Real Estate Developers hoping for concessions in the upcoming Union Budget 2015-16
The Union Budget is among the most important economic events of the nation. Every year, the Union Budget is awaited by all sectors of the economy, including real estate. It is therefore natural for players of the real estate sector to hope for measures that will give a much needed boost to the sector. Many developers are hoping for some concessions and announcements that will accelerate the property market. Makaan.com team finds out the view of Developers, lets read what concessions they are expecting from the Union Budget 2015.
Mr. Dhirender Gaba, MD Fairwealth Housing Pvt. Ltd.: Real Estate Sector is considered as the main contributing sector for the Indian Economy and still does not enjoy the status of Industry which certainly is the biggest hope of the sector from the govt. in this upcoming Union Budget for 2015-16. Affordable housing is the key to emerge the sector from the current crisis and we look forward to the govt. to give some relaxation in the home-loan rate of interest, availability of the funds for the land purchase and the development of the projects from banks and other financial institutions at the lesser rate of interest. The introduction of the GST Taxation system will further relax the end-user from the numerous taxes which are payable at the purchase of the property.
The long pending request of Single Clearance Window is still under considerations and should be taken into account as this single step will reduce the burden of the developers and will also reduce the cost and time which we generally spend on taking approvals from so many concerned authorities. The system of transaction and approvals could be made easy and online. The Govt. has been taking various vital steps to boost the economy and the real estate sector in particular thus we are very optimistic and hopeful to have important announcements on the day of the Budget.
Mr. Manoj Gaur, MD, Gaursons India Ltd & President CREDAI Western UP: I firmly believe and hope that the government will seriously think about giving infrastructure status to the real estate sector and easy licensing or single window clearance system should be introduced in the forth coming budget. At present Rate of Interest are at all-time high and from here rate of interest are expected to fall only. Government should focus on the green housing concept and to promote this they will have to announce the more incentives and subsidies for the environmental friendly material and equipment. The new government has the opportunity of making Indian real estate more investment-friendly and attractive by introducing a revised tax code. Government has to introduce the essential changes to overcome the tax hurdles because REITs will become the life-saver for Indian real estate. The government should raise the tax exemption limit for interest payment on housing loan from the existing Rs 2 lakhs to Rs 3.5 lakhs per annum.
Mr. Om Chaudhry, Founder & CEO, FIRE Capital & Chairman, Astrum Homes: Housing Sector contributes almost five per cent of the country's GDP. In the next five years, this contribution to the GDP is expected to rise to 6 per cent. Indian real estate sector has seen an unprecedented boom in the last few years. This was ignited and fueled by two main forces. First, the expanding industrial sector has created a surge in demand for office-buildings and dwellings. Second, the liberalization policies of Government have decreased the need for permissions and licenses before taking up mega construction projects.In view of above, governmental action is required in adequate measures to let the sector grow and also generate sufficient reserves to continue investment in the sector.
Mr. Rohit Gera, Managing Director, Gera Developments: On the back ground of a negative sentiment, the government must take definitive steps to deliver on its promise of "ache din". Today's citizen lives in a world of instant gratification. People do not have the patience to wait for the structural reforms to trickle down to them (which it eventually will). The finance minister therefore needs to take steps to now provide citizens with clear benefits.
The Governor of the RBI has already reduced rates by 25 bps. This however, is not adequate to jumpstart the real estate sector. We need out of the box bold decisive moves - an example of this could be to offer single home buyers an extra 100% deduction of the interest they pay for their homes for a period of 5 years. The effective interest rate for customers works out to 7% and the revenue loss for the exchequer on account of this additional deduction will be more than offset by the revenue gain on account of all other taxes on the home. Our expectations are therefore very high - the government must take clear and unequivocal steps that affect the pockets of the average citizens.