by Mr. Anuj
Puri, Chairman & Country Head, Jones Lang LaSalle India
With the
proposed Real Estate Regulatory Bill, where developer are expected to keep
considerable portion of sales in escrow account for majority of construction
period, finance cost for developers is expected to increase.
This, along
with increase in cost of construction and the already challenging economic
scenario, is expected to affect profit margins of developers. In such a
scenario, the real estate industry was obviously hoping for relief from RBI by
way of reduction in financing cost.
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| Anuj Puri, Chairman & Country Head, Jones Lang LaSalle India |
In the
current monetary policy, RBI has increased the repo rate by 0.25%, which will
increase the borrowing cost. However, with reduction of MSF by 0.75% and
reduction of minimum daily maintenance of CRR
from 99% to 95 %, it has relaxed tightening norms. While the real estate
industry has reason to be somewhat disappointed on the increase in borrowing
cost, the RBI has made provisions for increased liquidity in the system.
Considering
the current economic situation, I believe that the new RBI governor has acted
suitably with this monetary policy.
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