6th February 2017 - What to look forward to in 2017 : Property In Gurgaon
2017 has been pipped by many real estate experts as the gradual recovery year with certain events of prime importance as far as real estate is concerned in Gurgaon and across the country.
Demonetisation has paved the way for an all cheque mode of transacting in real estate as a norm for secondary market transactions adding to those occuring in the primary market.
Affordable housing is a segment that the NDA government is creating a promotional push for.
On December 31, PM Modi had announced additional subsidy on the rate of interest for home loans. He said that the government will facilitate 4% and 3% interest rate rebate for housing loans up to Rs 9 lakh and Rs 12 lakh, respectively. Additionally, loans of up to Rs 2 lakh for new housing or extension of housing in rural areas will receive an interest subvention of 3%.
As per announcements in Budget 2017, 2.95 crore homes are to be built under Pradhan Mantri Awaas Yojna (PMAY). There are many a batch of developers now focussing on developing homes in this segment across the country.
The Budget 2017 also allocated for 30 and 60 sq. metre flats to be built and sold as per carpet area rather than super area. Other key points of the budget 2017 for real estate catering to all segments of housing was the reduction in treatment of long term capital gains from 3 years to 2 years. This provides incentive for investment in real estate something that the government is trying to do side by side with RERA (Real Estate Regulation Act) and the attempt to provide impetus to end users.
Finally the cost or pricing index for property was raised from 1981 to 2001. This means that investors and property owners would be taxed on capital gains from 2001 onwards (higher values) thereby reducing their tax burden.
RERA is scheduled for an April 2017 forming of act in Haryana and should be in effect by June 2017. Haryana will make its own act. This should provide necessary fillip in terms of providing home-buyers comfort in terms of completions of projects here-on under. Full details are awaited.
We are likely to see a consolidation of property developers in Delhi – NCR and across the country as various states enact RERA.
We are currently seeing some secondary market activity happening at somewhat discounted rates though transactions are few and far between. Interest rates are expected to be reduced further in 2017 which will provide incentives to home-buyers. Real estate experts expect more property-buyers to first slowly test and then enter the market in the latter half of 2017. Residential rental activity is cyclic and healthy and will continue during the year. Office Leasing in Gurgaon is also expected to be fairly healthy in 2017. Retail and Office space investors holding large properties are expected to remain silent, infact they are expected to hold on until when the boom phase is in top gear..
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