Real Estate- Role & Relevance- 30-7-25.pptx

Opportunities and
Challenges for Real
Estate Industry,
Jit Kumar Gupta
Former Advisor, town Planning,
PUDA

Real Estate
-Definition
-Roel &
 Relevance

Real Estate-Defined
 Natural right to own property -as a concept had roots in Roman law/Greek philosophy
 1758 treatise The Law of Nations-- conceptualized the idea of private property
 largest real estate deal in history -- "Louisiana Purchase by USA “- in 1803 -- between U.S.& France -- of
"Louisiana Territory“-51,843 SQM- -- for fifteen million dollars,- each acre roughly 4 cents.
 The Alaska-- 586,412 square miles - Purchased by USA from Russian Empire - for a sum of $7.2 million
in 1867 (equivalent to $129 million in 2023).
 In terms of law, Real relates to land property -- different from personal property, while estate means
"interest“- a person has in that land property.
 .Accordingly, Real Estate defined as;
 -- land & any permanent structures attached and
 -- improvements made to land, whether natural/ artificial.
 But Excludes personal property-- not permanently attached to land -vehicles, jewelry, furniture,
equipment
 Sector- involves Land/ Construction /sale/purchase of plots/ built environment--
including buying/, selling, renting, leasing,, developing residential, commercial, industrial,
retail spaces.
 Main categories of RE structures - include residential, commercial, industrial, institutional, healthcare,
education, and special use.
 Investing in real estate includes-- purchasing a structure/home, or land
 Real estate encompasses ;
 - land, -- Making permanent additions to land --- constructing - houses / buildings.
 -Making Improvements that affect property's value

Role& Relevance of Real Estate
 Real Estate - known for its capacity, capability, role, importance in ;
 -Physical, Socio-economic Development, of communities/ city
 Promoting Economy, Eradicate poverty
 Ranked among top five sectors of national economy ;
 Most vibrant sectors-- attracting both local/ global investment .
 Second largest employer, -employing more than 35 million work-force .
 have role/ relevance from cradle to grave in human living;
 Increase consumption/production of goods and services
 Generating- large revenue for city/state/nation
 Accelerate industrialization- 290 industries involved in construction sector
 Rationalizes & Makes Urbanization Qualitative
 Promote Planned Development
 Making Cities Slum-free,
 Major propeller of construction sector
 Closely linked to economic development and social stability
 Prime determinant of quality of life .

Role& Relevance of Real Estate
 Real Estate is also known for-
 Adding new building materials & construction technologies
 attract businesses / increase property values
 Stimulate demand for construction materials and services
 -Shape communities & fostering social connections.
 Vibrant neighborhoods/ well-maintained properties-- attract residents and
businesses,.
 . For Senior citizens,-- real estate critical
 –creating a sense of security and safety.
 -- for retirement planning -- rental income or property appreciation,
 -- Supplement retirement savings –
 - provide a reliable source of income during later part of the age.
 Downsizing /selling property– generate funds for retirement expenses.
 provides numerous options for reshaping & make cities and communities safe,
resilient, inclusive and sustainable (SDG11),
 Considering major human activities -- encased within four walls of built environment
 Real estate sector holds great value for human living, health, productivity, growth ,
development

Role, Relevance & challenges Facing Real Estate
 Despite numerous positivities RE has negativities also;
 Sector-Ranked as largest consumer of water, energy , natural ,non-
renewable resources
 Generator of large waste.
 Known - to impact climate , global warming , rising temperature ,
generator of large carbon footprints and ozone depletion,
 Makes Planet Earth unsustainable
 Known to accelerate both natural / manmade disasters.
 Sector faces numerous challenges;
 Sensitive to changing government, policies & programs,
 Faces--numerous operational, management, governance challenges
 Reinventing / rationalising RE critical -for making the sector
 - more transparent,
 - more effective, efficient, vibrant and productive,
 for launching India-- on the path of—
 sustainable growth , planned development and economic growth.

