Budget 2022 Expectations: NAREDCO makes this recommendation to incentivise 'buy to rent' trend in realty sector

Ahead of Union Budget 2022, as a part of the rental housing reforms, rental income for the first five years from the date of completion should not be taxed to incentivise 'buy to rent' trend, Niranjan Hiranandini, Vice Chairman, National Real Estate Development Council (NAREDCO) proposed. 

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"This will be a major step to boost rental housing trend across the nation," Hiranandini posted from his official instagram profile about the above-mentioned reform proposal. 

 

 

 

 

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NAREDCO President Rajan Bandelkar said the Centre should increase the deduction of interest on home loan for self-occupied house from taxable income to at least Rs 5 lakh in order to promote the ownership concept, as per an IANS report. 

Currently, interest on borrowed capital to acquire a house for rental purposes is allowed in full. However, in the case of self-occupied houses, interest is restricted to Rs 2 lakhs, the council said in a statement.

"The sales momentum had picked up during the second half of previous year. In this perspective, while there is a need to continue the sales pace, there is also a need to strengthen the hands of consumers," Bandelkar added.

Noting that the Centre had taken up a pro-growth stand, he said, however, there is a need to continue the support offered to the realty sector amidst the renewed lockdown and economic uncertainty, he said, adding that there was a need to create a sense of home ownership and create value in buying homes.

Further, the Council urged the Centre to treat the units of `Real Estate Investment Trusts` equivalent to listed entities for direct tax computation.

(With IANS inputs)