Mr. K P Pradeep, CFO, Brigade Enterprises
A long pending demand from this Real Estate Sector is that they be given recognition as an Infrastructure provider and to provide it an industry status.
The Central Government has made a progressive move in implementing the RERA Act across the country. However the implementation of the Act across States needs to be more consistent. The RERA Rules are State specific and needs to have greater emphasis on clarity and ease of use.
Funding for the sector
The current situation is that banking provides a risk weight of 150 % on capital allocated to this sector - as a result of which the cost of funds to this sector is high. Given that this sector has not been a significant contributor to the overall NPA situation of the banks it would be unfair to weight risk this sector for the banking defaults in the other. This reduction in cost of funds will reduce the overall cost of financing for the Sector and the benefits can be passed on to consumers.
Special thrust on Affordable Housing
Presently the Affordable Housing category is limited upto 60 sqm area only, this area limit should be increased so that the MIG category housing can also come under the Affordable Housing category.
Given that Affordable Housing has been given Infrastructure status it will help the consumer by way of more affordable loans and the industry with fiscal sops attached to this category.
The current GST of 12% should be lowered to at least 6 to 8% and the stamp duty should be brought under the ambit of GST.
The Finance Act in the previous year had placed Rs. 200,000 interest cap on property let out. This has impacted investor interest in the residential sector quite significantly. The expectation is to remove the Rs.200,000 interest cap on house property which is let out. This should bring in genuine investor interest in the sector.
The tax concession on first time home buyers needs to increase from Rs. 50,000 currently to Rs. 200,000 per annum for home buyers.
The Sector is expecting the Central Government to drive reforms in Land Acquisition and get the States to bring in greater consistency and clarity on the process.
Single Window Clearance
The Sector has to go through a plethora of approvals which leads to delays and increases the transaction costs of the whole exercise. The Govt should introduce measures which creates a single window to get approvals across various departments. They should introduce timelines for getting such single window clearance and bring in the concept of deemed approval if there is no revert within the stated timeline. This should go a long way in addressing one of the most important demands of this Sector.
The expectation is that all these measures taken appropriately through fiscal interventions and other instruments will help achieve the Government's mission of 'Housing for All by 2022' apart from being a big boost to the Real Estate sector.
Ashish R. Puravankara, President CREDAI Bengaluru and Managing Director, Puravankara Limited
2017 was an eventful year for the real estate sector with significant structural policy reforms. Budget 2017 came with some wins for the sector with infra status conferred to the Affordable sector, deferring of landowner capital gains tax and several such initiatives. 2017 ended with an upward trend in buyer sentiment, we hope that the Union Budget 2018 will be an enabler for the industry to march towards a strong recovery and growth path.
The realty industry expectations on the consumer side would be some concrete measures to boost demand in the sector through income tax sops to homebuyers. Furthermore, some allocations towards accessing of loans for acquisition of land parcels would be an accelerant too. Most importantly some robust long-term strategy for the affordable housing segments in terms of cost of funds and GST relief making it viable for all stakeholders involved.
Real estate is the second largest employer in India after agriculture. The sector is hopeful that a viable roadmap for sustainable growth will create employment opportunities across the industry and eventually be a catalyst for a stronger India INC!
Mr. Farook Mahmood, World President FIABCI and Managing Director Silverline Realty
GST - The GST currently is on a higher slab with 12%, making it a total of 18%. We definitely expect it to reduce with the new budget. We also need clarity and transparency on the input credit tax as well.
Single Window Clearance - The single window clearance has not yet been implemented; they need to make cognizance and improve this as well.
Industry Status - Industry status should definitely be given to the real estate sector as it is one of the largest sectors contributing to the employment opportunities all across the country. However, Affordable Housing has been given the industry even though it doesn't really encompass the entire industry and is only a part of it.
Hence, it would be highly helpful if the Real Estae sector is given industry status as a whole.
First Time Home Buyers - In 2017, first time home buyers were allowed Rs. 50,000 worth of tax benefits. We expect this to be raised to a minimum of Rs. 1 lakh.