The government in 2019 Budget has announced that the only agenda is to provide “Ease of Living.” The government will definitely be focusing and promoting various schemes throughout the country which will make life easier for a common man. A special budget schemes will be set to continue “Housing For All” scheme. According to Government estimates till 2022 they are planning to come up with 1.95 Crore homes out of which 26 lakh are already constructed and among these 24 lakh home have already been delivered.
Finance Minister, Nirmala Sitharaman said, “There will be several reforms that would be undertaken to promote that current rental laws are not addressing fair lessor and lessee relationship.” Government will be making sure that consistent efforts will be made in Affordable Housing segment. The previous budget had given a great boost in Pradhan Mantri Awas Yojna scheme and this year there will be quantum of increase in Credit Linked Subsidy Scheme (CLSS) under PMAY.
Delay in getting all clearances leaded to the increased cost which was obviously carried forward to the home buyers. But now the system will be changed and new practices will be proceeded, which will bring fast approval in practice with reduced documentations providing direct benefit to industry and ultimately the home buyers.
Lower The Tax Burden:
In order to achieve “Housing For All” scheme there will be a significant cut to tax rates. Propose to allow an additional tax deduction of Rs 1.5 lakh on interest paid on housing loans for self-occupied house. Additional income tax deduction of Rs 1.5 lakh on the interest paid on loans for EVs (electric vehicles).
This means that there will be a great tax relief @ approx. 3.5 Lakh per annum for houses valued up to 45 lakhs to everyone who is planning to buy an affordable home.
Capital Gain Exemption:
The budget has provided once ever lifetime benefit of capital exemption by increasing the investment limit from 1 property to 2 properties, for gain upto 2 Cr. The government in their new budget has increased the capital gain from 2 Cr. to 3 Cr.
Home Loan Bank Facilities:
State bank of India (SBI) has announced a home loan scheme that can alter the way floating –rate housing loans are priced. This will bring transparency and will be available from 1st July. “Principle to be repaid every year is at least 3% of the outstanding loan amount, in addition to interest applicable. This percentage of EMI can fluctuate during the year depending on the repo rate fluctuation. The new scheme’s lending rate, starting at 8.4% will be pegged to Reserve Bank Of India’s Repo Rate.
The real estate sector has high expectations from new government that there new set of rules and regulations will help in improving liquidity, balance fiscal discipline with stimulus and most importantly implementation of RERA.