Budget 2022 Expectations Real Estate: Rs 5 lakh home loan interest, Income Tax 80C amendment, GST reduction and more

 Expectations for the Budget in 2022 Union Finance Minister Nirmala Sitharaman is expected to present the Union Budget 2022-23 on February 1, 2022. This is the fourth budget of Prime Minister Narendra Modi's NDA government, which is in its second term. On the 1st of February 2022, around 11 a.m., the Budget 2022 will be presented. People from all walks of life are looking forward to the Modi government's decisions and announcements in many industries, therefore there are great expectations for Budget 2022. Here's what Amit Agarwal, Co-Founder and CEO of NoBroker.com, has to say about the Real Estate Sector's Budget 2022 Expectations.

"The real estate industry has showed remarkable endurance in the face of the epidemic and is presently on a favourable development path. The sector's strength can be ascribed to a variety of factors, including steady property values, enticing builder discounts, and historically low home loan interest rates. And with a few measures that could be included in this year's budget, this increase can be expedited "According to Amit Agarwal.

Rs 5 lakh home loan interest

For many people, purchasing a home is currently a top priority. The NoBroker annual real estate study 2021 revealed the same. Interest rates on home loans are currently in the region of 6.5-7 percent per year, however buyers who want to take out a loan of more than INR 30 lakh would be unable to claim a deduction for the total interest paid in the first years due to a limit of Rs 2 lakh per year under section 24(b) of the Act. More solid demand in the home-buying category is critical at this time."Increasing the tax refund on housing loan interest rates from Rs 2 lakh to Rs 5 lakh or more could boost home demand, particularly in the cheap and mid-segment categories," he said.

Another important factor to consider is the notion of affordable housing. While unit sizes can be harmonised, pricing consistency between cities is not feasible. Property costs in Mumbai, for example, are substantially more than in Kanpur or Kolkata. One area where the budget may look into and redefine is this. "It will have a good influence on the sector if the concept of affordable housing is readjusted to city-specific norms," he added.

Moreover, over the years, various benefits have been defined for the cheap section. In this vein, if the government extends some incentives to mid-segment housing as well, demand will increase, resulting in a faster recovery of the real estate market.

Section 80C of the Income Tax Act, 1961

"The budget should give special emphasis to developing a much stronger banking sector in order to increase home purchasers' access to better and lower-cost borrowing. This can be accomplished by categorising home loans into priority sector lending categories. The budget could focus on revising Section 80C of the Income Tax Act of 1961 to extend the time limit for repaying the principle on a home loan. This will alleviate some of the stress on property buyers by giving them more time to return the money. In the next days, it will attract more customers "He went on to say that

GST

"There is also a pressing need to simplify the Goods and Services Tax, which is levied at 1% for affordable housing and 5% for all other segments. A 1% GST cap on under-construction projects would help speed up the completion of projects that have been stopped owing to budgetary constraints.

Developers of commercial real estate, for example, should be able to deduct GST paid on construction materials. Improving credit availability to smaller developers who are still experiencing cash flow problems as a result of the pandemic is another area where government assistance is needed "he stated

Stamp duty Reduction

"Maharashtra's stamp duty reduction has yielded positive consequences. If this can be replicated in other states, fence-sitters will be enticed to take the jump, boosting real estate even more "He went on to look for more.

GST reductions on raw materials, industry status

"For many years, a single window clearing has been overdue. Furthermore, now is an excellent time to grant industrial status to the real estate sector so that it may obtain lower-cost borrowing from banking institutions. GST reductions on raw commodities, such as cement and steel, should also be a priority in the budget. This will provide a great deal of relief to the developer community as a whole, allowing it to recover more quickly from the slowdowns imposed by COVID-19 "He went on to say that

"For many years, a single window clearing has been overdue. Furthermore, now is an excellent time to grant industrial status to the real estate sector so that it may obtain lower-cost borrowing from banking institutions. GST reductions on raw commodities, such as cement and steel, should also be a priority in the budget. This will provide a great deal of relief to the developer community as a whole, allowing it to recover more quickly from the slowdowns imposed by COVID-19 "He went on to say that

Conclusion

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