[INDIA REAL ESTATE NEWS] Good morning, everyone. Here I have important|
INDIA REAL ESTATE news to share with you which is as mentioned under.
Mumbai: The government’s decision to reduce corporate tax base rate to 22%
is expected to provide real estate developers a buffer to offer further incentives
and cut prices of residential, particularly luxury, property projects to spur demand.
The move is also expected to bolster growth of other key segments, including offices,
warehousing and industrial real estate, said experts.
“The cut in corporate tax, as announced by the government, possibly gives developers
an opportunity to marginally reduce prices of properties as and where they can,
which will eventually boost sales for them during the upcoming festive season,”
said Anuj Puri, chairman, ANAROCK Property Consultants.
The residential real estate sector has been grappling with sluggish demand that
has resulted in inventory pile-up and developers have already been offering incentives
and various schemes to attract buyers. Puri said that by sweetening the deal for
prospective homebuyers, developers will be able to liquidate their unsold stock
and thus reduce inventory.
In a bid to accelerate economic growth, the government has announced a series
of measures over the past few weeks. In a key measure, it announced a
Rs 20,000-crore fund to provide last-mile financing for stalled housing projects.
The corporate tax rationalisation is expected to boost both investment and consumption.
“The reduction in corporate tax will incentivise corporates to pump up investments.
This will provide more surpluses to corporates including real estate developers to
use the same for prompting customers to act and generate more demand,”
said Niranjan Hiranandani, president, National Real Estate Development Council.
However, further incentives or price rationalisation is unlikely to materialise across
markets and segments since the locations and projects that are already performing
relatively better would not move in that direction.
“While affordable and mid-income housing are unlikely to see any reduction,
luxury segment can see some reduction to attract homebuyers,” said Jaxay Shah,
national chairman of the Confederation of
Real Estate Developers Association of India (CREDAI).
“However, this can be a micro-market specific decision that developers
will have to take based on their inventory, need for liquidity, project phase
and response to the project so far.”
Meanwhile, representatives of CREDAI, in meetings held late Thursday with
senior officials of the ministries of finance, and housing and urban affairs, sought
further intervention of the government to resolve the ongoing liquidity and other
issues affecting the sector.
The government’s decision to reduce minimum alternate tax (MAT) to 15%
from 18.5% is expected to help special economic zone developers by pushing
demand in key sectors, including commercial and logistics, and warehousing.
Experts said the move is expected to push the manufacturing ecosystem to
generate jobs and create wealth. This, in turn, is likely to propel office space
and warehousing demand, they said.
Read more at: https://economictimes.indiatimes.com/wealth/real-estate/realtors-likely-to-offer-incentives-to-spur-demand-as-base-corporate-tax-rate-reduced-to-22/articleshow/71230303.cms
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