The real estate sector is one of the most critical pillars of the Indian economy, contributing significantly to GDP growth and employment generation. Government policies play a crucial role in shaping the real estate industry by regulating property transactions, ensuring transparency, and fostering sustainable development.
At Destiny Properties, we help homebuyers and investors navigate the ever-changing real estate landscape by staying updated on government policies that impact the sector. In this blog, we will discuss the major policies and their effects on real estate.
1. Real Estate (Regulation and Development) Act (RERA)
Impact:
- Enhances transparency and accountability in real estate transactions.
- Protects buyers from fraud and project delays.
- Ensures timely project completion by developers.
- Mandates developers to deposit 70% of the project funds in an escrow account to prevent fund mismanagement.
How It Affects Buyers & Investors:
- Buyers gain confidence in purchasing RERA-approved properties.
- Investors benefit from a more structured and regulated market.
2. Goods and Services Tax (GST) on Real Estate
Impact:
- Simplifies the tax structure by replacing multiple taxes like VAT, service tax, and excise duty.
- Affects property prices and demand based on the GST slab applicable to under-construction and completed properties.
- Reduces tax burden on affordable housing, making it more attractive for buyers.
How It Affects Buyers & Investors:
- Under-construction properties attract 5% GST (without input tax credit), while affordable housing projects have a lower GST rate of 1%.
- Ready-to-move-in properties are not subject to GST, making them a preferred choice for many buyers.
3. Pradhan Mantri Awas Yojana (PMAY)
Impact:
- Aims to provide affordable housing for all, with a focus on the economically weaker sections.
- Offers interest subsidies on home loans under the Credit-Linked Subsidy Scheme (CLSS).
- Boosts demand for housing in urban and rural areas.
How It Affects Buyers & Investors:
- First-time homebuyers benefit from lower loan interest rates.
- Investors in affordable housing see increased demand and government incentives.
4. Foreign Direct Investment (FDI) in Real Estate
Impact:
- Encourages foreign investment in real estate, boosting large-scale developments.
- Improves infrastructure and commercial real estate opportunities.
- Brings in more international players, leading to higher competition and quality standards.
How It Affects Buyers & Investors:
- More investment leads to better infrastructure and development projects.
- Higher demand for commercial spaces enhances rental yields for investors.
5. Stamp Duty and Registration Charges
Impact:
- These charges directly affect property affordability and transaction costs.
- State governments periodically revise stamp duty rates to encourage home purchases.
- Some states provide rebates for women homebuyers, promoting gender equality in homeownership.
How It Affects Buyers & Investors:
- Lower stamp duty rates make property purchases more affordable.
- Investors benefit from state-specific incentives that reduce transaction costs.
6. Smart City Mission and Infrastructure Development
Impact:
- Aims to develop modern and sustainable urban infrastructure.
- Enhances connectivity, public transport, and civic amenities, increasing property values.
- Encourages real estate development in emerging locations.
How It Affects Buyers & Investors:
- Properties in smart cities and well-connected areas see higher appreciation.
- Improved infrastructure makes cities more livable and attracts investment.
Government policies play a vital role in shaping the real estate sector. From regulatory reforms like RERA to tax benefits under PMAY, these initiatives bring more transparency, affordability, and investment opportunities for homebuyers and investors.
At Destiny Properties, we stay updated on policy changes to help you make informed property decisions. Whether you’re looking for a home or an investment opportunity, we ensure a smooth and secure real estate experience.
Call :+91 9819178547
Visit : destinyproperties.in
Stay informed. Invest wisely. Secure your future with Destiny Properties!
