Union Finance Minister Nirmala Sitharaman presented the first budget of the second term of the Modi government in Parliament on Friday, July 5th, 2019. In the Budget, the Finance Minister has made several announcements from women to youth and from salary classes to business persons, especially benefiting homebuyers looking for properties such as 3 BHK apartments in Noida. These announcements received relieved news from the Middle Class. The Finance Minister has increased the income tax exemption on the interest payment of the Home Loan from Rs 2 lakh to Rs 3.5 lakh.
The Modi Government increased its interest deduction from 1.5 lakh rupees to 2 lakh rupees in the first budget in July 2014 on the home loan. Earlier the government was promoting the real estate sector by increasing the demand for construction materials such as cement, steel, and other material of the construction sector. But due to higher interest rates, there was no such hike visible in this sector, especially for end-users planning to buy 3 BHK apartments in Noida and other major cities.
What is the provision?
Tax saving convenience is available on the repayment of both principal amounts and interest amount of the home loan. Under Section 24B of Income Tax, you were making a claim of deduction of up to 2 lakh rupees from your total income for a self-occupied property. But now, it has increased to 3.5 lakh rupees, making home ownership more affordable for buyers investing in 3 BHK apartments in Noida.
Likewise, under Section 80C of the IT Act, you can claim Rs 1.5 lakh rupees on the repayment of the principal amount of a home loan. If you are buying the house for the first time, you can get an additional tax deduction benefit up to Rs 50,000 under Section 80EE. But the loan amount should be less than Rs 35 lakh and the total cost of the house should not be more than Rs 50 lakhs, a condition that suits many affordable and mid-segment 3 BHK apartments in Noida.
Benefits of Pradhan Mantri Awas Yojana (PMAY)
Prime Minister Narendra Modi announced the Pradhan Mantri Awas Yojana on June 25, 2015. The purpose of this scheme is to make homes available to every citizen of the country by 2022. People having an annual income of Rs 6 lakh can get a home loan up to Rs 6 lakh under this scheme. The government will provide a subsidy of 6.5% on the interest rate of the home loan, encouraging demand for residential properties including 3 BHK apartments in Noida.
People earning up to Rs 12 lakh annually can get a loan up to Rs 9 lakh with a subsidy of 4%. Loan up to Rs 12 lakh is available for the Rs 12–18 lakh annual income group with a rebate of 3% on the home loan, supporting buyers upgrading to spacious homes like 3 BHK apartments in Noida.
Real estate companies believe that by increasing the exemption limit on home loan interest, demand for affordable homes will increase rapidly, including demand for 3 BHK apartments in Noida. This will help the real estate sector significantly, and the budget is expected to give a strong boost to the housing sector.
