How Union Budget 2024 Could Shape Real Estate Investments?

Upcoming 2024 Union Budget is eagerly awaited by the real estate industry in India which is currently experiencing a surge in optimism. Home prices in key markets such as Delhi NCR and Mumbai have risen nearly 50% over the past five years. Stakeholders are looking to the government for policies that can sustain and further boost this growth trajectory. Key expectations include budget allocations that support affordable housing initiatives, streamline regulatory processes and possibly offer tax incentives for both developers and homebuyers. The industry hopes these measures will not only stabilize prices but also encourage more investments in real estate across the country.

Enhancing Affordability

In the upcoming Union Budget 2024, one of the key expectations is an increase in the cap for affordable housing. Currently set at Rs 45 lakh this definition is seen as inadequate especially in metro cities where real estate prices are much higher. Industry experts Abhishek Raj Founder & CEO of Jenika Ventures recommend increasing this cap to ₹65 lakh or even ₹85 lakh in urban areas. This change is important because it makes government benefits more available to a wider group which could increase demand for affordable housing. By raising the affordability limit the government aims to make owning a home possible for more people.

Tax Reforms & Benefits

Real estate sector is undergoing tax reforms that will benefit homebuyers. One major change is raising the limit for tax deductions on home loan interest payments from ₹2 lakh to ₹5 lakh. Means homeowners could save more on their taxes. Additionally reducing GST on properties under construction and offering tax breaks on rental income are expected. These measures aim to make investing in both residential and commercial real estate more attractive financially. Overall these reforms are geared towards making real estate investments more affordable and encouraging responsible corporate behavior.

Improving Liquidity and Streamlining Approvals

Liquidity and quick project approvals are crucial for the real estate sector's growth. When projects get stuck or delayed it impacts affordable housing initiatives and overall development. Increased financing through initiatives like the Special Window for Affordable and Mid Income Housing fund and reviving the Credit Linked Subsidy Schemeunder PMAY can help in restarting stalled projects and making housing more accessible. Moreover digitizing property records and simplifying regulatory procedures can reduce delays benefiting both developers and homebuyers by making processes smoother and more efficient. These steps aim to foster a healthier real estate market ensuring timely delivery of projects and affordable housing options.

Sustainable Development & Investment Incentives

To promote sustainable development a key focus is on encouraging eco friendly building practices through financial incentives. These incentives could include tax breaks and other financial support for constructing environmentally friendly buildings. This approach aims to revitalize urban areas and attract foreign investment. By promoting these green building techniques, cities can improve their overall health and economic prospects in the long run. It also helps cities reduce their environmental impact, preserve natural resources and build stronger more resilient communities. These policies not only benefit the environment but also make urban areas more attractive to global investors which boosts economic growth.

Addressing Housing Price Appreciation

In the past five years, property prices in cities like Mumbai and Delhi NCR have surged by approximately 50%. This highlights a pressing need for fiscal policies that can foster steady economic growth while also addressing the affordability of housing. The upcoming budget presents a crucial opportunity for the real estate sector to tackle these challenges and explore new avenues for growth. By focusing on innovation and quality the industry can leverage potential reforms to enhance its offerings and promote sustainable development. This approach not only aims to stabilize housing costs but also aims to ensure that growth benefits both developers and homebuyers alike.