2016 was a Significant Year for India Real Estate Sector
May 18, 2017 Real Estate News
2016 has stood out in real estate sector compared to previous years. The ups and downs, the implementation of laws have all contributed effectively in favour of the buyers this year. From price correction to implementation of RERA, demonetization, all have made a significant difference in the real estate sector.
Budget Matters:
The Budget 106 provided some relief to the buyers by implementing no service tax on the affordable housing homes. This has been a great relief to the buyers looking for property in the affordable segment. Additional relief was given to the first time buyers by giving them the tax benefit if they took a home loan to buy the property. The only hunch back was that no direct benefits were given to the buyers in the budget.
Some relaxation was provided by Real Estate Investment Trust (REITs) by raising the investment cap of the in under construction project from 10 percent to 20 percent.
RERA:
The long awaited law was passed by the parliament this year, RERA (Real Estate Regulation Authority). The law will come into full force from 1st May 2017 and the states are given the liberty to make their own RERA laws that will suit the buyers and the developers of the respective states, given the condition that the laws should on the lines of what the central government has already rolled out. RERA will account for more transparency and account notability in the real estate sector. It is expected that it will put an end to the unfair practices by the developers that exploit the interest of the buyers and the buyers ultimately face an undue burden in both financial and psychological matters. The law states that the projects will have to receive all the mandatory approvals from the government before launching it. It holds for both the residential and commercial sector. Also, the agents who sell or buy any property will have to be registered with the real estate regulatory authority. The Act is promising to keep a check on the projects from start to finish.
Benami property:
Benami property act puts a ban on the properties that have been registered under fictitious name and identity. According to the law, the government can confiscate any such property or the culprit holding became property can be imprisoned or had to pay a fine amounting to the fourth of the cost of the property. The Benami property act also covers gold, and shares.
Demonetization:
It had a greater impact on the real estate market. Most of the transaction of property happened in liquid money to avoid taxes. Now with demonetisation, it is difficult for the buyers to pay money in cash. The secondary market has been hit harder with it than the primary market.
It is expected that this bring more genuine buyers in light and the prices of the properties will see some correction in coming times.
Budget Matters:
The Budget 106 provided some relief to the buyers by implementing no service tax on the affordable housing homes. This has been a great relief to the buyers looking for property in the affordable segment. Additional relief was given to the first time buyers by giving them the tax benefit if they took a home loan to buy the property. The only hunch back was that no direct benefits were given to the buyers in the budget.
Some relaxation was provided by Real Estate Investment Trust (REITs) by raising the investment cap of the in under construction project from 10 percent to 20 percent.
RERA:
The long awaited law was passed by the parliament this year, RERA (Real Estate Regulation Authority). The law will come into full force from 1st May 2017 and the states are given the liberty to make their own RERA laws that will suit the buyers and the developers of the respective states, given the condition that the laws should on the lines of what the central government has already rolled out. RERA will account for more transparency and account notability in the real estate sector. It is expected that it will put an end to the unfair practices by the developers that exploit the interest of the buyers and the buyers ultimately face an undue burden in both financial and psychological matters. The law states that the projects will have to receive all the mandatory approvals from the government before launching it. It holds for both the residential and commercial sector. Also, the agents who sell or buy any property will have to be registered with the real estate regulatory authority. The Act is promising to keep a check on the projects from start to finish.
Benami property:
Benami property act puts a ban on the properties that have been registered under fictitious name and identity. According to the law, the government can confiscate any such property or the culprit holding became property can be imprisoned or had to pay a fine amounting to the fourth of the cost of the property. The Benami property act also covers gold, and shares.
Demonetization:
It had a greater impact on the real estate market. Most of the transaction of property happened in liquid money to avoid taxes. Now with demonetisation, it is difficult for the buyers to pay money in cash. The secondary market has been hit harder with it than the primary market.
It is expected that this bring more genuine buyers in light and the prices of the properties will see some correction in coming times.
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