Realty stocks upbeat on GST rate cut

Real estate stocks were buzzing during the morning session on Monday as the GST Council decided on Sunday to cut GST rates applicable on under-construction houses and affordable housing segment.

With the new rates, affordable flats priced at less than 45 lakh in metros and housing of area less than 90 square meter in non-metros will be taxed at 1 per cent instead of the existing 8 per cent GST rate without input tax credit (ITC). While under construction properties priced above 45 lakh will attract a GST or 5 per cent instead of 12 per cent as earlier without ITC.

Reacting to this news, the stocks of listed realty companies were trading in the green. The BSE Realty index was at 1,826.77, up 0.49 per cent at 11:23 hours on Monday. The index stocks were trading up by more than 2 per cent. Among major realty stocks, Sunteck Realty, Mahindra Life, Brigade Enterprises, Phoenix Limited, Oberoi Realty were up by 3.16 per cent, 2.01 per cent, 1.86 per cent, 1.91 per cent, and 1.27 per cent, respectively. While Godrej Properties, Indianbulls Real Estate, Sobha Limited, Omaxe were up 0.90 per cent, 0.60 per cent, 0.40 per cent and 0.02 per cent, respectively. While Prestige Estates and DLF were trailing down 1.30 per cent and 0.65 per cent, respectively.