I Earn ₹50,000 pm, Should I Buy A Budget Home Now?

Feb 26,2020 / By Commonfloor / No Comment

If you’re like most people, investing in a house is undeniably a dream. It is thus no doubt that owning a home from your hard-earned money is the most extraordinary asset that you can have. However, investing in a house is time-consuming and money consuming. Thus, buying a budget home can unquestionably do you good. Nonetheless, the most fundamental component of purchasing a budget home is to do extensive and in-depth research. Before you impulsively plan to sign on the house agreement documents, understanding your budget is quite indispensable. Buying a home based on your monthly salary, i.e., Rs.50,000 unquestionably depends on your overall fiscal health. The following are some tips that can help you understand if buying a house with your salary is the right decision for you.

Analyze the house-hold income after eliminating the tax

In India, tax undeniably takes away a fair amount of money from our income. Thus, ensure analyzing your overall income after eliminating the tax to get a vague idea of the amount you can invest for the house. There are several calculating apps online for understanding how much money you will be left with after paying the appropriate tax.

Analyze your monthly expenses.

Household, Personal loans, and bills are a few of the most vital aspects of your living. It is best advised to take out time to jot down your monthly expenses such as insurance, bills, utilities, etc. Moreover, if you’re a family man, there are several other necessities and expenses, such as tuition fees of your children and groceries for cooking. Therefore, eliminating these expenses will help you analyze your expendable income. Making use of financial tracking apps can give you the maximal benefit of making a reliable and money-conserving investment.

Understand your budget

Purchasing a house under your budget of Rs 50,000 pm is possible, provided, you understand all your expenses and necessities. Make the required adjustments and cut down your unnecessary expenses so that you can increase your savings. Thus, this way, you’ll be making an economically wise decision.

Analyze your debts

It is best advised to either pay off your entire debts from earlier or to minimize them to a potential extent. According to experts, getting approved for a home loan and handling your mortgage payments becomes much easier if you pay off your debts. What’s more beneficial, you ask? Well, the most appealing element about paying off your debts is that it can enhance your credit score. The credit score is unquestionably one of the determining factors of purchasing a house. Therefore, minimize your debts and other expenses to have the best chance of getting a personal loan.

Do not be impulsive

We all know how exciting and overwhelming it is to buy a house. However, it is not the right step to impulsively buy a house without doing the necessary research. It is best advised to save up some money so that your deposit can be paid conveniently. Although, a deposit might seem like a hefty amount of cash, saving up and planning your income usage strategically will help enhance your chances of getting a home loan, and paying the deposit.

Have a realistic plan

There is no doubt that a fancy, large, and comfortable house can have your attention in minutes. However, this does not mean that you can impulsively choose a home that will take away years and years of your life to pay back the debts. Thus, ensure choosing an affordable home. Analyze additional expenses such as the maintenance cost, homeowner association fees, tax, etc. Moreover, it is best advised to consult banks to understand if you’re eligible for a loan.

Have options

Most of us make the mistake of investing in the very first home that we see. How is this disadvantageous, you ask? Well, having options will give you the benefit of analyzing if you’ll be making a wise investment. Checking similar houses can help you potentially bargain your way of making a smart and reasonable investment for yourself. Therefore, take out some time to properly analyze and search for houses.

Make use of a home inspector

Hiring a home inspector is the most primary yet imperative element of understanding any potential threats that you might need to deal with in the future. Thus, make sure to hire a reliable home inspector to detect any potential damage and other issues that this house might cost you.

To sum up,

The journey of buying a house is unquestionably exciting and infuriating. Nonetheless, don’t rush into making such a big decision. Take your time to analyze your financial health and choose a home accordingly. CommonFloor is a leading online portal offering groundbreaking services in the real estate industry for simplifying your property decisions. They are a distinctive company offering a multitude of remarkable services for sellers, real estate professionals, and home seekers.

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Real Estate expectations from Union Budget 2020

Jan 29,2020 / By Hozefa Sanwari / No Comment

Union Budget 2020 Expectations

The Union Budget 2020 will be presented on 1st February by the Finance Minister, Nirmala Sitharaman. Given the policy reforms undertaken by the government over the past couple of years, the real estate industry is hopeful that the upcoming budget will provide the much-needed impetus. The year 2019 saw the government take numerous steps to help improve market sentiment and revive real estate demand. Reforms such as capital gain benefit, tax exemption on notional rent, incentivizing Affordable Housing, the revised rental income limit for TDS, and thrust on infrastructure growth were highlights of the Union Budget 2019.

This time around, the sector expects the Budget 2020 to lower the GST rates on under-construction projects, increase the NBFC credit liquidity, implement single-window clearances for project approvals, redefine the Affordable Housing price bracket, allocate additional funds for PMAY scheme, and fuel investment in infrastructure.