Factors leveraging
Growth of Real Estate

Factors leveraging Growth of Real Estate;
 Owning a home, investing in properties, conducting business, RE embedded in all human activities
 -Ever increasing number of human beings;
 Rapid urbanization- Rural-Urban Migration
 -- Ever changing needs of human living- moving from joint to single families
 -- Ever changing pattern of economy- from secondary to tertiary sector- IT, soft skills Shopping Mall,
Online shopping, wholesale and retail trade, -cities like Bengaluru, Pune, Gurgaon, Chennai etc
 Increased individual earning/ saving
 Supportive government policies/programs- opening/liberalization of economies and globalization
 -Launching Missions - Prime Minister Awas Yojna ( Rural & Urban); Smart City Mission, Hriday, Amrut,
National Urban Livelihood Mission (NULM), Swachh Bharat Mission(SWM),
 changing the focus of Industry, from primary/ secondary sectors towards service-oriented industries.
 Rising proportion of elderly individuals-- in developed nations- creating demand for age-friendly
housing, medical facilities, retirement homes
 Land Speculation/ appreciation of values- Becoming popular choice for investors to build wealth.
 provide diversification-- within investment portfolios,-- reducing overall risk
 -- More stable and resilient, providing hedge against economic uncertainties
 McKenzie Global Institutes- projecting need of 700-900 million sqm for meeting urban demand for
construction space

Factors leveraging the Growth of Real Estate;
 3 major three major sectors of economies --Wholesale /retail trade, IT & ITES , and
telecommunication, -- positively linked with real estate sector
 Ever widening gap between - demand & supply of built space and high profitability
 Pulls and push factors -- accelerate growth of Real Estate Sector;
 Pull Factors - Development of commercial, industrial, institution, financial, trade &
commerce, banking, logistic, goods / services, housing etc., -- demand large built-
up areas / real estate products-
 Push Factor-- prosperity/ rapid growth of RE, creates large demand for diverse
construction products- further “pushing” growth/development of other sectors.
 .Looking at growing urbanization, -- ever- rising population,
 -- fast changing technologies, - ever- changing human numbers/needs and
 - ever-changing contours of Indian economy,
 Real Estate market in India to contribute 13% of country’s GDP by 2025
 -- contribution placed at $ 477 billion in the year 2022 ,
 -- projected to grow to $ 1trillion by the year 2030 and
 $5.7 trillion in the year 2047 as against $ 534.37 trillion at the global level.
 Sustained /rational growth of RE has capacity /capability-
 - of making India rank among largest three global economies.

Real Estate –Issues
Involved/Road Blocks

Issues Involved in RE Sector
 Despite Real estate play vital role in
 - promoting economy
 -- generating large employment
 -- making human living more qualitative,
 -- launching nations on the path of growth and development,
 it is not properly organized, Nor professionally managed . rationally regulated-
both by Government & stakeholders involved
 . Major factors contributing to the chaos, dualities, contradictions ,disorder and
mismanagement prevailing in the sector can be largely enumerated in terms of;
 1. Driven by Profitability;
 -- Sector being profit focused,
 -- aims at making maximum economic gains in minimum time frame,
 -- leading to creating products catering to elites of the society,
 -- ignoring/diluting interest of majority of low-income groups.
 -- created deficit in availability of reasonably priced housing options, for EWS/LIG
 -- emergence of large number of malpractices getting embedded in the sector.

Issues Involved in RE Sector-Demand Side
 2 Ignoring Public Interest;
 -- ignoring/diluting public interest for promoting personal interest
 -- products created marginalise availability of reasonably priced LIG/MIG housing.
 3. Marginalizing Quality
 --Using unskilled manpower –with little concern and commitment to quality,
 -- causing undue delay, litigation, economic loss.
 4 Ignoring Tranparency & Professional Ethics,
 --Adopting Unethical Practices;
 - marketing /selling properties without proper legal documentation / approvals.
 -- selling same property to multiple buyers,
 -- launching marketing campaigns for illegal or unapproved housing schemes,
 -. Misleading claims/undertakings regarding -- returns, amenities, delivery dates,
 5. -Undertaking multiple projects without adequate resources;
 - undertake large number of projects simultaneously,
 -without caring for capacity , capability and resources available
 -causing undue delay in completing projects on time- bound basis.
 -money collected from buyers from one project used for buying land for another project,
 causing undue delay in completion/ non-completion of given projects,

