The direct tax code will significantly change how income from house property is calculated, which will be adverse for residential property investments. Key changes include taxing all properties except one non-let property based on presumptive rent of 6% of the rateable value, removing vacancy allowances, reducing standard deductions for let properties from 30% to 20%, and not allowing deductions for interest on non-let properties or principal repayments for home loans. Overall these changes will drive investors out of the residential property market and significantly reduce tax-driven decisions to purchase own residences.

1. DTC household property