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Reduced GST rates, Now you have one more reason to buy a home

There is expected to receive a major boost in demand for Residential properties, following the government’s decision to cut the goods & services tax (GST) rates to 5% from effective rate of 12% for the under-construction projects. The government has reduced the GST in a major push to the affirmed objective of ‘Housing For All by 2022’ to marginal 1% for affordable housing while revising the definition of under-construction homes.

Prior to this declaration, the under-construction residential houses attracted rate is 18% and the effective rate is 12% after factoring one-third abatement for the value of the land/ground. The effective GST rate for affordable home was 8%. Ready houses/apartments that have received an occupancy certificate (OC) do not attract GST.

The government is focused on its schema of pushing affordable homes, which is visible in the decision of the government to reduce the GST to a mere 1% for this segment. The lower tax burden on home buyers is expected to push demand in under-construction homes which, in turn, will keep builders to build more affordable homes.

The reduction in the GST for under-construction projects is the most decisive move that will encourage the demand and sales of property and will give the necessary tonic to the demand in the under-construction sector, which has been suffering from low sales levels for last many years.

Aspiring homebuyers now have a more and better range of options to choose from, as the definition of affordable housing is widened, more builders can mobilize projects across the country.

According to experts, the reduction in GST rates with an expanded definition of affordable housing, combined with incentives proposed in the budget and the reduce the prime lending rates by the Reserve Bank of India, supports the sops for the under-construction residential real estate market.

The much-awaited reduction in GST can reduce the buyer’s payout by 6% – 7% on overall purchase, depending on the category.

 

February 25, 2019 / by / in
Advantages of Married Couple Owning a Joint Property

Property buyers these days in India first work out on the best means available for acquiring the immovable assets along with making a well- versed decision. Keeping in mind the most feasible financing options for benefit against taxes or to avoid the brokerage, directly meeting up with the sellers, people now a days are making an even smarter move by registering the property jointly with their spouses.

There are subtle benefits of getting the property registered jointly with your spouse such as elevation of the wife’s status in patriarchal society, impressive bonding, and long term commitments among the spouses. However, only a few are familiar with the financial benefits.

inexpensiveness

While purchasing a property, the budget is decided according to the loan eligibility which further depends upon the income of the buyer. The provision for joint registration here comes to your benefit since you can apply for joint home loan too whose eligibility is increased since two incomes will be considered and the debt burden is shared between two people. Not only the spouse, the joint home loan can also be opted with your parent or siblings

incentives in stamp duty

In order to encourage women to purchase property individually or jointly, government has introduced lower stamp duty for women. Like in Delhi, stamp duty payable by women is 4% as compared to 6% for men. Similarly in Rajasthan, it is 4% but men have to pay 5% the market value.

Claiming Tax Benefits on a Joint Home Loan

Under Section 80C, all the co-borrowers in a joint home loan can claim a tax reduction of 1.50 lacs for principal repayment. Besides, under Section 24, tax reduction up to 2 lacs could also be claimed for interest payment.

As a family you can claim a larger tax benefit for the interest paid on home loan when your property is jointly owned and your interest outgo is more than Rs 2lakhs per annum.

For more information- call an expert

 

November 9, 2017 / by / in