Home run for real estate in nugget
- Affordable housing gets infrastructure status
- Holding period for capital gains tax for homes reduced from 3 to 2 years
- Capital gains tax only in the end of completion year
- Tax break of 1 year after getting completion certificate for unsold inventories
- Instead of built-up area of 30 and 60 SqM, Carpet area will be applicable
Union Budget 2016-17; Budget for a cause
Union budget 2016-17 gives many reasons to us to rejoice. Unlike every year, this year everyone has some or other modest rate of interest in the Mr. Finance Minister’s speech. After all it seems to be quite promising in order to bring PMO’s dream project, ‘Housing for all’ extremely closer to its goal. The unveiling of budget by Arun Jaitley on Wednesday spread to the young professionals and the developers like a joy housewarming party! After their dream home is not far away. This year’s budget has increased their net pay by halving the tax rate, for those whose incomes are up to INR 5 Lacs.
Affordable Housing: Infra status
And the biggest reason that is bringing a positive stir in the real estate fraternity is the announcement of infrastructure status for affordable housing segment and offered ax sops to the developers with completed but unsold homes to get a revive in the sector. At present, the houses that are unoccupied though have their completion certificates are subjected to taxation. In this regard, Finance Minister, Arun Jaitly opined, “ For builders , for whom constructed buildings are stock-in-trades, I propose to apply this rule only after one year of the end of the year in which completion certificate is received so that they get some breathing time for liquidating their inventory.”
Instead of built-up area its now carpet area
Adding one more to the many benefits real estate is counting the blessings as the “measurement criteria has been changed to carpet area from built up area. This is going to make more spacious homes eligible for affordable housings’ says Mr. Jaitly. In his speech he said the National Housing Bank and Pradhan Mantri Awas Yojana will refinance individual home loans of about INR 20,000 Crore in 2017-18.
Real Estate market is here for bigger innings
In all these, the Government believes that the impact of demonetization is temporary. In the real estate Sector, the moves including the reduction in tenure of long-term capital gain tax from 3 years to 2 years. rationalization of capital gains, infrastructure status to affordable housing and most importantly the increase in the size of the affordable housing unit, enhancement of universe for the 60 SqM stipulation in the segment, are all positive steps for the real estate sector and is certainly helping in providing the much required thrust to the affordable segment of the segment.