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The Year-In-Review: 2017 Kept The Realty Market On A Constant Lookout

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Realty Market On A Constant Lookout

The year 2017 was a game changer for the real estate sector. With challenging reforms like Demonetization, making their way into the market, impacting the realty sector on high levels. Then came the big regulations such as Real Estate (Regulation and Development) Act and GST, which brought transparency and accountability, hence organising the realty market. Coupling the Demonetization with the imminent implementation of RERA and GST resulted in a major slow-down in terms of real estate sales.

A constant turmoil went throughout the industry during this period, but gradually the trends began to change, as the buyers started to look for ready flats instead of under-construction flats. Such major factors changed the ways of business operation of the developers. A relief was felt among the home buyers as their rights were now protected by RERA, hence generating a wave of confidence to invest more in the real estate market.

With an unlimited possibility of investment, the real estate sector proved to be one of the best choices among the masses, as every investment guaranteed a sure shot return. But the real estate sector stumbled at the implementation of the Real Estate Regulation & Development Act (RERA) and generated a large number of unsold units, ultimately bringing down the prices. With deliveries on time and transactions going transparent, these excessive number of unsold units, brought customers a luxury of choosing the properties of their choice at their budgeted prices.

Till date, about 223 housing projects have registered under Tamil Nadu RERA. About 1100 projects and realtors have registered in Gujarat, with MahaRERA with more than 14000 registered projects. To curb down the complex cascading tax structure and cutting tax burden on consumers, the Goods and Services Tax (GST) was introduced on July 1, 2017, in line with ‘One Nation, One Tax’ model. This new tax was only applicable to under-construction projects and hence made the ready-to-move-in apartments, a more attractive option for the buyers.

Not satisfied with the current rate of GST, the National Real Estate Development Council (Naredco) has recently urged the government to halve the GST rate for the real estate sector to 6 per cent to help boost demand for new homes.

tax authorities began cracking down on the Benami assets after the amendment of the Benami Transactions(Prohibition) Amendment Act. Till date, the income tax department has been able to seize 541 properties. Moreover, funds of about Rs 1,800 crore in various bank accounts are being frozen and more action is expected soon. In its next step, the government is planning to crack down on Benami properties by making it mandatory to link Aadhaar with property transactions.

The affordable housing sector might see a jump in sales, after the revision of the carpet area for the Middle Income Group (MIG) category under the Pradhan Mantri Awas Yojna (PMAY) scheme. An increment of about 90 sq m to 120 sq m in MIG-1 and 110 sq m to 150 sq m in MIG-2 were made in the carpet area. Providing the middle income home buyers with bigger and better houses.

These toughened laws are pushing the non-complying companies into a merger with the bigger players. Hence eliminating the delay and other setbacks, the consumers are being more protected, the increasing purchases in the real estate market are finally turning it into a global market.

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