A welcome move on the part of government: Manish Jaiswal, Magma housing finance
This is a welcome move on the part of government. It will certainly give a fillip to the housing finance sector. The full impact of these benefits will only play out when the government initiates concrete steps to address both -supply as well as cost of liquidity of HFCs. The recapitalisation of banks, enhancement of sectoral caps, portfolio purchase windows at affordable price for HFCs is the need of the hour for real estate revival be it retail consumers of developers. The repo rate transmission to HFCs and NBFCs is yet not palpable. The fuller benefit of GST tax cuts will accrue on the ground only when an interested home buyer has decent low cost financing options from HFCs- for most house purchases are rarely fully in cash.
GST rate cut will attract investors and end-users: Samyak Jain, Siddha Group
Knowing that the realty sector is on its way to recovery, the GST rate cut on under construction properties from 12% to 5% and on affordable homes from 8% to 1% will boost the market. This will be further complemented by the tax amendments announced in the budget to lessen the burden on the taxpayers who are earning up to 5 lakhs per annum making home buying easy for the first time buyers. The rate slash by the council and the Union Finance Minister will attract a large number of investors along with end users and shape the sector positively in the near future.
A buyer friendly measure: Jeevandas Narayan, Manappuram Home Finance Limited
The GST council’s decision to reduce the GST rates on affordable housing from 8% to 1% is a buyer friendly measure which will increase the appetite for such projects across the country. The additional demand will address the supply overhang, and spur new construction activity.
The reduction of rates on other housing segments is also welcome as it makes unsold or under construction inventory with builders more attractive to buyers. We also do not foresee withdrawal of input credit affecting either buyer or builder sentiments.