Union Budget 2021 was announced by Finance Minister on February 01, 2021, and there was a considerable focuses on affordable housing. The government also extended the tax exemption of Rs. 1.5 lakh till March 31st, 2022 for affordable housing. To boost the morale of home buyers and realty developers, the safe harbor limit has been extended to 20% from 10% in the specified primary sales of residential units. Through the budget, foreign Portfolio Investors’ Debt Funding of InVITs and REITs will be made possible by making necessary changes in the current laws. This will encourage access to InVITS and REITs for funding which will result in growing funds for the infrastructure and real estate sectors.
The budget announced this year seemed quite transparent. The government has allocated Rs54,581 crores in this year’s budget. In the budget, Finance Minister also announced the resolution of stressed assets. To consolidate and take over the current stressed debt, an Asset Reconstruction Company and Asset Management Company will be formed to manage and dispose of the assets for the eventual realization of value to Alternative Investment Funds and other potential investors. Goel Ganga Real Estate.
In order to further broaden the efforts towards the unorganized migrant labor force, FM proposed to launch a portal that would collect relevant information, among others, on gigs, buildings, and construction workers. This will help in formulating schemes for migrant workers for health, accommodation, skills, insurance, credit, and food. However, there were several expectations from the budget regarding ‘bestowing industry’ status to the sector and several tax relaxations that are not fulfilled by the budget. But overall the budget is seen in a positive light by various economists and realtors. Goel Ganga Real Estate
Key highlights of the budget about the real estate sector:
- Affordable housing for laborers and migrant workers
- Extension of Tax Exemption for affordable housing loans
- Easy approachability to REITs and InVITs
- Increment in safe harbor limit in specifies primary sale for residential units
- Boom in infrastructure, especially metro
- Resolution for stressed assets
According to the Managing Director of Goel Ganga Developments, Mr. Annuj Goel, “The government’s emphasis on infrastructure development and MSMEs would contribute to the creation of jobs that will help people become financially stable. The support announced by the finance minister would also go a long way to improve the real estate market and alleviate a lot of pressure points in the rented home plans. This will significantly assist migrant workers and help them in staying in metros and other major cities during periods of financial distress such as the Covid-19 pandemic”.
