By: Bhim Yadav, CEO, Falcon Realty Services Private Limited
What Government can look at is to increase the demand and continue interest reduction in housing or enhance the deduction limit. Government can also provide special tax incentives for budget housing. Instead of expecting small time concessions the sector should look at something that will help in the long term and boost the demand. We expect a waiver of 3 lakh for home loan borrower which will help boost the demand and sale of property that fall in the price range of Rs 30-40 lakh.
Government should also mull over reducing VAT to 2.3%. Cement and steel prices should be kept in control because sometimes fluctuation of 20-30 per cent takes place in this sector. The fluctuation in prices should be proportionate to GDP and not above it, i.e. around 10 per cent. This is mandatory as housing prices vary according to the prices of cement and steel. If we want to provide houses for all then this factor should be paid heed to.
Government should encourage affordable housing that is being developed on Public-Private partnership (PPP) model. Under this financing institutions should get blanket clearance for working capital. It should be done to make sure that speed of work should not decrease because of lack of fund. Quaterly audit should be done to make sure that work order received by bank has been utilized properly. Monetary cell should be constituted to monitor the funding of affordable housing and for better coordination with the Government.
