Realtors demand more affordable homes in Budget

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Realtors demand more affordable homes in Budget

With demand for residential steadily rebounding, realtors in the country are demanding consumer friendly measures from finance minister Nirmala Sitharaman in the upcoming budget to boost home sales.

Most of the demands from the country s real estate developers are focused on incentivising home purchases, from raising the decades old cap on the deduction against home loan interest to increasing the horizon of affordable homes in key metro markets.

According to Niranjan Hiranandani, Co-founder and Managing Director of Mumbai-based real estate giant Hiranandani Group, a stimulus will help the sector's growth momentum to sustain in the upcoming Budget. We want to raise the cap on deductions on home loan from Rs 2 lakh to Rs 5 lakh. It wouldn't cost more than Rs 5,000 crore directly to the exchequer, but it will help boost the sector to a greater extent. This is long due to the cap being imposed some two decades ago and it's high time for a revision he told Business Today.

The government is trying to increase the Rs 45 lakh cap on prices of affordable homes because of the high land prices in and around the key metro markets. According to Hiranandani, the cap should be raised to 1 crore for metro markets so that more buyers are encouraged to purchase a home.

Pankaj Bansal, M 3 M India director, said the reduction in taxes and additional rebates provided by the government will encourage more millennials and Gen Z buyers to enter the housing market.

Buyers are looking for better tax rebates. Nearly a third of the young Indians are under 35 years of age as borrowers of home-loans. These are all active home-loan audiences and together account for 53 per cent of the annual originations, with the age group of 36 -- 45 years. He said that investments in real estate from these young millennials will grow only with the relaxation of taxes and rebates by the Govt in the Union Budget.

Pradeep Aggarwal, Co-Founder Chairman, Signature Global and Chairman of ASSOCHAM National Council on Real Estate, Housing and Urban Development, is of the opinion that increasing fund allocation for Pradhan Mantri Awas Yojana will be helpful.

We expect the government to double the amount of funding allocated for Pradhan Mantri Awas Yojana to allow more people to achieve their dream of owning a home. This will help to achieve the government's goal of Housing for All by the year 2022. Aggarwal demands incentives for developers due to rising costs of operations. The Finance Minister will have to pay attention to the Input Tax Credit, reduce the GST on goods and services and continue tax holiday for affordable housing developer, he told Business Today.

Industry status to real estate sector is a long-standing demand, which makes it hard for real estate sector to get legitimate funding from banks and other financial institutions. Amit Modi, Director, ABA Corp President Elect, CREDAI Western UP said it will help in getting low cost loans from the system, and then the cost benefit with regard to high interest loans from outside the system can be further moved on to the end-users.

According to Deepak Kapoor, Director at Noida-based Gulshan Group, the real estate market sentiment is positive this year, compared to the two Pandemic years gone by. Kapoor feels that it is high time that the government gives industry status to the sector. That will give developers the ability to avail cheaper credit facilities from financial institutions and banks. Stamp duty and registration charges would be highly acknowledged, and would be highly acknowledged. He said that the sector is counting on the government.

The corpus of the government-backed stress fund SWAMIH should be raised to at least 1 lakh crore. The current corpus of Rs 25,000 crore has already been committed. He said that this will help in the completion of stuck projects and bring back the trust of consumers in the under construction property market.