NEW DELHI: The real estate sector is seeking big reforms from the upcoming Union budget for FY26 (to be tabled on Feb 1, 2025) to revive sentiments amid a decline in transaction activity.
After facing a blow in the previous budget when the government decided to do away with indexation benefits, realty players want a rise in tax exemption limit on housing loans to Rs 5 lakh, revision in affordable housing criteria and reintroduce of the Credit-Linked Subsidy Scheme under Pradhan Mantri Awas Yojana (PMAY).
“For realtysector, key expectations include industry status and revival of affordable housing segment,” said Anuj Puri, Chairman of ANAROCK Group. Puri explains that once a promising sector, affordable housing— homes priced under Rs 40 lakh— has struggled post-pandemic, with demand and supply shrinking significantly. As per data, sales share of affordable housing fell to 18% in 2024 from over 38% in 2019.
“Affordable housing requires focused attention and targeted benefits, which have been lacking in the past two years. Tax breaks to boost supply and enable buyers are crucial, but the challenges go deeper. A critical issue remains lack of urban land, mainly in areas where affordable housing is most needed,” said Puri. He added that to address this, the government could release centrally controlled land — managed by agencies like the Indian Railways, Port Trusts and the Department of Heavy Industries—for affordable housing projects.
Not only affordable segment, other classes of housing market is also showing signs of slowdown due to a steep rise in property prices over past three years. Top realty players have shifted their focus on luxury segment. Pradeep Aggarwal, founder & Chairman, Signature Global said the revision of current tax exemption limit on housing loans to `5 lakh, in line with rising property prices and construction costs, could provide major relief to homebuyers.”
Realtors’ focus shifts to luxury segment
Top real estate players have shifted their focus on luxury segment. Not only affordable segment, other classes of housing market is also showing signs of slowdown due to a steep rise in property prices over past three years