I feel the budget 2017 by FM, Mr. Arun Jaitley, is encouraging for many businesses who were expecting some good measures by the Government this year.
The most prominent announcement for RE sector this year has to be affordable housing getting infrastructure status as this was a long-time demand from the industry. The segment is a significant driver of the economy and we are pleased to see the Government taking actions to augment the same. This measure is sure to lessen the cost burden on developers and attract investors. This is also going to give a push to PM Modi’s vision of Housing for All as the new status will amplify resource allocation and decrease demand logjam.
The built up area for affordable housing has changed from 30/60 sq mtrs to a carpet area of 30/60 sq mtrs which is a win-win for both developers and buyers. While buyers get a bigger house, developers will be able to capture a larger segment of buyers.
One of the most important policy change suggested by the government is that the developer can complete affordable housing project in 5 years instead of earlier policy of 3 years. This will ease pressure and lots of organized developers will venture into affordable housing and customers can expect quality homes.
Another important announcement is allocation of Rs. 3.96 Lacs Cr to infra development which shall fuel economy and development of the country and employment generation. This in term should fuel demand in real estate.
Capital gain period is reduced to 2 years which means customers will have to purchase property for lesser period and enjoy capital gain benefits. This would have multiple effect when it comes to investment in real estate.
Everyone was waiting for clarity on GST and we are happy that the GST Council has finalized the recommendations. We now await to see the implementation of the same. Relaxation of the FDI regime is a boost to our economy as we can look forward to easier investments from foreign companies which will lead to a boom in businesses.
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