The residential real estate market did see a slump thanks to the COVID-19 pandemic but is now on an upswing. To this end, several initiatives have been taken by the Government of India to encourage home investors to purchase properties. This has provided the residential real estate sector with a much-needed fillip and instilled greater degrees of trust in homebuyers.
One significant step taken by the government to encourage sales has been the reduction of interest rates on home loans. Another measure taken by the authorities has been the reduction in stamp duty levied on property transactions across the country. This is a tax paid to the state government on real estate sales and varies between various locations across India.
The stamp duty levied varies based on the gender of the buyer and is not uniform, varying for different documents. This reduction in stamp duty has been from 5% to 2% on properties up to Rs. 20 lakhs in Karnataka. For properties worth up to Rs. 35 lakhs, there has been a reduction in stamp duty from 5% to 3%.
Also, the government has made it possible for this tax to be paid online, making it extremely convenient for homebuyers. All these measures are in keeping with the government’s policy of making affordable housing solutions available to all Indian citizens. This has been a great incentive, which has reduced the total amount of money that a home investor will spend.
Stamp duty reduction also has had a major benefit of providing significant tax benefits to the borrowers of home loans. Also, in the case of home co-ownership, every buyer can claim stamp fee according to their share in the property. The reduction in stamp duty will also enable investors to avail of loans, thereby boosting the residential real estate sector.
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