Real estate alert! Booked flat? Waiting for possession? This is what may happen to your dream home

Amid rising number of deaths and cases of coronavirus caused covid 19 pandemic in India, according to a report by PHD Chamber of Commerce, the Centre should advise the Real Estate Regulatory Authorities (RERAs) in the states to extend the deadline for completion of projects by six months to 1 year in the wake of the disruption caused by the coronavirus crisis and the nation-wide lockdown.

Moratorium period of 6 months

The industry body has also suggested that a moratorium period of six months should be allotted for paying local body taxes like municipality taxes and property taxes. It also said that ongoing projects can be considered as assets for granting credit to developers.

Reduce/waive off stamp duty

The report further said: "Stamp duty and registration charges on completed flats for a period of around one year should be reduced or waived off. This will be a huge fillip to not just the real estate sector but will also stimulate demand in core industries like cement, steel, electrical, etc., while at the same time providing employment opportunities. This could go a long way in rejuvenating economic activity."

It noted that although, the emergency rate cut by the RBI will lower interest rates, but sentiment needs to be improved for home buying to be kick started.

Interest deduction 

"It is suggested that the enhanced interest deduction for home purchase should be brought down this year. For instance, for current year, the deduction of interest could be 200 per cent of interest paid, followed by deduction of 175 per cent of interest paid for second year, deduction of 150 per cent of interest paid for third year and so on," said the industry body's report.

Minimum wages of labourers

The minimum wages of the construction labourers should be borne by the government utilising labour cess funds collected from the developers, during COVID-19 crisis, it said. 

Industry status

The report also touched upon a long standing demand for industry status to be given to the real estate sector. Since long real estate has demanding an industry/Infrastructure stature for easy accessibility of credit from financial market. Therefore, we suggest that the government should grant industry/infrastructure status to real estate.