Will next-gen GST make homes more affordable?
Industry experts say the timing could not be better, as the festive season is generally a time when homebuyers take purchase decisions.'The proposed simpler two-slab GST regime could spark the housing market, reducing costs for developers and creating renewed optimism among homebuyers,' said Umang Jindal, CEO of Homeland Group.He added, 'By rationalising rates and lowering the tax burden on essential construction materials, affordability improves, particularly for first-time buyers and the affordable housing segment. Even a 5–10% easing in costs can be the difference between waiting and booking. With interest rates stable and sentiment positive, this GST reform could act as a trigger for buyers who have been on the fence.'Developers also point out that construction materials currently fall under different tax slabs, which increases compliance burdens and pushes up overall project costs.Dr. Gautam Kanodia, Founder of KREEVA and Kanodia Group, explained that if the GST rate on cement is cut from 28% to 18%, construction costs could fall by several percentage points. 'For under-construction projects, this has a direct impact on affordability. With festive sentiment building, homebuyers could save lakhs depending on the ticket size, while developers gain more flexibility in pricing.'Experts believe that if GST rationalisation is approved, it would help both developers and buyers. Lower costs for builders could lead to reduced property prices, while stable interest rates and positive consumer sentiment could finally push buyers off the fence.Simply put, the proposed GST reform may not solve all the challenges facing the housing sector, but it could be a much-needed trigger to revive demand and improve affordability, particularly in emerging markets and the affordable housing segment.- Ends
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