Realty experts are hot property - Commercial property, rentals in service tax net

Real estate consultants and experts in India have become hot property for overseas buyers. Fund houses, private equity firms, venture capitalists, bankers, institutional investors, companies, high networth individuals, non-resident Indians, indeed just about every potential property buyer, are dialing local real estate experts in order to get a feel of the local market…. 

For the realty sector, the finance minister Pranab Mukherjee appears to have balanced out one sop with an impost. Mukherjee has imposed the service tax on the real estate sector while extending an additional year of tax holiday for pending projects in the affordable segment…. 

The Federation of Indian Chambers of Commerce and Industry (FICCI) on Saturday announced that Rajan Bharti Mittal, vice-chairman and managing director, Bharti Enterprises, has taken over as the President of FICCI…. 

The finance minister presented a realistic yet progressive budget which provides long-term goals for growth, with special focus on reforms and fiscal stability. The Union Budget 2010–11 can be termed as benevolent for the masses through revised direct tax norms and other popular measures. Even though there are no major initiatives towards the real estate sector, several benefits can be culled from announcements related to infrastructure, finance sector and urban development. The thrust on unconventional sectors like power, food processing and education are likely to play a major role in growth of real estate sector, said Anurag Mathur, managing director, Cushman & Wakefield…. 

Union Budget 2010-11 addresses the real estate sector in many ways, the impact of which is latent at first comprehension. The service tax net has been widened to include the activity of construction as deemed taxable service provided by the builder to the prospective buyer during the construction period. The fate of STPI units has been jeopardized by its conspicuous absence in the speech of the minister. However, the impact of these changes could be significant if it means an end to the fiscal benefits provided to STPI units and rise in real estate prices due to service tax levy, said Priyankar Bhikshu, head of research (India), DTZ…. 

Finance minister Pranab Mukherjee has presented a very realistic budget. This budget goes on to prove present Government’s pragmatic approach instead of a populist one. Mukherjee has chosen a very balanced approach in devising the Budget for 2010-11. Though there are not too many big bang reform-centric announcements, but what has come as a relief to the markets is the absence of major negatives, barring the hike in MAT, increase in excise duties and increase in the levy of oil prices, said Sushanto Roy, CEO, Sahara Prime City Limited…. 

The Budget presented by the finance minister is progressive and will help the economy leapfrog. The relief announced for the real estate sector and the enhanced allocation for development of Urban & Rural infrastructure augurs well for the Indian Real Estate Industry, said Seemanto Roy, Head, Aamby Valley City and Sahara Entertainment Business…. 

The Union Budget for 2010-11 focused on Infrastructure development, but failed to address important demands from the real estate sector, said Pravin Doshi, president, Maharashtra Chamber of Housing Industry (MCHI)…. 

The finance minister has taken a pro-active measure by reducing the income tax burden on the middle class and hence, increasing disposable income and consequently leading to increased demand for consumables and housing, said Abhisheck Lodha, managing director, Lodha Developers…. 

The union budget for FY11 is an unbiased activity to sustain the economical growth along with fiscal consolidation, said Chetan Shah, chairman & managing director, Marathon Nextgen Realty Ltd…. 

The Budget has both positive and negative aspects for real estate developers as well as buyers, said R K Arora, chairman and managing director, Supertech Ltd…. 

Commenting on the Union Budget 2010, Amitabh Das Mundhra, director, Simplex Infrastructures Ltd, said, “We are appreciative of the budget measures to put the economy on a 9 per cent growth target. Infrastructure, both rural and urban, seems to be the central theme this year, accounting for 46 per cent of the overall allocation. It would certainly have an overall positive impact on the sector.”… 

“No unpleasant surprises is a good news’’ and this is particularly true for this budget. The thrust of this budget is managing growth, while controlling the fiscal deficit. Therefore the government has decided to revert to earlier higher growth rates and perhaps drive towards double digit growth in the near future by increasing the emphasis on infrastructure for which plan allocation has been augmented to as much as 46 per cent. While pushing for growth, the budget has simultaneously provided the road map for fiscal consolidation. Overall a decent and controlled budget, endeavoring towards inclusive growth in as much as a continuing attempt is being made towards placing more disposable income in the hands of the aam admi, both urban and rural…. 

Real Estate got a mention in this year’s budget unlike last year where it was largely ignored. The finance minister provided one time interim relief by allowing a one year extension to housing development projects to claim deduction on profits…. 

Welcoming the budget, Pradeep Jain, chairman, Parsvnath Developers Ltd, said, “I personally feel that the budget was for aam-admi, it is good for each and every individual in the society, the budget is supportive for the tax payers as the extension of limit will help in reducing burden on individual tax payers. I am sure that the budget tabled will induce renewed sense of optimism over the country’s growth…. 

