Hit hard by the pandemic and some policy reforms, the real estate sector had high expectations from the Budget 2022. However, while most of its hopes were belied as the budget failed to do much for the sector as a whole, there was some good news for affordable housing.
“Affordable housing has always been the focus of the incumbent government. In the budget speech today, Finance Minister Nirmala Sitharaman announced the allocation of Rs 48,000 crore under PMAY urban and rural schemes. Around 80 lakh houses are expected to be completed by 2023 across the country,” said Adhil Shetty, CEO, BankBazaar.com.
“This announcement is expected to boost the affordable housing in the country and give a push to the real estate sector and developers who are building affordable homes. Single-window environmental approvals will also help to grow affordable housing more in the times to come,” Shetty added.
Honeyy Katiyal, Founder of Investors Clinic, had similar views. “The Budget 2022 will boost the affordable segment in the housing sector. Allowing allocation of Rs 48,000 crore under PM housing plan and allocation of Rs 60,000 crore to cover 3.8 crore households for tap water will boost the affordable housing segment immensely. Also, the government’s focus on urban development will push employment in the urban cities and encourage the upcoming talent. With more employment, the spending capacities of households will increase, which in turn will boost the overall economy and with this we expect the housing market to further improve as the sector just needs positive sentiment,” he said.
It also needs to be noted that connectivity has always helped real estate. So, with road construction given a boost by increasing the target to 25,000 kms of National Highways construction, the sector is likely to benefit.
Industry experts said the Union Budget 2022-23 is forward looking and focuses on a long-term plan for the country with digitization, urban development, and sustainability at its core.
“For the real estate sector, the budget placed an outlay of Rs 48,000 crores under the Pradhan Mantri Awas Yojana, and construction of 80 lakh homes will facilitate affordable housing. This, yet again, showcases the government’s commitment on building affordable housing stock. However, we would have liked if there was more push on the demand side, such as extension & expansion of the credit linked subsidy scheme,” said Ramesh Nair, CEO, India & Managing Director, Market Development, Asia, Colliers.
“We also look forward to the announcement on the replacement of the Special Economic Zone Act with a new legislation. This has the potential to make export-led parks attractive for investments. The new benefits will also trickle down to technology companies who export services and have a positive bearing on commercial office real estate,” Nair added.