Issues Involved in RE Sector-Demand Side
 6. Weak Enforcement; ;
 ---Prevailing enforcement mechanisms, remains often weak /
inconsistent,
 - allowing space for malpractices/ violations to persist, without
accountability.
 7 Absence of Rating of Promoters /Developers ;
 -- absence of index defining credibility of promoters/ developers,
 -- difficult for buyers to make a rational/logical choice while
purchasing property
 - Majority of Developers/Promoters, lack skill , expertise,
knowledge, understanding, operation & management of RE Sector,
 --create operational issues in project planning/execution
 -- Fly-by-night developers known to abandoning/delaying
projects.
 Absence of qualification /experience for registration of
Developers/promoters ,

Issues Involved in RE Sector-Supply Side
 B. Supply Side;
8. Absence of Comprehensive Policy;
 -- Absence of a comprehensive National/State level Policy for managing
Real Estate Sector- to make it more effective, efficient productive.
9.Unskilled Manpower ;
 -sector is largely managed by unskilled manpower ,
 -- having little understanding importance / implications of quality-built
environment,
 -- made sector - inefficient, opaque, unprofessional- cost-intensive, resource
inefficient
10. High Land Pricing& Cost of Construction;
 - Limited availability of reasonably priced land
 - high degree of speculation in land,
 -- greatest challenge in making sector more rational , operationally efficient.
 -- rising cost of construction materials,/ increasing cost of labour, makes the
real estate expensive,

 11. Irrational Legal Framework;
 --- Multiplicity of laws; -- with overlapping/duplication of jurisdiction/ area of operation,
 -- outdated & cumbersome provisions/ documentation, process/ procedures for obtaining
approvals
 Unable to safe-guard interest of individual buyers- inadequate compensation for aggrieved
buyers etc.,
 -Lack of safeguard to developer/promoters--, subjected to undue harassment caused by
scrupulous buyers.
 12. Lack of Accountability;
 --Majority of issues has genesis in lack of understanding of the complexity of the Real estate sector and
 - lack of accountability of agencies involved in granting approvals to the project,
 13. Multiplicity of Agencies involved;
 - RE subjected to large number of statutory / regulatory approvals,
 -- working in silos – multiple authorities make sector, more rational & efficient
 -- Segregation of Departments of Urban development from Local Government created more problems
 14. Large Litigation & Delayed Justice;
 -- Largest cases in courts pertain to disputed land/ownership,
 -- take years for resolution.
 -- leading to prolonged legal battles / delayed justice.
 - causing undue hardship to promoters - consumer/buyer.

 15. , Absence of Master Plans;
 ‘About half of cities - growing/expanding without any Master Plan -to guide
growth & infrastructure development.
 only 37 cities/168 cities of Punjab has Master Plans prepared/approved
 State of Haryana prepares- Development Plans for Controlled Area/Urban
area, falling outside urban limits,
 Absence of planning framework--
 -Create problem in approval of projects; promote subjectivity
 --Promote unplanned/haphazard development
 promoting lop-sided development of essential urban infrastructure and
services.
 16 High Government Charges;
 - Prevailing Notion of RE generating large revenue
 sector subjected to numerous/multiple government charges
 - levying taxes fees, levies, charges and tolls,
 - increasing cost & making it unaffordable.
 - Emergence of numerous unethical practices.
,

 17 Duality of Regulations by RERA& Consumers Courts;
 - Duality of controls /accountability to RERA & Consumers Courts,
 -- invariably lead to multiple litigations,
 - causing enormous stress, strain harassment to promoters/developers,
 18. Conflicts and multiplicity of documentation for Licensing and Registration;;
 - Conflict between -Competent authority to sanction/license project and
 --; Real Estate Regulatory Authorities (RERA),
 -- leads to duplication / multiplication of documentation-- for licensing & registration.
 19. Delayed Completions;
 -- Involving multiple agencies for granting--approvals/permissions required for
closing any Real Estate project,
 -- completion certificate invariably takes considerable time-delayed completion
 - Delayed completion-- has physical, social , economic implications-- for both
promoters/allottee,
 20. Sourcing Funds from Financial Institutions;- due to failure to complete projects in
majority of cases- poor servicing of loans- poor credibility,