Outlining its views on the Union Budget 2010-2011, the Royal Institution of Chartered Surveyors (RICS) commends the budget for its phased approach towards fiscal consolidation, envisaging a gradual lowering of the fiscal deficit by a moderate 1.4 per cent to reach 5.5 per cent in 2010-11 from current 6.9 per cent and further decline of approx 0.7 per cent each year through 2011-13…. 

The budget presented by the finance minister is good for the Indian economy. However, the finance minister has not considered the real estate sector’s major recommendations such as status of infrastructure to the industry, extension of tax exemption/tax rebate under section 80 IB up to March 2011, ECB for real estate, and the like. This would have helped the country to focus on meeting the housing shortage in the country as well as improving the overall GDP of the country, said Navin M Raheja , managing director, Raheja Developers Ltd…. 

Commenting on the Budget announced by the finance minister, Kabul Chawla, managing director, BPTP Ltd, said that the budget is stable for overall economic development….

Budget 2010 has been neutral and could come as a dampener to a sector which is gradually limping back with new projects being launched and improved liquidity on the back of qualified institutional placements (QIP) and proposed public issues, said SK Sayal, director & CEO, Alpha G:Corp… 

From demand stimulants and some relief for the beleaguered industry, to overlooked asset classes and higher indirect taxes, the budget presents a mixed bag for real estate, according Avinash Narvekar, Tax Partner-Real Estate, Ernst &Young…. 

Welcoming the Budget announced by the finance minister, Vidur Bharadwaj, director, The 3C Company said that the announcements made will go a long way in stabilising the overall economy and lay a roadmap for attaining the double digit growth rate…. 

Overall the budget is good, as it aims to put our nation back into the peak growth of 9 per cent GDP with its prime focus on infrastructure, education, social sector, rural development, agriculture, healthcare and accompanied with a balancing note to smoothen the supply side of food, to control inflation. However, it is disappointing to know that there is no forward push given for the real estate industry, said Jitendra Jain, CEO & MD, Neev Group of companies…. 

The Budget presented by finance minister Pranab Mukherjee is likely to provide a permanent investment solution to the buyers and will also boost demand in the affordable housing segment for real estate companies, said Bhim Yadav, CEO, Falcon Realty Services…. 

The budget has been a well-balanced keeping in view the fiscal deficit. The clarity on GST, DTC rollout is welcome, said Rohit Raj Modi, spokesperson, Raj Nagar Extn…. 

Today’s budget comes as a relief for buyer community. The common man will be benefited by the continued subsidy of 1 per cent for low cost housing loan, said Ahosk Gupta, director, Ajnara India Ltd…. 

The budget 2010 is buyer friendly, where buyer will get 1 per cent subsidy in interest rate, on the other hand the sector get 2 per cent hike in steel and cement prices which will definitely affects the cost of the construction of the projects, said Vijay Jindal, CMD, SVP Group…. 

The extension of interest subvention scheme of 1 per cent on housing loans upto Rs 10 lakh for units costing upto Rs 20 lakh till March 30, 2011 is a step in positive direction but the Budget failed to address the real demands of the real estate sector like extension of 80 IB or increase in deduction on principal repayment and interest on housing loans, said Gaurav Gupta, director, SG Estates…. 

Finance minister Pranab Mukherjee’s budget 2010-11 clearly is development focused, said Aditya Verma, VP & business head, Makaan.com…. 

The Gujarat government will soon enter the open market to create a Rs 5,000 crore Gujarat Infrastructure Fund to finance its various projects. This includes the upcoming projects in information technology, biotechnology, small and medium enterprise and nano technology projects among others…. 

Prime minister’s Economic Advisor Counsil (PMEAC) chairman C Rangarajan has said the economy is likely to grow by around 9 per cent in the fourth quarter and would make up for the slow expansion in the October-December period to clock a growth of 7.2 per cent this fiscal…. 

The Karnataka government plans to build an integrated IT city near the Bangalore international airport to attract more investments in the knowledge sector, state governor H R Bhardwaj said recently…. 

The runaway success of India’s first floating super-market has enthused its owner Kerala Consumerfed to think of launching a floating mall, probably the world’s first, that will take modern retail to villages by the backwaters…. 

Real estate professionals expect the number of distressed properties coming onto the market to increase in 19 out of 25 countries with the US, Japan, China, Germany and the United Arab Emirates seeing the most sector growth, according to a new report….

America’s most listened-to investor Warren Buffett said the United States residential real estate slump will end by next year, predicting that’s how long it will take demand for homes to catch up with the supply…. 

Global design, engineering and management consultancy WSP Group said on Monday it had cut 40 per cent of its Middle East workforce amid the impact of the slowdown seen in Dubai…. 

Special Economic Zones (SEZs) may become favourites of the IT firms for new investment as alternative for tax sops, with the government deciding to put curtains on the Software Technology Parks of India (STPI) scheme….