More than 200 press releases in my mailbox; and all are glorifying the Union Budget 2025-26. This raises more questions than addressing any of the concerns of the Indian real estate. Has real estate sector finally got its due with the Union Budget 2025-26? Why are the stakeholders so upbeat with the Union Budget that has by and large ignored the wish list of the sector? Aren’t these industry voices taking “U-Turn” in pre & post budget overtones?
The rhetoric of the leading voices of Indian real estate, after every Union Budget, is ridiculous, to say the least. In the pre-budget they come out with a long list of demands, with claims that only real estate has the capabilities to accelerate the economic growth. After all, real estate has backward & forward linkages with around 200 odd industries. To add to it, construction sector is the second largest economic activity in India after agriculture.
To a large extent, the claims of real estate sector appear to be legitimate if one takes it on the sheer face value. But then the ground realities are different. Before we delve into why & how the sector was ignored for both the demand side as well as the supply side, let’s look at the critical demands of the sector this time around and for many years now.
Let’s break the budget wish list of Indian real estate into two parts – 7 key demands each for both business and home buyers.
Demands for Real Estate Sector
Demand I: Granting Industry Status to the sector
Demand 2: Single Window Clearance for the real estate projects
Demand 3: GST reduction on key construction raw materials
Demand 4: Input Tax Credit for the construction material
Demand 5: Infrastructure Status for housing
Demand 6: Price cap of Affordable Housing to be hiked to INR 70 lakh from present 45 lakh
Demand 7: Increased Fund Allocation for Stressed Projects under SWAMIH Fund
Demands for Home Buyers
Demand 1: GST Exemption on Under Construction Projects
Demand 2: Separate & higher deduction for Housing Loan principal repayment up to INR 5 lakh, that is currently capped at INR 1.5 lakh under Section 80C
Demand 3: Hike in Section 24(b) tax deduction limit for Home Loan Interest paid to INR 5 lakh
Demand 4: Revival of CLSS (Credit Linked Subsidy Scheme) for first-time home buyers
Demand 5: Reintroduction of Tax Holidays for Affordable Housing projects under Section 80IBA
Demand 6: Extension of tax benefits for First-Time Home Buyers in affordable projects under Section 80EEA
Demand 7: Tax exemption on Rental Housing
Now the sector cheer leader overtones can only confuse a neutral analyst. Track2Realty has a few questions with real estate stakeholders:
Question 1: Have they got even one-third of their demands?
Question 2: Were they not serious with their demands?
Question 3: Whether these demands were just pressure posturing prior to the budget?
Question 4: Whether they knew beforehand that they would finally rest with some silver lining here and there?
Question 5: Were they conscious of the fact that real estate won’t be directly granted anything tangible?
Question 6: If every respective budget has been game changer for real estate in the last few years, when will the game actually change?
Question 7: Aren’t they sounding hypocritical with their “U-Turn” now?
Unfortunately, the leading voices within the sector would not like to answer these uncomfortable questions and be seen on the wrong side of the power corridors. Everybody is aware that the momentum of housing sector after Covid has come to standstill by 2025. The target of the sector to reach to a valuation of 1 trillion USD or 4.7 trillion, or 10 trillion USD is a distant dream; something that doesn’t seem to be achievable by any stretch of imagination.
The Economic Survey prior to Union Budget said that housing demand in India is expected to touch 93 million units by 2036. Will it? Well, as likely as the statement of Finance Minister Nirmala Sitharaman that Viksit Bharat will have zero poverty, quality education, high-quality affordable and comprehensive healthcare. Well, if only lofty claims would have been the roadmap, we would be living in a different world.
One last point! I hope now the real estate sector won’t declare this analysis as “Sin Item” and demand the Finance Minister to put it under GST. So, I rest my case.
Ravi Sinha
X: RaviTrack2Media
Ravi Sinha is a journalist with over two decades of cross-discipline media exposure. He is the CEO of real estate thinktank group Track2Realty. He has been writing extensively on the real estate sector for more than a decade now. Evaluation of real estate brand performance is his core domain expertise and he has immense insight into consumers’ psychograph. He has conceptualised Track2Realty BrandXReport as India’s 1st & only objective & non-paid brand rating journal that is industry-accepted benchmark of brand equity & ranking of the Indian real estate companies.
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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