At the recently concluded Global Housing Construction Technology Challenge (GHCTC) investor event, Minister of State of Housing & Urban Affairs (I/C), Shri Hardeep Puri, announced infrastructure status has been granted by the government to the affordable housing segment.
The move will enable low-cost housing projects to avail associated benefits such as lower borrowing rates, tax concessions, increased flow of foreign and private capital, profit-linked income tax deductions, relaxations on tax for vacant/unsold units for 1 year, counting of the carpet area instead of the built up area of 30 and 60 sq.m., among others.
Shri Puri, in his address to the participants, informed that additional measures, such as the Real Estate (Regulation and Development) Act, 2016 (RERA), Real Estate Investment Trusts (REITs), the Benami Transactions (Prohibition) Amendment Act 2016, higher tax breaks on home loans, the Goods and Services Tax (GST), land related reforms, optimizing development control rules, rationalizing of the stamp duty and registration charges, digitalization etc. have also been introduced.
“These will be effective in spurring the housing and construction activities, providing huge relief to real estate developers. Also, these would attract private and foreign investments in the housing sector, having a positive multiplier effect on GDP and labor market,” he added.
Regarding the land acquisition difficulties faced by promoters, builders & developers, Shri Puri said, “We are aware that availability of encumbrance free land within existing municipal areas for urban housing schemes is not an easy task. Therefore, provision has been made to include rural areas falling within the notified Planning/Development areas, under ambit of PMAY-Urban scheme. It would leverage availability of additional land at cheaper cost for construction of affordable houses.”
The Pradhan Mantri Awas Yojana (PMAY)-Urban scheme was launched in 2015 with the goal of catering to the deficit in supply and to fulfil the housing needs of homeless urban poor and enable them to own decent pucca houses with basic infrastructure facilities by 2022.
However, according to states from state governments, 12 million homes under EWS/LIG segment of the society is needed by 2022 to fulfil this vision.
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