CREDAI Urges Government to Boost Affordable and Mid-Income Housing Demand
Renowned real estate advocacy body, CREDAI, celebrated its 25th foundation day by highlighting the need for government interventions to stimulate affordable and mid-income housing demand in India. The organization proposed several measures during a recent press conference held by CREDAI President, Boman Irani.
Revising Home Loan Interest Deductions
One of the key proposals made by CREDAI involves revising the current home loan interest deductions provided under Section 24 of the Income Tax Act. Irani suggested replacing the existing cap of ?2 lakh with a 100% deduction for home loan interest. According to him, this change would incentivize homebuyers and encourage investments in the real estate sector.
Redefining Affordable Housing
To keep up with market inflation, CREDAI recommended revising the definitions of affordable housing. The organization proposed to raise the price cap for affordable homes from ?45 lakh to ?75-80 lakh. Additionally, CREDAI suggested a reduced Goods and Services Tax (GST) rate of 1% for under-construction properties falling within this revised range. Currently, properties exceeding ?45 lakh attract a 5% GST rate. By lowering the tax burden, these measures aim to stimulate housing demand and make buying homes within reach for more individuals.
No Price Cap on Affordable Housing
Another noteworthy recommendation put forth by CREDAI is the removal of the price cap entirely for properties falling under the affordable housing category. The organization believes that focusing on the carpet area criteria—60 square meters in metros and 90 square meters in non-metros—will better serve the purpose of defining affordable housing. This change is expected to provide more flexibility and options to homebuyers.
Streamlining Approval Processes
Streamlining the complex approval processes faced by developers has also been emphasized by CREDAI. The organization highlighted the challenges faced by developers in securing timely approvals, often resulting in delays of 12-18 months. Therefore, CREDAI calls for efficient and streamlined procedures to enhance the overall ease of doing business in the real estate sector.
A Vision for Real Estate Growth
Established in 1999, CREDAI has been a proponent of reforms to enhance growth and development in the real estate sector. With more than 13,000 members nationwide, the organization has built a strong network of realtors working towards the government’s ‘housing-for-all’ vision. The recent proposals made by CREDAI align with this vision and aim to benefit both developers and homebuyers alike.
The real estate sector plays a vital role in boosting the Indian economy, and CREDAI’s advocacy and proposals centered around affordable and mid-income housing certainly align with the current market needs. The government would do well to consider these recommendations and work towards implementing measures that encourage investment, simplify processes, and make housing more affordable for aspiring homeowners.
