Highlighting the pinnacle reached by the Indian real estate sector in 2023, Kaushal says that boosted by favourable market conditions and fueled by a healthy macroeconomic outlook, stable lending rates, and a thriving job market, industry insiders have high expectations for the upcoming 2024 Budget.
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The primary focus is on prioritising affordable housing, considered pivotal for the sector’s recovery and eliminating the housing gap.
A key expectation is the grant of industry status to the real estate sector, seen as a driver for major growth. Recommendations include single window clearance, tax reductions, and GST rationalisation. Experts recommend increasing the house loan interest rate rebate under Income Tax Act Section 24 from ₹2 lakh to a minimum of ₹5 lakh to stimulate housing demand.
Key suggestions to strengthen real estate industry:
To strengthen the industry further, suggestions include lowering repo rates, providing tax breaks for developers, and look into alternate sources of project funding. A collective call from developers seeks provisions to reduce interest rates on project financing and place construction items in a lower GST category, relieving financial pressures and promoting sustainable development practices.
In essence, the 2024 Budget expectations align with the goal of cultivating a robust real estate ecosystem contributing significantly to India’s economic growth and societal well-being, maintaining a neutral and objective perspective on the industry’s prospects.
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Rohan Khatau, Director of CCI Projects Private Limited
Laying out a wishlist for Budget 2024, Rohan says the primary demand is for substantial increase in the tax deduction limit on home loan interest, aiming to raise it from the current ₹2 lakhs to ₹5 lakhs. This move seeks to attract a wider range of first-time homebuyers by offering significant tax relief.
Readjusting affordable housing caps in cities
Metropolitan areas face a pressing need for an adjustment in the affordable housing price cap, currently set at ₹45 lakhs. High land and construction costs make it challenging to build houses within this limit, emphasising the need for a revision.
Another crucial plea is the long-standing request for industry status recognition for the real estate sector. This designation could attract equity investments, facilitate debt restructuring, and secure loans at more favourable interest rates.
Additionally, there’s a strong emphasis on increasing investments in both green and traditional infrastructure. Allocating funds towards renewable energy and essential infrastructure like roads and railways is seen as vital for the real estate sector’s growth and overall economic development.
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As Budget 2024 approaches, these strategic proposals aim to fortify the real estate landscape and contribute to broader economic advancement.