In this backdrop, Commonfloor conducted a real estate survey on builders across India to capture their expectations from the Budget 2020. More than 300 builders participated in this survey to express their views and expectations.

The majority of the builders (31%) expect the Budget to lower the GST on under-construction projects. GST reduction clubbed with the revival of Input Tax Credit can provide relief to the builders and housing can be made available at lower prices. After the reduction in GST rates in 2019, the government had withdrawn Input Tax Credit. The next key expectation of real estate is to address the challenge of NBFC (Non-banking Financial Company) liquidity. Liquidity will ensure positive momentum with a steady supply of ready-to-move homes. Also, single-window clearances can aid in procuring quick approvals so that project delays can be avoided. In the past few years, Affordable Housing has been the major growth driver. Still, it needs some reforms as currently only those houses are awarded affordable status and subsequently reduced GST rate of 1% which has a carpet area less than 60 sq.m. and falls under the price cap of Rs 45 lakh (GST rate for under-construction house is 5%)

Around 50% of the builders surveyed feel that the increase in Home Loan tax exemption is the primary factor boosting real estate demand. A further extension to the existing 2-lakh tax rebate on home loan interest rates will push the fence-sitters to buy homes. It could result in a higher demand for housing, especially in the affordable and mid-segment categories. Interestingly, “Redefinition of Affordable Housing” and “Income Tax Removal on Notional Rent” got equal responses from the builder community. The abolition of income tax on notional rent from the second self-occupied house benefits those with two houses and encourages home buying.

One-third of the builders surveyed feel that the GST rates are the most vital component hurting homebuyers’ sentiment. Apart from GST, project delays and high property prices are the other factors that affect consumer sentiments. Builders feel that the initial aid of Rs 25000 cr last-mile funding for stalled projects is insufficient for the realty sector and that it needs to be executed on a larger level on a priority basis. Moreover, home loan interest rates and high government taxes such as stamp duty and registration could be reduced to propel demand in the market.

Foreign Direct Investment is a key driver of economic growth and a medium of non-debt finance for any country’s economic development. One-fourth of the builders surveyed responded that single-window clearance will streamline the approval process and can bring about a major boom in FDIs for the realty sector. The next two major factors that can drive FDI are ‘clarity on entry-exit norms’ and ‘stamp duty exemption on FDI transfer’. More FDI in real estate will provide the necessary thrust to the current slump in the market.

Builder Bytes

Ajith Alex George, Director of 42 Estates says, “The real estate category in India requires bold fiscal measures from the union budget. The sector is going through a liquidity crisis with stalled projects across India, an economic booster required for the industry as a whole. Ease of Funding both on the supply and demand side along with quicker processing can again make this one of the key growth sectors. Approvals of projects have gotten better however there could be better clarity on some of the norms and changes in regulations, especially around taxation. Single-window clearance and query handling can make the process easier for the sector.

From the home buyers’ perspective, interest rates on home loans have to be reduced, we have been hearing further reduction on personal tax rates and stamp duties, this can strengthen the buying power of the home buyers which will have a compounding impact on the industry as both residential and commercial projects would get a better demand-side environment. The government is already doing its bit with the PMAY showing good traction, a further increase in subsidy rates for affordable housing can further help percolate this initiative. These steps might give the much-needed boost to the confidence of the developers and buyers alike.”

Mr. Amarjit Bakshi, CMD at Central Park says “Initiatives have already been taken to aid the real estate sector, such as tax concessions and availability of low-cost loans for developers and buyers. Reforms were put into place to promote rental housing as well as boost affordable housing, empowering the middle class and first-time home buyers.

We expect policy changes to boost consumption in the economy and improved liquidity for the industry by easing fund availability for the real estate sector, enabling the sector to come back on track, since it generates more than 6.5% of the GDP. It is expected that to boost investor interest, the limit of home loan interest will be increased. Announcing an industry status to the sector will bring manifold benefits.

Conclusion:

The implementation of the above-mentioned measures will help revive real estate growth to a great extent and give a thrust to home buying sentiments, which in turn will revive the economy. To generate cash flows for struggling builders, it is quite evident that the stress fund will be a big boost, but it would address only a small portion of the stalled projects. The rest could only be addressed by NBFCs and banks.

The real estate sector has long needed an industry status that can help to procure finances at a lower cost, especially now, when credit availability is a major headwind. The momentum of infrastructure development should continue from last year so that growth is decentralized and migration to urban centers remain under check. The real estate sector is optimistic that the upcoming budget will usher fresh stimulus in terms of bold fiscal measures to outperform its growth from last year.

