The sector has already sent out its wishlist to the North Block for consideration for the upcoming budget 2025, G Hari Babu, National President, NAREDCO said the government can consider addressing “key challenges and propel the real estate sector towards sustainable growth.” Babu says that the government can consider revising the affordable housing price cap from ₹45 lakh to ₹60 lakh, “which has remained unchanged for a decade, is imperative to account for rising input costs and inflation. Similarly, increasing the income tax deduction limit on interest payments under Section 80C from ₹2 lakh to ₹5 lakh and reducing home loan interest rates will make homeownership more accessible.”
He adds that “policy reforms such as reintroducing Section 80IBA incentives and removing MAT provisions are essential to reviving affordable housing development. Buyers will benefit from measures like restoring the interest subvention under PMAY for loans up to ₹6 lakhs and offering fixed interest rates of 5% for loans up to ₹25 lakh.”
To further encourage investment, the government can consider “lifting the ₹10 crore cap on capital gains tax exemption and rather should think of introducing a uniform long-term capital gains tax across asset classes. Additionally, discontinuing the deemed rental income tax on the unsold inventory under Section 23(5) and increasing the safe harbour limit from 10% to 25% will align stamp duty rates with market realities, fostering higher transaction volumes.”
Talking to CNBC-TV18, Niranjan Hiranandani, Chairman of NAREDCO, the national body representing the Indian real estate industry, who was also part of the pre-budget consultations at the Finance Ministry added that the government should consider, elevating the affordable housing sector. The affordable housing segment is currently experiencing negative growth. We urge an escalated flow of funds to reinvigorate this crucial sector, thereby promoting inclusivity and sustainable urban development. Further to support homebuyers, increasing the tax deduction limit on home loan interest payments from Rs. 2 lakh to Rs. 5 lakh, making home purchases more affordable and stimulating market demand.”
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Hiranandani, restating the age-old demand, added that “ recognizing housing as infrastructure will unlock new avenues for investment and development, positioning the housing sector as a cornerstone of national infrastructure. Thus, granting Infrastructure Status to the Housing Sector will help boost sentiments.”
Expressing similar sentiments, Sanchit Bhutani, Managing Director of Group 108, Says, “Granting industry status to the real estate sector remains a key demand that we urge the government to address in the forthcoming budget. We anticipate the union budget to include fiscal incentives to stimulate demand and supply. The budget could also introduce a tax incentive under Section 80 C for REIT investors. The implementation of a single-window clearance system is equally critical, as it would save valuable time for developers and accelerate project delivery. We also seek measures to cap interest rates and ensure they remain conducive to sustained growth in the sector.”
Sandeep Chhillar, Founder and Chairman, of Landmark Group too said the same and added, “Supported by strong performance and sustained growth, the real estate sector is at a crucial point in its growth trajectory. The sector is pinning high hopes at the upcoming budget announcements to look into its long pending demands of industry status and single window clearance. Government must consider introducing policies and reforms, to further amplify foreign and domestic investment into the sector as it will further strengthen market sentiments. Additionally, we expect the government to consider a revision in taxation policies to offer greater benefits to first-time homebuyers as it could be a pivotal move fostering homeownership and driving broader economic growth.”
Some of the other demands included that the government consider improving the Urban Infrastructure by enhancing energy and transportation infrastructure facilities for sustainable urban growth and improved quality of life.
The sector is also raising an interesting demand for expanding rental housing. Hiranandani added that “to improve rental affordability, it is imperative to expand rental housing beyond industrial workers. We recommend deleting notional income from house property held as stock-in-trade to facilitate the creation of a sufficient rental housing stock, in alignment with the ‘Housing for All’ objective. Further, the government can incentivize Investment in Rental Housing as the current provisions that set off losses from income from house properties disincentivize rental housing investment. Given the potential for real estate investment to provide a source of income during retirement years, we propose the deletion of this section.”
