FM misses out on big time realty reforms, says Sotheby’s
Realty players by and large hailed Finance Minister Nirmala Sitharaman for her Budget 2022 which they said will boost growth.
Mohit Malhotra, MD and CEO, Godrej Properties Ltd. -The Finance Minister’s budget proposal 2022-23 has been optimistic to enhance the nation’s growth and revive the overall economy. The ambitious commitment to allocate Rs 48,000 crore towards ‘Housing for All’ has reinforced the Government’s determination to boost affordable housing in the country. Moreover, the budget has laid the foundation of stronger urban development with sheer measures to revamp the housing challenge in the urban areas. Additionally, this will push for larger vertical development modules that utilize green energy generated by solar panels to reduce the overall carbon footprint. Electric mobility is the future, and the urban development program will encourage developers to move towards more functional amenities, keeping in mind the electric mobility needs of the new-age home buyers.
Pritam Chivukula, Co-Founder & Director, Tridhaatu Realty and Treasurer, CREDAI MCHI -The Government has once again laid an emphasis on infrastructure in the Union budget announced today. Infra spending in PPP mode seems to be the thrust of the Union Budget 2022. The Budget made several announcements to spur the growth of the infrastructure sector in the country that includes the announcement of 25,000 km of new highways, Gati Shakti Masterplan for expressways, 100 new cargo terminals for multi-nodal logistics, and development of urban metro systems. This will propel the growth of the real estate sector and will also help drive demand for the warehousing and logistics sector across the country. The Government also extended the ECLGS up to March 2023. This will go a long way in supporting the MSME sector and revive industrial activity.
The good news for the real estate sector has been the allocation of Rs. 48,000 crore for PMAY along with 80 lakh houses expected to be completed by 2023 across the country. This has yet again highlighted the Government's vision of Housing for All. The move will not only boost the affordable housing segment but will also encourage a lot of homebuyers to buy their dream homes.
Through Ease of Doing Business 2.0, the Government continues to encourage digitization and fin-tech innovation. The focus on creation of digital infra, single portal for ease-of-doing business and digital skilling will strengthen the start-up ecosystem.
Overall, a progressive budget with the Government's emphasis on job creation, building a robust infrastructure and revitalizing the economy.
Jitesh Lalwani, President, HomeSync Real Estate Advisory -Finance Minister Nirmala Sitharaman presented a growth-oriented Budget by hosting several measures to encourage leading sectors of the economy. Looking at the medium and long-term goal for the overall economy, it seems a desirable budget where the efforts will be made to increase private capital in the infrastructure sector. The announcement of 25000 kms of new highways along with Gati Shakti Masterplan for Expressways will pull forward the economy and will lead to more jobs and opportunities for the youth. In a boost to affordable housing, FM announced Rs 48,000 crore towards the Affordable Housing Scheme (PMAY) and will build 80 lakh homes for identified eligible beneficiaries, and identify eligible beneficiaries for 60,000 houses under PMAY in rural and urban areas that will directly support the Government's mission of Housing For All. Although, the real estate sector was further eyeing sops such as relaxation in GST on under-construction properties, a reduction of GST on key raw materials, a higher interest exemption for homebuyers and above all, the long-awaited demand of granting 'infra' status to the sector; there were a few big announcements which will augur growth across the major sectors of the country.''
Shraddha Kedia-Agarwal, Director, Transcon Developers- As anticipated, in today's Budget 2022, Union Finance Minister Nirmala Sitharaman addressed the nation with the overall focus on national infrastructure development that will act as a catalyst to growth. It was a neutral budget where FM talked about rolling out the next phase of ease of doing business and ease of living. Besides, there were various implementations of reforms to boost digitization that might grab some attention from the NRIs to invest in the housing sector from around the globe. However, the major announcements on the economic front will surely benefit the overall GDP of the country in the near future.
Bhushan Nemlekar - Director, Sumit Woods Limited -The real estate sector had high hopes from the Budget 2022. Although the focus of the Union Budget 2022 was on overall economic development, the only thing to cheer for the real estate industry was the budget allocation of Rs 48,000 crore for the PM Awas Yojna. In urban and rural areas, 80 lakh houses will be constructed for identified beneficiaries for affordable housing under the PM Awas Yojana and 60,000 houses will be identified as beneficiaries. Also, the Government has given a lot of importance on urban planning by showing it's desire to set up a high-level committee for urban planners and economists. This will lay a foundation for Tier 2 & Tier 3 cities to transform into centres of economic growth. It is undoubtedly a progressive budget especially with its emphasis on building infrastructure for the country.''
