Lower GST rates to trigger transactions in Real Estate
The 20 lakh crore economic package aims to supply immediate relief against the damaging impacts of COVID-19 on the Indian economy. It's a significant relief for businesses because it helps them maintain a stable workforce and boosts the sectors that are adversely suffering from widespread COVID-19. The vital estate sector in India has been facing significant headwinds thanks to the pandemic COVID-19. The continual labor shortage, costs for sanitization, and low offline sales have caused a decline within the situation.
The package declared the extension of registration and completion of land projects up to six months, infusion of Rs 30,000 Crore liquidity support scheme, and introduction of partial guarantee scheme will allow a colossal impulsion to the important estate sector.
Additionally, a discount in GST rates and stamp tax charges for the subsequent 6 to 9 months, and by increasing the tax exemption limit, would undoubtedly speed up the demand among the buyers, during these difficult times. The autumn in reckoner rates will help convert housing demand. Thus, the vital estate sector needs tangible measures to revive the market and ease its stakeholders' concerns.
Recently, Union Minister Piyush Goyal advised builders to sell projects at reduced prices for clearing unsold inventory. However, experts believe that the necessity for the hour is to specialize in the completion of on-going projects and timely delivery, which was severely hampered by the lockdown. With volatility like this, reducing property rates looks difficult, at best, developers can negotiate within the market price bracket, but a significant reduction would be back-breaking for the developer fraternity across the country.
Over the past few years, buyers have shown interest in purchasing homes. However, builders are already offering incentives to shop for, like price protection schemes, flexible payment plans, and offers like the waiver of stamp tax and registration charges to make sure sales. Most developers are struggling to balance their margins and should not have much flexibility to chop prices further. At some level, the minister's suggestion to developers to lower costs is beneficial because it may assist in reducing inventory. However, it's going not to be the first viable option. We hope that the govt and Authorities help us re-initiate our construction activities so that we will return to normalcy by Diwali.