Pioneer provides good, timely and satisfactory services with unmatched efficiency. All required feedback is received timely. All my dealings with them always run smooth and they comply with the most up-to-date regulations in the market. I wish them luck in their future endeavors...
- Mayank Kakrania - Advocate
I have been working with Pioneer Property for the past one and half decades. I am very happy with their service and our relationship has been quite fruitful. Pioneer's well coordinated and transparent approach has been effective in our mutual growth...
- Nakul Himatsingka - Managing Director, Ideal Group
The visionary advices, professionalism, hardwork, and passion for customer care are the best of Pioneer
- Kamal Periwal - Chief Architect, Maheshwari & Associates
We see you as a very important partner for our growth. Your sincerity and dedication in execution is really appreciable. Strategic reporting, extensive database and prompt actions are some of the unique features that give Pioneer a cut above the rest in the market. Our dealing with Pioneer has been very smooth and entrepreneurial support throughout the completion of our project has been phenomenal...
- Sumit Dabriwal - Managing Director, Hiland Group
Yes. The proposals given in the Union Budget 2017-18 have really surpassed every expectation, especially when it comes to the Real Estate Sector. The Government of India has indeed adopted a bull-run approach in driving the cartwheel of the sector with complete competence.
Premium on EMIs over Rent
The strong agenda of 'Housing for All' is on the verge of getting materialized. Our previous blog on budget expectations paid heed to the fact that the Government must grant infrastructure status to the sector in the first place. in this regard, The Government has taken a judicious step by granting infrastructure status to affordable housing sector and allocated funds to the tune of Rs. 23,000 Crores to affordable housing. The decision taken has been well crafted and is directly wired to nudge the overall growth of the sector. The Indian Middle Class have always been strong aspirants of having their own home and there is always a premium to pay EMIs instead of paying rents. With humungous funds allocated in the budget and liquidity available in the hands of the banks, the developers will now become more aggressive in their development endeavours. On the other hand, on the demand side, interest rates of home loans are reducing significantly (in the current scenario it is hovering in the range of 8% per annum and expected to touch 7% mark), the buyers get first hand leverage to purchase their own homes instead of paying rents.
Consolidated focus on infrastructure
The Government of India has been quite proactive in continuously aggravating infrastructure at the granular level to areas of dire complexities. Superseding general expectations, the Government has allocated a massive Rs.3, 96,135 crores in 2017-18. Around Rs.1,31,000 has been allocated for railways, Rs.6,490 crores has been allocated for highways that includes 2,000 Kms of coastal roads along with facilitating better connectivity between major ports of the nation. A huge amount has been also earmarked for development of dedicated freight corridors. Selected airports in Tier-II cities will see investment for operation and maintenance through the public-private partnership (PPP) model.Consequently, urbanization will be brisk.
One of the potential decisions made by the Government that needs to be mentioned here is to increase the minimum size requirements of affordable housing - from built-up area of 30 square meters and 60 square meters to carpet area of 30 and 60 square meters. This will help develop the growth of affordable housing in the smaller cities of India.
Reasons to smile for First time home buyers
People earning salaries up to Rs.18 lakhs annually will be buying their first home around Rs.2.4 lakhs less, as the Government of India will subsidise a part of buyers' home loan interest. At present, this subsidy is available to only those earning up to Rs. 6 lakh per annum.
The government has announced two new subsidy slabs to spur the real estate market and achieve 'Housing for All'. The slabs will apply to loans with tenure of up to 20 years, as against 15 years now. Homebuyers will get subsidy at different rates depending on the income bracket they are in. People earning less than Rs.6 lakh per annum will get a subsidy of 6.5 % points on a principal component of Rs. 6 lakh, regardless of total loan amount. If they borrowed money at 9% interest, they will pay only 2.5% interest on Rs.6 lakh, and 9% on the remainder.
People earning up to Rs. 12 lakh per annum will get interest subsidy of 4 percentage points on a principal component of Rs. 9 lakh, and the highest income category of Rs. 18 lakh per annum will get a subsidy of 3 % points on a principal component of Rs. 12 lakh. The net benefit to all three categories over a 20-year loan tenure is roughly Rs. 2.4 lakh (assuming an interest rate of 9%), and the monthly EMI reduces by roughly Rs. 2,200. This subsidy benefit is in addition to the income tax benefits on home loans, which can go up to Rs. 61,800 per annum for someone in the 30% tax bracket.
Lesser Capital Gains liability for Joint Development Agreement
If a Joint Development Agreement is signed for the development of property, then the capital gains tax will only be paid in the year of completion of the project. Apart from several other measures to reduce capital gains tax, this step will provide tax relief not only to the landowner but also the builder/promoter, thereby decreasing their liabilities.
Potential avenues created for NRIs
The Foreign Exchange Management Act (FEMA) along with the Reserve Bank of India (RBI) have become lenient in the policies for NRIs who are looking to invest in India. The availability of affordable properties in the Indian realty segment is major reason to attract a large number of urban NRI populations. Apart from that, availability of ready-to-move in properties give them a cost premium.
The NRIs are closely watching the developments back home on the policy front. The policy changes by the Central Government during the year, from the Real Estate, Regulatory Act (RERA) and the Goods and Services Tax (GST), to REITs and the latest demonetization drive, have all been steps towards bringing in transparency within the sector and boosting the confidence of the NRIs.Anticipations direct that the residential market in 2017 is expected to shift from a pure price play mechanism towards a market that is driven by commitment to delivery, quality and right pricing strategies. More importantly, transparency is the buzz word for them where they can evaluate right property in the right market and the right price point.
In essence, the Budget proposals have surpassed expectations and if everything is monitored and implemented properly, the fate of Indian Real Estate sector will surely be glorified. The direct and indirect benefits of the proposals are innumerable and the scope for discussion is limited. The Budget has been framed keeping in mind the needs and necessities of the Indian middle class and has given ample reasons to give a big thumbs up for real benefits.