Buying A House Under ₹45 Lakhs? Save Upto ₹3.5 Lakhs Instantly



Homes that comes under ₹ 45 lakhs fall under the category of affordable homes.

Do you know there is a provision of deduction up to ₹1.5 lakh in interest on home loans taken for the purchase of house/flats under the category of affordable residential property.

Under section 80EEA the deduction from taxable income will now be valid up to March 31 of the next year. Only one rider is attached to this : to avail this benefit, one must not own any other residential property as on the date of sanction of the loan.

This rebate is above the ₹ 2 lakh deduction against interest paid on a home loan taken to buy a house under Section 24 of I-T Act.

The above discussion means a total rebate of ₹3.5 lakh on interest paid on your home loan.

If you are looking to buy a house worth ₹45 lakh and also thinking of taking a loan of ₹40 lakh for the purchase of house, the rebate that you'll get will cover the whole interest amount you have to pay in a year.

 

Moreover, if you fall in the 20% tax bracket of Income tax, then this new budget move will reduce your effective interest rate to around 5.5 per cent from the current 7 per cent.

 

For example you are taking a loan of ₹40 Lakhs to buy a house, then the EMI amount that has to be paid monthly will be ₹26000 when one adjusts for new rebate.

This particular move by the government has lightened an exceptional enthusiasm in the real estate sector, which definitely expects a rush of new demand and new opportunities in the affordable housing segment.


Sources:

Economic Times, Ministry of Finance - GOI.

By

PrateekGoel


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