Odisha, Real Estate sector adversely affected due to huge charges on land owners for issuance of Power of Attorney

Bhubaneswar: In Odisha, Real Estate sector is being adversely affected due to huge charges on land owners for issuance of Power of Attorney (POA) to do business for Joint Development Projects.

Incidentally, other states have provisions for a separate category for Development Agreement Cum General Power of Attorney (DACGPA) where charges are very nominal. As development agreement cum Power of Attorney is considered as a contractual obligation, which is subject to cancellation in case of non-compliance of the terms and conditions in the agreement or failure to take up projects for any reasons and getting the mandatory approvals in time.

Ironically, in Odisha, the registration authority is charging normal rate for both getting and cancellation of POA @ 7% on market value of land in the absence of specific provision for this purpose. These unreasonable charges shoot up prices of houses. This has forced developers to sell homes at high rates. By denying the level playing field to developers, the authorities have not allowed us to compete with prominent developers from neighboring states.

Consequently, the investment in housing sector has gone all time low as local consumers prefer to invest in real estate in other states due to competitive offers. Since the state government is keen and committed to promote Affordable Housing, Ease of Doing Business, Start up and Stand up, there is an urgent need for creation of separate category for DACGPA with nominal fees which will go a long way to boost the sector.

This action also will facilitate small and medium class entrepreneurs to fulfilling the dreams of millions of affordable home seekers. Such reformative measures will also enable the authorities to earn three to four times more revenue at the time of registration as property values become higher by five to six times after development. Further, it will encourage more new entrepreneur to start up housing business with less investment and will make sector more competitive and standardized.