Options for making Real Estate Sector
 More Productive,
More Sustainable,
More Transparent
More Vibrant

Options for making Real Estate Sector More Productive,
Sustainable, Transparent and Vibrant;
1. Creating A Comprehensive State Policy
 -Addressing issues / challenges facing Real Estate
 creating a long-term rational / supportive policy framework,
 - supportive regulatory mechanism -- for smooth/efficient functioning of sector.
2, Making Land market More Efficient
 -; Real Estate Sector - largest consumer of land
 - efficacy/efficiency of RE depends upon price of land
 - land market must be made operationally efficient,
 -- Ensuring supply of adequate amount of land, at affordable cost
3. Documenting Land;
 -- urban land must be documented --in terms of location, area, ownership,
accessibility,
 -- current status in terms land, use of land, prevailing encumbrances, if any
 -- made available in public domain
 - for sourcing land/exploring options of Real estate.

Options for making Real Estate Sector More Productive, Sustainable,
Transparent and Vibrant;
4. Rationalising Fees and Charges;
 - to rationalise land cost,
 make housing affordable
 , improve transparency, minimising delays
 5. Skilling RE Industry-Inducting Professionals;
 - inducting quality professionals ,
 having appropriate skill, knowledge, experience and expertise in Real Estate,
 -- to launch sector on the path of rational growth/ development.
 6 Creating an Interactive Platform;
 -States to constitute an Empowered Committee of all stakeholders
 - government officials, Developers/Promoters , Experts in Real Estate Sector , Members from allied fields,
 - to discuss issues and suggest options to remove roadblocks
 - for making sector more responsive, efficient, transparent, productive.

Options for making Real Estate Sector More
Productive, Sustainable, Transparent and Vibrant
7 Making Sector Socially/Community Responsive
 --Developers encouraged to create parks, open spaces, public spaces,
 -- construct healthcare facilities and community centers - for local/marginalized communities.
 Create more stock for affordable Housing
8. Recognising & Incentivizing Good Projects;
 - Urban development/township projects rated/ objectively evaluated on pre-defined parameters,
 -- sustainability, safety, inclusiveness, resilience, optimising resources, waste management, cost, quality,
health, happiness, community's satisfaction
 good projects recognized / rewarded on annual basis,
 --to encourage Developers , develop such projects.
9. Documenting Good Practices;
 --Making Real Estate Sector, more qualitative, professional, productive,
 - useful to documenting best practices used both locally/globally
 For dissemination/replication/ adoption with modifications at local level.

10 Embedding Accountability;
 --Accountability must be embedded in all agencies/authorities/manpower
 -, Granting permissions/approvals for Real Estate Projects ,on time- bound basis.
 -- Promoting transparency and accountability,
 11. Rationalising Urbanisation;
 Making urabanisation process more qualitative and productive
 Promoting orderly growth/ development of urban centres
 Promote Planned development
 Providing city level core/basic infrastructures/services
 Creating long term sustainable plans
 Creating a vision and mission for development
 Promoting Good governance

Options for making Real Estate Sector More Productive,
Sustainable, Transparent and Vibrant
12 Preparing and Implementing Master Plans;
 Preparing and Implementing Master Plans;
 -Considering the role, relevance and importance of Master Plans
 -- in promoting planned development,
 -- defining framework and agenda for the planned growth and development
 of urban development, provision of infrastructure
 -Accurate Master Plan prepared for all cities prepared on priority.
 help in making Real Estate Sector more rational, objective and productive,
 Render valuable support for
 -- proper implementation of such plans and
 -- development of basic infrastructures/services
 Generate resources for plan implementation

13 Creating A Single Window for Clearance of the Projects;
 Designating a single agency
 creating single window clearance for the Real Estate Projects at local level
 , within a defined time frame,
 Creating an effective, efficient, transparent mechanism of on-line submissions ,
 with minimising human interface between Developers& Approving agencies
 help in removing numerous anomalies/malpractices prevailing in the sector.
 Help in tracking processing/stage of project approval
 improving operational efficiency of RE

14. Incentivizing New Technologies;
 Technology involving
 - Artificial Intelligence, 3D printing, Virtual Reality and Augmented Reality, in particularly,-
 - known for capacity, capability , distinct advantage in making construction industry
 -- more productive,
 -- cost-effective,
 - Time/ resource efficient,
 - energy efficient
 - environment friendly
 - making built environment more qualitative and sustainable,
 Critical/ important that promoter /developers incentivized
 -to bring /invent new construction technologies/machinery.
 induct New building Materials
 .- making RE sector more affordable, productive, qualitative.

