How Budget 2023 can help home buyers, know what to expect

The home loan/real estate sector is an important part of the Indian economy and is facing some challenging times due to rising interest rates. Lenders need to come up with better interest rates and repayment policies to boost growth in this sector.

Budget expectations for home buyers

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Housing sector Well done in 2022. According to a report by Anark Research, residential property sales are expected to increase by more than 50 percent in 2022 compared to 2021. But the housing sector in India (Indian Housing Sector) For 2023, things are not as smooth as we see them. Experts say, here Dr Budget 2023 Steps can be taken to significantly boost this sector from both buyer and seller side.

Home Loan/Real Estate Sector Indian economy And facing some challenging times due to rising interest rates. Lenders need to come up with better interest rates and repayment policies to boost growth in this sector. which can help the sector remain competitive and ensure customers’ budgets. Below are 5 expectations of the real estate industry‚Ķ

Change the home loan terms

Anuj Sharma, Chief Operating Officer, IMGC said that home loan interest rates need to come down to make home loans affordable. While lending rates depend on the RBI’s policy rate, the Budget may provide relief to home buyers by relaxing home loan norms. Sharma said these could include steps like reducing required down payments or easing eligibility criteria for home loans, making it easier for homebuyers to secure financing.

Tax Exemption in Progressive Rates

Experts say the rise in interest rates is expected to have a major impact on the home loan and real estate sectors. Rising rates will make affordability a major concern for buyers moving forward. Therefore, the government needs to take steps to increase the tax deduction on home loan interest under section 24(b) to Rs 5 lakh. According to Sharma, tax breaks for first-time home buyers can help reduce the overall cost of buying a home, making it more affordable for first-time buyers.

Changes to affordable housing limits

The current price band of 45 lakhs for properties considered under affordable housing is not justified in most cities in India, it should be raised to 75 lakhs or more.

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Exemption in GST

Experts say the current GST framework for under-construction and affordable housing creates an additional burden on developers, leading to higher property prices for buyers. GST on steel and cement increases household costs by 18 percent and 28 percent, respectively, and developers cannot claim tax credit for GST paid on input goods. To reduce this burden and increase resource capacity, the government may consider restoring the Input Tax Credit (ITC) in the upcoming budget. Also, capping GST at 1 percent for under-construction projects and reducing the cost of raw materials like cement and steel could help encourage more people to buy affordable homes.

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