Excited and thrilled with yesterday’s budget Atul Gupta – JMD, Earth Group of Companies said, “The Union Budget announced by Finance Minister yesterday will give a much required boost to real estate industry. Tax benefits forwarded to people specially I-T exemption against housing loan interest will help in building a positive buyer sentiment. Increase in tax slabs by Rs 50000 will further strengthen common men’s hope of owning a home; turning their dream into reality.”
Also the schemes announced today by Finance minister for improving infrastructure such as sanitation & electricity, boost in medical facilities and increase in education hubs and a special initiative of developing 100 smart cities with an investment of Rs 7060 Crs will instigate real estate shift from key cities to other un-tabbed cities, which again is a very positive sign.
According to the housing ministry, there is a shortage of around 18.78 million houses in the country of which 96% is in the economically weaker and low income segments. Budget allocation for rural housing scheme and affordable housing for urban poor is also an exciting move for both real estate industry as well as people at large. Affordable housing in India will surely be promoted by Governments venture of providing ‘housing for all by 2022’ through new measures announced in Union Budget that comprises allocation of funds for national housing bank, setting up a mission on low cost affordable housing and inclusion of slum development in the list of CSR activities, would help in promoting development of affordable housing in the country. The budget not only talks about PPP but also offers a lot of scope for such partnerships.
The government will offer all the necessary incentives for real estate investment trusts (REITS) and giving a tax cross status is an encouraging move as it will help in reducing the pressure on the banking system, avail fresh equity as well as draw long term finance from foreign & Indian sources. The reduction in built-up area threshold from 50,000 square metres to 20,000 square metres and capital requirement from USD 10 million to $5 million would help boost FDI in housing projects as more projects will now qualify.
There is no doubt in saying that the budget will be highly effective and fruitful. Focusing on fiscal prudence, this budget has introduced proposals that may help to launch investments in the real estate sector. Also the budget sets a directional industrial upsurge with 16 new ports, airports, revival of SEZs which will help in boosting economy in longer run. Over all it’s an exciting and a far-sighted budget.