Finance Minister,Arun Jaitly
NEW DELHI: Terming today's Budget proposals as positive for the real estate sector, industry players said that tax sops for first home buyers and incentives on development of affordable housing projects will help revive demand in the sluggish property market.
Some of them, however, rued that their demand to provide industry and infrastructure status to the realty sector was not considered.
The Budget 2016-17 has proposed an additional Rs 50,000 deduction on interest on loans for first home buyers and 100 per cent deduction for profit on development of affordable housing, besides exempting REITs from dividend distribution tax.
"It is overall a very positive budget for the real estate sector and CREDAI is certain that this will spur the market and induce the home buyer who has been waiting ever since for some special incentive to actually be able to buy a house," realtors' apex body CREDAI President Getamber Anand said.
The Finance Minister has taken the right steps to boost housing sector and ensure that 'Housing for All by 2022' becomes reality, he added.
Commenting on the budget, India's largest realty firm DLF CEO Rajeev Talwar said: "Very good budget for real estate. Tax incentives have been given to first home buyers as well as development of housing projects. This will boost both housing demand and supply significantly. 90 per cent of the housing demand is in affordable segment".
Tata Housing MD & CEO Brotin Banerjee said "additional exemption of Rs 50,000 for houses under Rs 50 lakhs will help bring in first buyers to the market...We may see a lot of traction in the affordable housing space".
JLL India Chairman and Country Head Anuj Puri said the additional deduction of Rs 50,000 would mostly benefit first time home buyers in tier-III and tier-II cities.
The Real Estate Investment Trusts (REITs) could become a reality now after the exemption of dividend distribution tax (DDT) on such business trusts, he added.
NAREDCO President Parveen Jain said tax incentives given to first home buyers will boost depressed housing sector.
Anshuman Magazine, CMD of CBRE South Asia, said: The most encouraging announcement has been the exemption of REITs from DDT. "Although more could have been done to revive housing demand in the country, the Government has extended incentives on various fronts, especially for the affordable housing".
Cushman & Wakefield India MD Sanjay Dutt said the Union Budget has placed greater thrust on affordable housing and has brought about a much-needed cheer for the real estate sector.
"The finance minister's announcement of 100% deduction in tax from profits of affordable housing developers would increase their focus on the segment that has been largely ignored owing to business viability issues," he added.
Sobha Ltd Vice Chairman and MD J C Sharma said the tax sops would "perk up the market sentiments".
Knight Frank India CMD Shishir Baijal said the housing sector will get a push from both supply and demand side from this year budget.