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“The simplest definition of a budget is "telling your money where to go.” …
Tsh Oxenreider is an author,
podcaster, travel guide, and teacher. No wonder a combination of teacher &
travel guide only can make the definition of a concept as complex as budget in
so simple words! With due respect to Ms. Tsh, sometimes you can explain life
to others in very simple words but to make it live isn’t that easy, &
budget is just like the life! And when somebody else is telling your money (or
deciding) then more difficult it is to digest, right? On the background of
two successive years of virus, pandemic, lockdowns & what not I really feel
pity for our Hon Finance Minister while she will be delivering this year’s
budget as already a country of some 130 plus crore population under whose
expectations even the god will get stressed & all of them expects they as
respective business fraternity as well as an individual must get something out
of the budget (read as, gain), which of us can do this miracle possible, I
certainly can’t! Yet she has to make a budget for this country as the country
needs revenue which has to be collected from the pockets of each person out of
those 130 plus crore population only. As its from that money only the roads,
waterlines, public transport, medical assistance, education, agriculture,
drainage line, power grids & many such things will be possible for these
130 plus crore people only yet each of them thinks the money should not be
taken from his or her pocket but from rest all the people as he or she is more
needy than others, that’s what everybody’s expectation from the budget is!
Well,
coming to our real estate, builders are no expectation to the human psychology
(though the society doesn’t consider the builders as humans, that’s different
story) & they too expect from the budget which most of the times goes in
the vein, is what the history says. But again, if you read the pre-budget expectations
(a dear subject of the media) & post-budget reactions then I rarely have found
an entity or say community or fraternity (I am not referring to an individual)
which is happy with the budget. Yet time & again real estate has been
neglected on not just budget provision front but on most financial policies, is
a hard bitter fact. If you think it’s because a builder is writing this then,
well, for a change the news media this time has covered expectations of common
people or say aspirant home buyers also about the budget. And I just happened
to read few of them & one reaction was very interesting (needless to say
from a house-wife, as who better than a house-wife can put in clear words true
needs about a home from the budget), the lady said “the govt should make such
budget that, I can save some money to pay the loan instalments to buy my own
Home”! Madmaji, God bless you for these words, whoever
& wherever you are, as this is what the builder fraternity should ask to
the govt than asking for anything for themselves or for real estate industry
from the budget!
There
were other citizen’s comments (expectation’s) also & thankfully for the
first time nobody was blaming the builders for making the homes costly or
unaffordable but expecting the govt should do that! Indeed, govt don’t make homes or sale them
directly (they think so, though) but high time the govt should understand the
fact that if they don’t build the home by themselves then they should not
expect the builders (read as blame the builder) for making the homes unaffordable
as the govt’s policies towards (read as affecting) the real estate, is what
actually makes the homes affordable or unaffordable & not the builders! For e.g., right from
neglecting hundreds of demands of the real estate may it be GST or Income Tax
or Finance Interest Rates, nothing ever has been positively considered which
are key factors for any business. Here are few unique policies for e.g., and do
mind, I am not any finance expert but an engineer who can understand the
illogicality in them, sorry for the term, but the govt & the experts can
enlighten me if I am wrong (fool I am, that I know)!
1. Real estate is the only business probably where
there is no GST on finished good i.e., ready possession homes but there is GST
on in making product i.e., ongoing product! So how I recover the GST, I have
paid on construction material & labour if I don’t collect any GST that’s
unanswered.
2. Real estate is the only business where you have to pay
income tax even if your product is ready but unsold! Means ready possession
homes even if are unsold they are added in your income.
3. Real estate is the only industry where the product buyer
gets assured & cheaper loans than the product maker. It means if I am a
builder then first, I won’t get any loan (read as easily) then my rate of
interest is 15% with loads of documentation & a collateral security of
ready possession property equal amount of loan, needless to say the project is
entirely mortgaged already! But my flat buyers get loan at 7% interest &
for 15 years times span while for a builder its maximum repayment period is
three years!
4. One more joke, probably only in the real estate, while
giving finance to the project, land cost is not considered which is biggest
cost incurred actually but the bank giving loan for just construction costs
mortgages the land also!
5. There is TDR available of all types as well Paid FSI &
Metro FSI but the planning authority decides which the builder should use &
the builder has to pay by the rate the planning authority decides means the
govt! Its like you are allowed eat in the hotel but the hotel owner will decide
what you will eat & in which sequence!
6. In Pune city we all get electricity by MSEDCL (MSEB) i.e., a
govt agency. If MSEDCL is laying the cable & cutting the road for same then
rate per running meter to be paid to local body i.e., PMC/PCMC is Rs 3000 /
meter. But if the builder is laying power cable which is job of MSEDCL & as
MSEDCL don’t have funds so it makes the builder, do it & later takes
possession of that infrastructure via legal agreement yet the local body
charges the builder at the rate of RS 12,000/ meter i.e., four times that of
MSEDCL! Same scene is with water lines & drainage lines all of which is
responsibility of the local civic body & which is forced on the builder’s
head!
Now
tell me, who will be carrying the burden of all above added taxes, premiums,
fines whatsoever you call it, the builder or the flat buyer? And, above are just
few jokes which are outcome of the policies of the govt which every budget the
real estate expects to be corrected but instead there is addition of new jokes!
Outcome of all such policies is the major earner is govt, the homes get
unaffordable & the builder ends with tag of culprit for making the homes
costly! Indeed, there has been times when land rates were less, the landlords
were illiterate, supply was less of the homes & builders did make huge
money & that was different times as then even Fiats’ & Hindustan Motors’
& Bajajs’ & Firodiyas’ has also made huge money when we have lesser
players in the automobile markets, but are they ever tagged as making
automobiles costly for the end users?
And
on top of this right from poor public health, to poor public transport, higher
fuel costs & costly education, all of which burdens the pocket of home
buyer thus reducing the buying capacity of him or her & the builder is
shamed for making the homes unaffordable! Hon. Finance Minister (read as Prime Minister
too), as a builder I personally don’t want any relaxation in any tax or free
finance from you in the budget, just treat us a normal business fraternity
& make policy which are logical & see that they get implemented &
that’s enough for us! A home is a basic need of not just humans but every species
& its only possible when all of us unite for the cause & for that first
we all should be on one platform first, that’s all our request for the budget;
do I need to explain in more words!!
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Sanjay Deshpande
Sanjeevani Dev.
Please
view my sharing about real estate in Pune at You Tube link below..
https://www.youtube.com/watch?v=g4xX7eopH5o&t=5s
Please do visit my blog links below to read about real estate & home
buying!
https://visonoflife.blogspot.com/2021/09/choosing-right-home.html
http://jivnachadrushtikon.blogspot.com/2021/09/blog-post_21.html
Creating Togetherness; team Sanjeevani Way (Click link below)
https://www.flickr.com/photos/65629150@N06/albums/72157627904681345
For any of your complaints about city, log in at link below
www.punecorporation.org
Take your issues to
Hon PM at link below..
Think Green, Think Life
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