By Dhaval Ajmera
The Union Budget 2023-24 is a strong move that showcases the tremendous potential for economic growth. The infra-centric announcements by the honourable Finance Minister highlight the government’s ideology to boost development and connectivity in the regional pockets of Bharat. The past few years turned into a silver lining for real estate sector, making it a lucrative investment asset class. The tremendous push towards the goal of ‘Housing for All’ is the much-needed last-mile support for the sector. These measures will be of major influence on growth for housing demand and value appreciations. With the realisation of real estate as a weatherproof asset class, the announcement from the budget will further empower homebuyers with multiple benefits.
New tax regime for the middle-class
The redefined slabs with the revised tax exemption bracket broadened to a 7 lakh p.a. This is a great opportunity for homebuyers to capitalise on their tax savings by investing in real estate. The enhanced flow of liquidity for discretionary spending along with a sharp reduction in the highest surcharge will collectively act as the prime catalyst to boosting real estate as an asset class.
The 79,000 crore boost to PMAY
The highlight of the budget is undoubtedly the 66% incremental hike in the budget outlay towards PMAY. This move will be a major boost to affordable housing and realize the Honourable PM’s goal of ‘Housing for All’ well within the renewed deadline. Eventually, this uptick in demand for affordable housing will motivate the real-estate sector to focus more on this segment. Whereas, the subsidies will empower the prospects. Thus, giving real estate a preferential advantage over other asset classes.
A boost of 10 lakh crore to Infrastructure
Announcing 50 new airports, aerodromes and helipads will lead to a real estate development boost in the surrounding localities and strengthen property rates. The multiplier effect of these measures will create new realty hotspots that will benefit homebuyers and early settlers with lucrative rentals and returns. As a result, homebuyers with an intent to invest in real estate will look for options beyond the prime regions. This demand in turn will be the driver of growth for the real estate sector
Incentivisation of Municipal bonds
An initiative that will directly benefit end-users is the incentivisation of municipal bonds to boost civic facilities. This will not only encourage the Municipal bodies to act swiftly on public concerns and improvise their creditworthiness but it will also benefit the homebuyers with improvised civic facilities and boost the overall credibility of the city, thus creating more demand for housing.
Overall, the announcements made in the union budget 2023-24 have strengthened the dominance of the real estate sector as an investment class. We will witness the true potential of growth coming to life in the years to come.
(Dhaval Ajmera is Director of Ajmera Realty & Infra India Ltd. The views expressed are the author’s and do not reflect the policy or views of FinancialExpress.com)