WHAT’S NEW IN BUDGET 2017 FOR REAL ESTATE SECTOR?

NEW DELHI: Finance Minister Arun Jaitley in his Budget 2017-18 speech has announced one of the much needed changes for the Indian real estate sector. The affordable housing will be given infrastructure status which is likely to result in increased participation from private players.

“The announcement of affordable housing being given Infrastructure status is a welcome move and will act as a catalyst to meet the objectives of Housing to all by 2022. Credit off-take towards affordable segment of housing will lead to creation of supply especially for both stake holders the first home buyer and developer who will now have access to cheaper funding,” said Ravi Ahuja, Executive Director, Office Services & Investment Sales at Colliers International India.

“Considering the impetus being given to road infrastructure, manufacturing and affordable housing, the government have put in all the required ingredients to incentivise urban decongestion and the development of new industrial cities around our industrial transport corridors”

Jaitley also announced that National Housing Bank will refinance indiviual loans worth Rs 20,000 crore in 2017-18. “NHB allocation will give a big push to affordable Housing Finance Ccompanies namely AU housing, Gruh Finance, Repco,” said India Ratings.

Source: http://economictimes.indiatimes.com/wealth/personal-finance-news/whats-new-in-budget-2017-for-real-estate-sector/articleshow/56910234.cms

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FIRST HOUSE ON 20-YEAR LOAN TO COST RS 2.4 LAKH LESS

If you earn up to Rs 18 lakh per annum, buying your first house will cost about Rs 2.4 lakh less as the government will subsidise a part of your home loan interest. At present, this subsidy is available to only those earning up to Rs 6 lakh per annum.

The government has announced two new subsidy slabs to spur the real estate market and achieve housing for all by 2022. The slabs will apply to loans with a tenure of up to 20 years, as against the limit of 15 years now.

On December 31, 2016, PM Narendra Modi had announced two subsidy schemes under Prime Minister Awas Yojana (PMAY), but their details have been worked out only now.
Homebuyers will get subsidy at different rates depending on the income bracket they are in. People earning less than Rs 6lakh per annum will get a subsidy of 6.5 percentage points on a principal component of Rs 6 lakh, regardless of their total loan amount. If they borrowed money at 9% interest, they will pay only 2.5% interest on Rs 6 lakh, and 9% on the remainder.

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In the next bracket, people earning up to Rs 12 lakh per annum will get interest subsidy of 4 percentage points on a principal component of Rs 9 lakh, and the highest income category of Rs 18 lakh per annum will get a subsidy of 3 percentage points on a principal component of Rs 12 lakh.

The net benefit to all three categories over a 20-year loan tenure is roughly Rs 2.4 lakh (assuming an interest rate of 9%, see table), and the monthly instalment reduces by roughly Rs 2,200. This subsidy benefit under PMAY is in addition to the income tax benefits on home loans, which can go up to Rs 61,800 per annum for someone in the 30% tax bracket.

National Housing Bank (NHB) and HUDCO are the nodal agencies to implement the subsidy schemes. Under the scheme for the low-income group, the government had subsidised around 18,000 firsttime homebuyers, at a cost of around Rs 310 crore. A senior NHB official said the disbursal rate is likely to go up as the middle-income category has been brought under the scheme.

Source: http://economictimes.indiatimes.com/wealth/real-estate/first-house-on-20-year-loan-to-cost-rs-2-4-lakh-less/articleshow/57074740.cms

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LAND POOLING CAN HELP ADDRESS DELHI’S DEVELOPMENTAL ISSUES

Amaravati, the new capital of Andhra Pradesh, is being constructed by innovative landpooling mechanism without the use of the Land Acquisition Act. Capital gains tax will be exempted for persons holding land from which some part was pooled for creation of the state capital of Andhra Pradesh. The tax benefit depends on the value of the land given up by the farmer, according to the budget proposals.htestate

Those who held land on June 2, 2014 and sold it to the government to carve out the new capital will benefit from the tax waiver. Over 20,000 farmers have given up land under the Land Pooling Scheme (LPS) for the development of the new capital city. The exemptions are retrospective and are applicable for transfer of capital assets, both land and buildings.

So shouldn’t Delhi be given the same priority? After notification, the land-pooling policy of Delhi is currently languishing due to lack of political will, thereby leading to an increase in slums and unauthorised developments. It has been almost three years now.

Farmers, whether in Amravati or Delhi, deserve the same exemption. This is because Delhi is India’s only city state, which is 100% urbanised according to the Master Plan of Delhi 2021 or MPD 2021. The stated Farmers in Andhra Pradesh, who surrendered their land to the government for its upcoming capital city Amaravati, will not have to pay capital gains tax on land sale proceeds Those who held land on June 2, 2014 — when Andhra Pradesh was bifurcated to carve out Telangana, India’s youngest state — and sold it to the government will benefit from the tax waiver, finance minister Arun Jaitley vision is to “develop Delhi into a world-class megapolis. Land is either an inherited or longterm investment asset, and so valuation is largely subjective. There is also a projected need for almost 1.6 million affordable residential units and 130 million sq ft of workspace.

