Budget 2017: Highlights for the Housing Sector, Home Buyers

In Budget 2017-18 speech a much needed thrust to the Indian real estate sector was given.

budget 2017 infographics

Here are few important Announcements on Housing Sector:

  • Infrastructure status is given to Affordable Housing Sector
  • Affordable Housing Defined: Projects with flats upto 30sqm in metros & 60sqm in other cities (carpet area).

The following will benefit developers and should bring down costs for Buyers:

  • Better availability of loans for developers, with affordable housing getting infrastructure status.
  • 100% deduction for profits in affordable housing sector, approved during June 16 – Mar 19 & completed in 3 years
  • Exemption from service tax on construction of affordable houses

Announcements which effect Home Owners:

  • Income of Rs. 2.5 lakh -Rs. 5 lakh to be taxed at 5 %. Additional surcharge of 10% for income between 50 Lakhs to 1 Crore
  • Deduction for additional interest of 50,000 per annum for loans up to 35  lakh  sanctioned  in  2016 for  first  time  home  buyers, where house cost does not exceed 50 lakh
  • Tax to be levied for unoccupied houses a year after getting completion certificate.
  • Capital Gains Tax holding period reduced from 3 years to 2 years for real estate
  • National Housing Bank will refinance individual loans worth Rs 20,000 crore in 2017-18.

Towards RWAs

  • Govt will undertake important reforms by providing legal framework for dispute resolution and re-negotiations in PPP projects and public utility contracts, bringing in more development in urban neighborhoods.

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