new delhi government should set up an exclusive stock exchange dealing only in realestate based mutual funds to arrest the current downtrend and boost growth of the sector a leading real estate consulting firm has said setting up a stock exchange allowing exclusive trading in realestate based mutual funds is absolutely necessary for the growth of the sector sanjay verma director cushman wakefield said he said real estate investment trusts reits like the ones existing in the us to allow buying and trading of realestate based shares should also be established us experience in reits offers us an innovative option of permitting investors to buy and trade shares in the real estate sector verma said and added permission should be also be given to collect dividends from capital appreciation and rental incomes an reit is a company that buys develops manages and sells real estate assets and allows participants to invest in a professionally managed portfolio of properties verma said introduction of real estate mutual funds and mortgagebacked securitisation would help to provide a muchneeded fillip to the domestic real estate sector current economic slowdown coupled with the uncertain global security environment has affected the domestic real estate sector with property prices plunging by over 10 per cent this year hudco chairman v suresh thinks reit is a viable option with requisite tax and regulatory structures this would result in increased rental housing generation he says outlining the primary difference between reits and other realestate companies suresh says it is primarily a clearing entity which distributes the majority of its income cash flow to investors thereby saving taxation at corporate level reits are generally classified into three categories equity reits mortgage reits and hybrid reits majority of reits in the us are equitybased currently there are over 300 publiclytraded reits operating in the us with total assets of over 300 billion and with average daily share transactions of over 260 million according to suresh over 149 reits are listed in the new york stock exchange suresh also advocates permitting fdi in realestate sector with necessary checks and balance saying it would bring competitiveness into the sector on the issues impacting the growth of real estate in india sanjay verma believes there is a need to draw up conducive investment guidelines for the sector