Print Edition - 2014-05-12 | MONEY
Developers seek government efforts
May 11, 2014-
As the NLHDA Real Estate Expo 2014 ended on Sunday posting Rs 270 million transactions, buoyant real-estate developers are now expecting more government efforts to maintain the momentum.
The fact that 54 standalone homes and apartment units were sold during the four-day expo shows the confidence is back among the prospective buyers. Developers say it’s high time the government categorised the realty sector as an industry. “The sector has come to a comfortable position compared to four-five years ago,” said Ichha Raj Tamang, chairman of Nepal Land and Housing Devel-opers’ Association (NLHDA). “The government too has become more positive over the period, but still there are lot of things to be done.”
Developers demanded the government scrap the provision of disclosing income source while purchasing property. “This will help those wanting to make long-term investment in the real-estate sector,” said Tamang, adding, the removal of the provision would not encourage speculative buying as all the stakeholders — developers, financial institutions and buyers — have learnt a lesson from the debacle the sector faced in the recent past.
Besides property deals at the expo, the government has achieved the full-year land revenue target in just nine months suggests revival of the sector. Land revenue worth Rs 4.5 billion has been collected as of the ninth month of the fiscal year, according to data from the Department of Land Reforms and Management and Land Revenue Offices. The government estimates the figure to touch Rs 6 billion by year-end.
NLHDA General Secretary Min Man Shrestha said the government’s plan to let non-residential Nepalis (NRN) and foreigners purchase apartments and houses in Nepal should be implemented at the possible earliest to make the sector more vibrant.
Although the budget for 2011-12 had talked about allowing foreigners to purchase houses and apartments, the provision is yet to be executed due to disputes between line ministries. The budget had said foreign individuals and companies would be permitted to buy apartment units worth $200,000 or more.
As projects priced up to Rs 10 million were readily selling, the implementation of the plan, according to the developers, would help sell expensive property too.
Shrestha added like in many countries, the government should encourage civil servants to purchase planned residence by providing cheaper loans. “This can be done at least for their first home,” said Shrestha. “It will not only stimulate the sector, but will also promote the trend of living in organised homes, intimately helping planned urbanisation.
The developers also complained about imposition on taxes on unsold property
and on open spaces at residential projects. “The taxes are levied right after the construction,” said Shrestha, adding the government should only levy the taxes after the projects are sold.
Unavailability of construction workers is another challenge the developers are facing. They say there is a dearth of skilled manpower amid increasing migration to Gulf countries.
Published: 12-05-2014 09:06