From Our Special Correspondent
Daijiworld Media Network - Bangalore

Bangalore, Nov 15: Investment in real estate business remained lukewarm despite aggressive marketing efforts and attractive offers made by Real Estate firms prior to and during the Deepavali festival season.

This is the finding of a survey conducted by the Associated Chambers of Commerce and Industry of India (Assocham) in major cities such as Delhi-NCR, Mumbai, Bangalore, Chennai, Kolkata, Ahmedabad, Hyderabad, Pune, Chandigarh and Dehradun.

Assocham had collected information from 250 property dealers, noted 40 builders/developers and 20 divisions of housing financing, according to a press release.

The major factors, according to Assocham for the lukewarm response was the high prices of land and unprecedented rise in the cost of construction materials, iron, cement and labour.

There was barely 20 per cent demand on the eve of the festival compared to the normal average sale per month.

Majority of the developers have complained that inordinate delays in getting necessary approvals from multiple regulations and authorities resulted in cost and time overruns.

The survey said the apathy of banks in financing real estate projects in the absence of industry status was another factor that contributed to the lukewarm response.

Assocham Secretary General D S Rawat said the resale or secondary market was dull this festive season as there was very little resale going specially in the NCR and surrounding areas.

The survey suggested that the government should act as a facilitator rather than a regulator of the real estate projects, particularly where demand is more than supply.

All approvals of real estate projects must be accorded in a time bound, accountable and simplifies manner, the Assocham said suggesting that the process and status of all approvals be made on line so as to bring transparency.

The state governments should complete their land records process and make the same computerised and supporting infrastructure; not only transportation and logistics but also water, power, housing, healthcare and sanitation must be taken up in tandem, the survey said.