Buyers have decided to invest in homes after April 1, 2019, so that they can avail the benefits of reduction in the GST. GST was reduced from 12 per cent to 5 per cent for under construction houses, while in case of affordable houses, it was reduced from 5 per cent to 1 per cent. A house which costs less than Rs 45 lakh is falls under the affordable category.
If the person postpones his decision of buying the Rs 2 crore worth of flat for a month, (ie. after April 1, 2019), then he will able to save almost Rs 14 lakh as per the new calculations of GST.
Rajesh Prajapati, chairman of Prajapati Developers said that most of the home buyers have put their decision on hold for a month. "The buyers will benefit if they buy the property next month. If we are ready to give this proposed reduction in GST this month, then they are ready to buy the house immediately," Prajapati added.
Manjul Yagnik, vice president at Nahar Group told DNA that the realty market is going through a tough time from last couple of months. She further added that this GST decision has not impacted the ready to occupy house market. "Buyers who have invested in near to finish projects are waiting for the developers to get occupation certificate, so that buyers need not to pay any sort of GST. While for under construction projects, developers who are in dire need of money are absorbing the additional cost of GST, either by slashing the property prices marginally or bearing some part of GST burden" she informed.
Manohar Shroff; vice president of Maharashtra Chamber of Housing Industry (MCHI), Navi Mumbai said, "One month period is quite long time for real estate sector. Once the elections are declared, again people will put buying property on hold till new government is formed."