As India prepares for the upcoming Union Budget, real estate industry leaders are calling for transformative measures aimed at revitalizing affordable housing, streamlining regulations, and stimulating market demand. Among their key expectations are tax reliefs, increased funding for housing projects, and the granting of industry status to the real estate sector.
Key Demands from Industry Leaders
1. Tax Reliefs and Incentives
Niranjan Hiranandani, Chairman of the National Real Estate Development Council (NAREDCO), emphasized the importance of making homeownership more affordable for the masses. He proposed raising the tax deduction limit on home loan interest from Rs 2 lakh to Rs 5 lakh. Additionally, he advocated for granting infrastructure status to the housing sector, which would lower borrowing costs and enhance access to financing for developers and homebuyers alike.
2. Revival of Credit-Linked Subsidy Scheme
Anuj Puri, Chairman of ANAROCK Group, called for the revival of the Credit-Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY) to support first-time homebuyers. Puri also suggested revising the Rs 45 lakh price cap for affordable homes in high-cost cities, a move aimed at making homes more accessible in urban centers where demand for affordable housing remains high. Furthermore, he urged the release of centrally controlled land to facilitate affordable housing projects.
3. Addressing Rising Construction Costs
Anshuman Magazine, Chairman & CEO of CBRE India, highlighted the challenges posed by rising construction and borrowing costs. To mitigate these, Magazine recommended revising the affordable housing price cap and introducing tax incentives for Real Estate Investment Trusts (REITs) to attract investors. He also called for increasing tax deductions on home loan interest to provide relief for homebuyers and encourage investment in residential real estate.
4. Industry Status for Real Estate
Ritesh Mehta, Senior Director at JLL India, strongly emphasized the need to grant industry status to the real estate sector. This would allow developers to access cheaper loans, thus reducing construction costs and benefiting homebuyers. With real estate contributing significantly to India’s GDP, such a measure could not only boost the sector but also stimulate broader economic growth.
Implications for Economic Growth
The real estate sector in India is a key driver of economic growth, and industry leaders believe that these budgetary measures will be critical in maintaining momentum in the residential segment in 2025. Focused efforts on affordable housing, infrastructure development, and tax reforms are seen as crucial to stimulating demand, enhancing market stability, and supporting the broader economy.
As the real estate sector seeks to overcome current challenges and capitalize on its potential, these proposed changes could pave the way for a stronger and more sustainable housing market in India.
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