Governments, both at the Centre and the state level, need to understand that the average said in his budget speech Over 20,000 farmers have given up land under the Land Pooling Scheme (LPS) for the development of the new capital city Capital gains tax will be exempted for persons holding land from which land was pooled for creation of the state capital of Andhra Pradesh. The tax benefit depends on the value of the land given up by the farmer per capita land holding in Delhi would be less than half a hectare, and the only way to aggregate 56,000 hectares will be through the incentives route. This would help channelise billions in institutional investments into land and future developments.

If a robust manufacturing sector is to be developed, the government needs to extend facilitation and incentives towards raw materials for programmes, including Make in India and Start up India. So why can’t land be treated as the most crucial raw material for planned urbanisation of Delhi? MPD 2021 is the last phase of development of Delhi and 100% land is likely to be consumed for development. All possible incentives need be extended so that government agencies have access to identified land parcels to roll out the new infrastructure.

The lieutenant governor of Delhi, through an executive order, had ordered that the inter-department transfer of land for development projects in the Capital must attract only a notional fee. Even government agencies need to be incentivised to roll out physical and social infrastructure in a time-bound manner. Let’s not forget that almost 40% of the total land in Delhi would be available to DDA under the land-pooling policy.

Treat land like raw material for affordable housing, considering that the projected population in the NCT of Delhi is around 2.3 crore. There is also an urgent need for more workplaces.

Land pooling is the only way forward, and now is the best time to establish Delhi as the political, economic and development capital of India. The author is the founder director of Certes Realty Limited, a New Delhibased niche advisory and transaction organisation

Source from: Hindustan Times

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Govt Rider to Land-Pooling Policy

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The Delhi government has agreed in-principle to put its stamp of approval on DDA’s land-pooling policy provided the agency makes a few amendments to it.The AAP government wants DDA to hand over 12-15% of the pooled land (from DDA’s share) to it for free for development projects.

The decision was communicated to the land-owning agency on Thursday. The policy was notified by the Union urban development ministry in 2013. “It is suggested that a provision may be made in the land-pooling policy to hand over the component pertaining to industrial (4-5%), public and semi-public facilities (8-10%)–12-15% in total of the pooled land–to the Delhi government free of cost,“ said an official.

Sources said the government was facing a lot of difficulty in getting land from DDA. “The government requires land for facilities such as electrical sub-stations, stadium, industrial areas, old-age homes, hostels, schools, etc. It has to buy land from DDA,“ the official added.

According to Delhi government officials, if the policy is amended, it will help the government build infrastructure on time. DDA officials said that the government’s view would be studied and placed before the competent authority for a final decision.

The land-pooling policy is stuck for the past one year as the Delhi government is yet to declare 95 villages where the policy will be implemented as development areas.The government had already transferred gram sabha land in these 95 villages to its revenue department. This will help the government keep those plots for infrastructure projects even after the villages have been handed over to DDA.

Sources said DDA might not agree to hand over its land to the government free of cost. “We have to see the issue in totality. DDA will be spending money on providing basic infrastructure in these areas. The industrial areas can’t be given free of cost. But the matter has to be studied as an implementation of the land pooling policy is crucial for Delhi’s development,“ said a senior official……..

Full details:  http://epaperbeta.timesofindia.com/Article.aspx?eid=31808&articlexml=Govt-rider-to-land-pooling-policy-02072016004039

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All about the most preferred choice for home seekers in Delhi

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India has been the latest market for real estate boom and the main reason behind this is the people coming from all around the globe to settle in Delhi. There are so many new companies and MNC’s that are getting established in the NCR region and along with these companies the techies, employees and many other members are coming to Delhi. As the demand is increasing every day, people are looking for more and more luxurious and comfortable stay. One of the popular places in Delhi that have been a buzz since its inception is the L Zone where builders like Kamp developers Dwarka are coming up with a series of world-class houses.

The L zone Dwarka:

As the demand for housing in Delhi is increasing the Delhi Development Authority has been working on a master plan in which a particular zone has been focused. This zone has been named as L zone Dwarka. The L zone Dwarka is located in the South-West Delhi and the total area is about 22,840 hectare. There are many things that make this L zone Dwarka in Delhi is the most preferred choice for home seekers.

Some of the facts and pointers of Kamp Sir syed Residency Dwarka L Zone include the L zone Dwarka in Delhi is close to the Indira Gandhi Internation Airport. The location is also in the perfect spot as it has been strategically placed between the two popular regions Dwarka and Gurgaon. Under the master development plan, the Delhi Development Authority has divided Delhi into many zones. The L zone Dwarka is the largest of all the zones.

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