With the Indian housing sector reeling under a large number of unsold inventory, the Economic Survey 2019-20 has suggested that developers should clear their stock by taking a haircut and selling apartments at lower prices. (#BudgetOnZee)

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The survey also said that real estate players taking a haircut would also help clean the balance sheets of banks and non-banking financial companies (NBFC). "Existing unsold housing inventory can be cleared and the balance sheets of both bank/non-bank lenders cleaned if the real estate developers are willing to take a `hair-cut` by allowing the house-prices to drop," it said.

Commenting on the survey, Anuj Puri, Chairman, Anarock Property Consultants said: "As for property prices, they are already at their lowest best across most cities and the prospects of them reducing further are extremely low. Nor are prices the sole reason for lack of demand. In fact, as much as 36 per cent of the existing unsold stock is in the affordable price bracket of Rs 40 lakh and below."

According to data from Anarock, the stock of unsold houses across seven major cities in the country stand at around 6.48 lakh units.

The low demand for houses is largely attributed to the liquidity crisis and lack of funds with prospective home buyers.

The survey tabled in the Parliament by Finance Minister Nirmala Sitharaman also noted that higher investment in housing by households may increase the fixed investment in the economy. It observed that the government`s thrust on affordable housing is evident, in order to boost the real estate sector and consequently the construction activity in the country.

On the Pradhan Mantri Awaas Yojana, the survey, prepared by Chief Economic Advisor K.V. Subramanian, said that under PMAY-G (Gramin/Rural), the number of houses completed in a year increased by more than four times, from 11.95 lakh in 2014-15 to 47.33 lakh in 2018-19.

Further, the scheme of PMAY-U (Urban) is also rapidly moving towards achieving the vision for providing a pucca house to every household by 2022, as per the document. It said that out of 1.03 crore houses approved, 60 lakh units have been grounded for construction, of which 32 lakh houses have been completed and delivered.