The government needs to engage with the housing finance companies (HFCs) to work out the appropriate margin cap based on real operating costs and risks involved in lending in these segments
The current refinance norm of National Housing Bank (NHB) prescribes a margin cap of 2.5 per cent between the refinance rate and the borrowing rate of the end consumer. This 2.5 per cent does not even cover the transaction cost, let alone meet the risk and return requirement.
While the micro and small enterprises are fairly well targeted, there is no coverage or mention of housing finance needs for them. The budget talks of housing for all, how do people in EWS/LIG segments buy or build houses in the absence of access to long-term home loans at very reasonable rates? This concern should have been answered in this years budget.
Many of the realtors were expecting significant changes in the issues regarding like interest subvention, service tax exemption and infrastructure status, but there has been no improvement in any of the above issues.
Except for REITs and curbing of benami transactions, there was no specific mention suggesting to the sector this time around unlike in the last budget. and also, the increase of nearly 2 per cent in service tax is going to push up the overall cost for buyers and those availing services from the real estate sector
Yeah, smart cities also seems to be a distant dream now. It is the biggest agenda in their manifesto to build smart cities but nothing is mentioned about it except allocation of 22,000 crore. While there are welcome steps like interest-free bonds for infrastructure and single-window committee and other reforms, overall, it is a disppointment.
Apart from failing to meet the expected standards of affordable housing, manyof the realtors feel that the government has also failed to deliver on another of its pet projects, which is smart cities.
Some of the long-pending demands such as removal of DDT and MAT on SEZs, reintroduction of Section 80-IB for low-cost housing and extension of interest subvention for affordable housing have been ignored yet again in this years budget.
as far as affordable housing is concerned, the budget is totally disappointing. Everybody was expecting a very big stimulus for affordable housing because the government’s agenda is to provide housing to all by 2022. There is not much time left to complete the task, so developers across the country are disappointed
This budget was highly anticipated by all, and many of the developers and the investors were depending on this budget to bring up the real estate market in the city back on track Central government has not done enough to achieve their dream of housing for all. While some judgements were welcomed by the developers across the country, a majority of them felt let down by the budget.