What’s the Big
News
- 1. The Union Government has slashed GST on some construction inputs —
notably cement — from 28% down to 18%. .
- 2. According to CREDAI’s Srikakulam town president, this change will
significantly lower building costs, making properties more affordable. .
What
Developers & Buyers Can Expect
- 1. Cement bags might see a price reduction of around ₹35–₹40 each
due to the revised GST slab. .
- 2. Builders are expected to pass on this cost savings so that
homebuyers benefit, not just manufacturers or intermediaries. .
- 3. There are also supportive moves at the State level — relaxed
norms for constructing high-rise buildings and exemptions from certain fees/charges,
such as NALA (Non-Agricultural Lands Assessment) charges. .
Impacts
Across the Industry
- 1. Affordability: With lower
materials cost and relaxed regulatory norms, apartments can be offered at discounts,
potentially around ₹3 lakh to ₹4 lakh per unit in some cases.
- 2. Revival of Projects: Many
realtors who put projects on hold are now more likely to resume construction, thanks to
the combined impact of GST reduction and regulatory easing. .
Things to
Watch Out For
- 1. It’s crucial that manufacturers and builders genuinely pass on
the GST benefit. Without that, reductions at the tax level won’t translate into lower
prices for buyers.
- 2. Regulatory changes at State level also need effective
implementation. Relaxed permissions or exemptions are good on paper, but actual
timelines, clearances, and enforcement matter.
- 3. Builders may still face other overheads (land cost, labour,
logistics) that GST cuts can’t address; so while this is a strong positive, it’s not a
silver bullet.
Why This
Matters
- 1. The real estate sector has been under pressure from high input
costs for a long time; this move gives breathing space.
- 2. Lower costs for construction materials can help stabilize
property prices, perhaps even pull down rates in overheated local markets.
- 3. For end-buyers, this could be the moment to plan purchases or
investments — better deals, more choices.
Conclusion
This GST cut for construction materials, especially cement, combined with State government
reforms, is shaping up to be a win for both real estate developers and homebuyers. If the
tax benefit is passed down the chain, and regulatory relaxations are implemented
properly, we could see more projects restarting, and better affordability in housing. A
promising development, indeed.
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