Housing
finance companies are allowed to raise funds from the market
in the form of fixed deposits and bonds with tenure of not
more than 7 years. There is TDS under section 195 for sale to
NRIs.
Inadequate foreclosure norms prevailing in the country,
especially in case of defaults has hurt the housing finance
segment badly. Providing a strong legal support mechanism for
making changes in foreclosure laws would give a real shot in
the arm for housing finance companies.
If
foreclosure norms could ensure speedy settlement at the
juncture of such cases, we could expect housing finance
companies to finance even 100% of the property purchase while
at present they would dare to provide only to a maximum of 85%
of the cost of the property.
There is
a major concern for a better and clear legal framework for
property developers, buyers and the housing finance companies.
It
should be remembered that the housing sector ranks fifth in
terms of employment generation. Any additional unit
expenditure in the construction sector enables multiplier
effects resulting in eight-fold increase in the employment
generation in the economy especially in the grass-root level.
The sector has the ability to contribute substantially to the
GDP growth is now being realized by all. Without doubt, with a
booming economy and overall growth, the property and real
estate sector is on the verge of witnessing the most
unprecedented period of growth ever in India.
