Vision of Life; by Sanjay: Policies, Real Estate & Affordable Homes!

“We should not be focusing on quick solutions. The really important concern for policymakers everywhere is to prevent disasters - that is, the outlived events that matter the most”… Robert J. Shiller.

Robert James Shiller is an American economist, academic, and best-selling author. As of 2018, he serves as a Sterling Professor of Economics at Yale University and is a fellow at the Yale School of Management's International Center for Finance. No wonder with such personalities keeping tab on the govt, USA has reached to top of Economic Power’s list despite all ups & downs created by its rulers on & off policies! And speaking about policies we top surely in making policies which creates controversies more than the desired outcome for which the policy has been made & when these policies are related to land use (read real estate) then the more fun adding spice to the entire matter! And every time our "Mai Baap" govt announces something related to real estate then I wonder where we are heading on the front of making homes affordable as well planned growth, environment conservation & lastly the latest in thing (read fad) Smart Cities! If you are feeling I am behaving like a full-fledged Punekar i.e. criticizing everything around then read these news papers headlines in last week, No Construction along the Rivers on both banks, CRZ policy lifted; making thousands of hectors of land free for construction (CRZ is a policy restricting any construction in distance of 500 m along the coast line of Oceans ), then there was a regular news covered by all media & needless to say it’s about regularizing (read legalizing) all the constructions on govt land (don’t ask means what) & lastly one more news was there that as per data from eight major cities in the country the real estate developers (read builders) owe (read cheated) to the investors/ lenders & flat holders for near four lac crore rupees! Well, one will ask what’s relevance in this news as what policy making has to do with last news because real estate was always infamous for giving jitters to its money lenders! Indeed but truth is now a day’s its becoming more frequent & with big names also getting painted as bad when it comes to returning money of following commitments & it’s this aspect of real estate makes me share my views about policies!

For decades real estate or anything related to land or buildings was considered as money making business as land is limited but our needs related to lands are infinite! We need land to build our homes which in turn needs essential to luxury commodities which needs factories & factories needs roads, railways, wear-houses & then people living in these homes as well working in factories needs schools, malls, hospitals (well gardens & forests too) & recreation things.! So we need land & its limited as you can’t create land in any factory but yes you can use the available land for its maximum potential & for that you need to make policies & here is where the chaos started! As people (read builders) started realizing it’s the polices which can make land potential increase & then rest of the policy makers also soon realized that actually they are the one who are creating virtual lands via FSI/TDR/TOD/Paid FSI tags & builders are making money! So the policy makers once got wise with this knowledge started making policy for individual city or suburb (read as per the demand & not need) & then finally "Mai Baap Sarkar" awakened that if everybody related to land policies is making money why cant govt also make some!

Till that time so much of burden (read financial burden) has been added on the land, both i.e. land rate first & that of FSI as well expenditure in generating that FSI, that the homes has become out of reach for the buyers as however luxurious & best quality homes you build & with world class amenities with investors money pumped in, yet finally you need some family to actually buy it & live in that home! And when with all these policy makers ( read all segments connected to land) wanting their cut from the money which actually was going to come from the pocket of this home buying family, they realized there are no or very few families who can actually buy their dream home! And this is why the last news is related to all other policy news i.e. builders owing crores of rupees to investors as well flat holders!

Because if you go through last decade especially regarding polices then it’s not, “Ease of Doing Business” but “Ease of Not Doing Business” is the scene! You don’t believe my words, then above two polices are best example! As for so many years there was no construction allowed along coast line of sea-shores up to 500 m & its huge area & suddenly when all such lands poor land owners must have sold with frustration as its of no use; then one fine morning govt announces, yes you can build in the zone which was supposed to be No Development Zone for years! Don’t tell me how many original land lords or aspiring builders will be benefitted with this but a handful of big sharks that must have swallowed these lands already for their rosy development dreams! I can see the tag lines, “sip first cup of your morning tea with sound of waves” or “why you need a bathroom in your home when you have entire beach as your bath room” types! And it’s obvious this money from the changed land use will go to lucky few as well the govt as there will some hefty premium for allowing buildings here in CRZ! But the very same govt takes different stand about the rivers which are finally going to merge in the oceans only, see the joke, around the rivers which carries water to the oceans, construction has been banned but around the ocean itself it’s been opened & for decades it was vise e versa & then most of the cities in the State are around some river is also a fact! Now don’t ask what happens to the person who has bought land around the rivers considering the then present rules were allowing construction along the banks of the river barring a stretch of some 25 m wide! All such builders are doomed & their only fault was they thought the policies made by govt are like engravings on rock (read unchangeable), well it’s not, policies made by govt (about real estate at least) are writings in sand, which can get blown by wind or washed away by waves, is the bitter fact & that’s one of main reason of down fall of real estate at least in this State!

