Budget, high on hopes, low on execution, says CREDAI chief

Terming the Union Budget as good on large canvass but the most disappointing for housing, realtor's apex bodyCREDAI chairman Lalit Kumar Jain said, the Union Finance Minister Arun Jaitley lost a big opportunity to address the core issues.

"It is all fine to talk about policies and visions like Housing for all by 2022, but sadly the budget does not give any direction towards executing this," said Mr. Jain, who is also the CMD of Mumbai - Pune based real estate firm Kumar Urban Development Pvt. Limited (KUL).

"One wonders as to how the government will meet the target of building four crore houses in rural areas and two crore in cities with the kind of lopsided polices that it adopts," he said.

There was just one announcement about simplifying the process of clearances by setting up a regulatory framework, but that is not enough as the government has done nothing to encourage the housing sector.

As regards the focus on infrastructure, Mr. Jain pointed out that land acquisition, environment clearance, tender processes are pre-requisite to these projects. But for housing, land is readily available in most cases and one does not have to go for the complicated process of land acquisition.

Much like the infra bonds, the government could have launched Tax-free Housing Bonds as well, to create allow home loans at 7% to home seekers and provide the much needed funds for the sector.

He felt that the proposal to overhaul of capital gains taxes to pave the way for the listing of REITs is just miniscule.

The Finance Minister failed to address the key issues like SEZ nor did he meet the long pending demand of according infrastructure status to housing.

Mr. Jain regretted that the budget does not speak about either the affordable housing scheme or tax incentives to overcome the yawning demand-supply gap of 25 million houses by 2025.

The government could have gone for Increase in deduction of interest u/s 24 of income tax act for home loans, removal of capital gain tax to promote rental housing and to treat rental income on affordable housing tenement.

The industry was expecting that the government will come out with realty reforms but we were disappointed. Instead the Finance Minister proposed an increase in service tax which will lead to increase in the cost of housing.

Mr. Jain was however hopeful that the government will move beyond the budget and take on the issue of housing shortage in all right earnest. The housing sector looks forward to acche din for all"