Union Budget FY23: Real estate sector expects reforms to drive demand for housing

1 Feb 2022 , 07:37 AM

Major tax-related reforms are expected for the real estate sector. Since the outbreak of the pandemic, activities in the realty sector has struggled to keep up with the pace. However, as the virus was modified and surfaced, in 2021, the sector has witnessed recovery on the back of improved customer sentiment and developers pushing sale schemes. Also, the government has introduced various liquidity schemes to make home-buying more lucrative.

Here’s what CARE Ratings expects during this Budget for the sector:

Hike in Rs 2 lakh rebate u/s 24 of IT Act towards interest on home loans could infuse robust demand for housing, especially in the mid-segment categories. A separate tax deduction under section 80C could be offered for housing loan principal repayment.

Ever since its implementation in 2017, the CLSS scheme has benefitted over 3.3 lakh families and the extension will further aid many more families to avail themselves housing under this scheme.

Industry status to the sector so that cheaper credit facilities can be availed of from financial institutions.

Tax neutral business consolidation through merger or amalgamation to push rescue of stalled housing projects.