Home buyers, industry share their Budget expectations

Magicbricks has been highlighting over the past couple of weeks what the real estate industry expects from the Union Budget 2015. Magicbricks ran a survey to get the perspective of the buyers as to what they need the government to do for the sector this Budget. Interestingly, the buyers’ and the industry’s expectations are quite similar. Let’s have a look at what these are.

Lower home loan rates

High home loan rates seem to be a pressing issue for the buyers. As per the survey, nearly 75 per cent of the respondents have been holding back their property purchase due to the Budget. More than 20 per cent of them claimed that high home loan rate is the prime reason for not being able to buy a property.

The same concern was also raised by several industry experts. For instance, Kishore Pate, CMD, Amit Enterprises Housing Ltd says, “The Union Budget 2015-16 should make the rate of interest specific to home loans more reasonable. Currently, interest rates are in the range of 10.15-10.40 per cent. The budget should bring the interest rate on home loans down to between 7.5-8 per cent.”

The need for lower home loan rates was also highlighted by the fact nearly 60 per cent of the respondents expected the Budget to announce a cut of home loan rates.

Tax incentives

In a bid to promote affordable housing and encourage property buying, the industry has consistently emphasised on the importance of tax incentives on the loan repayment. The need to increase the home loan interest amount exemption under Income Tax benefit from the existing limit of 1.5 lakh to 3 lakh was raised by many experts. Anuj Puri, chairman and country head, Jones Lang LaSalle India further adds, “Tax incentives on renting residential properties are also required to provide a boost to the sector. Providing tax breaks specific to rental income will give a significant boost to the rental housing segment in the country and help increase rental supply in the metros.”

The results of the survey revealed that the industry has understood the pulse of the buyers as nearly 21 per cent of the respondents expected higher tax rebate on loan repayment to be announced this Budget.

Faster deliveries and more transparency in the sector

An issue that has plagued the real estate sector for ages is the delayed deliveries of projects. This has been a pressing concern for multiple reasons. The survey results also indicated that the buyers were looking for measures from the government to address this issue.

As per the survey, nearly 35 per cent of the respondents expect measure form the Budget that would ensure timely possession and penalties in case of delays. About 30 per cent of the respondents also said that they were looking for more transparency as far as information about developers and projects were concerned.

To achieve these demands, the industry has been voicing the need for single window clearances and industry status for the sector.

Affordable housing and GST

More than 25 per cent of the survey respondents said they were expecting measures from the Budget that would ensure availability of affordable housing projects. Almost 10 per cent also claimed that they expected Goods and Services Taxes (GST) to become a reality post this Budget.

Similar concerns have also been raised by the industry experts. “In its first budget, the government announced its vision of Affordable Housing by 2022. It is time to implement it. Affordable housing policy and industry status for the housing sector are the need of the hour,” says Lalit Kumar Jain, chairman, CREDAI.

Thus, it is amply clear that the industry and the buyers are on the same page as far as Budget expectations are concerned. However, only time would tell if the Budget would stand up to these expectations.

Source: http://content.magicbricks.com/industry-news/home-buyers-industry-share-their-budget-expectations/80512.html