The very fact that the realty industry is looking forward to reforms after a lull of a few years makes the Union Budget even more crucial. From the introduction of Goods and Services Tax (GST) Bill to foreign direct investment (FDI) to financial protection from delay in under-construction projects, there is a lot of expectations from the upcoming Budget. Delay in delivery of construction is the real spoilsport that is also hiking the costs of projects. A buyer is entitled for a tax benefit of up to Rs 2 lakh upon possession within three years. Any delay in construction beyond three years reduces the benefits up to Rs 30,000, which means the buyer now has to pay higher interests for the fault of the developer.
Chairman and country head of JLL India, Anuj Puri suggests that the upcoming budget must allow tax benefits to home buyers from the very first time that interest is paid by them. This will not only offload their financial burden, but also speed up the home loan disbursement effectively.
Puri asserts that any under-construction project purchased by capital gains must be ready within three years from the date of its sale. As such cases are also prone to delays, the authority must extend the construction timeline from three years to five years.
Tax deduction limit on housing loans is another issue on the list of the upcoming budget, which, the industry experts, consider insignificant at Rs 2 lakh at the time when the ticket sizes are priced at Rs 1 crore in metropolitan cities such as Mumbai. It should be revised to Rs 3 lakh and automated to keep up with the inflationary trends. Introduction of tax reductions on house insurance premiums will also encourage home insurance increase.
To popularize green living amongst people of the country, the budget should pay attention to providing benefits to buyers of green projects who otherwise turn a blind eye to such projects due to extra premium.
The budget should designate an amount especially for the connectivity of the construction projects to the metro cities and enhancement of the infrastructure. This will pave way for affordable housing in the cities, which was the priority of the last budget. There should be a cheaper financing option for developers to achieve the dream ‘Housing for All by 2022’ target.