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What did Budget 2019 have in store for real estate buyers and sellers?
With the first budget of the NDA government being announced, buyers and sellers in the real estate sector have several reasons to be happy. The industry had been gaining consistency over the last few years. With the budget around the corner, players in the real estate segment had several expectations from the government. Well, the Finance Minister has announced the Budget 2019, and the real estate sector is likely to benefit from the same. The buyers and sellers seem contented with the announcements that have been made by the government.
For second homes, a notional rent was previously applicable for people who own more than one home. In Budget 2019, this has been waived off, as the authorities have considered the requirements of people who find job opportunities and migrate to other cities. Besides, certain people have family reasons to maintain two houses.
In the past, people who had two houses had to make tax payment on the notional rent, although they did not rent out the second house. For families, where the immediate family members or parents who occupied the second home, the tax had to be paid for notional rent, although the owners did not earn anything from the property in the form of rent. The Finance Minister made this announcement during Budget 2019, which is a welcome move from the government.
Besides, people who have been making getting rental income from the homes need to cheer out as well. The limit on rental income of TDS has been increased to INR 2.4 lakh. Previously, this figure was set at INR 1.8 lakh.
People who have been looking forward to buy homes also have a good reason to cheer. As per the previous norms, people buying a new home for residence would not have to pay capital gains tax when they used the proceeds from the sale of another residential property. Under Section 54, this was applicable only for one new residential property. According to the new budget announced recently, this norm is made applicable for two residential houses. The Finance Minister further stated that this benefit is valid only once in a lifetime and the benefit that would be offered would be up to INR 2 crore.
For investors, the Budget 2019 has come up with some good news, particularly related to tax payment. Well, people planning to buy real estate in India have a good opportunity now. The market conditions have been improving, and it is picking up pace after a couple of years of slowdown. A large number of residents are already purchasing property in the key cities. These investments can reap good returns in the coming years, with the prices of real estate rising over the years.
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