Realty News Roundup: Tax To Be Levied On Unsold Inventories; Mah Govt To Use Saltpan Land To Build Affordable Homes

Realty News Roundup is PropGuide's selection of top stories from the real estate sector

Top News

DNA reports that the central government has given its nod to the income tax department to levy tax on unsold apartments from real estate developers with effect from the current fiscal year. The report quotes income tax (IT) officials who have confirmed this development. The tax will be calculated on the basis of the property's current market rental. "This will certainly induce builders to sell flats and not to hold them awaiting price escalation in future. Such tax will force builders to sell property in competitive price," the report quotes an IT official. Read more.

The Urban Development Ministry has said that the Centre's Rs 500-crore fund for each of the 100 shortlisted smart cities can be used for any component of the smart city plan adhering to the guideline. At a two-day 'Idea Camp' on Smart Cities held in New Delhi, the officials of the ministry told smart city stakeholders that this fund need not be project specific. Read more.

With the growing demand for affordable homes, the Maharashtra government has directed Mumbai Metropolitan Region Development Authority (MMRDA) to prepare a plan to use saltpans to construct affordable homes. This report by The Asian Age says that there is about 12,000 acre of saltpan land in the state, of which 3,000 acre is in Mumbai, followed by around 2,000 acre each in Vasai and Palghar district.

Off the front page

Latest in the interest rate cut, Indiabulls Housing Finance has lowered its lending rates to 9.60 per cent from 9.85 per cent. In another development, private housing finance company Dewan Housing Finance Limited (DHFL) has reduced its retail prime lending rate by 20 basis points (bps). It now offers home loans at 9.65 per cent. The company has also announced a festive offer of 9.55 per cent interest on loans upto Rs 25 lakh valid upto December 31, 2015. In Chennai, Sundaram BNP Paribas Home Finance has cut its prime lending rate by 25 bps. It now offers home loans at 9.65 per cent.

Business watch: Bengaluru-based Sobha Ltd achieved new sales of 8,50,329 sq ft valued at Rs 495 crore with an average realisation of Rs 5,822 per sq ft. It has reported over 11 per cent decline in sales bookings. Its sales bookings stood at Rs 559 crore in the year-ago period.

In another development, Aspire Home Finance Corporation (AHFCL) expects its loan portfolio to double to Rs 2,000 crore in six months. The company's loan book jumped to Rs 1,000 crore as at September 2015 from Rs 359 crore as at March-end 2015.

Opinion

Sachin Sandhir, Global MD, emerging business, Royal Institution of Chartered Surveyors (RICS), explains why the issues of standardisation, adopting global best practices, inclusive development, and following international property measurement standards, are the need of the hour for Indian real estate sector. Read here.

Smart City Watch: This article looks at the importance of an appropriate public-private-partnership (PPP) model to finance smart city projects in India. The article says it is also important to include provisions for unique and innovative modes of financing for smart cities.