The Confederation of Real Estate Developers' Associations of India (CREDAI) has written to the prime minister, asking him to intervene in order to ease the credit freeze that's hit the real estate sector. The apex developers' body has claimed the scenario has an adverse impact on the entire real estate ecosystem, which may also lead to home buyers not getting timely possession of their houses.

"At a time when developers are under immense pressure to deliver projects on time, financial institutions are cancelling disbursements after loans were sancitoned, leading to non-adherence of timelines specified to buyers," said the statement from CREDAI.

"Currently, the Indian real estate sector requires the government's support more than ever before. We have submitted a bouquet of options to resolve this issue. We hope to work together with the concerned authorities and resolve the issue amicably," Jaxay Shah, CREDAI president, said.

Getamber Anand, chairman, CREDAI National, commented, "The Indian real estate sector is the second largest contributor to the country's GDP. It's imperative that the industry is brought to a sustainable path of development. At this critical juncture, we seek the government's immediate intervention to provide adequate avenues of liquidity to developers to sustain the revival of Indian realty."

Part of CREDAI's recommendations to the prime minister included a one-time restructuring scheme for bank loans, while also seeking that the RBI include a sub-limit of 10 per cent for affordable housing in an overall target of lending 40 per cent to priority sector. This would help increase flow of credit to cheaper rate to affordable housing. Apart from this, they also suggested the creation of a 'stressed asset fund', which will be directed to address "last mile funding" for completion of real estate projects. The fund would support the existing bank funding by providing only additional funding required to complete the project.