| Realty's expectations from Budget The Confederation of Real Estate Developers' Associations of India (CREDAI) is looking forward to the Centre as well as the State Budgets to assist the sector address the requirements of your home buyers. Reduction in stamp duty in the affordable segment can certainly help pass on the benefits directly to the consumer. In the general segment, the government needs to have a better valuation method for the properties. We are going to send a memorandum to the state finance department to take a look into our proposals. WBHIDCO (West Bengal Housing Infrastructure Development Corporation) had once started projects in the PPP (Public Private Partnership) mode for affordable housing. But do you believe that there is any scope for real estate development companies in this regard anymore? In PPP projects, no matter what the scope was there has happened. Now, the government is moving towards a more transparent mechanism of land allotment and offer, by way of auction and bidding process. We aren't very clear on the PPP policy of the present government, and we are in dialogue with the government to see what their take is on affordable housing. We are looking for indicators and directions from them in this regard. We will have to wait for the budget. So are you looking for some incentives in this regard? The government needs to develop the infrastructure (like connectivity, mass transport and basic amenities) in these peripheral areas (to the city) and proper policies to simplify the land conversion process. They also need to come out with a proper township policy to encourage land format development. In the commercial area market, there are a good number of transactions happening in the Salt Lake Sector V (IT hub area), following consumption by IT and Telecom players. In the Central Business District area, there are very few commercial developments taking place, and smaller officers are being taken up in these projects. Large offices are shifting to Sector V and Rajarhat (another satellite township). Excerpts from the interview: What are CREDAI's Budget expectations? In case of the national budget, we are expecting benefits and incentives for the affordable housing segment. There could be competition in this area of the market. However, the ultra high-end apartments are like boutique developments. They have their own status and value, and have their own niche market. Urban Land Ceiling Act is definitely a hindrance to the large-scale development of the State. And as a result of this, the supply of apartments in the city is not as great as some other cities. On the other side, there is an announcement of Metro Railway being extended up to Joka; areas from Joka to another five areas within that region would be a good area for real estate development. Northern parts of Kolkata, like BT Road and Barrackpore, and some other areas like Barasat, Madhyamgram, are new areas because of extension of Metro. Some other areas like Howrah and Hooghly (adjoining districts of Kolkata) have also seen a traction on account of the construction of the Belgharia Expressway which connects areas like Rishra, Uttarpara and Konnagar. What is the current pattern in the real estate sector — both residential and commercial segments — in Kolkata? The residential sector can be divided mainly into three segments without taking into consideration the economically weaker-section segment. Since there has been a delay in launches of all of the projects, the current pattern of sales in these projects is quite good. The next segment has a ticket size of up to Rs 1 crore. One is the MIG segment with ticket size between Rs 25 lakh and Rs 40 lakh, which is quite buoyant in the city. We are also expecting certain rebates in terms of interest for financing the affordable housing segment, and liberalisation of finance towards real estate companies by institutions and banks. We are also looking forward to the sector being given an infrastructure developer status. This apart, we have also proposed that there be certain income tax relaxations, particularly in the form of rebate on housing loans for individuals. What are your expections from the State Budget (West Bengal)? As far as the state budget is concerned, we need to re-look at the VAT provisions. There are stringent VAT rules here, unlike some others. In terms of opportunities in the State, the extension of Metro railway routes is expected to come as a blessing for the sector. What does this mean for the sector? Are land and property prices expected to raise further? The Metro route expansion and extension all around the city (of Kolkata) is indeed a good thing to happen here. This will open up a new area of real estate development in the vicinity of every Metro station. |
Monday 12 March 2012
Realty's expectations from Budget
