The present scenario of the Realty sector has been a little disturbing as the market growth is diminished and led to a point where there is a lot of inventory and very few buyers. With the prices towering so high up, the buyers are less interested in buying at the time.
The Pune’s Builder Community has raised concerns to this issue to the Reserve Bank of India (RBI) Governor, Raghuram Rajan. They feel that, with proper revision of service tax on under-construction properties, better income tax exemption benefits, faster approval process and low home loan interest rate will surely be a relief and accelerate growth. On the other hand, Raghuram Rajan, RBI governor, asks builders to lower the property price and the home loans will by default go down.
The builder’s Community reacted sharply by adding the factors like high interest rates, less priority to realty sector, towering land costs, high infra costs, two to three years of approval period, increasing material cost,increase in service tax. They also added an example to support their plea. For instance if they sold a flat for say Rs 20 Lakh, the ready reckoner prices would make it to Rs 25 Lakh and attract Registration charges on that high amount. Then, the income tax department would charge you for around Rs 2 Lakh on the extra Rs 5 Lakh you would be paying. They also added if things continue at this rate, the poor builders may opt for suicide as a better option.
With the current realty scenario, there is an imbalance created between the demand and the supply of property, which should be taken care of as soon as possible. Its time now for the builder’s community and the RBI to work something out in the benefit of buyers.
Source : –http://blog.puneproperties.com/blog/the-realty-scenario/