Real estate companies may have welcomed the new budgetary provision on tax rebate for home loan EMIs, but the man on the street did not appear overly enthused.
The government had in the Union Budget proposed to extend the period of tax rebate on equated monthly instalments (EMIs) from three years to five years. Now, homebuyers who are paying EMIs but have not got physical possession of their flats can seek tax rebate on EMIs for five years in four instalments.
“The Central government’s move is good, but it will help very few people in the vicinity. Most of the projects in Noida and Greater Noida are delaying possession from five to seven years. The government must understand that we are paying EMIs without shifting to the flats. The money is still going to the banks and they are making profit. Why are they giving us a time-bound rebate,” said Abhishek Kumar, president, New Era flat owners’ welfare association (Nefowa).
The homebuyers’ association demanded removal of the time limit on tax relief on EMIs
“It has been five years since I bought a flat at Logix Blossom County in Noida. Since then, I have been waiting for possession. According to the new law, my EMIs will be out of the permissible limit from next year, but I don’t know when I will get the possession. The government should check the ground reality. All the projects are delayed,” said Neeraj Kumar, a homebuyer.
Those who bought houses at the soft launch of projects are suffering the most. Many of the builders have delayed possession for up to eight to nine years.
“It has been six years since I booked a flat at Arihant Arden project at Greater Noida West. Now, I cannot seek tax rebate on EMIs and nobody can assure when I will get possession of my flat,” said Hareram Pathak, another homebuyer.
The builders, however, welcomed the government’s move and said it will encourage buyers to invest in properties.
“It is a reality that no builder can deliver a group housing project within three years. Five years is a minimum requirement for completing a project. It’s good that the government thought about the investors’ money. We hope this will attract flow of money in the industry,” said Amit Modi, vice president, confederation of real estate developers association of India (Credai), Western UP.