“One of the key demand of the real estate sector has been to get industry status to get preferential and lower borrowing rates from banks. This announcement will surely provide ample push for the affordable housing sector in India, a key initiative under Housing for All. Developers having projects in the affordable segment will benefit greatly with this announcement. Housing demand (absorption) across key cities had already declined by 31% largely on uncertainty post demonetisation, which led to very few transactions materializing in both primary and secondary market in Oct-Dec 2016,” Mr. Samir Jasuja, Founder and CEO of PropEquity.
“Another key announcement to boost affordable projects is that instead of built-up area, carpet area will be counted for affordable housing of 30 (Metro) and 60 (rest of India) sq. mt. which will broadly increase housing sizes by 30 pct. This will generate interest from developers who were earlier reluctant to launch projects in this segment due to smaller sizes.,” Mr. Jasuja added.
“Lastly, 100 per cent deduction for profits to an undertaking in affordable housing projects needs to be now completed in five years instead of earlier three years will provide enough time to complete projects in time to get the benefit,” Mr. Jasuja added.