On rates and taxation, Hiranandani said that the government can consider adjusting the safe harbour for ready reckoner rates. He said that the “current deemed tax on the difference between the Ready Reckoner/Circle rate and the market value of flats should have an increased safe harbour from 10% to 25% to reflect more realistic market conditions. On the individual tax side, the government can think of rationalization of individual tax rate slabs from the current 37% to 25% is strongly recommended to benefit taxpayers, enhance disposable income, and incentivize market participation.
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The government should also see the possibility of equitable Dividend Taxation. The rate of dividend taxation for resident investors should be maintained at 10% to ensure competitiveness and parity with NRI investors, promoting fair investment opportunities. When it comes to Capital Gains Tax for Housing Purchases, reforms to the capital gains tax rules pertaining to the purchase of multiple houses should be implemented. This will encourage homeownership, leading to increased housing demand and greater economic stability.”
Meanwhile, other industry players also shared similar sentiments, especially on the personal income tax side.
Anantharam Varayur, co-founder of Manasum Senior Living said, “The 2025 Union Budget presents a chance to drive growth in the real estate sector, which is transforming to cater to buyers seeking curated experiences and contemporary lifestyles, We look forward to measures such as tax benefits, infrastructure enhancements, and service reforms, particularly for senior living communities, to elevate comfort, sophistication, and inclusivity while meeting the unique demands of this expanding segment.”
Manoj Gaur, Chairman of CREDAI National and CMD of Gaurs Group said, “In many ways, real estate mirrors the country’s economic progress. Therefore, we expect the government to infuse new vigour into India’s economic development. One of the major demands of the sector is the rationalisation of stamp duty, which has increased significantly in recent years and is causing a big financial burden on buyers. Further, a revision of the current deduction limit from ₹1.5 lakh to ₹5 lakh under section 80(c) to ease home ownership experience should also be considered.”
“As one of the largest employers in India, particularly for unskilled and casual labour and among the foremost contributors to the country’s GDP, one of the primary expectations from the upcoming budget is the long-awaited recognition of the real estate sector as an industry. This would significantly bolster the sector’s growth apart from aiding in the vision of “Housing for All” and driving employment generation. Additionally, we hope to see the introduction of a single-window clearance system to streamline approvals and a renewed push for affordable housing as there is a significant demand,” added Sanjay Sharma, Director, SKA Group.
Meanwhile, Amit Modi, Director of County Group, said, “One of the most long-standing demands the sector emphasises upon is the need to grant industry status to enable easier access to low-cost financing, which benefits consumers directly. Additionally, implementing single-window clearance is crucial for timely project completion and cost efficiency.” “Furthermore, reintroducing GST input credits for residential real estate will stabilise costs. We also expect to increase the home loan interest exemption to ₹8 lakh annually to support first-time buyers, while Section 80C should exclusively cover housing loan principal deductions or raise its limit to
₹5 lakh.”
Yash Miglani, Managing Director, Migsun said, “NITI Aayog’s projection of the Indian real estate sector achieving a $1 trillion market size by 2030 underscores its immense growth potential and long-term opportunities. To support this trajectory, the sector seeks government intervention to reduce input costs, particularly for materials like steel, cement, and fuel in the forthcoming budget. Additionally, a reduction in the GST rate on cement and targeted initiatives to promote affordable housing through enhanced tax incentives would provide much-needed impetus to the sector’s growth and affordability.”
Peush Jain, MD-Commercial Leasing and Advisory, Anarock Group too shared that “The office sector growth is expected to stay buoyant with supply to touch a billion sq.ft. by the end of 2025 with record leasing activity led by GCCs and flex space operators. The Budget must focus on not just maintaining India’s growth momentum but also initiating reforms that will aid India’s attractiveness as an investment destination for both domestic and foreign companies. Input tax credit on fit-outs, review of depreciation and amortisation rates for assets on the backdrop of larger adoption or AI and incentivising new technology sectors would fuel the office demand evenly across the country.”
