2021 Union Budget For Bengaluru’s Realty

By Author: Beegru Realty
Total Articles: 5
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Union Government had to deal with an economy still recovering from the COVID-19 induced economic slowdown. The budget hints towards a shift to capital expenditure and the easing of investment policies to enable Foreign Portfolio Investors, kickstarting the flow of cash in the economy to undertake asset-building activities.
· Capital Expenditure is the funds used by a country to acquire, upgrade & maintain physical assets. Capital Expenditure or CapEx is often used to undertake new projects or investments.
The government has relied on productive sectors (real estate and infrastructure) to pilot its plan to get the limping economy back in its form. The capital influx in the infrastructure sector is expected to have a multiplier effect.
The government has increased investment in the productive sectors with an increase in the capital expenditure (capital expenditure in the next year is budgeted to be Rs 5,54,236 crore — 26% more than this year), thus focusing on asset building to revive the economy.
Ministry of Housing and Urban Affairs has been granted Rs 54,581 Cr as an allocation in the 2021–22 ...
... Union budget.
· The sector is expected to incur the most Non-Resident Indian (NRI) investments, both in the short term and the long term.
· Namma Bengaluru is expected to be the most favored property investment destination for NRIs, followed by Hyderabad, Ahmedabad, Pune, Chennai, Goa, and Delhi.
What’s in it for Namma Bengaluru?
- ‘MetroLite’ and ‘MetroNeo’ will be deployed to provide metro rail systems at a lesser cost in the peripheral areas of the city.
- Bengaluru Metro Railway Project Phase 2A and 2B of 58.19 km at a cost of Rs 14,788 crore
- Phase 2(A) (18 km)- Silkboard to K.R Puram. This line along the ORR (Outer Ring Road) is proposed to have 13 stations — Silk Board till K.R. Puram.
- Phase 2B or Airport Line (39.8 km)- MG Road to Kempegowda International Airport (KIA). The line originating from K.R Puram will be aligned along the northern part of ORR (Outer Ring road), Hebbal, and Jakkur before heading towards the airport.
These two Metro Phase construction will provide a boost to the residential and commercial establishments along the above-mentioned routes which will increase the desirability of the areas. Cutting down of travel time and easing of traffic will contribute to a relaxed lifestyle.
Key Takeaways for the Real Estate Sector
1. Safe Harbor Limit for sale of residential units is proposed to be increased from existing 10% to 20%.
2. Additional tax deduction of Rs 1.5L for interest on home loans and tax holiday for affordable housing extended till March 31, 2022.
3. Debt Financing of InVITs (Infrastructure investment trusts) and REITs (Real estate investment trusts) by Foreign Portfolio Investors will be enabled by making amendments in the relevant legislation, thus increase in funding for respective sectors.
4. A dedicated portal for construction workers, which will collect relevant information to help formulate Health, Housing, skills, Insurance, Credit, and food schemes for migrant workers.
5. Proposal to set up DFI (Development Financial Institution) will act as a provider, enabler, and catalyst for infrastructure funding.
SOURCES:
1. India Brand Equity Foundation. (2017, November 01). About Indian Real Estate Industry, Market Size, Export & Investment Opportunity.
2. Namma Metro. (2021, January 25).
3. Www.ETRealty.com. (2021, February 01). What real estate gained in Union Budget 2021? — ET RealEstate.
4. Misra, U. (2021, February 03).