Housing for all dream on the way to become a reality
The BJP government manifesto stated loud and clear about the dream for housing for all by India’s 75th Independence Day. The first budget to be presented by the Finance Minister ArunJaitley’s team is expected to have incentives to the real estate sector as well as a vision for affordable housing.
On Monday’s Presidential address to the joint session of Parliament, President Pranab Mukherjee mentioned that the government will build 100 cities focused on specialised domains and equipped with world-class amenities. By 2022 every family will have a brick and mortar house with water connection, toilet facilities, 24×7 electricity supply and access
Developers have put a demand to lower the borrowing cost for the housing sector as well as reduced taxes to promote affordable housing.Credai demanded that the housing sector also faces a disproportionate incidence of taxes, at 35 % of the cost of a completed unit. This burden can be partially mitigated by giving the tax treatment of special economic zones to affordable housing projects and increasing threshold limits of deduction on interest to Rs 5 lakh on housing.
According to the realty experts, when the market slows down, the developers reduce the ticket size and lower the prices of the smaller units reducing their margins. However they retain the amenities of high-end projects and end up making a decent profit even in a slump market in high end projects. Hence the low profit margin in the affordable housing sector keeps it unattractive to the realtors.
Source-Business Standard
Developers have demanded lower borrowing cost for the housing sector, Govt Help Sought for Affordable Housing, Govt might offer sops for affordable housing, reduced taxes to promote affordable housing
