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Emaar MGF: Budget Promises to Trigger Revival of India’s Real Estate


July 11, 2014 - New Delhi, Delhi, India

There was a deep sense of anticipation that underpinned the days preceding to the announcement of the Union Budget for the financial year 2014-15. At the close of finance minister Arun Jaitley’s presentation, the general consensus echoed encouraging mandate - the budget highlighted the new government's rational approach to policies for taxation, government spending and growth.
 
For the real estate sector in particular, the symptoms are heartening. The Budget has paid significant attention to the housing sector, with a majority of the stakeholders giving it a rousing reception.
 
Emaar MGF spokesperson said: “We finally have a reason to feel good about this budget. We believe the measures announced by the Government will fuel the real estate sector’s growth, thereby adding to India’s GDP. The Government’s commitment to allow REITs is a step in the right direction and long overdue.”
 
REITs, a prevalent concept internationally, would get a tax pass-through status. Infrastructure Investment Trusts would get tax benefits as well.
 
Emaar MGF spokesperson further added: “the introduction of REITs will facilitate the way for raising capital without much problem. It will also afford access to retail investors to take advantage from regular income and appreciation benefits from real estate. REITs also have the potential to solve several issues that act as an impediment to growth of the economy pertaining to transparency, credit crunch, organisation of the property market sector and liquidity of real estate assets.”
 
Relaxation in FDI, smart cities development and incentives for affordable housing is another area where the Government has delivered, creating a great thrust for real estate growth. The government has also afforded relief to the realty business by ensuring certainty in the tax regime. The spokesperson said, “It is a welcome move that no change will be made in the tax laws. The proposal to strengthen authority for advance ruling in tax is also one such step in the same direction.”
 
The positive signs are not limited to the real estate development end only. Measures have been taken to enhance consumption in the housing sector as well. Interestingly, the housing loan rebate on self-occupied property has been increased from Rs 1, 50,000 to Rs 2, 00,000.
 
Spokesperson for Emaar MGF added: “The Realty industry had expected the Tax Exemption on home loan to be enhanced to around 3lacs, but it was only increased to 2 Lacs, which is a marginal change but nevertheless a positive change. Overall, we feel that the budget will support the real estate market and boost buyer-investor sentiment.
 
It now remains to be seen how fast these initiatives hit the ground in real time.


About The Company:

Emaar MGF Land Limited is a joint venture between Emaar Properties PJSC ("Emaar") of Dubai and MGF Development Limited ("MGF") of India. Emaar is one of the world's leading real estate companies, having developed approximately 89 million square feet of real estate across residential, commercial and other business segments and with operations in 14 countries. MGF has established itself as one of the key players in retail real estate development in Northern India and has delivered approximately 2 million square feet of retail space.

The Company commenced operations in India in February 2005 and is into real estate development with a pan-India presence and operations spanning all key segments of the Indian real estate industry, namely the residential, commercial, retail and hospitality sectors. The Company's operations encompass various aspects of real estate development, such as land identification and acquisition, project planning, designing, marketing and execution. At present, its focus is on the development of residential projects in Delhi and elsewhere in the NCR, Mohali, Hyderabad, Chennai and other key Indian cities.
 

 

Source: Business Wire India

BusinessWireIndia

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