Realty sector in Nepal faces imminent disasters that could shatter the economy unless the government and financial institutions (BFIs) along with the stake holders addressed the issues with stronger preventive measures.

BFIs are feeling that they are treading on risky grounds whereas the developers are already stuck in the form of non performing assets (NPA.)

Tax exemption for the first time home buyers, reduction in interest rates, increment in home loan ceiling to ten million, recommending middle class affordable housings and apartments in proper urban planning scenarios, introducing the ethical realtors, implementation of rules that foreigners can buy the house in Nepal are some of the major steps to take that could help realty sector of Nepal. Also the central bank needs to refinance the realty loans and allow restructuring to avoid similar casualties from losses. Government’s support for well planned urban development through housing developers, encouraging policy to facilitate urban housing along with satellite townships created and relocation of growing urban population will be an added boost for this sector.

BFIs’ should also look into those who are in the middle of constructing apartments that may need restructuring of their loan or may even need additional loans to lubricate their projects. The market itself will correct the pure speculative financing on land and housing. BFI's should try to find out a way to provide some relief to housing development.

To move away from the current slump, correction of regulatory stance, pricing and behavior are a must. The Government must act immediately to gain the confidence of the people. If the real estate market fails, it will be extremely difficult for our economy to survive.