Niti for making budget homes more budget friendly

NITI Aayog's strategy for budget homes focuses on fiscal incentives for developers (like 100% tax breaks), cheaper finance for buyers (increased loan limits, tax-free bonds), and reducing transaction costs, alongside streamlining approvals, to make housing more affordable and attract private investment, especially for EWS/LIG segments, to meet India's growing urban demand. Key ideas include tax exemptions for REIT investors, boosting credit guarantees, and policy shifts to lower costs and boost supply.  Key Proposals by NITI Aayog:

1. Developer Incentives:
   • 100% Tax Exemption: Reintroduce full tax exemption for developers on profits from approved affordable housing projects to improve viability.
   • REIT Incentives: Offer tax breaks on capital gains and rental income for investors in Real Estate Investment Trusts (REITs) to lower funding costs.
2. Financing & Credit Support:
   • Increased Loan Limits: Raise the loan limit to ₹40 lakh under the Credit Risk Guarantee Fund Scheme for Low-Income Housing.
   • Tax-Free Bonds: Allow the National Housing Bank to issue tax-free bonds for concessional funding.
3. Transaction Cost Reduction:
   • A broader push to reduce costs associated with buying and selling affordable homes, making them more accessible.
4. Policy & Framework:
   • Developing a comprehensive framework with the Ministry of Housing and Urban Affairs (MoHUA) to align incentives with urban development goals.
   • Targeting specific income groups (EWS, LIG) with aligned benefits. 

Why it Matters:

• Urbanization: Addresses the massive projected growth in India's urban population (50% by 2050).
• Economic Growth: Stimulates construction, creates jobs, and boosts GDP.
• Social Impact: Promotes homeownership, breaking poverty cycles, and improving living standards. 

By implementing these fiscal and financial measures, NITI Aayog aims to unlock private investment and significantly reduce housing prices, making homeownership a reality for more Indians.    Source - https://m.economictimes.com/news/economy/policy/niti-aayog-calls-for-fiscal-incentives-to-push-development-of-affordable-houses-in-india/articleshow/126391282.cms