Three moves in the 2019 Budget have been happy news for the real estate sector.
1) The government has announced that rollover of capital gains extended to two houses instead of just one. A person who earlier purchased a new residential property using the proceeds from the sale of another residential property would be exempt from capital gains tax - now that benefit has been extended on a rollover basis if the investment has been made in two houses (up to Rs. 2 crore limit).
2) Notional rent on second house has been waived off.Previously, somebody who had two houses had to pay a tax on the notional rent even if the second house was not rented out.
2) Threshold for TDS on rental income on second property raised to Rs. 2.4 lakh from Rs. 1.8 lakh
3) Proposed change to the GST now applied to underconstruction properties (a big problem for real estate companies trying to make sales).
Phoenix Mills, Ajmera Realty and other real estate stocks are rising on the news. Nifty Realty is also sharply up.