Enhanced allocation to Smart City mission pleases realty sector
The Budget allocated 2.04 lakh crore for 99 cities under Smart City mission
Despite the Budget 2018 failed to acquiesce to the long-standing demand of giving industry status to real estate, sector players term the annual financial statement as populist one.
M Murali, managing director of Shriram Properties, said the Budget was more of a welfare budget -- a perfect mixture of populism and pragmatism.
"Announcement of dedicated affordable housing for priority sector fund is encouraging. But there is still a lot to be done to achieve the objective of Housing For All mission which has both social and economic benefits," Murali said.
The sector was expecting much more from the Budget, particularly under affordable housing segment. The government may have to revisit this area. However, the outlay of 2.04 lakh crore for 99 cities under Smart City mission is heart-warming.
The only highpoint was the announcement of a dedicated fund for Affordable Housing segment under the National Housing Bank. The recent announcement of a reduction in the GST rates from 12% to 8% for affordable housing coupled with the dedicated fund are the only direct impetus to the sector.
The segment, however, is likely to reap indirect benefits of increased allocation on infrastructure as well as tax on long-term capital gains in financial assets, said Gorakh Jhunjhunwala, managing director of Meraqi Advisors.
Rajeev Piramal, Vice Chairman & Managing Director, Peninsula Land said, “Budget 2018 has been a mixed bag for the sector, the announcements made by the government are very optimistic for affordable housing and will definitely attract more corporate players to enter this space.
"We welcome the Finance Minister’s decision of allocating budget for infrastructure spending on roads and construction that will definitely improve connectivity and boost housing demand, thus creating opportunities for new homes and development."
“The proposed budgeted expenses in various sectors; rural Infrastructure, health and fishing will have a positive impact on the economy allowing us to be optimistic about the real estate market and we look forward to a productive year,” said Sanjay Jain, Managing Director, Siddha Group.
“The government’s move to promote affordable housing by setting up a special fund is welcome. It will boost buyers’ sentiments and help revive the real estate market. We expected the government to give industry status to real estate sector, though its efforts to support infrastructural development is laudable. This will have some impact on the real estate market I suppose,” said Venkatesh Gopalkrishnan, Chief Executive Officer of Shapoorji Pallonji Real Estate.