The Confederation of Real Estate Developers’ Associations of India (CREDAI), which represents more than 13,000 developers, urged the central government to introduce a fixed 15% income tax rate for cheaper housing projects in the forthcoming union budget 2025.
It is presumed under the industry body that the same measure shall motivate the developers to build low-cost housing that addresses the rising demand for affordable homes.
Changed Affordable Housing Definition, Enhance Tax Incentives
It was offered by CREDAI to revise the cheaper housing definition which caps the cost at Rs 45 lakh a limit that does not revise since 2017 even after real estate costs have risen by 50%. It was suggested by the organisation to align this cap with the existing market realities to make the cheaper housing projects feasible for the developers and accessible to the buyers.
To make homeownership more cheaper CREDAI recommends raising tax deductions for individuals on the home loan principal and the interest payments.
The Concern of Decreasing Cheaper Homes
CREDAI emphasizing the decreasing share of the cheaper housing in the total fresh supply over the past years stresses the need to reverse the existing trend. The overall sales of the cheaper homes have indeed been affected by the reduced availability of affordable homes.
Real Estate- A Support of Economic Growth
CREDAI National President stated, “The Indian real estate sector significantly contributes to GDP, employment generation, and infrastructure. Currently influencing 53% of the GDP (directly and indirectly) and employing over 8 crore people, this sector is pivotal in meeting the housing needs of 40 crore Indians who lack adequate homes.”
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CREDAI holding a vision to provide 7 crore homes and generate 2 crore new jobs in the forthcoming 7 years has provided suggestions to address the structural challenges and utilise the potential of the sector to an extent. Associations are positive that such measures will augment the growth, empower homebuyers, and support the economic aspirations of India.
