Budget Expectations: Housing for all should top government’s agenda list, say real estate experts
Consumer centric relaxations like additional housing loan deduction for taxation, interest at lower rate from a special housing fund, are expected. Credai also stressed that there should be concessional GST at 5% for affordable housing and relaxation for women buyers in PMAY (Pradhan Mantri Awas Yojna) norms.
Real estate sector in Pune, post demonetisation last year, is witnessing stability even as the sale of flats have gone down. The implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA) with effect from May 1, 2017, has been another major step. Ahead of budget, the housing sector hopes that housing for all will top the list of agenda for the government during the budget.
Shrikant Paranjape, president, Credai, (Pune Metro), said, “It is expected that the government will give benefits mainly to affordable housing. The amendment to s80IB (A) so that very large developments can also participate in affordable housing thereby increasing affordable housing stock, thus taking steps to bring in ease of doing business for affordable housing such as sanctions by architects. Lowering of ratio and risk rating for affordable housing which has hot infrastructure status, so that larger and cheaper housing loans for consumer and construction finance for developers will be available.”
He also said that consumer centric relaxations like additional housing loan deduction for taxation, interest at lower rate from a special housing fund, are expected. Credai also stressed that there should be concessional GST at 5% for affordable housing and relaxation for women buyers in PMAY (Pradhan Mantri Awas Yojna) norms.
Shantilal Kataria, president, Credai (Maharshtra), said, “In last year’s budget, infrastructure status was declared to affordable housing but still not implemented in true sense by RBI/ banks, that should be done on priority, while some of the income tax provisions should not be co-related with ready recknor/ circle rates of states . There should not be additional burden of tax on flats sold below ready recknor rates. Increase PMAY subsidies amount by at least 50% for benefit to end consumers. GST should include state stamp duty or reduce GST rates to 6% ( like earlier service tax+ VAT (4.5% + 1%) ), taxation on unsold inventory should be removed, appropriate changes and incentives for consumers and also developers in income tax act to increase supply of affordable housing in entire nation, concessions in interest of housing loans to boost housing sector in totality, special benefits to women in PMAY subsidies, provide more incentives to first time home buyers, to overcome the impact of reforms like GST, Rera and demonetisation. This time expectations are high for announcements of strengthening and improving real estate sector in turn to increase GDP growth.”
Nitin Kulkarni, director, Vastuahodh Projects, said, “I think the budget should boost the sagging sentiment of the economy by bringing in major reforms in direct tax (income tax), thereby leaving the middle class with a higher disposable income, which would have a positive impact on the economy. A lot of thrust (and monitoring) is to be put on banking sector to increase / prioritise lending to SME’s and real estate industry to help them tide out of difficult cash flow situations. Moreover, capital cost has to reduce by reducing prime lending rates. Banks have almost stopped lending the SMEs because of the poor financial health of the banking sector created by NPAs of bigger defaulters / large scale industries.”