Representatives of the real estate sector today met Reserve Bank of India officials to take up the “problems” being faced by the cash-starved sector. “We requested the RBI to create an environment where banks treat real estate at par with other industries and do not discriminate and treat realtors as ‘untouchables’. Presently, the real estate sector is forced to borrow from banks at 2 per cent higher rates than other industries,” said Ajmera group chairman and managing director Rajnikant Ajmera.

RBI governor D Subbarao, deputy governor Usha Thorat and other officials met the realtors.

“There were three specific issues on which real estate developers wanted the attention of the apex bank. The first suggestion we made was on bringing the initial deposit for home buyers down to the amount what was being asked for in the recent past,” he said.

“We suggested that the downpayments for home loans should be brought to the 10-15 per cent levels rather than present 30 per cent. Secondly we suggested that the bar for soft home loans should be raised to Rs 30 lakh to promote affordable housing in the country,” Ajmera said.

Though the RBI has reduced key rates, it has contributed little to minimise the woes of the sector, realtors said. RBI Governor said the central bank would look into their demands.

“Banks are simply not lending enough to real estate. Plus, cost of funds is still high, in spite of the recent rate reductions that have been included in the stimulus package. We want the reduction to apply to those borrowing between Rs 35-40 lakh as well,” said Sunil Mantri, Chairman, Mantri Realty who was present in the meeting as a representative of CREDAI.

... contd.