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Housing


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Budget 1998-99
Budget 1997-98
Budget 1996-97

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Housing

Turning to shelter in urban areas, we have already taken major steps for encouraging housing development, including repeal of the Urban Land (Ceiling and Regulation) Act. To improve the flow of credit for housing I propose the following measures:
To develop the primary and secondary market for housing mortgages, it is necessary to simplify the present legal provisions for foreclosure and transfer of property. I propose to make necessary changes in the foreclosure laws in the housing sector through amendments in the National Housing Bank Act. 
To strengthen housing finance companies, I will be proposing changes in the tax treatment of the income earned on non-performing assets.
To enhance the availability of banking funds to the housing sector, RBI will be advising scheduled commercial banks to lend up to 3% of their incremental deposits for housing finance.
National Housing Bank is implementing the Golden Jubilee Rural Housing Finance Scheme for which I announced a target of 1 lakh dwelling units last year. Encouraged by the satisfactory response to this scheme, I propose to increase this target by 25% to 1.25 lakh dwelling units during 1999-2000.
The National Housing Bank has proposed a scheme, which entails a reduction in the interest rates for small borrowers. The scheme will be available in towns where Urban Land (Ceiling and Regulation) Act is not applicable. We will provide necessary support to NHB for this purpose. The details of the scheme would be announced by NHB.
The development of housing in urban areas also depends heavily on the quality of urban services. Many of our municipal bodies are at present financially too weak to provide basic services. To encourage these bodies to improve their creditworthiness in financial markets, I propose to accord tax-free status to a limited amount of municipal bonds issued each year. A little later, I shall be announcing far reaching tax initiatives to promote housing.

 

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