commercial borrowing, the cash starved sector will find a new means to raise money.

Other measures like both state and central government working together to release more land for lower and middle income housing will have an impact in the long-run.

The cut in the repo rate by 100 basis points could mean cheaper home loans in the near future.

?It is a positive move by the government. It is good for a company like ours which specialises in integrated townships. At a time of tight liquidity in the market it is helpful because it helps us raise funds for our projects,? said Anil Kumar, CEO, Ansal API.

With a slowdown in the global economy some believe there will be fewer investors and even though there has been a change in norms in ECB for more money to flow to this sector it will hardly be of any help in the current scenario.

A highly placed official from Omaxe pointed out, ?If we are able to find the right merchant banker and the project is viable there is no reason why ECB will elude us. There are many advantages of this measure as we will be able to access more funds for development. The rate of interest is also going to be cheaper compared to domestic debt.?

With repo rates coming down it will have an impact on prime lending rate. One of the major fallout of this phenomenon is that home loans will get cheaper.

Developers are also happy about the fact that both state governments and central government will be working towards releasing more land for low and middle income housing.

This measure will make an impact only if the government ensures that the land is available at a reasonable price to the developers. ?State government should identify good developers and pick them up on the basis of technical bids. If this land goes to the highest bidder and the land comes at an expensive price then it does not serve the purpose. It should go to the lowest bidder with the best experience. Only if the land is available at a subsidised rate, the price of the housing units that are built can be made available at a cheaper rate,? said Navin M Raheja, MD, Raheja Developers.