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With hardly any benefits announced towards residential and real estate sector in the Union Budget, the prospective home owners are bound to feel the heat in the coming months. The industry expected the Finance Minister to extend tax benefits to builders providing residential apartments in the cities.

The Urban Housing Ministry has proposed that the 12.5 per cent service tax on construction of residential units be scrapped. This would bring down the cost of owning a house by 3 per cent to 4 per cent. The ministry is of the view that the tax was negating all government initiatives aimed at keeping property prices in check.

The budget has not been very exciting as far as the real estate sector is concerned. There have been no sops offered though the industry has pinned its hope for some. The construction industry is not being recognised as a professional one on the lines of pharma or health sectors which manage some soft corner with the government. Lesser interest rates would have gone a long way in giving further impetus to the growth. There should have been some encouragement as real estate is expected to register a good growth in coming days.

There are no concessions offered in the budget though the construction industry hoped for a couple of positive moves. Since most big projects are coming up on one acre and more sites, the industry anticipated for some concessions for them and also Software Technology Parks. There was also some hope on the interest rates for home loans being brought down but that too did not happen.

However, the move to hike tax percentage and slabs does offer some savings for the salaried employees which could help them in their aspiration for a dwelling.

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