Considering
that the welfare of the poor and middle class is the priority area of
the government and the assembly elections manifestos of all the major
political parties centre around housing and urban development, this
year's budget is expected to give a major thrust on real estate housing
& infrastructure.
The Budget 2017 should
be seen in the backdrop of a tough year for real estate and housing,
with the problem of weak sales and high unsold inventory getting further
precipitated by demonetisation. It's a matter of concern that the sale
of housing units declined by 10 percent in the six month period ending
September 2016.
This
poses a major challenge to NDA government's flagship programme of
'Housing for All', as housing besides infrastructure, is a major booster
to GDP especially in a slowdown economy and has a multiplier effect on
allied sectors.
It's
time to build on the foundation of structural and institutional
reforms, addressing the vital issue of seamless implementation of key
reforms like Real Estate Regulation Act (RERA), Smart Cities Mission,
REITs (real estate investment trusts), GST and Bankruptcy Act and carry
out the unfinished reform agenda of 'Ease of Doing Business and Single
Window Clearance'.
As
the government is rightly giving boost to affordable/low-cost housing
for the success of its 'Housing for All' mission,the budget needs to
come up with policy initiatives/incentives to give a fillip to
affordable and low cost housing by way of direct benefits to home
buyers, resulting in enhanced affordability.
In
order to widen the scope of interest rebate on affordable
housing,there's a need to enhance the 30 sq mtr area limit of houses,
especially when the government has already broadened the scope of
interest subsidy under Pradhan Mantri Awas Yojana (PMAY) by enhancing
the loan eligibility limit from 6 lakh to 12 lakh by creating two
additional loan slabs of 9 lakh and 12 lakh with interest subsidy of 4
percent and 3 percent respectively. Read more
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