At the heart of these proposals lies the government’s ‘Housing for All’ vision for 2030, with the real estate sector anticipating policy reforms and financial incentives to accelerate progress toward this goal.

Affordable Housing in Focus
A major focus is the affordable housing segment. Dr. Nayan Shah, Chairman and Managing Director of Mayfair Housing, has suggested raising the price cap for affordable housing projects to ₹75 lakh to better support this critical segment and reduce the financial burden on homebuyers. He also advocates for including real estate under Input Tax Credit (ITC) and phasing out stamp duty under a proposed ‘One Nation, One Tax’ initiative.

Jash Panchamia of Suraksha Smart City echoes these sentiments, emphasizing the need to revise the price cap from ₹45 lakh to ₹75 lakh for the Mumbai Metropolitan Region (MMR). He believes this adjustment, along with extended benefits under Section 80-IBA, will reflect market realities and enhance housing accessibility.

Increased Allocation to PMAY
Bhavesh Shah, Joint Managing Director of Today Group, which has projects in Navi Mumbai and Thane, supports an increase in the budget allocation to the Pradhan Mantri Awas Yojana (PMAY). “A 10-15% rise over the previous ₹79,000 crore allocation would help ensure that efforts to provide housing for all gain momentum,” he said. Shah also highlighted the need for policies promoting urban regeneration and incentives for vertical developments to transform India’s urban landscape.

Addressing Rising Costs of Homeownership
Rising costs remain a concern for both developers and homebuyers. Parthh K Mehta, CMD of Paradigm Realty, emphasized the importance of increasing the tax deduction cap on home loan interest, which would provide instant relief to homebuyers and encourage investment in residential real estate. Similarly, Chintan Sheth, CMD of Sheth Realty, called for additional tax benefits for first-time homebuyers and a more rationalized property tax structure to spur demand.

Sustainability and Green Housing Initiatives
Green housing and sustainability have also emerged as key priorities. Dr. Shah proposed leveraging a labor cess to improve construction workers’ welfare and promote green-certified buildings. Hiren Chheda, Managing Director of Ekatva Group, stressed the importance of special provisions for green-certified buildings to attract foreign investors and address environmental challenges.

Streamlining Costs and Processes
With a projected 34% increase in high-rise towers exceeding 40 floors by 2030 in Mumbai, developers like Mehta advocate for reduced input costs on materials such as steel and cement, along with a streamlined single-window clearance system to eliminate delays and encourage investments.

Improving Urban Infrastructure
Developers are also pushing for improvements in urban infrastructure. Chintan Sheth urged the government to allocate additional funds for city infrastructure to ensure the viability of affordable housing projects. Hiren Chheda suggested simplifying REIT regulations to enhance liquidity for developers while boosting retail investor participation.

The Call for Industry Status
Anmoll D Shroff, Founder and CEO of Graanth Realty, highlighted the need to grant the real estate sector industry status, unlocking access to institutional capital and low-cost financing options. Shroff also proposed reducing GST on essential construction materials and rationalizing rates for under-construction properties to optimize costs. Additionally, he advocated for tax incentives for real estate derivatives like REITs and SMREITs to increase retail investor participation.

A Balanced Budget is Key
While the sector praises the government’s efforts to improve urban housing and infrastructure, developers believe the 2025-26 Budget offers an opportunity to address longstanding concerns. Tax reforms, improved regulatory frameworks, and increased infrastructure investments could collectively drive growth and make real estate more inclusive and accessible.

The industry is optimistic that the upcoming budget will balance the aspirations of all stakeholders, fostering a more robust and sustainable ecosystem for developers, homebuyers, and investors alike.

Also Read: budget expectations for real estate

The post Developers Look to Union Budget 2025-26 for Growth-Oriented Real Estate Policies appeared first on Square Feat India.

Focus on Infrastructure and Economic Growth
Despite declining real estate activity in the second half of 2024, the sector anticipates the government will prioritize robust infrastructure development, a long-term driver for real estate growth. The budget is also expected to include measures to stabilize the economy and enhance GDP growth, with a focus on supporting SMEs, MSMEs, job creation, and skilling initiatives.

Affordable Housing in Need of Revival
Affordable housing, a once-thriving segment, has struggled post-pandemic, with its sales share in the top seven cities dropping to 18% in 2024 from over 38% in 2019, according to ANAROCK Group data. The supply of affordable homes has also declined significantly.

To address these challenges, industry experts are calling for targeted government intervention, including:

• Reintroducing the Credit-Linked Subsidy Scheme (CLSS): This scheme, which expired in 2022, provided financial incentives for first-time buyers of affordable homes. Its revival could stimulate demand in this segment.
• Restoring the 100% Tax Holiday for Developers: Developers previously benefited from tax exemptions under Section 80-IBA of the Finance Act, 2016, which helped increase affordable housing supply. Reinstating this provision could boost developer interest in such projects.
• Revising Affordable Housing Criteria: Current definitions of affordable housing, particularly the price cap of INR 45 lakh, are considered outdated in high-cost markets like Mumbai. Experts suggest raising the price cap to INR 85 lakh in Mumbai and INR 60-65 lakh in other metros to reflect market conditions.

The Road Ahead
ANAROCK Group Chairman Anuj Puri noted that centrally controlled land managed by agencies such as Indian Railways and the Port Trusts could be released for affordable housing projects, addressing land scarcity issues.

The slowdown in 2024 saw housing sales in the top seven cities decline by 4% to approximately 4.46 lakh units, while new launches dropped by 7% to around 4.13 lakh units. However, stakeholders believe that with the right incentives, 2025 could mark a turnaround for the residential real estate market.

The Union Budget 2025-26 holds the potential to reinvigorate the sector, fostering growth and ensuring housing remains affordable for all.

Also Read: Nirmala Sitharaman to present the union budget

The post Real Estate Sector Pins Hopes on Union Budget 2025-26 for Revival Measures appeared first on Square Feat India.