Realtors want tax exemption up to Rs 5 Lakhs, with Rs. 2 Lakhs on the Principal Loan and Rs. 3 Lakhs on Interest.
MUMBAI, Jan 25 (The COINNECT) – The real estate industry expects the government’s renewed focus on affordable housing with separate indices for tier-1 and 2 cities.
A key expectation is the introduction of a tax exemption up to Rs 5 Lakhs, encompassing Rs. 2 Lakhs on the Principal Loan Amount and Rs. 3 Lakhs on Home Loan Interest.
Here are the snapshots of the wish lists:
Hira Ludhani, Director, Evershine Group: “In the upcoming interim budget, I anticipate a renewed focus on affordable housing with incentives such as simplified housing loan processes and interest subvention, making homebuying a desirable experience, especially for first time buyers. Additionally, I hope to see initiatives that promote sustainability within the industry to drive eco-friendly practices and technological advancements. I look forward to witnessing these changes leading to a successful year of growth in real estate.”
Vihang Sarnaik, Director, Vihang Group: “A critical facet of my expectation from the Budget is the re-evaluation of affordable housing criteria. I expect the Honourable Finance Minister will find some merit in establishing a separate affordable housing index for each Tier-1 and Tier-2 cities with impetus to the housing affordability of the Metro Cities Periphery. It is crucial to incorporate essential factors such as inflation, land cost, construction cost, approval cost, and labour cost for defining affordability in housing. For instance, in the case of Mumbai, where housing costs are notably high, we hope that the Budget will increase the price ceiling of affordable housing from ₹45 lakhs to ₹90 lakhs so that the whole affordable scheme benefits reach its intended audience. As per the current affordable housing scheme, the limit is set at ₹45 lakhs and you will not find a single home in Mumbai in that price bracket. So, the scope of availing the full benefit of credit link subsidy under PMAY is non-existent in Mumbai. According to me, the Government should redefine affordable housing and extend the Credit Linked Subsidy Scheme (CLSS) and Pradhan Mantri Awas Yojana (PMAY) to a larger audience as per the existing real estate prices prevalent in the city and not make it centralised. I think such a move will empower the unorganised sections and salaried professionals to fulfil their dream of owning a home in a city like Mumbai.”
Nikunj Sanghvi, Managing Director – Veena Group & Treasurer- CREDAI-MCHI: In the context of the upcoming budget and the proposed housing loan scheme, addressing gender disparities in property ownership emerges as a pivotal aspect deserving attention. With a stark 3% ownership rate among women compared to men in India, it is imperative for the Government to consider targeted measures in this budget. An optimistic expectation is the introduction of tax benefit schemes exclusively designed for working women. Envisioning a tax saving scheme offering up to ₹3 lakh on the principal amount for their initial home purchase. Such an initiative not only serves as an incentive for property ownership but also contributes significantly to fostering gender equality and empowering women financially. The government should also offer an additional 1 or 2 percent interest waiver for women under the new credit-linked housing loan scheme.
The tax benefit combined with interest waiver is poised to be a compelling catalyst, further attracting women to invest in real estate. Moreover, a potential exception to the section 24(b) cap of ₹2 lakh on interest paid by first-time female homebuyers would not only encourage their entry into the real estate market but also pave the way for greater financial independence among women in our society.”
Madan Jain, Chairman of the Bhairaav Group and President of CREDAI-MCHI Navi Mumbai: “In anticipation of a pivotal general election, the interim budget holds the potential to make significant strides in fostering economic inclusivity, with a focus on tax exemptions for home purchases. A key expectation is the introduction of a tax exemption up to Rs 5 Lakhs, encompassing Rs. 2 Lakhs on the Principal Loan Amount and Rs. 3 Lakhs on Home Loan Interest. This proposed fiscal measure, coupled with the government’s commitment to a credit-linked home loan subsidy, underscores a dedicated effort to alleviate financial burdens for the salaried middle class. The envisaged synergy between tax reforms and a targeted approach to affordable housing not only promises to invigorate the real estate sector but also aims to enhance financial inclusivity by broadening access to home ownership opportunities. The transformative potential of such initiatives aligns seamlessly with the overarching goal of creating a more equitable society. This will mark as a progressive stride in economic policies, signalling the government’s dedication to relieving financial pressures and nurturing an inclusive economic environment.”
