DNA Money Edit: Realty awaits Seventh Pay Commission bounty

Elections are seen as a driver to revive a slowed down economy. Real estate sector is one such industry where the future doesn't seem bright immediately. Perhaps, decisions that the Union government may take just before the general elections or during the interim Budget can help the sector to recover partially. One such decision awaited by the industry is implementation of Seventh Pay Commission. If this happens before elections, the industry would benefit through higher sales as compared to the last few years. 

However, certain issues still need to be ironed out between the government and the employees as the latter are demanding a higher fitment factor of 3.68 times as against the earlier decided 2.57 times. With the existing fiscal deficit situation, it is unlikely that the higher demand will be accepted. As a result, there will be an uptick in housing sales, but not by a higher percentage. 

Nevertheless, for a struggling industry that has been hit by one after the other crisis or policy decisions like Real Estate Regulatory Act and Goods and Services Tax as well as the ongoing crisis at non-banking finance companies, implementation of Seventh Pay Commission, irrespective of the fitment factor, will surely be a welcome move.