Sudhir Pai, CEO of Magicbricks, said The Union Budget, 2022 seems to bring in a balanced approach by prioritising agriculture, infrastructure, manufacturing and employment, besides reinstating confidence in the real estate industry. The announcement of INR 48, 000 crore allotted for PM Awas Yojana wherein 80 lakh households will be identified for the affordable housing scheme reiterates the focus on affordable housing. The PM Gati Shakti is also expected to further strengthen infrastructure across the nation, inducing more investment in the real estate space with access and connectivity poised to shoot up. We laud the government for providing continuous support in the real estate space that has managed to stay afloat with resilience and gumption. In addition to this, it is heartening to see the strong stimulus incorporated in the Union Budget to catalyse overall digitisation of the economy along with revival of consumer demand at large.”
Surendra Hiranandani, Chairman and Managing Director, House of Hiranandani -Budget 2022 has set the tone for the modern India that will be built on a strong foundation of planned cities with high capital expenditure towards a robust network of infrastructure and technology.
Honourable Finance Minister Nirmala Sitharaman’s focus on redefining urbanization through urban building policy and setting up of a high-level expert committee is a welcome move. Our cities have been built with the age-old laws and there was a dire need to refurbish them as per modern day to day requirements and needs. The focus on modernizing building / infrastructure laws and town planning displays that we are gearing to envision a new India with smart and tech-led planned cities.
Allocation of Rs 48000 cr towards affordable housing reassures the Government’s focus on housing. Equal focus on infrastructure, sustainability, technology, will have a multiplier effect by creating more job opportunities and consumption demand.
Real Estate sector has been largely impacted due to the pandemic. There were some expectations from the sector that would have boosted demand and offered increased deductions towards the principal/ interest payment of home loans. There was a need to increase the scope of affordable housing by raising the cap of Rs 45 Lakhs for metros. This would have increased the scope of affordable housing and a large number of home-buyers could have then benefitted from the subsidies available for this segment.
An infrastructure status has been a long pending demand of the sector. It would have made a major difference in accessing capital at a reasonable cost. Nevertheless, we appreciate the government's focus on overall developments of the nation. We are optimistic and look forward to witnessing the beginning of a new and robust economy.
Gautam Thacker, President, NAREDCO - Progressive Neral-Karjat Unit -The union budget for 2022 looks promising and balanced. It has more or less provided each sector with some benefits which will help the businesses to overcome certain uncertainty. Announcements such as 48,000 crores for PMAY, 80 lakh homes under PMAY will help boost the affordable housing market. Besides this, the government (Central and State) has designed various schemes, such as Pradhan Mantri Awas Yojana (PMAY) with the aim to build one crore homes in urban and rural India by 2022 which will further boost the boost affordable housing and achieve the vision of Housing for all by 2022 – 2023.
The Central Government in tandem with the state governments needs to align the process in order to reduce the time period required for all land and construction-related approvals. Having said that the government's move to develop urban planning with the adoption of public transportation will help the housing sector grow. The govt initiative of subsidy on housing loans through the Credit Linked Subsidy Scheme (CLSS) is benefitting the masses opting for affordable housing.
The announcement of the extension of ECLGS to help MSMEs cope with pandemic losses is a progressive move by the government with a goal to strengthen the economy and boost employment generation
Aman Trehan, Executive Director Trehan Iris- The Union Budget 2022-23 has done an excellent job of ensuring that the economy recovers fast from the disastrous impacts of the global Covid pandemic. We are confident that the boost to the real estate sector provided by a high-level committee of urban planners and institutes charged with formulating policies for India's sustainable urban development will usher in a prosperous period for the industry.
We expect that as part of the rental housing changes, rental revenue for the first five years after completion will not be taxed in order to encourage people to rent. This will be a significant step toward boosting the buy-to-rent housing trend across the country.
Manju Yagnik, Vice Chairperson, Nahar Group and Sr. Vice President, NAREDCO - Maharashtra -The Union Budget 2022 presented by FM Shrimati Nirmala Sitharaman earlier on Tuesday morning was a growth-oriented one. The FM majorly focussed on India’s push for infrastructure project wheeling out the development plan for Railways, roads, airports, ports, mass transport, waterways and logistics. Under the master plan, the government plans to roll out big infrastructure projects including - the expansion of highways by 25,000 kilometres spread throughout the country, allocating Rs 60,000 crore to the Nal Se Jal scheme, the commencement of five river link projects across many states.
The push towards the infrastructure industry is optimistically anticipated to largely benefit the real estate sector as well. These projects will definitely be beneficial for the real estate sector with regards to better connectivity, enhanced productivity, property as well as rental price appreciation and increased employment rates. With the allocation of an additional Rs 48,000 crore to the Pradhan Mantri Awas Yojana and the identification of 80 lakh households for the affordable housing scheme, the consumer could definitely spark a sharp boost in residential demand.
