The benefits and advantages available to first-time homebuyers in India are highlighted below

Who Qualifies as a First-Time Homebuyer:

A first-time homebuyer is not necessarily someone purchasing a home for the first time. If you haven't bought a primary property in the past three years, you're considered a first-time homebuyer.

Benefits for First-Time Homebuyers:

Tax Benefits (Section 80C): You can claim tax advantages of up to Rs. 1.5 lakh on the principal repayment of a home loan. This deduction is available for homes that are completed and have been owned for at least 5 years from the acquisition date.

Additional Tax Benefits (Sections 80EE and 80EEA): First-time homebuyers can get a tax credit of Rs. 50,000 on interest repayment, in addition to benefits under Section 24. Section 80EEA provides increased tax benefits on interest payments for a house loan up to Rs. 1.5 lakhs, particularly for "affordable housing."

Interest Deductions (Section 24): First-time home purchasers paying interest on a home loan can claim interest deductions up to Rs. 2 lakhs per year. This applies only if the home is owned and not rented.

Claim Timeline: Prior to 2016, tax benefits could only be claimed on self-occupied residences built or acquired within three years of the loan's approval. This has been extended to 5 years since the 2016 budget.

Other Benefits for First-Time Homebuyers:

RERA (Real Estate Regulation Act) of 2016: RERA provides several benefits to homebuyers, including data transparency on builder projects, standardized property measurements (like carpet area), enhanced buyer rights, insolvency restrictions, and more.

Pradhan Mantri Awas Yojana (PMAY): This scheme aims to provide "housing for everyone" and assists first-time homebuyers from lower and middle-income families, with maximum family incomes up to Rs. 18 lakhs. The scheme offers discounts on the principal amount based on income.

Housing Subsidy GST: A 12% GST on residences acquired under PMAY was reduced to 8% in 2018. This means that first-time homeowners with average earnings of Rs. 18 lakhs can receive a subsidy of up to Rs. 2.7 lakhs when purchasing a flat or house.

New Subsidy Income Slabs: PMAY introduced two additional income brackets for home loan subsidies, providing subsidies for those with annual incomes of Rs. 12 lakhs or Rs. 18 lakhs. It is important to utilize government efforts to maximize the benefits of buying a property in India as a first-time homebuyer.