Nifty99000 100%

Sensex99000 100%

Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
RSS

News

Housing fund get fillip, but no relief for taxpayers

Author: IANS/Friday, February 2, 2018/Categories: Real Estate

Housing fund get fillip, but no relief for taxpayers

New Delhi - Welcoming Union Finance Minister Arun Jaitley's announcement to create a dedicated affordable housing fund in the National Housing Bank, real estate experts however said significant incentives or exemptions on the personal tax front were the missing factors for the sector.

However, they expect Jaitley's announcements for developing better connectivity through air, road and rail would give an impetus to the housing sector.

"My government will also establish a dedicated Affordable Housing Fund (AHF) in the National Housing Bank, funded from priority sector lending shortfall and fully serviced bonds authorised by the government of India," Jaitley said while presenting the Union Budget for 2018-19.

In line with the government's "Housing for all by 2022", more than one crore houses were being/would be built in rural areas in the current and next financial year under the Pradhan Mantri Awas Yojana, he said, while in urban areas, assistance has been sanctioned to construct 37 lakh houses.

"The announcement of a dedicated Affordable Housing Fund seems to be the right move towards achieving the vision of 'Housing for all by 2022'," said Anarock Property Consultants Chairman Anuj Puri.

The allocation of Rs 14.34 lakh crore for livelihood and infrastructure upgrades in rural areas will bring a clear focus on the building of roads, which will certainly boost budget housing as it is invariably developed in well-connected peripheral areas, he said.

"Strengthening affordable housing sector through creation of an affordable housing fund will allow better access to capital for related developments in urban and semi-urban areas," said JLL India's CEO and Country Head Ramesh Nair.

Company 99Acres Chief Business Officer Narasimha Jayakumar said that the dedicated fund will help create more affordable supply as well as drive demand from genuine end-users.

"A major push on highway development and inner-city rail networks give the necessary impetus to real estate development. Further push to Udaan, development of 600 plus new railway stations will mean better connectivity to smaller towns, spurring real estate development beyond metros," he said.

In his budget speech, Jaitley noted that a roof over the family's head is another concern for the poor.

"Far from the benami (proxy) properties earned through corrupt means, the poor only desire to have a roof, a small house by his honest earnings. Our government is helping them so that they may fulfil the dream of owning a house," he said.

However, experts were disappointed with no changes in the income tax slabs and absence of other direct measures that influence the real estate sector.

"The real estate sector's long-standing demand of getting an 'industry' status has once again not found mention. Further, there was no concession for external commercial borrowing for real estate.

"The sector expected to see some measures to infuse demand, with relaxations in key tax rates like 80C, 80CC and 24B, which too have not been addressed. Aspects like single-window clearances, uniform stamp duty or reduction in Goods and Services Tax rates on real estate were not mentioned either," Nair said.

KPMG's Partner and Head, Building, Construction and Real Estate, Neeraj Bansal said while the Finance Minister marginally incentivised the salaried class with a standard deduction of Rs 40,000, with no other significant incentives or exemptions on the personal tax front, there is not much change in the net disposable income.

"As a specific measure, 5% leeway in terms of taxability of difference between transaction value and stamp duty value vis-A-vis transfer of real estate property is a welcome move, however, the impact of the same may be minimal," Bansal said.

Credai Bengal President Nandu Belani said the introduction of 10% tax on long-term capital gains exceeding Rs 1 lakh, is likely to act as a dampener for investors in stock option and ergo, likely to move to real estate sector as an alternative investment option.

According to Puri, there was conjecture that cryptocurrencies would find their way into the Indian real estate, as it has in developed countries, effectively becoming the 'new black money' in the sector.

"With the government now intent on taking all necessary steps to eliminate the use of cryptocurrencies in India, people who were looking at them as a get-rich-quick route will have to look at traditional asset classes and investment routes again," he added.

Print Rate this article:
No rating

Number of views (384)/Comments (0)

rajyashree guha

IANS

Other posts by IANS
Contact author

Leave a comment

Name:
Email:
Comment:
Add comment

Name:
Email:
Subject:
Message:
x

Videos

Ask the Finapolis.

I'm not a robot
 
Dharmendra Satpathy
Col. Sanjeev Govila (retd)
Hum Fauji Investments
 
The Finapolis' expert answers your queries on investments, taxation and personal finance. Want advice? Submit your Question above
Want to Invest
 
 

Categories

Disclaimer

The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.