We look forward to the implementation of the Real Estate Regulatory Authority Bill (RERA) which will bring in more transparency and professionalism into the sector. It is a positive move for developers with an established corporate governance practice. RERA coupled with GST and demonetisation will create a strong framework within which this industry will function.
It will create a clear demarcation between reputed developers and those with less respect for corporate governance, thus making it easier for investors to invest with comfort. This can only create a more conducive environment for foreign investors to invest.
´Housing for All´ and affordable housing have been major announcements of the government for the real estate sector in 2016. It would need strong private sector partnership to succeed and achieve its goal. It´s time now to expand these concepts and increase the benefits for other segments of the population as well. Industry status for the realty sector has been long awaited and it would be a game changer if approved this time. Overall, it is expected that Union Budget 2017-18 will be a common man´s budget where optimistic changes in the income-tax structure are predicted.
The Union Budget presented by Finance Minister Arun Jaitley is a people´s budget where affordable housing has been the focus and will be given infra status. This bodes well for home seekers living in Tier-II and Tier-III cities, which is also in line with the government´s vision of ´Housing for All´ by 2022.
Also, since affordable housing will now be given infra status, we can look at funding through insurance companies, which is a huge alternate sector and opens up a new avenue for real estate funding.
Demonetisation has impacted the real estate sector in the short term. But on the flip side, we see banks flushed with funds and given the surplus liquidity that they presently have, we look forward to banks further lowering their home loan interest rates to customers.
The reduction of the period for long term capital gains tax coupled with reintroduction of capital gains tax saving investments will attract more landowners to capitalise on their land holdings, thereby bringing more land into development.
The Prime Minister recently announced a subvention scheme which is tailor-made for attracting a wider audience base of home buyers. Huge allocations proposed for the housing and infrastructure sectors will set the pace of housing our populace at a much quicker pace, and developing our infrastructure to align with our vision of ´Housing For All´ by 2022.