Our government has passed the budget 2019 contended with various huge issues regarding real estate sector and it will be a huge benefit to the real estate builders in Mumbai also.
The big announcements made by our government have given significant relief for common people and home buyers.
Income Tax Rebates for Up to 5 Lakh Per Annum Income
A tax exemption is being announced by the government in budget 2019 on people who have their income up to 5 lakh per annum, as “zero-tax”.
But if a person under section 80(C) invests in tax saving investment, his income will increase to 6.5 lakhs which will still be tax-free. Further one’s income can be increased up to 7.5 lakhs by tax benefits easily under section 24, 80(D), 80(CCD). This is proved to be a life-changing step by the government for people thinking to buy home and for the realty sector.
The announcement to provide a tax rebate for income up to five lakhs can provide a huge boost to the demand for housing and will increase the budget of home buyers.
This budget is helping to provide more income to the real estate buyers for residences, to make them increase their budget for the new homes and also helps in investing for a new home by providing tax incentives.
There will be an increase in demand for residential real estate. There are plenty of available who will help you to get a perfect place. It is a great opportunity for home buyers.
Government’s Emphasis on the Growth of Infrastructure
Rs 19,000 crores are being announced for Sadak yojna by the government and also the government has come up with the future ideas that will help in enhancing the physical and social infrastructure. The two huge steps, i.e.
Housing under PMAY and the increment in the development of infrastructure in the budget, are leading us towards real estate accessibility at affordable investment and it will help the people to buy their homes in the city and outskirts of the city.
Benefit Extension of One Year Under Section 80 IBA
An extension of benefit under section 80 IBA by another year is also announced by the government under section 80 IBA, till 2020. This step will help the developers and the new residential real estate buyers to achieve the “Housing for all” program.
Reinvestment and Capital Gains in Two Houses
This announcement will expectedly higher the investment by the residential real estate buyers and also allows the capital gain reinvestment in two homes.
According to the recent budget provided by the government, capital gains are extended to investments for two houses for people who have more up to Rs two crores of capital gains. This budget is making the demand and attraction of the real estate market higher.
The increment in the Period From One Year Into Two Years for Taxing Notional Rents on Unsold Inventory
Developers consider unsold inventory as a problem and further notional rent on unsold inventory makes it even more problematic.
But now, if the inventory that is unsold is at least one year old, then its notional rent is levied. Through the budget 2019, this period is being increased to two years to provide relief to realty players.
TDS Increased From Rs 1.8 Lakhs to Rs 2.4 Lakhs on Rental Incomes
No tax for houses renting up to Rs 2.4 lakhs, increased from the previous limit of Rs 1.8 lakhs. It will result in more people willing to buy another home so that they can earn rental income also.
Standard Deduction Increased for Salaried People
For salaried people, the standard deduction is increased from Rs 40,000 to Rs 50,000 which will ultimately lead to high disposable incomes. It will also lead to improvisation in repayment capacity of EMIs for home loans.
The sectors which are still left in this interim budget are expected to be covered in further full budgets after the elections. Increase in section 80(C) is expected to be increased for people borrowing home loans, for the inclusion of GST stamp duty etc.