Effect of RERA and GST on the real estate sector .

Effect of RERA and GST on the real estate sector .

$aheba $eraj

The Government has paid more attention to the real sector than any other sector by announcing more than 20 supporting measures to revive real estate sector over the last two years including announcing the long awaited infrastructure status for affordable housing besides several tax concessions and exemptions. The Union Finance Minister during the budget 2017 said that the government plans to build 1 crore houses for the poor by 2019 along with the allocation of Rs 23,000 crore for Pradhan Mantri Awas Yojana to fulfill the government agenda of ‘Housing for All” mission by 2022’.

“Anybody in India if asked about their aspiration to buy a house, their reply would always be a yes, young or old everybody wants to own a house of their own. This kind of consumer sentiment is only seen in the Indian real estate market where there is increase in sales despite a cash crunch. In India real estate is considered a form of investment with high returns on investment looking at it from a long term perspective,” said Amit Wadhwani, Director of Sai Estate Consultants when asked about the growth in the real estate sector.

“The Government has taken a number of steps to boost affordable housing in the country. In the recently concluded budget, the government granted infrastructure status to affordable housing which clearly shows its intention to achieve the target of Housing for All by 2022. The interest on subsidy scheme for the EWS, LIG and MIG group which the Govt has announced through the Pradhan Mantra Awas Yojana will definitely increase the demand for housing,” said Sanjay Jain, Group MD, Siddha Group.

“The announcement of ‘infrastructure status’ to the affordable housing sector, will serve as a significant step in achieving the government’s ‘Housing for All’ mission by 2022. To attract more investments and assure sustained growth of affordable housing in India, higher limit on external commercial borrowings, easy and dedicated access to institutional financing will give an advantage. Making it a priority, banks will lend more which will benefit more to buyers as well. Under the Pradhan Mantri Awas Yojana (PMAY), government’s decision to provide interest subvention of 3% and 4% for loans of up to Rs 12 lakh and Rs 9 lakh, respectively, will further boost demand in affordable housing segment,” said Manju Yagnik, Vice-Chairperson of Nahar Group.

The real estate sector, which till now was dis-organised, will be regulated with the Real Estate Regulation and Development Act 2016 (RERA) and GST. The purchaser will be more protected and greater transparency in the sector will be visible after the Government through legislation passed the RERA, which puts accountability on the developers in terms of financial disclosure, timely development of projects and maintaining good corporate governance practices. Home buyers confidence is now set to increase on the back of these sentiment-building measures of the government 

Aug 23 2017 5:35AM



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