Even though the Union ministry of home affairs has allowed construction activity to resume, Goa’s realty sector is staring at a six-month recovery period. The beleaguered industry’s stakeholders expect financial liquidity and availability of raw material to dictate the pace of construction activity.
CREDAI-Goa has already written to the Real Estate (Regulation and Development) Authority (RERA) asking for leniency over delays and delivery of residential projects.
“The challenge is the supply of raw materials, like sand, which comes from other states. Almost all the raw material comes from outside Goa and only once the construction sites open up and builders take an inventory, will they know what needs to be done,” said CREDAI-Goa president Nilesh Salkar.
After being abruptly thrust into an overnight halt, the industry now needs to come to terms with the month-long inactivity. Goa’s realty slowdown has now been prolonged for over five years, beginning with the closure of mining.
Just as the sector was finding its feet, demonetisation and the Goods and Services Tax pulled the rug out from under its feet. Since then, the introduction of RERA and an economic slowdown have hampered recovery. “A lot of turmoil came into the real estate business after demonetisation,” said former CREDAI Goa president Jagannath Desh Prabhudessai.
Industry stakeholders expect full fledged construction activity to commence only after the monsoon. “Most likely from tomorrow, people might start applying for permissions and this may take two days at least. I don’t know if the local governing bodies have received instructions on how to process permissions. For industries, it has been streamlined but these type of things are not available for the construction industry,” said a builder.
Real estate firms pointed out that the ministry of home affair’s guidelines for construction activity lacked clarity. The guidelines do not allow hardware stores to remain open but permit electricians, plumbers, carpenters and other skilled workers to do business. “It will take a week’s time for construction activity to resume and I think it will be five to six months till everything comes back to normal. Right from availability of labour and material to financial restructuring, a lot needs to happen,” said Salkar.
“Wherever the labour is on site, construction can restart. In Goa we are a bit better off, and the labourers are still on the site and many builders could hold them. After the lockdown is lifted, the workers may try to go home, and that is a worry for us,” said Prabhudessai.
