HYDERABAD: Realtors across the state have unanimously called for a reduction in interest rates for home loans and have demanded direction in policy making and abolition of service tax ahead of the Union budget. With the residential sector struggling considerably, realtors are hoping that the budget will offer them a much-needed lifeline.
“The Union government’s agenda is to make housing for all by 2022. Fundamentally to be eligible to own a house, 97 per cent are among the low-income groups. People are not in a position to raise the money to buy an apartment. The solution for that is to reduce the rate of interest from 10 per cent to 8 per cent for everybody,” C Sekhar Reddy, president, CREDAI-National, has said.
“They should make a provision in the upcoming budget for interest subvention of 3 per cent for at least five years. They have to set up a provision for interest subvention and provide some direction in policy making and give us an indication that the interest rates will come down in the near future,” he added.
Realtors have strongly suggested for measures to be taken to spur growth and sales in the real estate industry. “To encourage customers to purchase a house, we request the government to reduce the interest rate for home loans on par with developed nations, The home loan interest rate is around 5 to 6 per cent in the developed countries whereas it is more than 10 per cent in India. This will reduce the EMI burden and increase the eligibility of the customer, making him purchase the property,” said Venu Vinod, managing director, Cybercity Builders and Developers.
The realtor opined that the government must also increase threshold limit for deduction on interest on housing loans to Rs 2.5 lakh.
“This is important as the cost of property has increased significantly and the increase in limits will encourage individuals to invest more in real estate sector and avail the tax sops,” he said.
With expectations riding high that the Centre will continue to push for reforms, realtors feel that the revival of economic growth will benefit the real estate industry. “In addition to introducing suitable policy reforms in the Budget, the Centre also needs to pass the proposed Real Estate Regulation Bill and implement it in on a priority basis to bring in more transparency and best practices to the real estate sector,” added Sanjay Dutt, executive managing director, South Asia, Cushman & Wakefield.