As the government gears up to present the Union Budget for the fiscal year 2024-25, the real estate sector stands at the forefront of expectations, anticipating transformative policy measures to propel its growth and ensure transparency. Key stakeholders in the industry are rallying for strategic interventions to revive the sector, bridge the housing gap, and fortify the trajectory set by recent reforms.

The urgent need to address the housing gap has brought the affordable housing segment into sharp focus. Industry experts emphasize the importance of policy impetus, tax breaks, and fiscal support to revive this segment, ensuring that it becomes a cornerstone of the upcoming budget’s agenda. This concerted effort aims not only to provide homes for a larger section of society but also to stimulate economic activity in related industries.

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Industry status, single-window clearance

A pivotal demand echoed by the real estate fraternity is the accord of industry status. This recognition would signify a paradigm shift, acknowledging the sector’s vital role in India’s economic development. Alongside this, the call for a single-window clearance mechanism gains prominence, streamlining regulatory processes and spurring a more conducive environment for project execution. Coupled with tax breaks and GST rationalization, these measures can create a ripple effect, positively impacting ancillary industries.

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Enhancing home Loan interest rate rebates

To invigorate the housing market, experts advocate for a substantial increase in the Income Tax Act Section 24’s home loan interest rate rebate. Proposing an elevation from ₹2 lakh to at least ₹5 lakh, this measure aims to attract genuine homebuyers and boost demand. Simultaneously, considerations such as reducing repo rates, offering tax holidays to developers, and exploring alternative project funding sources are on the table for discussion.

SWAMIH Fund and beyond

The National Real Estate Development Council (NAREDCO) has emerged as a vocal advocate for the industry’s interests. Their recommendations include the introduction of the second tranche of the Special Window for Affordable and Mid-Income Housing (SWAMIH) fund, allocating a corpus of ₹50,000 crore for the fiscal year 2024-2025. This injection of liquidity is envisioned as a catalyst for timely project completion, providing a much-needed boost to the sector.

Beyond the SWAMIH fund, NAREDCO has championed additional budgetary supports. This includes the push for input tax credit under GST, incentives for rental housing, and a strategic reduction in GST rates for real estate. Aligned with the overarching vision of achieving “housing for all,” these measures aim to create an ecosystem that fosters sustainable growth and widespread access to housing.

Real estate’s role in India’s economic ascent

As India strides toward a $5 trillion economy with the aim of becoming the third-largest GDP by 2027-28, the real estate sector anticipates the government’s initiatives to stimulate consumer demand in the property market. Acknowledged as a significant contributor to the Indian economy, the real estate industry underscores its optimistic outlook, expecting policy measures that align with the nation’s economic ambitions.

Real estate education platforms

Looking beyond policy interventions, the budget is anticipated to pave the way for real estate-focused education platforms. These platforms would cater to upskilling existing professionals and nurturing budding realtors. Initiatives encompassing skill development programs, soft skill training, and specialized courses for marketing professionals could find a place under these platforms. Such a move not only upgrades a significant job market but also motivates young Indians to join the real estate sector, fostering a skilled workforce.

RERA: A game-changer

Government interventions not only impact the financial dynamics of homebuying but also serve as a reinforcement of regulatory frameworks. Increased accountability and transparency are intrinsic to the government’s support for amendments to the Real Estate (Regulation and Development) Act. These changes play a pivotal role in shielding the industry from fraud and delays, fostering renewed trust in the real estate business, a sentiment steadily rising in recent years. RERA stands out as a game-changer for the industry. While it has effectively addressed myriad violations and improved sectoral functionality, there is a collective call for intensified execution to further elevate transparency.

Conclusively, the real estate sector’s wishlist for the Union Budget 2024-25 is comprehensive and strategic. It encompasses measures to stimulate demand, enhance transparency, and fortify the industry’s pivotal role in India’s economic landscape. As the government navigates these expectations, the real estate sector remains hopeful that the budget will provide the necessary impetus for its continued growth and development.

(By Venket Rao, a RERA Expert & Founder, Intygrat, a corporate law firm. Views are personal)