VINOD KUMAR MENON vinodm@ mid- day. com REAL estate players were left disappointed with this yearu2019s Union Budget, as no short term benefits seemed to be in sight for the industry.
The governmentu2019s focus on development of infra projects, means that real estate might see benefits only in the long run. u201c But the need of the hour was to actually break the vicious cycle of economic slowdown that has adversely impacted the real estate market in the last few years,u201d said Pankaj Kapoor, managing director of Liases Foras.
u201c Our statistics have shown that nearly 13 lakh housing stock remains unsold in the country, of which 7 lakh fall under the affordable housing category. In the Mumbai Metropolitan Region alone, a total of 2.83 lakh stock, which includes one lakh affordable homes, remains unsold,u201d explained Kapoor.
Madhan Nahar, practising chartered accountant, said, u201c In the new tax regime, the housing interest component from the monthly EMI, deducted towards housing loan that was exempted until now, is believed to be one of the 70 lists exempted under the Income Tax Act. This is a bad sign for those looking for investments in the housing sector.u201d According to Dr Niranjan Hiranandani, president, NAREDCO, the Budget has set a positive tone, but failed to provide the much- needed economic stimulus to kick- start the $ 5 trillion economy. u201c The labour- intensive real estate sector, which had pegged its hope on additional liquidity infusion, tax reforms and rental housing, was overlooked in the budget.u201d Kamlesh Dhruv, a developer who constructs affordable houses under M/ s Dhruv Residency in Wangani, said the budget was not favourable, as his company was u201c already facing liquidity crunch in the marketu201d. u201c The flats I am selling in the affordable segment range from R 11 to R 17 lakh, but due to banksu2019 stringent scrutiny of homebuyersu2019 loan applications, loans are getting rejected, which is impacting the flat sales. As many as 40 loan applications for my project have been cancelled.u201d Senior property lawyer, advocate Vinod Sampat added, u201c While the government is talking about affordable housing, nothing is being done to aid flat purchasers.u201d Ramesh Prabhu, founder of Maharashtra Housing Societies Welfare Association ( MahaSEWA), also called the Budget u201c pooru201d. An exception, he said, was made for cooperative societies, where the u201c tax has been proposed to be reduced to 22 per cent, as against 30 per centu201d. Anuj Puri, chairman of Anarock Property Consultants, in a statement said, u201c The Budget misses on the u2018 quick fixesu2019 the real estate sector needs urgently and focuses on long- term vision.u201d A few positives u00a3 Affordable housing continues to be the governmentu2019s focus for real estate. The previous tax exemptions for both homebuyers and developers have been extended u00a3 Personal tax relief across various income slabs will invariably increase disposable income at the hands of the middle class, and boost their consumption capabilities u00a3 Alternative segments get boost: Instead of giving direct benefits to residential real estate, the FM laid more focus on alternative segments within real estate, such as warehousing, data centres, schools, hospitals, etc While the government is talking about affordable housing, nothing is being done to aid flat purchasers Vinod Sampat 13l Unsold housing stock in the country
