Budget 2019: Real Estate sector expects single window clearance, GST cut on under-construction projects

Budget 2019: FM Arun Jaitely will be announcing this government's first interim budget on February 1 ahead of this year's general elections. The ruling government has been very active in making houses affordable across the country and realty sector hopes for the good work to continue. Sachin Bhandari, CEO, VTP Realty told Zee Business Online, "One of the prominent agenda of the government has been to promote Affordable Housing in our country and the previous budget had introduced certain measures to boost up the same in the Indian real estate sector."

"One long-standing expectation that developers have from the government is single window clearance." Bhandari added. 

There is no single window clearance system to seek redressals from home buyers, builders, developers, financial institutions etc on property matters. Absence of such structured system add delays to possessions, clearance certificates, construction work, investor complaints etc. The Budget 2019 should bring a unique system to deal with the problems in the realty sector.

However, after the introduction of RERA, delays in the approvals have eased a bit as it facilitates smooth clearances of the projects to avoid delays, due to approval hindrances. But still, developers, investors and financiers are demanding a single window system to uplift the state of housing Industry.

"Another major demand is to reduce the 12% GST on under-construction projects as the resulted high cost is then passed on to consumers and affects the sales." Bhandari mentioned.

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The GST council was expected to bring down the prevailing GST rates on under construction projects in the latest meet, but it has kept them same as of now. If government decides to reduce GST rates on property, the middle class home aspirants can be relieved with the hovering price burdens.

Bhandari added that the government should also provide an increase in interest and principal limit for tax exemption for home loans.

As the home prices have increased substantially, the components of interest and principal have increased. The budget should incentivise home purchases for developers to get more business. 

"Long-standing demand that has so far gone unnoticed is real estate sector being given the industry standard," he said. This move would help in reducing the delay in construction.