It has been a tough time for the world in fighting the deadly virus since the year 2020 began, as millions lost their lives while millions are still affected by the virus. Be it developed, developing, or under-developed countries all have faced a downfall in terms of health or economy.
India is among the countries where the virus has affected badly, the constant downfall in the economy, and a rapid increase in the number of positive cases are some major factors that are really worrisome.
But even in all this, the government came up with various schemes for all those who were affected by the lockdown and the sudden downfall of the economy. To boost the economy and help the skilled people of society different schemes were made. Aatmanirbhar Bharat initiative was launched for those who were affected.
For a constant flow of cash in the market, RBI came up with a series of schemes to help the business run in the country.
Among the most affected business, the real estate market is adversely affected because of the pandemic. After which the Maharashtra government has decided to temporarily reduce the stamp duty as a major policy decision aimed at boosting the real estate sector.
Speaking to The Live Nagpur Gaurav Agarwala Secretary CREDAI, Nagpur Director – SDPL, Nagpur informed about the new major changes in the real estate market and why it is the right time to make an investment in the real estate.
The Government has announced a 3% reduction in the Stamp Duty from 1st Sept to 31St Dec 2020. The benefit will reduce to 2% from 1st Jan 2021 to 31st Mar 2021 informed Gaurav.
The interest on home loans is on an all-time low. PMAY Subsidy up to Rs.2.67 lakh is being offered to eligible buyers (Ending 31st Mar 2021 for MIG buyers). These benefits could prove to be the right time to own a property.
CREDAI has been pursuing state governments for reduction in stamp duty since the beginning of lockdown. The move will benefit the customer and foster demand creation along with giving motivation to the real estate sector, he added.
The residential market is unlikely to offer this palette anytime soon – rationalized pricing, lowest home loan interest rates of 6.85% approx., an extension of credit linked subsidy scheme, and developers doling out lucrative schemes and now this is added with lower stamp duty rates.
The Government has successfully implemented the Credit Linked Subsidy Scheme under Pradhan Mantri Awaas Yojana (PMAY), wherein a first time home buyer gets a subsidy upto Rs.2.67 lakhs on taking a home loan.
Who all are eligible to get subsidy?
- Family Income should be less than Rs.18 Lakh per year
- Family should not own a House in their name
- Aadhaar card is mandatory
| Family Income | Category | Â Subsidy Amount | Valid Till |
| Below 6 Lakhs | EWS / LIG | Â Â Â Â Â Â Â Â Â Â Â Â 2,67,000 | 31.3.2022 |
| 6 to 12 Lakhs | MIG-1 | Â Â Â Â Â Â Â Â Â Â Â Â 2,35,000 | 31.3.2021 |
| 12 to 18 Lakhs | MIG-2 | Â Â Â Â Â Â Â Â Â Â Â Â 2,30,000 |
In addition to these short term benefits, there are several deductions under Income Tax on buying a home
Sec 24D – The interest portion of the EMI paid for the year can be claimed as a deduction up to a maximum of Rs 2 lakh.
Sec 80C – The Principal portion of the EMI paid for the year is allowed as deduction up to a maximum of Rs.1.5 lakh.
Sec 80C – Besides claiming the deduction for principal and interest repayment, a deduction for stamp duty and registration charges can also be claimed u/s 80C but within the overall limit of Rs.1.5 lakhs.
Sec 80EE – Additional deduction is allowed to the home buyers for maximum up to Rs 50,000. To claim this deduction, the amount of loan taken should be Rs 35 lakhs or less and the value of the property does not exceed Rs 50 lakhs.
Sec 80EEA – The budget 2019 has introduced additional deduction for home buyers for maximum up to Rs 1,50,000, subject to the stamp value of the property does not exceed Rs 45 lakhs.
| Deductions | Section | Maximum Deduction | Tax Savings | |
| 20% Slab | 30% Slab | |||
| Interest | 24B | 2,00,000 | 40,000 | 60,000 |
| Principal | 80C | 1,50,000 | 30,000 | 45,000 |
| Stamp Duty | 80C | |||
| Interest | 80EEA | 1,50,000 | 30,000 | 45,000 |
| Interest | 80EE | 50,000 | 10,000 | 15,000 |
| Total | 5,50,000 | 1,10,000 | 1,65,000 | |