And if this is State wide scene let’s see what happening on policies regarding real estate at our Intelligent, Smart, Oxford of West & Cultural Capitol of State City, yes I meant Pune! Right from TOD (Well, Transportation Oriented Development is long form) FSI to not allowing TDR on 6m wide road (and yet making them 9m), to parking policy to premium rates to ban on constructions adjoining the nallaahs (yes they were streams some years back), to ban on construction along foot hills (and lifting it too), to redevelopment of ULC affected societies; the real estate in city is confused, devastated, frustrated & yes helpless about the policies on this front! Feather in the cap is Aviation Ministry’s NOC for buildings above certain heights & reason is threat to airports in & around Pune. Well, many came to know that NDA (National Defense Academy) has air port also which actually is an air strip. Nobody denies the importance of our defense establishments yet for so many years these airports were & are here & so was development but I don’t remember any threat to them. And then out of blue we come with a policy to protect these air ports, that’s fine, issue is the way such policies are framed & implemented without any system in place causing delays & distress only for the real estate! As who decided the zones regarding height restrictions, what kind of survey has been done, what about Pune’s basic ground contour as this is city of hills so the average ground level varies largely from suburb to suburb, many such questions are there which has been either ignored deliberately or negligently, And then no system is in place to measure the height of building from mean sea level, certify it & issue NOC in time but one has to go via grinding process involving agencies like Geographical Survey of India & “Baap of All” i.e. Defense Ministry, both of them gives damn to the development of the city rather considers it as virus in the body! With all latest technology like Google Maps at hand why we still need basic certification like height from ground level from some govt institute which has been forgotten its own purpose of existence, is I will ask! Instead ask any of these defense officers or even Geographical Survey’s officers which are supposed to give NOC for height for buildings in Pune, that while driving in some new city does they refer their own dept’s maps or Google map & their reply will say all!

Outcome is one more NOC has been added in endless list of such documents required to get sanctions for a building & one more expense head too got added for the that family which will be making home in this building. Problem is not with NOC’s, problem is the system involved in giving such NOC’s as why can there be Single Window at local sanctioning authority (read PMC/ PCMC/ PMRDA) for every such NOC! But then in this country you don’t ask such question & definitely not if you are a builder by yourself as the PMC itself can’t run Single Window within its jurisdiction, thinking of applying it for the organizations out of PMC is something which I would not dare to even dream! And another side of this coin is which dept (read system) will miss to have a cut in the cake (read real estate) by allowing some other organization getting their NOC’s rights!

And on all this back ground there was a news in which our Hon PM is saying real estate prices has came down & that’s success of the policies by the govt & that’s why today’s youths can fulfill their dream of owning a home! Indeed real estate prices has come down but it’s not just policies success but somewhere its outcome of the greed of the builders as well everyone related to real estate is one main reason to make the homes out of budget of genuine buyers & slowing down the sales; which is main reason of fall in real estate prices! As this is desperate effort by the builders frustrated (read defeated) by real estate related policies, who are in cash crunch due to slow down of entire process of manufacturing of the homes which is making them sale at prices even lower than manufacturing costs! At the same time the scene on other side is millions of people in every city (even the above eight cities in news) needs their home & want to buy it & can’t buy a legal home so are succumbing to illegal homes which eventually gets regularized via some policy only!

Hon PM Sir, we have all respect of your efforts for making homes available to all the countrymen but then for that you need to make a comprehensive policy by which the real estate itself should feel that this is an affordable business in first place, is what I will request to look in! Or else the day is not long where affordable homes’ (read any type of homes) policies will be there but no makers will be around to build those homes!

Sanjay Deshpande

Sanjeevani Dev.

Please view my sharing about real estate in Pune at U-Tube link below..

https://youtu.be/g3lx1Nq7pBs

Please do visit my blogs to know about our philosophy at Sanjeevani ! (Click the links below)

http://visonoflife.blogspot.com/2018/08/pune-city-no-1.html