With the Union Budget set to be presented on February 1, 2025, the real estate industry has articulated a comprehensive wish list aimed at fostering growth and sustainability in the sector. Leading voices from the industry have put forward their expectations, urging the government to adopt measures that would stimulate investment, promote housing affordability, and drive urban development.
Dr Niranjan Hiranandani, Chairman of NAREDCO, expressed gratitude to the Finance Ministry for its continued support of real estate. He emphasized the need for enhanced funding in affordable housing, a segment currently experiencing negative growth. “Increasing the flow of funds will revitalize this critical sector, promoting inclusivity and sustainable urbanization,” he stated.
Among the key recommendations is a significant increase in the home loan interest tax deduction limit under Section 24(b) from Rs 2 lakh to Rs 5 lakh. Hiranandani argued that such a move would boost home affordability and stimulate market demand. Additionally, NAREDCO advocates granting infrastructure status to the housing sector to unlock new investment avenues and streamline development.
The focus on rental housing also stands out. NAREDCO proposes removing the notional income tax on unsold properties held as stock-in-trade to enhance rental supply. The industry further recommends tax exemptions of up to Rs 3 lakh for rental income on houses priced below Rs 50 lakh to encourage investment in low-income housing.
Shishir Baijal, Chairman and Managing Director of Knight Frank India, highlighted the persistent affordability challenge for homebuyers, despite initiatives like PMAY 2.0. He proposed increasing the value limit of eligible homes under PMAY from Rs 35 lakh to Rs 50 lakh in metro cities. He also recommended a separate annual deduction of Rs 1.5 lakh for principal repayment under Section 80C, citing its potential to ease affordability and incentivize home loans.
Capital gains tax reforms also feature prominently on the agenda. Industry leaders call for an extension of the construction completion period under Section 54 from three years to five, recognizing that modern residential projects require longer timelines. Relaxing the timeframe for purchasing a new property before selling an old one would also give homeowners flexibility in managing finances.
Sustainability and investment policies are key for luxury real estate. Sandeep Ahuja, Global CEO of Atmosphere Living, stressed the importance of green incentives, relaxed FDI norms, and streamlined processes to attract local and foreign capital. “The right policies can make India a global leader in real estate while boosting sustainability,” he remarked.
Venkatesh Gopalakrishnan, CEO of Shapoorji Pallonji Real Estate, anticipates measures addressing tax slabs for middle-income earners, raw material volatility, and single-window clearance to enhance efficiency. “A forward-looking budget will drive innovation, stabilize housing prices, and fuel long-term growth,” he noted.
Siddharth Vasudevan, Managing Director of Vascon Engineers, echoed these sentiments. He called for reduced stamp duties, lower home loan rates, and a revival of the Credit Linked Subsidy Scheme. “Real estate is vital for economic growth. Global examples like Singapore and Dubai show how supportive policies can propel entire economies,” he added.
The industry also urges the government to incentivize slum redevelopment, particularly in cities like Mumbai, to meet the “Housing for All” objective within five years. Collectively, these measures aim to bolster affordability, spur investments, and drive sustainable urban growth, ultimately contributing to a more resilient real estate sector and a stronger economy.
