The Union Budget 2025 introduced transformative measures aimed at strengthening the real estate sector and making homeownership more accessible. The significant tax relief for the middle class—exempting individuals earning up to ₹12 lakh under the new tax regime—is a pivotal step. By easing the tax burden and enhancing disposable income, this move is set to boost household consumption, savings, and investments, thereby fuelling housing demand and overall economic growth.
“The Government’s renewed focus on resolving stalled projects is reinforced through the ₹15,000 crore SWAMIH Fund 2.0, targeting the completion of 1 lakh housing units. With the fund already facilitating the delivery of over 50,000 homes and another 40,000 units expected by 2025, this initiative will play a vital role in restoring buyer confidence and improving liquidity in the sector,” said Dhruv Agarwala, Group CEO, Housing.com & PropTiger.com.
Sahil Agarwal, CEO, Nimbus Group said the revision in tax slabs, resulting in higher disposable income, is expected to increase housing demand, as greater savings will encourage more individuals to consider homeownership.
“This additional financial cushion will be particularly beneficial for those applying for home loans with a co-borrower, as the combined savings boost will significantly enhance loan eligibility. As a result, prospective buyers may either increase their home-buying budget to invest in better properties or comfortably manage their EMIs within their existing loan limits. This shift is likely to stimulate growth in both the affordable and mid-segment housing markets,” he added.
Furthermore, according to realty experts, the enhanced infrastructure outlay—spanning rural connectivity and new airport expansions—will unlock real estate potential in emerging regions. Improved connectivity not only enhances accessibility but also serves as a catalyst for residential and commercial growth in high-potential markets.
Samir Jasuja, Founder and CEO of PropEquity, said, “The Budget’s focus on improving infrastructure through PPP projects and interest-free loan to states for capital expenditure, setting up an Urban Challenge Fund of Rs 1 lakh crore for rejuvenation of Indian cities will improve the real estate activity in metro and tier 2 cities by encouraging developers to invest and partake in the development. The announcement of zero tax for income up to 12 lakh under the new tax regime will give a big boost to consumption including spurring demand for homes.”
Abhishek Trehan, Executive Director, Trehan Iris, also said that the creation of the Urban Challenge Fund, with an allocation of ₹1 lakh crore to support ‘Cities as Growth Hubs,’ is a groundbreaking move that will fuel sustainable, inclusive growth across the nation. The big relaxation in income tax slabs, announced by Union Finance Minister Nirmala Sitharaman, will boost the power of consumption and provide a major fillip to the real estate sector, enabling investors to spend more on property buying.
Additionally, “the SWAMIH Fund of ₹15,000 crore will accelerate the completion of housing projects, benefiting both developers and homebuyers. Moreover, with over 1.18 crore homes already sanctioned under the Pradhan Mantri Awas Yojana, and the introduction of PMAY-U 2.0 for one crore more households, we are optimistic that these initiatives will redefine our urban landscape. Budget 2025 strikes a vital balance between growth and housing, setting the foundation for sustainable development and long-term prosperity in the real estate sector,” Trehan added.
The Finance Minister’s focus on addressing stalled housing projects through initiatives such as interest-free loans amounting to Rs 1.5 lakh crore for capital expenditure and the introduction of three Public-Private Partnership model (PPP) proposals from each infrastructure ministry is commendable.
“This budget also aims to complete an additional 40 thousand housing units in 225, benefitting middle class families who are currently managing both EMIs for home loans and rental payments. A nationwide framework will be developed as guidance to states for promoting Global Capacity Centres (GCCs) in emerging tier 2 cities. Also, increase of the nil tax slab threshold to ₹12 lakh enhances the spending power of the middle class, making homeownership more attainable. With increased disposable income, individuals can more comfortably manage home loan EMIs, encouraging them to invest in their dream homes. Overall, this budget sets the stage for sustainable growth in the real estate sector, fostering new opportunities for investors and homebuyers,” said Yashank Wason, Managing Director, Royal Green Realty.
For middle-class households in India, the construction of 50,000 dwelling units under the Special Window for mid-income housing and the anticipated delivery of an additional 40,000 units in 2025 represent a major milestone.
“By easing the combined financial strain of rent and EMIs, these initiatives help homebuyers regain their confidence. In addition, the ₹1 lakh crore Urban Challenge Fund, which has ₹10,000 crore set aside for FY 2025–2026, has the potential to turn our cities into vibrant centers of growth. Cities will become more habitable and appealing as a result of this significant investment in urban infrastructure. These programs along with additional funds given in hands of taxpayers by slashing on rates has further opened the door for sustainable urban growth and shall inspire any real estate developers,” said Manik Malik, CFO, BPTP.
Pradeep Aggarwal, Chairman, Signature Global (India) Ltd, said, “The SWAMIH Fund 2 with ₹15,000 crore will accelerate the completion of stalled housing projects, bringing relief to over one lakh homebuyers. The ₹1 lakh crore Urban Challenge Fund will play a pivotal role in transforming cities into vibrant growth hubs, ensuring balanced regional development. The masterstroke of direct tax reform—exempting income up to ₹12 lakh—will significantly boost disposable income, increasing affordability for homebuyers and driving real estate demand. Additionally, the government’s thrust on PPP-driven infrastructure with a structured three-year project pipeline will accelerate urban expansion, unlocking new opportunities for real estate and housing. These progressive reforms align with India’s vision of ‘Sabka Vikas’, fostering a robust ecosystem for homebuyers, developers, and investors alike.”
Vineet Nanda, Director-Sales & Marketing, Krisumi Corporation, said, “The budget’s strong focus on urban development—evident in the establishment of a Rs 1 lakh crore fund for developing cities as Growth Hubs—signals a clear commitment to transforming our urban centers into engines of economic progress. This initiative is set to drive sustainable urban redevelopment, modernize infrastructure, and unlock new growth opportunities. At Krisumi Corporation, we see the Budget 2025-26 as a powerful catalyst for change. It aligns with our vision of fostering a dynamic and resilient real estate market that supports sustainable growth.”
Alakshendra Singh, Head of Corporate Communication, Eros Group, said, “The Union Budget 2025 introduces significant measures that will drive growth in the real estate sector. The Rs 1 lakh crore Urban Challenge Fund and continued focus on affordable housing initiatives will enhance urban infrastructure and homeownership opportunities. Streamlining REIT regulations and property tax provisions will attract institutional investments and improve market transparency. First-time homebuyers stand to benefit from financial incentives, making housing more accessible. These reforms will strengthen consumer confidence, promote sustainable urban development, and position real estate as a key driver of economic growth. The sector is poised for long-term stability, fostering investment and homeownership across demographics.”
With these strategic interventions, the Union Budget 2025 lays a strong foundation for sustainable growth, reinforcing homeownership aspirations and contributing to India’s broader economic momentum.