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Property Tax Evaluation To Get Faster in Hyderabad

Oct 10,2019 / By Prahalad Singh / No Comment

Hyderabad: Property Tax Assessment To Get Faster

A plan to combine building permission and property tax in Development Permission Management System (DPMS) is on papers. Unlike earlier, property tax will be assessed while issuing the Occupancy Certificate.

As per the top Greater Hyderabad Municipal Corporation (GHMC), once the details are listed in DPMS for building permission, the data will be shared in a single-window platform and property tax will be assessed. The software will be developed to combine building permission and property tax.

As of now, after the occupancy certificate is issued by the civic body’s town planning division. It can not be ignored that there are cases where houses have been identified after 3-years of occupancy and bill collectors manually evaluated the properties and estimated property tax.

What Is a Property Tax Assessment?

A property tax evaluation decides the market value of a property. Evaluations are normally prepared on a particular date each year, and they are usually based on current sales of equal properties in the area. Local authorities use your tax evaluation on the basis of your annual property tax bill.

Is property tax evaluation fair the market value?

Property taxes are charged by the state in which you live. They will impose a value based on comparable homes in your neighborhood. This assessed value will decide the amount of property tax you have to pay. Usually, the assessed value of a home is less than the market value.

How can I check my property tax online in Hyderabad?

You can check your property tax status online by following the steps below:

Step 1: Visit the GHMC Property Tax Website
Step 2: Select Search Your Property Tax
Step 3: Select Your Property
Step 4: Verify Dues and Make Property Tax Payment

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Chandigarh: property tax exemption for widows, disabled, and defence personnel

Jul 2,2019 / By Prahalad Singh / No Comment

Chandigarh: Property Tax Exemption For Widows, Disabled, And Defence Personnel

Property tax from both commercial as well as residential properties is one of the major sources of revenue for Chandigarh Municipal Corporation. Last financial year, the civic body has collected around Rs.50 crore from property tax and expected Rs.52 crore for the current financial year.

The Union Territory administration has recently issued a notification and exempted widows, disabled, and defence personnel from paying property tax to the Chandigarh Municipal Corporation.

Last year in August, the civic body had passed a plan for 100% residential property tax exemption to defence personnel. This year, the Chandigarh Municipal Corporation also exempted defence personnel owing plots measuring less than 300 sq yards but more than 300 sq yards will have to pay only 50%.

The notification was issued on June 26 asserted that no tax shall be leviable on residential lands and buildings up to 300 sq yards owned and self-occupied (no portion is let out) by the widows and disabled persons.

The notification further asserted that no tax shall be leviable on residential lands and buildings up to 300 sq yards owned and self-occupied (no portion is let out) by persons who have served, or are serving, in any rank whether as a soldier or non-soldier in the naval, army or air force of the Union of India, for 300 sq yards, free and wholly exempted. For more than 300 sq yards, only 50% shall be charged.

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People prefer online mode of payment to pay property tax in Pune

May 9,2019 / By Prahalad Singh / No Comment

Pune Municipal Corporation Property (PMC) Tax:

In Pune, it is the Pune Municipal Corporation (PMC) or Pimpri Chinchwad Municipal Corporation (PCMC) that estimates a property to give it a value and impose a tax on a person’s property as per the location of the property.
PMC has been an effective service since 1950 and collects property tax as its 2nd largest source of revenue after Octroi.

People of Pune are favoring new age payment systems to pay their property tax. The number of citizens paying their property tax via online methods has replaced those pay using offline modes. As per the Pune Municipal Corporation sources, over 55% property tax collection for the first month of the current fiscal year has taken place through mobile banking, net banking, and other payment gateways.

The Pune Municipal Corporation has collected around Rs.234 crore through property tax in the new fiscal. Out of the total amount, around 129.7 crores has been paid via the online process, while Rs.105.3 crores were received through the offline process. The mobile-based payment system is also getting a good response from citizens.

Last year, around 45% of people had chosen for online payment services. This year, the payment is around Rs20 crore more than the last year.

Civic officials are saying that the online payment method has been in place for the last 5 years and has been getting a good response from its citizens. To keep the momentum on, the Pune civic body offers a discount on property tax bill, if it is paid before 31st May 2019. Many property owners are paying their taxes to get this benefit and in return, it will help to increase revenue for the state.

The civic administration hopes to get more revenue from the tax in the coming fiscal. They also said that nearly 1.67 lakh more properties have been added in the Pune Municipal Corporation Limits. Hence, the properties in PMC’s tax range have crossed the Rs.10 lakh target. The revenue will rise by around Rs.64 crore due to added properties.

To pay your property tax bill in Pune, simply click this link https://pmc.gov.in/en/ptax

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