In the previous union budget, affordable housing segment was granted infrastructure industry status which was a highly welcome step. We have seen its impact in terms of so many affordable housing projects launched during last one year. However the long awaited expectation still remains the infrastructure status for the entire real estate industry, which will lead to construction funds being available to the developer at lower interest rates and for longer durations. This will have direct impact on employment scenario and also the multiple ancillary industries dependent on real estate.
Also, rates of interest on housing loans need a further reduction to stimulate demand. Government policies should promote Single Window Clearance and Smoother Approval Process including Environmental Clearance within specified timelines.
Despite input credit being passed on to the customer, with GST @ 12%, there is a marginal increase in the overall cost impact to the consumer. This needs to be revised downwards, to benefit the consumer, leading to a further push in overall demand. We are also expecting to see the additional stamp duty and registration on properties to be reduced or merged with GST. The government must look at reducing this cost and rationalizing and standardizing stamp duty rates across the country. The taxes and stamp duty are a major hindrance to development today. GST applicability should be post recovery instead of at the time of billing. This will help in reduction of stress on working capital of consulting company.
A reduction of the taxes and add-on costs, inclusive of brokerage, on under-construction properties, will also ease the financial burden from a consumer perspective. Overall, we are positively looking forward to favorable policy announcements for real estate and infrastructure sectors in the coming budget.
About Rudrabhishek Enterprises Limited (REPL)
Established in 1992, Rudrabhishek Enterprises Limited (REPL) is Integrated Real Estate & Infrastructure Consultants. REPL integrates a range of services to deliver end-to-end consultancy in diverse sectors. It has expertise in formulating regional plans, master plans & zonal plans; designing water management & transportation systems and other infrastructure facilities.