 15 Designating a single Agency at local level;.
 - designating a single agency at local level other than state agency will help
in;
 - speedier submission of project
 speedier approval of projects
 -removing local conflict/contradictions
 - speedier clearances
 Aid/advising/assisting the developers/builders
 Promoting close co-operation and resolutions of objections
 Better supervision and implementation of project

 16 Redefining Role of RERA -.
 defining strategies / options to make sector more qualitative
and productive.
 RERA role need to be redefined to be;
 more supportive to make sector more responsive, effective,
efficient and sustainable.
 defining strategies /options to make the sector more qualitative
& productive
 aid, advise, assist and guide the state government;
 -- in evolving rational /realistic policies
 -- Resolving major issues / road blocks facing real sector
 -Review, revise and redefine its composition- to more
professionals and focused
 Including members having knowledge, experience, skill,
expertise, experience related to operation/functioning of RE

 17 Rationalising Legal framework;
 -Legal framework regulating Real Estate Sector reviewed, revised and rationalized,
 to make it
 simpler, focused, objective,
 rational, effective, efficient , qualitative.
 18 Involving Professionals;
 Involving Architects, Town Planners , Engineers both by Governmnet & Developers/promoters
 for using their knowledge, expertise , skill to make RE more qualitative,
productive, efficient.
 19 Registering Quality Promoters;
 - Registration of developers limited to individuals/societies/companies having
 -requisite resources, skill, manpower, machinery, capacity, capability,
 to plan, design , make project a distinct reality&
 deliver quality built environment/infrastructure development. .

20 Rating Promoters/Developers;
- Besides registering quality promoters/developers
- State need to develop a system of rating of developers - by an independent agency
- Making people aware before making purchasing RE product
21. Rationalising Planning Norms& Standards.; optimising Land Resource
, -Infrastructure norms /standards, for soft / hard infrastructures need rationalization
- for ensuring quality development,
- -limiting, use of non-renewable resources
- - optimizing use of land
- -using land on 24x7x365 basis
- - moving away from population – to making multiple use of facilities
- for optimising the use of scarce land resource

22. Avoiding Multiplicity of Regulating Laws/Agencies;
 Considering dualities of controls & prevailing contradictions,
 - for minimizing litigations and allow Real estate sector to perform effectively and efficiently
 , sector governed exclusively by RERA by excluding from Consumers Protection Act.2019
23. Creating a dedicated Court;
 For faster /time bound resolution of Real Estate Sector related conflicts
 state need to constitute dedicated court for deciding cases related to Real Estate
 with adequate mandate/power/authority
24 Rationalising Profit Margins;
 Dictated purely by profit/using unaccounted money,
 Sector has large negativities ,
 making end product highly priced/ unaffordable, for majority of buyers.
 Foe making product affordable- profit margin of Developers/Promoters
 must be defined, - for saving buyers from being fleeced / over-charged

26 Incentivizing Low-Cost Housing ;
 For making affordable housing in urban areas, a distinct reality &
 To make housing affordable, Real Estate sector must be;
 - incentivized & actively involved in creation of such housing
 bridge prevailing gap in demand and supply of such housing.
 State to create a dedicated Land Bank,
 allot land parcels on pre-defined price / reduced government fees and
charges,
 with all prior approvals,
 Along with small commercial /institutional area
 to identified Developers for developing such housing
 With incentivized Floor Area Ration, height, density, number of dwelling units
 to provide large stock of houses on Rental Basis

Real Estate- Role & Relevance- 30-7-25.pptx

Real Estate- Role & Relevance- 30-7-25.pptx

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