Union Finance Minister Arun Jaitley’s announcement of setting up of a dedicated Affordable Housing Fund (AHF) in National Housing Bank is set to mark a new trend in India’s realty sector.
It will be funded from priority sector lending shortfall and fully serviced bonds authorized by the Centre, it is reported.
Santosh Rungta, former President of builders’ body, CREDAI, has said there has been a continued push on affordable housing. “The establishment of a dedicated affordable housing fund under the National Housing Bank for priority sector lending will provide a further impetus to the development of housing in this segment,” he said.
Affordable housing looks like a good trend that will pick up steam triggering further growth to the realty sector.
“The continued focus on smart city projects is expected to boost real estate activities further,” Rishi Jain, Director, Jain Developers said.
Ashish Jindal, Co-Head, Real Estate, Sanctum Wealth Management, is hopeful that this fund will help a few major real estate companies delve into the affordable housing segment as a viable business opportunity.
“The Budget has given a big relief by allowing up to a 5 per cent gap between the two and this has the potential to remove the irritant and revive secondary market transactions,” he said adding that the move may also help increase demand for housing.
Post demonetisation, the secondary market witnessed a bit of turbulence due to the absence of liquidity. Additionally, in major cities, the circle rates were increased and had become more than the market rates.
This resulted in a gap between the two rates, which was counted as income in hands of both buyer and seller.