- There has been unprecedented rises in prices of land, readily built houses and flats in apartment during last two three years only due to unwarranted support given by the government to real estate sector and uncalled for IT benefits given to individuals who buy houses.
- The benefits are availed not by common men or middle class people but only by rich class and affluent persons because only they can afford buying a house worth 40 to 50 lacs and only rich can afford repay the loan of such huge amount as Rs. 20 or Rs.30 lacs. It is to kept in mind that in India when a house is traded in 30 lacs, it means the actual trade has occurred in at least 40 lacs , it may be 50 or 60 lacs also.
- There is almost no land deal and sale of house or flat is possible until there is offer of black money of considerable amount by buyer. If a house is sold in Rs.20.00 lacs , the registration of house will take place for only Rs.10.00 lacs to save stamp duty and also to use ill earned money or black money lying idle in the hand of buyer. Government is silent spectator of what is happening in real estate sector and still allowing one after other benefits to rich and it is always poor who are ignored .
- There is one silver lining in such real estate deal involving black money that lending bank are not unsafe as US banks are .Even if the borrower fails to repay the dues in time , banks are not unsafe because the real value of such properties is always more than the actual loan amount.
Real Estate Sector
Danendra Jain (manager) (614 Points)
21 September 2009
CAclubindia