Srikanth Iyer, CEO and Co- Founder, HomeLane - One of the key highlights of this Union Budget is the consideration to extend the redemption of existing tax incentives for startups, until March 31, 2023. This will benefit the overall startup ecosystem in the country post this pandemic wave.
Furthermore, the PLI scheme to achieve the vision of Aatmanirbhar Bharat is promising and has enormous potential to create job opportunities with additional production of 30 lakh crore during the next keycap digit five years.
The PLI scheme is highly relevant especially for the real estate and organised home interiors sector, who are dependent on other countries as the overall costs are still much higher for manufacturing in India, given the continued global crisis in the supply-chain. I am confident that this will enable to further boost the organised home interiors sector in India and ensure increased dependency on the manufacturing requirements domestically.”
Amit Goyal, CEO, India Sotheby’s International Realty -The Union Budget has laid out a long-term path of growth and investment with an enhanced total expenditure at INR 39.45 trillion and yet managed to curtail Fiscal deficit to 6.4% in FY 23 (from 6.9%). The Budget has allocated INR 48,000 cr to housing projects under PM housing scheme. However, no big reforms or incentives were announced for the real estate sector. It’s a missed opportunity for the real estate sector as incentives in the form of higher deductions against home loans, changes in incongruities related to real estate transfer and others might have improved the market scenario and triggered the demand and sales process in the real estate sector. Real estate sector being a major contributor to India’s GDP needs more focus from the government.
Sandeep Runwal - President, NAREDCO Maharashtra and Managing Director, Runwal Group -For the first time, the Finance Minister has sought to transform the real estate sector by bringing in transparency and efficiency in the business. This will help to reduce the cost of transaction and will ultimately benefit the homebuyers.
The Government's plan to launch ‘Ease of Doing Business 2.0' is a step in the right direction and it's continuous efforts to promote the same along with digitization will help the economy and the real estate sector business going forward. Single Window clearance mechanism too will go a long way in improving ease of doing business in India. This should include more dynamic aspects and make India a more investment friendly destination.
In 2022-23, 80 lakh households will be identified for the affordable housing scheme and Rs. 48,000 crore allocated for PM Awas Yojana. This together will boost the affordable housing segment and help to achieve the Prime Minister's vision of Housing for All. Also, the 60,000 houses to be identified as beneficiaries for PMAY in rural & urban areas will ensure that more and more homebuyers get to avail this benefit.
As anticipated, it's a very futuristic budget focusing on economic recovery benefitting from public investment and capital spending.
Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory -The budget’s resolute focus on infrastructure will certainly aid the real estate sector growth trajectory. The impetus given to road infrastructure through the new 25,000 km National Highway network will offer new momentum for the sector by opening a new market in tier-2 and tier-3 cities. The allocation of INR 48,000 crore for PMAY Urban and Rural will push the affordable housing segment.
The move to appoint a high-level panel for urban planning and designating the five existing academic institutions as the Centre for Excellence for urban planning with endowment fund of Rs 250 crore will prove pivotal for the real estate sector as both the emerging urban landscape and decaying city infrastructure need a complete overhaul. The emphasis on promoting the use of public transport in urban areas is futuristic, considering the traffic and pollution scenario in all metro cities.
Bringing 1.5 lakh post offices under the core banking system will enable financial inclusion and provide access to accounts through net banking, mobile banking, ATMs to the marginalized section. This will prove significant for farmers and senior citizens in rural areas to invest by enabling interoperability and financial inclusion. Eliminating 75,000 compliances and repealing 1,486 union laws for facilitating ease of doing business environment is a great step to promote young entrepreneurs and start-up ecosystem. In a nutshell, the budget is progressive.
However, the budget missed the opportunity to accord the long pending industry status to the Real Estate sector as a whole; currently the same has been accorded only to affordable housing. This long-pending demand would have helped developers raise funds at lower costs.
Sandeep Raheja, Chairman, K Raheja Realty.-I believe that the Government has initiated the growth of technology and by providing education for all at macro-level through setting up the digital university and providing content in regional languages. Over & above they are also allocating better budgets for education.
Leapfrogging Indian students to the next era of technology and mass education, this will be a great opportunity to facilitate the growth and development of the field in general. India will create one of the largest generations of educated youth, which will make India one of the largest Economic Markets.
The industry can benefit from young aspirers who not only have great knowledge of technology and innovative methods but also technical knowledge and creative minds.
The budget has emphasized giving due consideration in introducing courses related to infrastructure and urban planning. This will ensure that the future of Indian infrastructure will be more advanced and efficient and it will help in developing India-specific knowledge in urban planning and design.”
In conclusion, an increased impetus on production linked incentive schemes, creation of jobs, digitization of the economy, modern infrastructure and most importantly a budget promoting inclusive development of all communities is going to help India move towards a futuristic growth path.