The Union Budget is awaited with much anticipation by the man on the street as well as by industry sectors with wishes and expectations sky-high. Will the Finance Minister offer an ‘all-pleasing-budget’ is a million-dollar question!
After a lull of over five years the perception on the economy’s growth has turned positive which has lead to great expectations from this year’s Budget to be presented by the new government today (February 28).
The foremost expectation from the real estate sector is a favourable economic scenario that could bring the interest rates down.
This would help access funds at a cheaper cost to pass on the benefit to buyers which in turn would boost sales, making it more affordable for people to invest in property.
Such reduction in interest rates would also increase the traction in the lending space for banks and housing financial institutions.
Further, an announcement on infusion of fresh capital by the government into banks too would be looked forward to.
This would increase the lending capacity of the commercial banks, signalling the right impetus needed for increased sales and higher borrowing power. This is another sop that the sector is hopeful about.
With the government’s proposal to develop 100 smart cities and focus on redeveloping smaller cities, the real estate sector has turned hopeful of the prospects.
Moreover, allowing FDI in this sector has already made the construction & infrastructure companies source risk capital from other than banks and financial institutions.
Besides the above, the tax saving limit under Section 80C could be increased from Rs.1.50 lakh to Rs.3 lakh. This would surely bring smiles on the faces of the salaried class, allowing it to save more on taxes and look at various opportunities in investment instruments.
It is also expected that the interest and the principal component of home loan too could get a look by the Finance Minister. The current limit is set at Rs.1.50 lakh on principal and Rs.2 lakh on interest outflow on home loans.
Balaji Rao
The real estate sector is hoping for sops which it can pass on to the consumer, says Balaji Rao
