Describing Union Finance Minister’s Arun Jaitley’s maiden budget as “half glass full” and half filled with hopes, realtors’ apex body CREDAI Chairman Lalit Kumar Jain said it met with some expectations and left some out.
Mr. Jain welcomed the announcements on REIT and FDI and said the subsidized rate of interest for low income group and economically weaker section groups is not enough.
“Giving pass-through status to REIT and CSR status for Slum Redevelopment Programmes are major welcome announcements by the finance minister,” he said and expressed the hope that will contribute to revival of the real estate sector.
FM has in his speech mentioned that he will consider housing Industry demands in due course, which is comforting.
Some SOPS in Affordable housing, funding for low income housing through NHB do recognize fact that much is needed to be done. We hope FM will look at this Industry as an Engine of growth and major action is needed to achieve homes for all.
Incentivizing REITs will help in easing liquidity requirement for developers, making way to raise easy capital and also provide access to retail investors’ benefits from regular income and appreciation benefits from real estate. This will not only help developers but also to Private Funds and Financial Institutions as well.
Mr. Jain added “The proper implementation of REIT structure can generate almost one lakh crore worth equity over some period.”
Mr. Jain, however, said the Finance Minister was not clear about policy neither on according industry status to housing nor on the demand for giving infrastructure status to the sector.
The details of affordable housing schemes are also missing in the speech, CREDAI chairman said.
He welcomed the government’s commitment to revive SEZs by taking “effective steps” to make them instruments of industrial production, economic growth, export promotion and employment generation.
“We are happy that the government plans effective steps to operationalize the SEZs, to revive the investors’ interest to develop better infrastructure and to effectively and efficiently use the available unutilized land,” he said.
Prime Minister Narendra Modi has surely begun to take measures towards his vision of creating a ‘Shresht Bharat’, and the proposal of Rs 50,000 crores for urban infra projects is definitely a welcome move, he said.
“We have been suggesting to the government for long to help revive the real estate sector to rejuvenate the economy and we definitely hope to see a radical change coming to the state,” he said.
The minister has given some relief to individual tax payers by raising the income tax exemption limit by 50,000 and has also raised the limit of the interest part of home loans from Rs. 1.5 lakh to Rs. 2 lakh. The combined effect will definitely lead to renewed interest in home purchase by Indians.
“This measure is bound to encourage home buyers, who have been fence sitters in view of the increasing cost of housing, to go in for loans,” he said.
Mr. Jain hailed the announcement on setting aside Rs. 8000 crores fund under the umbrella of the National Housing Bank.
“Yet, we see the glass half full and the remaining half is filled with hope,” Mr Jain said.