Post Budget Reaction by Amit Modi, Director ABA Corp and Vice President CREDAI Western UP

We have to say that though the Union Budget 2016 has been great on infrastructure, same is the not the case when it comes of Real Estate and Housing! The Rs Rs 97,000 crore for road construction was indeed the need of hours, we would have liked the government to announce long pending demand of Single Window Clearance for Real Estate Projects to bring in more transparency and Industry Status to Real Estate Sector to avail legal low cost funding were completely ignore since both these initiatives would been achieved without putting burden on the budgetary allocation.
While we welcome the announced interest rebate of Rs 50,000 for first time home loans if the value of homes does not exceed of Rs 50 lakhs but would’ve like the ticket size to increased to at least Rs 1 crore since the average apartment cost in cities like Delhi and Mumbai are a lot more than Rs 50 lakhs, hence an extremely small segment of first time home buyers will be able to benefit from this initiative. Similar is the case with Service Tax exemption on housing construction of houses less that 60sq ms in the cities. The proposed 100% deduction for profits of undertakings from housing projects during June 2016 – March 2019 since the stipulated timeline of 3 years is impractical since realistically speaking it takes at least 5 years for a housing project to be delivered.
But since big infrastructure projects always bring in huge economic multiplier effect for the whole country, both in terms of employment generation and for the ancillary industries we feel that it’s a good budget with a lot more room for improvement.