GST in Real Estate: Should you buy a home or wait?
![GST](https://pacificacompanies.co.in/wp-content/uploads/2017/08/47538388_xxl-2000x1200.jpg)
Goods and Services Tax has given rise to many questions, the top one being should a buyer or investor invest in property before the implementation of GST or after it. Looking at this million dollar question from an apparent point of view, one can easily point out that Real Estate prices may raise by 7.5% to 12%. The indirect Tax uniformity will bring about a rise in real estate costs from a mere 4.5% to 12%. However, this is not entirely true.
For ready to move houses, resale of housing or business areas, GST does not affect the prices because immovable properties do not fall under “Goods and services”. The Indirect Taxes there except for registration and stamp duty are nullified. Furthermore, the costs of logistics will dip down, leading to lower construction costs and a more transparent deal for the buyer.
It may be fair enough to say that although real estate developers are urging people to buy homes at “Lower costs” before the taxes are implemented, it will not be so. In fact, the costs on low priced properties will decrease by some mere percentile while the high-end properties, may face some surges due to this.
It is easier to infer that the price reduction, annulment of all other Indirect Taxes, uniformity and transparency will be better for both the buyer as well as the seller and prevent situations where the buyers are duped. The overall market for Real Estate will face a decline in price by 1% to 3% and the industrial environment will definitely be better and more favorable after the implementation of GST.
Goods and Services Tax, as implemented from 1st July 2017, will see a rise in real estate investments and buying of properties as a whole, and it is advisable for investors to wait till the full implementation of the tax before buying a property especially if it is not a higher priced one. The bottom line is that prices will definitely be in favor of the buyer.