JAIPUR: The Centre’s move to extend exemptions for the purchase of affordable houses and to provide tax exemption for affordable
housing projects will benefit home buyers, but not the
real estate industry, claimed
developers in the state.
Many believe that the announcement will give a push to the ‘housing for all’ goal and boost purchasers to buy properties up to Rs 45 lakh after the decision to extend the Rs 1.5 lakh benefit on interest paid on affordable housing loans by one year to March 31, 2022. However, developers believe revival of the real estate industry, which was reeling under the crisis even before the pandemic, required more reforms.
Vinay Joshi, president of Rajasthan Affordable Housing Developers Association said, “The announcements will only benefit the end-users and not the developers. For the revival of industry, the developers were expecting relaxation in stamp duty after formulating a policy one nation, one duty. Also, the Centre should have provided rebate on investment in real estate for long term capital gain and provided relief for developers to clear existing inventory. If developers are neglected, buyers cannot be benefited for long.”
After
Covid, it was perceived that residents, who were preferring rented accommodation over buying, have changed their mindset and need of people to own their own house was accelerated. This had revived hopes of developers to sell off their inventory. However, the industry did not witness revival as expected.
Rajasthan CREDAI chairman Gopal Das Gupta said, “We welcome the announcement for affordable housing. However, key issues to revive the real estate industry, which is second-highest generator of employment and contribute to more than 8 per cent to the economy, have not been addressed. The developers are disappointed as industry received no assistance.”
Meanwhile, there are few developers who are optimistic to sell their inventory after the announcement. “Many factors including reduction in interest rates has narrowed the gap of rent and home loan EMIs. This announcement will also encourage actual buyers to make faster decisions on the purchase of residential units. Flats ranging between 25 lakh and 45 lakh will be on high demand after the relaxation ,” said developer
Vikas Sharma.