After witnessing some serious economic headwinds and sluggish demand over the last two years, real estate industry is hoping that the stable Government at the Centre would rejuvenate the property market in the upcoming Budget 2014-15.
The sector is looking forward to a number of policy initiatives, including a review of the FDI rules in housing, REIT legislations and effective implementation of Real Estate (Regulation and Development) Bill. ‘The long-awaited infrastructure status and single window clearance system are the other significant issues that the new Government will have to look into according to industry players
Realtors apex body CREDAI Chairman lalit Jain told The Pioneer that “The focus of the Government should be on quick result factors to grow GDP and employment. Granting Infrastructure status, necessary fiscal reforms, providing home loans at 7.5 per cent by tax free housing bond at 5 percent, REIT and affordable housing scheme are quick measures suggested in this budget.
Expressing similar views Omaxe CEO Mohit Goel, said “We expect the Budget to grant infrastructure status to real estate sector with single window clearance, tax incentive for affordable housing, removing roadblocks in land acquisition bill, faster approvals, interest subvention for affordable housing upto Rs 40 lakh etc are some of the short-term measures that can be taken. In the Government’s agenda of building 100 smart cities, the private developers can be expected to play a greater role.”
Supertech CMD RK Arora said “Though 100 per cent FDI is permitted through automatic route in the sector, much more needs to be done like provision of single window clearance, giving the sector ‘industry’ status and facilitating REITS etc. to ensure completion of projects in time and in a transparent manner which only will bring about confidence in foreign investors.
“We are confident that the present Government will take proactive measures with the view to ease inflow of foreign money in real estate which would ultimately improve liquidity in all spheres of trade and industry,” he added. The realty sector has been facing a huge slowdown in demand over last few years due to high interest rates on home loans and lower economic growth. Gaursons MD Manoj Gaur, said “Union Budget 2014-15 is expected to be a Budget of hope after the dull and average previous year (2013) for the real estate industry. Now a stable and full majority led NDA Government is at the Centre and we expect the inflation to be controlled in 2014.”
“I firmly believe easy licensing or single window clearance system should be introduced by the new regime. Though a necessary breather was given by RBI last year by keeping the rates unchanged and it is expected to remain so this year too. Also a new clear policy on REITs (Real Estate Investment Trust) and inflows is expected. This will help the developers to arrange funds for the projects. The Government should raise the tax exemption limit for interest payment on housing loan from the existing Rs 1.5 lakhs to Rs 2.5 lakhs per annum,” Gaur added.