Union Budget 2025: The real estate in the country is at the cusp of scripting new records with housing sales spiralling up across cities. As per ANAROCK rock, the inventory pile-up is already declining and new projects are taking shape. “In the North, Delhi-NCR’s unsold inventory declined from approx. 2 lakh units by Q1 2018-end to approx. 86,420 units by Q1 2024-end. In the South, Bengaluru, Hyderabad & Chennai saw collective unsold stock decrease by 11% in this period; Bengaluru saw a 50% decline; in Hyderabad, inventory rose almost 4X amid increased new supply,” said an ANAROCK report released in May last year.
As the Narendra Modi government prepares to present its second budget of its third tenure, realtors are optimistic about a favorable approach from Finance Minister Nirmala Sitharaman this time. The real estate players are expecting a slew of changes in the current provisions not only to boost sales but also to help homebuyers gain big.
Manoj Gaur, President- CREDAI NCR and CMD, Gaurs Group said that real estate mirrors the country’s economic progress in many ways and thus, it needs special attention. “We expect the government to infuse new vigour into India’s economic development. One of the major demands of the sector is the rationalisation of stamp duty, which has increased significantly in recent years and is causing a big financial burden on buyers,” he said.
The decline in affordable housing projects has been yet another major concern not only among the sector but even for states and central governments as well. Experts want the government to address this issue by reworking the parameters of affordable housing to reflect the current reality.
“Instead of focusing on price cap (the current Rs 40/45 lakh limit is too little, given the pricing trends and variance in land cost from one town/city to another), it should emphasise carpet area, that is, 60 sqm in the metros and 90 sqm in non-metro cities. Incentivising real estate developers in the form of income tax rebates to undertake affordable housing projects can provide a fillip to affordable housing and help the country realise its mission of ‘Housing for All’,” said Gaur.
Another demand of the sector is to increase the income tax deduction limit to Rs 5 lakh from the current Rs 1.5 lakhs under Section 80(C). “The tax cut on housing loan interest should be increased to a maximum of Rs 5 lakh as this will assist the middle class significantly. Because of this, we predict that the demand for affordable housing would increase by at least 30% during the next financial year,” said Aman Gupta, Director, RPS Group.
Manoj Goyal, Director, Forteasia Realty, said that due to an increase in construction expenses and hefty movement costs, increasing the subsidy limits of the CLSS may be what is needed to boost the demand of affordable homes in the Rs 40 lakh segment.
Anurag Goel, Director, Goel Ganga Developments urged the government to restart the previously provided 100% tax exemption on affordable housing projects.
Dr. Gautam Kanodia, Founder of KREEVA and Kanodia Group, urged the government to consider reducing GST on construction materials, which would significantly lower project costs and empower developers to initiate new ventures with greater ease.
Manik Malik, CFO, BPTP, said that policies promoting sustainable development, infrastructure enhancement can help in economic growth while boosting housing demand. “Additionally, more real estate investments, particularly in the housing sectors, can be stimulated by extending the benefits of capital gains and allowing for greater flexibility in reinvestment standards,” said Malik.
The experts also urged the government to grant industry status to real estate and establish a single-window clearance system, saying that both are vital for streamlining operations and driving sectoral growth.
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