The Government’s push to boost affordable housing in the 2017-18 Budget might see a number of builders starting such projects in the city and outskirts in the near future, feel city-based realtors.
Providing the infrastructure status and increasing the unit size by about 30% were some of the announcements made by Finance Minister Arun Jaitley on Wednesday. As of now, there are only a handful of affordable housing projects underway in the State.
Institutional funding
According to Samantak Das, Chief Economist and National Director (Research), Knight Frank India Pvt. Ltd, there will be more institutional funding from banks and other sources after the budget session. He said that the costs of working capital will come down and decision to extend the period of completion from three years to five years, will see more builders jumping into the fray. He felt that the developers can also afford the mass projects because of the benefits.
However, the budget speech also left industry leaders disappointed.
“Only those customers who are buying units from affordable housing projects will benefit and not the general public,” said P. Dasharath Reddy, president, Telangana Real Estate Developers Association (TREDA). “More importance has been given for infrastructure projects. Apart from that, there is not much for the sector or the builders,” he opined.
Property prices
Mr. Reddy also said that the property prices will remain the same in the city and outskirts. The real estate sector has once again been denied an industry status, said D. Sreedhar Reddy, former President, National Association of Realtors - India.
He said that it is yet to be seen if builders are ready to start affordable housing ventures at a time when land rates and construction costs are escalating. He said that reducing the Long Term Capital Gain tax from 3 years to 2 years was a welcome move which will bring solace to the industry.
