New Delhi: The Finance Minister Arun Jaitley while presenting the Budget 2017-18 in Parliament on Wednesday said that the scheme for profit linked income tax exemption for promoters of affordable housing will be broad based.
Jaitley also said that affordable housing will now be given infrastructure status, which will enable these projects to avail the associated benefits.
Here's what real estate players said on Union Budget 2017-18 :
Rajesh Doshi, Managing Director, ACME Group
The Union Budget 2017 is a very encouraging & favorable Budget for housing Industry. Government has realized the hurdles and challenges faced by the realty sector and its buyers. They have considered all the challenges faced by the housing industry and tried to resolve most of them.
The biggest announcement is awarding infrastructure status to affordable housing. “This will not only give the biggest boost to PMs ‘Housing for all scheme’ but also enable developers to cater to the citizens who cannot afford housing today. Due to this status, developers like us who are working on these projects will get access to lower cost funds and hosts of other benefits. Moreover, by increasing the size of the affordable homes by changing from built-up to carpet area allows for better planning of the house.
Additionally, the government has taken into considerations that these are generally larger projects and take longer to complete and thus has increased the time line of project to 5 years from 3 years. NHB refinancing 20,000 crore of housing loans will enable HFC and other institutes further lower the interest rates to these segments.
There is cheer even for projects which do not fall under the affordable segment. One of the major change is that the holding period for capital gains tax for immovable property is now reduced from 3 years to 2 years. This will help people who want to sell existing properties and upgrade. People will also get benefit of indexation so tax incidence will be much lower. Indexation for older properties is moved to 2001 from 1981. Again, huge tax break for people who want to upgrade from older flats. All these decisions will boost the realty sector and allied industries like steel, cement – much needed impetus to the remonetizing economy.
However, some benefits for mid-income, upper-income realty buyers would have been good, especially in the metros.
From the developers side, the decision that the landowner entering into joint development agreement for development of the property, shall be subject to capital gains tax upon completion of the project is a good one and will usher in lot of clarity and remove ambiguity in this aspect.
Anil Jindal,Chairman SRS GROUP
As every year, this year’s Union Budget has ushered in positive advancements for various sectors, including Infrastructure and Real Estate. We are delighted to note the overall reforms initiated by the government to promote an environment for the growth and functioning of affordable housing, a movement that has been championed the Cabinet post 2015.
Discussed in the latest budget, the government announcement for real estate sector states that affordable housing will be given infrastructure status, proving to be an added boost to its stature. This also results in real estate sector getting economical funding for affordable housing. Alongside bolstering the revenue for real estate, this move proves to make housing more approachable for the lower income brackets of the society. We belief that such prolific move would create a robust demand for economically-scaled real estate, while catering to the beneficiary of the mass.