This year’s Budget came as a pleasant surprise to many. Those in the real estate industry have been singing the praises of the effects on the market. It looks like homebuyers too have much to look forward to. Here are some of the reasons for the homebuyers to celebrate:
This year’s Budget has definitely made a lot of people happy. Industry insiders are beaming with the satisfaction of having been on the receiving end. Home buyers too stand to gain immensely from the recent developments.
Taxation on Capital gains and nominal tax are two aspects of the Budget that are instrumental under this context. The Capital gains tax is a charge on property that is on the sales market. Previously, anyone wishing to sell the house within a 3-year period would have to pay high taxes. Now, the tax period is 2 years. This is an advantage to the homebuyer, as the amount paid will reduce.
Several positive changes such as these have certainly enlightened the people. Many homebuyers are looking to invest in the near future. Moreover, the demonetization scheme that encourages cash-less transactions has many advantages too. There is a genuine belief now that homebuyers have a good end of the deal. Investing options are increasing with more financial assistance in the picture.
The second advantage is in relation to nominal or notional tax. This system is one where the tax is on constructed properties. Earlier, the taxable amount would be the value assessed at the time of the deal. However, now various changes ensure that tax is on completed property. This allows much more people to get into ventures with developers.
Apartments in metros are becoming more affordable thanks to these changes being facilitated by the Budget. More and more people are bringing forward their queries to the developers and getting better deals. Demand from the homebuyers’ side is steadily increasing. To add to that, supply is also gradually picking up.
The Budget has brought with it many surprises and shocks and the various different sections in the Real Estate market have been the witness to many changes. Affordable housing to high-end luxury buying has become all the more convenient to purchase, owing to the changes brought in by the Government. Many changes in the tax system have been an encouraging factor for promoting investment. The Budget having come as a prelude to the GST has been instrumental in mentioning the immediate reforms.
The GST that is a major boon will also ensure that the taxes borne by the homebuyers are in the aggregate or the complete property. Only on the final stage will the tax be applicable. Further, deduction of the tax paid at each stage will also take place. The GST will also abolish the multiple taxes and put forth a single tax. The GST will thus reduce the construction costs that will make it cheaper for the homebuyers. The main aim of GST is reducing the harassment faced by the homebuyers.
In a metro like Chennai, buying a house is a big deal with a huge investment. Many people save their income for years on a stretch to be able to afford a property. First-time homebuyers look towards their life-savings to invest in the real estate world. The Budget after recognizing the requirements of the middle and lower-income group living in urban cities has put in place changes in the tax system.
Overall, as we have seen the Budget looks to reduce the burden of tax and payment on the incomplete property. This will be a great move to ensure that homebuyers find the incentives to invest in properties. The main takeaway from the Budget is that it is not only developer-friendly but buyer-friendly as well.
With this in mind, invest in some property taking into account the yield that you expect and the purpose of investment.