Union Budget 2017-18, led by Arun Jaitley, proved to be nothing short of a high energy, highly anticipated T20 match for the real estate sector, cringing and lauding on every word spoken on the 1st of February, 2017.
2016 had been a tough year for Indian real estate. And just when some of us industry players thought we had managed to pull through the hard times, demonetization struck.
Our respected Prime Minister had the best interests of this country in his heart, but the battle against unaccounted cash reserves left a few scars.
So as we nursed ourselves back into action through the month of January, the preponed budget 2017 arrived; disguised as a potential guardian angel.
So, was it a happy ending? No really. But it definitely hints at the beginning of a new era in real estate.
Almost every piece of content present online since demonetization has been aiming its conclusions at a steep fall in real estate prices. The assumption is honestly a gamble.
But, there are other aspects that we (both developers & buyers) have been struggling with,
- Steady supply in funds
- Affordable home loans
- More space per square foot paid
- Increasing gap in material supply
- High pressure points in unsold inventory
- Land acquisition
- Timely approval on projects
- Timely completion of projects
to name a few.
As some of you experienced buyers may have noticed, a delay in project hand over is often a result of the factors listed above. So let’s take a moment to analyse how these issues have been resolved post demonetization and February 1:
- The knighting of the affordable housing sector to an infrastructure status has given us more access to funds.
- Our new found title has also given us the boost required to develop more spacious homes at better priced rates.
[Change in eligibility criteria from built-up area to carpet area at 30 sq. m and 60 sq. m] - Since compromising on project quality is not an option, a steady funding is good news for all our partners, aiding a more consistent supply of construction materials.
- The easing on notional rent on stock in trade for a year after completion has left us smiling a little more.
- We encourage Joint Development. Turns out, so does our Finance Minister. Therefore, taxation paid on gains by land owners apply only after our projects are complete.
- Although we wish there was a single window system to get our project approvals in place, for now we will make do from the 2-year extension.
[Developers get five years to complete the project instead of three years at present, out of which maximum time goes into getting approvals] - With funds reaching us on time, a renewed enthusiasm from our suppliers, relief on taxation norms and hopefully an easier access to land, we do hope to experience and deliver a happier and prosperous 2017. If you are motivated to buy a home after hearing about the positive implications of the budget, here’s a Bengaluru Home Buyer’s Checklist 101 you should go through first.