Union Budget 2013: Budget continued support for housing sector, says Asia Pac

With the announcement of the Union Budget 2013-14 by Finance Minister today, Shrinivas Rao, CEO-Asia Pacific, Vestian Global said "In comparison to the previous Budget, the Union Budget 2013-14 continued its support for the housing sector. Augmented deductions under Section 80C on home loans up to INR 25 lakhs and interest subventions of 1 percent sure to make home loans an attractive option. Additionally, the allocation of INR RS 2000 Cr for urban housing fund renders affordable low cost housing a key highlight of the Union Budget 2013-14.

 However, the 1 percent TDS on large property transactions above INR 50L will stretch the end-users budgets as well as impact the developers negatively. Funding continues to be a challenge for developers with no announcement on REITs legislation and no industry status for the RE sector in this budget.

Due importance to infrastructural development with USD 1 trillion grant and continued support to the JNNURM scheme in the 12th 5-year plan will positively impact the real estate sector. Both residential and commercial real estate will witness a surge in demand with the development of the Bangalore-Chennai, Mumbai-Bangalore industrial corridors & industrial cities along Delhi Mumbai Industrial Corridor (DMIC), Maharashtra and Gujarat. Among other cities, Bangalore's RE sector will particularly benefit in the long run."