The upcoming Union Budget 2015-16 is anticipated to be a reformist Budget for the real estate industry. Starting from tax sops to rebates in interest rates, and going up to the promotion of infrastructure, affordable housing and investment through REITS, the Budget session has hopes of all stakeholders pinned to itself. Expressing his concerns and expectations, Aman Nagar, Director, Paras Buildtech says Budget 2015 should focus on the buying capacity of a common man. Edited Excerpts are given below -
What are your expectations from the upcoming Union Budget?
Given the Prime Minister’s thrust on housing and smart cities, measures will definitely be taken for them. However, the Government first needs to bring in measures to empower people to buy homes. And, that is going to be crucial. For that, measures such as raising exemption on interest repayment on home loans, rebate on buying home and industry status to sector will provide a healthy platform.
Will the Government bring any subvention schemes for homebuyers?
For those who were hard-pressed to pay EMIs on home loans due to high inflation, Government should check and offer part-waiver or some kind of help to genuine borrowers to raise the morale. As far as home loans are concerned, we are optimistic that Government will provide some rebates to the first time home buyers or people who do not have homes. In Budget 2014, the Government raised the limit of tax exemption of interest repayment and we are expecting further extension to that in this budget.
What about Smart Cities? Do you think these should be given enough importance in this budget? Why?
The Prime Minister has a grand dream of building 100 smart cities in our country and that is indeed radical and need of the hour. With our lives getting increasingly automated day by day, only smart cities will be able to match changed lifestyle and supporting infrastructure. He initiated the movement during his tenure as a Chief Minister in Gujarat and has extended it to national level. His Government's first interim budget allocated initial money to kick-start the process and we are expecting that the outlay for this is going to be increased substantially.
Though Government did exceedingly well by paving the way for REITs in its interim budget itself, yet it needs to follow it up this time. It needs to further clarify on tax structure and exit options.
Recently, there was a hike in FAR in Delhi. How important/beneficial do you think the move was?
To bridge the yawning gap between demand and supply of housing units in Delhi, it was a good decision in right direction. Metro cities need vertical development to accommodate the rising population as well as the rising demand for rented accommodations. As per an estimate, about half the population in metro cities is living in rented homes. In such a scenario when there is almost no fresh supply of land, the decision to raise the FAR is crucial for providing housing to all.
Are there any new growth areas you expect around Delhi NCR?
We are concentrating on Golf Course Extension, Dwarka Expressway and Gwal Pahari areas in Gurgaon and Noida expressway presently and both these destinations still have huge untapped potential. Apart from them, areas such as Kundli, Sonipat, Manesar and Sohna in Haryana and NH-24 and Meerut road in Uttar Pradesh have the potential to be good real estate destinations.
Do you think the ‘Make in India’ Campaign would have any impact on Indian real estate in the coming years?
It's really big mission for the Government. There is a lot of action on this front and if the Government continues to work with the same spirit and intentions, 'Make in India' has the potential to turn around India's future and its world standing. It will have direct impact on the realty sector as demand for commercial properties and residential units will rise naturally. Given the mammoth size of mission, I think will take at least 2 years to see visible changes.