A Year of Change- 2016!

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A Year of Change- 2016!
?January 2, 2017
?Real Estate ?current real estate market trends,
real estate
market 2016, trends in real estate ?Srishti
Chandola
2016 is the year that will be remembered for some
dramatic policy changes in the real estate
sector. All these changes have great potential to
usher to be more organized and cleaner. Also, it
has got more transparency is the real estate
market in India. Though, there are some policies
that have some adverse effect in the sector in
short to medium term. These are the top 10
policies changes that have taken place in the
real estate market in 2016 Real Estate
Regulation and Development Act, 2016 100
deduction in the construction profits especially
of affordable homes Improvement to the Benami
Transactions Act Amendment in arbitration norms
for the construction of companies Interest
subsidy for the first-time home buyers DDT
exception for SPVs to REITs Exception of service
tax for the construction of affordable housing
Status of permanent residents for the foreign
investors Execution of Services and Goods Tax
structure Demonetization of 500 and 1000 rupee
notes Regulations directed at boosting the
transparency in the real estate industry
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As per numerous reports, the real estate market
was in the news for all the correct reasons in
2016, of course, with the government making
announcements for various policy initiatives. It
can be clearly seen that the Real Estate
Regulation and Development Act, 2016 which came
into force in March this year has laid down a
regulatory framework that has drastically changed
the ways that the real estate sector works or
operates in India. It clearly aims to enhance
more transparency and bring greater
accountability to set the disclosure norms that
would protect the interest of the stakeholders
as well as ensures speedy settlement of the
property disputes. Likewise, the Benami
Transactions Amendment Act, 2016have laid down
some stringent rules as well as penalties that
are associated with the Benami transactions. It
has established a regulatory mechanism to deal
with the disputes that are arising from all the
transactions and levying penalties to increase
the involvement of institutional investors those
regulate the business and make India an
eye-catching destination for investment. The
Real Estate Act is already in force in Gujarat
and Uttar Pradesh while another state will
formulate the rules under this act and implement
it by mid-2017. The amendments of Benami
Transactions Act might curtail the influx of the
unaccounted money or funds in the real estate
sector. Model Shops and Establishment Bill was
also announced in June 2016. This bill allows
all the retail establishments such as malls,
cinema halls, shops, restaurants, etc. to be
operational 247. Though it was welcomed by the
retail industry, there was varied actual
response was in terms of the retailers those were
keeping the operations open. Policies that
boosted affordable housing sector The change of
policies during 2016 will definitely help the
real estate sector much more than harming the
business, maintains the real estate
developers. Some of the developers even
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believe that the change in policy has been pretty
favorable for the developers along with the home
buyers. Experts do believe that the proposal by
the government for 100 deduction in the profits
for the affordable housing projects which were
approved during June 2016 to March 2019 will have
to endorse affordable housing. Also, the
condition that these projects should be completed
within 3 years of the grant of approval
definitely favors the buyers. There are various
other policies in favor of the buyer. Union
budget for 2016-17 proposed some additional
deduction in the interest of Rs 50,000 per
annum, especially for the first time home buyers.
For the loans up to Rs 35 lacs which were
sanctioned during the next financial year for the
homes mot exceeding Rs 50 lacs. The exemption
of the service tax on the construction of the
affordable housing projects up to 60 sq meters
under the state and central government scheme
which includes PPP schemes which are also
intended to boost affordable housing segments as
well as encourage the greater collaboration
between public and private sector in the
construction. Impact of demonetization and GST
on property markets still remains uncertain Most
of these decisions are accepted and welcomed by
the real estate fraternity and the impact of two
major policies seen to be on the Good and
Services Tax and demonetization of high- value
currency. For the Good and Services tax, there is
still a lack of clarity on whether the real
estate sector will fall in the common use or sin
category as well as the tax rate will attract no
matter whether it will be 18 or higher. Also,
charity needed on whether Good and Services Tax
will include the existing taxes that are
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charged on the under-construction projects, such
as value added tax and service tax. The
announcement of demonetization and the withdrawal
of Rs 500 and 1000 notes has lit the land deals
across the country while the housing sales in the
resale market have reduced or deducted markedly.
Thus, reduction of rates in these segments. Also,
in the primary market, numerous reputed
developers who have conducted the transparent
dealings through official channels have been
very less affected. In the cash-driven economy
such as India, demonetization may cause the home
to adopt the wait and watch approach in the
coming year. This might not be good news for the
realty sector which is struggling to the
emergence from the slowdown.
? Decorate your Home for New Year
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Estate Pvt Ltd 19 hrs Happy newyear
2k17 Here's to new Beginnings, stay blessed
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