Experts predict a positive outlook for the real estate sector in the Interim Budget for 2024-25. They expect key reforms aimed at stimulating demand and boosting investment, such as granting infrastructure status to affordable housing, lowering GST rates, and simplifying the taxation structure for REITs. Additionally, experts propose debt restructuring options for stressed developers, improved credit availability, and digitization initiatives to enhance transparency. Overall, the real estate sector is optimistic about a comprehensive policy framework in the 2024-25 Budget to foster growth and resilience in the post-pandemic era.
The government should specifically focus on the affordable housing segment in this Budget. Despite being a sunrise segment, it witnessed a sales decline during the pandemic, now constituting only 20% of total housing sales compared to its pre-pandemic share of 40%. Through well-thought-out policy incentives, tax breaks, and fiscal support, authorities must assist in the sector’s revival, considering its crucial role in addressing the widening housing gap.
While the real estate sector is poised for vigorous growth in 2024, regulatory bodies and governments must prioritize affordability and long-term sustainability. Urban centres in India still face acute housing shortages, and proactive measures are required to address this issue. Adjusting affordability definitions, incentivizing developers through funding options, tax discounts, and R&D support, and focusing on sustainable building practices are essential for the long-term viability of the sector.
Given that the real estate sector contributes significantly to the economy, accounting for around 8% of the GDP and being a major employment generator, the government should take proactive steps to boost demand, rationalize costs, and reduce regulatory bottlenecks. Granting industry status, single window clearance, tax breaks, and GST rationalization should be considered in the upcoming budget to benefit not just the realty industry but also its ancillary sectors.
The Indian real estate sector, reaching its peak in 2023 with robust sales, expects continued bullish sentiments in 2024. The government should play a role in sustaining this growth through prudent initiatives, including potential tax rebate increases, reducing repo rates, offering tax holidays to developers, and exploring alternative sources of project funding.
In anticipation of the 2024 Interim Budget, the Indian real estate sector has specific expectations, particularly regarding home loans and affordable housing. Advocating for a substantial increase in the tax deduction for home loan interest and a reevaluation of qualifying criteria for affordable housing, the industry aims to revitalize the market and make homes more accessible to a broader range of buyers.