On the other hand, Shishir Baijal, Chairman and Managing Director of Knight Frank India said, “The primary aspiration of the typical Indian is to have a home of their own, a formidable undertaking in a developing nation like ours. While the government has taken steps through the Pradhan Mantri Awas Yojana (now PMAY 2.0) to address this issue, homeownership is still far from reality for the masses of the country. For a large section of the population, affordability remains the biggest challenge with the right home always being just out of reach for prospective homebuyers. On this front, the union budget has provided relief in the past by facilitating tax deductions for principal and interest components of home loans and even harvesting capital gains from the sale of existing property. We believe that these measures can be tweaked further to have a real impact on affordability.”
Baijal added that to boost affordable housing, “the share of sales in the
For the growing middle class, Baijal said that the government should consider maximizing the deduction for home loans under section 24. “To invigorate the housing market, especially in the affordable segment most affected by the pandemic, it is imperative to enhance the tax rebate on home loan interest rates under Section 24(b) of the Income Tax Act from ₹2 lakh to a minimum of ₹ 5 lakh,” Baijal said.
Baijal too wants the government to focus on extending benefits under section 80 C, incentivising rental housing, making home purchases more tax-efficient – Long term capital gains benefit under section 54, among others.”
Thomas Stopper, VP-Asia, Hansgrohe Group said, “As we look toward the Union Budget 2025, we expect the Finance Minister to introduce policies that foster sustainable growth in the housing sector, which will, in turn, help align industries like premium lifestyle and home solutions for broader development. A key focus should be on enhancing urban infrastructure, with dedicated funds for sustainable housing projects, smart cities, and eco-friendly home solutions. We anticipate that the Budget will introduce tax incentives for manufacturers focused on sustainability, encouraging the development of products that align with India’s environmental goals. Additionally, reducing GST on luxury home solutions is expected to make them more accessible, driving demand in this segment”.
Ashish Bhutani, CEO of Bhutani Infra said, “The Union Budget 2025 will be a game-changer for India’s real estate sector, especially in bustling regions of Uttar Pradesh. Areas like Noida are seeing a surge in demand for commercial spaces. The rising demand for commercial properties in areas like Noida, spurred by transformative projects such as the Bayview Bhutani International Film City and Noida International Airport underscores the need for policies that further boost infrastructure and urban development. One major improvement could be introducing single-window clearance systems to fast-track project approvals. It’s a simple step that could save time and cut delays for commercial real estate projects. Another big opportunity lies in making it easier for foreign investors to invest in mixed-use and Grade-A office spaces. Tax breaks for green buildings and smart urban projects can attract global investors and elevate the region’s status as a commercial hub. With strategic government support, real estate can boost job creation and contribute to India’s $5 trillion economy vision.”
Madhur Gupta, CEO of Hero Realty said, “As the Union Budget 2025 approaches, we are optimistic that the government will introduce measures to propel growth in the real estate sector further. We advocate for increasing the tax rebate on housing loan interest to a minimum of ₹5 lakh. This initiative would provide substantial relief to homebuyers, easing their financial burden and encouraging greater investment in the real estate sector. Industry experts have echoed this sentiment, emphasizing that the current ₹2 lakh rebate is insufficient given the rise in property prices and construction costs. Additionally, we urge the government to implement a single-window clearance mechanism. This new system is critical to expediting the multi-approval process, ensuring greater efficiency and transparency. Such a reform would be transformative, boosting the ease of doing business and attracting further investments into the industry.”
Yashank Wason, Managing Director, Royal Green Realty said, “The impending budget offers a critical chance to support the real estate industry, especially in Tier-II cities, which are becoming economic development engines. In order to draw investments and spur urbanization in cities like Indore, Bahadurgarh, Sonipat and others, we want policies that support different housing segments, infrastructure growth, and improved connectivity. We anticipate policies like higher tax deductions on home loan interest and streamlined GST rates across segments to improve housing affordability. Simplified single-window clearance procedures are necessary to cut down on project delays and related expenses. By meeting these goals, the budget may enable Tier-II cities to become independent centers of growth, making a substantial contribution to India’s urban transformation and generating strong prospects for the real estate industry.”
