There is an urgent need for the new government to focus with growth incentivized policies for the real estate sector in the country. Our wish list would be:
- Giving industry status to the real estate industry
- Bringing down interest rates on housing loans
- Removing or at least reducing service tax substantially
- Income tax exemption for affordable homes built for EWS and LIG
- Borrowing for construction companies to be available at lower interest rates
Giving industry status to the real estate industry will attract huge foreign direct investments into the sector giving developers a major reprieve due to want of funding options available in the country. This will result in faster completion of projects thereby reducing cost of project resulting in property prices offered at reduced cost to home buyers.
Bringing down interest rates on housing loans will encourage buyers to purchase their dream homes as it will make buying property more affordable. Reducing service tax will take a huge burden off the shoulders of home buyers as they are already burdened with numerous taxes and the service tax is an additional burden on them.
The key areas that government needs to prioritize its focus would be providing finance to housing industry at lower cost and creating an atmosphere where approval mechanism is faster. Also, focus on easing norms for buying land as it is the basic raw material.