Sudeep Bhatt, Director of Strategy, Whiteland Corporation says, “The upcoming budget presents an opportunity to move the real estate sector towards growth and resilience. The industry seeks better tax benefits for homebuyers, particularly a higher deduction limit for home loan interest to boost housing demand. Rationalization of GST rates for under-construction properties and incentives for green and sustainable real estate projects are also likely anticipated. Additionally, policies to enhance liquidity for developers, promote ease of doing business and incorporate private and foreign investments through relaxed FDI norms are crucial. This budget can catalyze the real estate sector’s potential, making it an important element for the country’s economic development and employment generation.”
Manik Malik, CFO, BPTP said, “As the Union Budget 2025 – 26 approaches, the real estate sector eagerly awaits impactful measures to drive growth and sustainability. With rising housing demand across different locations, tax reliefs for homebuyers and incentives for the housing sector are crucial. Policies promoting sustainable development, and infrastructure enhancement will not only help in economic growth but also boost housing demand. Additionally, more real estate investments, particularly in the housing sectors, can be stimulated by extending the benefits of capital gains and allowing for greater flexibility in reinvestment standards. In addition to accelerating sector growth, a forward-thinking policy framework with these measures will support infrastructure development and job creation, both of which are essential for India’s economic future.
Pradeep Aggarwal, Founder and Chairman of Signature Global (India) Ltd said, “As we approach the upcoming budget, the real estate sector is optimistic about reforms that can act as growth catalysts and enhance operational efficiency. Revising the current tax exemption limit on housing loans to ₹5 lakhs, in line with rising property prices and construction costs, could provide significant relief to homebuyers. This step would directly support millions of aspiring homeowners and boost demand across the sector. Equally transformative would be granting industry status to real estate, a move capable of invigorating over 200 allied sectors. Such recognition would foster job creation, enable skill development, and amplify economic activity, further solidifying the sector’s position as a cornerstone of India’s economy. Additionally, introducing a ₹5 lakh subsidy for housing loans up to ₹1 crore would offer crucial financial support to urban and semi-urban homebuyers.”
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Piyush Bothra, Co-Founder and CFO of Square Yards said, “As we enter 2025, real estate stands poised for crucial new reforms to drive its growth. A key priority is adjusting the affordable housing price cap beyond the current ₹45 lakh to align with rising development costs in metropolitan areas. Another significant expectation is to increase the tax deduction limit on home loan interest from ₹2 lakh to ₹4 lakh, providing tangible relief to aspiring homeowners. Reduced GST rates will further enhance market vibrancy, creating a more accessible pricing structure. Finally, introducing tax incentives under Section 80C for investments in REITs can promote real estate as an attractive tax-saving avenue, drawing new investors to the sector. These measures have the potential to catalyse substantial demand, ensuring a stronger, more sustainable real estate market in the years ahead.”
Badal Yagnik, CEO of Colliers India said, “Budget 2025 is expected to build cornerstones to drive the next phase of elevated growth in Indian real estate with an ambition to reach $1 trillion by 2030. Transformative measures in the form of incentives & favourable policies to fuel infrastructure, economic and real estate development in tier 2 cities, technology-led infrastructure & growth corridors and incentivizing green building adoption will draw significant domestic and foreign institutional capital.
Accordance of ‘industry’ status to real estate, standardization & extension of affordable housing benefits, streamlining and rationalization of GST levy across segments possess significant potential to drive heightened real estate activity across segments and geographies with better access to capital and single window clearance. While the simplification of tax regimes across individuals & corporates will continue to bring in efficiencies, drive entrepreneurial capital, retail investment; a concerted coordination between the country’s legal and financial framework will surely aid in improving ease of doing business.”
Though the wishlist seems to be too huge, still some of these are expected to be part of the union budget 2025, including the continued push towards housing for all and making affordable housing available to all, added sources.
To be seen is what does the union Budget 2025 unveil on February 1.
