As the anticipation builds for the unveiling of the Budget 2024, the real estate sector stands poised, hoping for policies that can catalyze growth and address the challenges plaguing the industry. Among the myriad expectations from various stakeholders, the spotlight shines brightly on first-time homebuyers, tax incentives, and the long-awaited industry status. These elements are crucial not only for the revival of the real estate market but also for fostering socio-economic development. Let’s delve into the wishlist of the top real estate players.

Empowering First-Time Homebuyers:

Owning a home is a cherished dream for many, especially for first-time buyers. However, affordability remains a significant hurdle, exacerbated by rising property prices and stagnant incomes. Real estate developers, along with industry bodies, are urging the government to introduce measures aimed at making homeownership more accessible.

One such expectation is an increase in the deduction limit under Section 80C of the Income Tax Act for principal repayment of home loans. Currently capped at ₹1.5 lakh, an upward revision could incentivize more individuals to invest in real estate. Additionally, enhancing the limit for interest deduction under Section 24 could further sweeten the deal for homebuyers, reducing their tax burden and boosting demand.

Furthermore, the implementation of a dedicated subsidy scheme or tax rebate exclusively for first-time homebuyers is on the wishlist. This targeted approach would provide much-needed relief to aspiring homeowners, particularly in the affordable housing segment. Such initiatives not only fulfill the aspirations of citizens but also stimulate economic activity by driving demand in the real estate sector.

Tax Sops for Developers:

Real estate developers are grappling with a plethora of challenges, including liquidity constraints, high input costs, and regulatory compliance burdens. In this context, tax incentives emerge as a potent tool for incentivizing investment and spurring development.

One of the primary expectations from Budget 2024 is the restoration of the Input Tax Credit (ITC) under the Goods and Services Tax (GST) regime for the real estate sector. The withdrawal of ITC had led to an increase in developers’ construction costs, which were ultimately passed on to buyers. Reintroducing ITC would not only ease the financial burden on developers but also make properties more affordable for consumers.

Moreover, granting industry status to the real estate sector has been a longstanding demand. Bestowing this status would not only streamline regulations but also enable developers to access institutional financing at lower interest rates. Additionally, it would enhance the sector’s credibility and attract more investments, fostering its growth trajectory.

In line with promoting sustainable practices and affordable housing, developers are hopeful for tax rebates or exemptions on eco-friendly construction materials and affordable housing projects. Encouraging green initiatives not only aligns with the government’s environmental goals but also enhances the quality of infrastructure and reduces long-term operational costs for homeowners.

Granting Industry Status:

Perhaps the most significant expectation from Budget 2024 is the conferral of industry status upon the real estate sector. Despite being one of the largest contributors to the country’s GDP and employment generation, real estate has historically grappled with regulatory ambiguity and financing challenges.

Being accorded industry status would afford the real estate sector access to various benefits, including easier access to credit from banks and financial institutions. This, in turn, would facilitate timely project execution and alleviate liquidity concerns plaguing developers. Additionally, it would bolster investor confidence and attract foreign direct investment (FDI), further augmenting the sector’s growth trajectory.

Moreover, industry status would enable the implementation of supportive policies tailored to address the sector’s specific needs and challenges. This includes rationalizing taxation, streamlining approval processes, and fostering innovation and technology adoption in construction practices. Such reforms are pivotal for enhancing the sector’s competitiveness and aligning it with global standards.

The Budget 2024 presents a golden opportunity for the government to enact transformative policies that can reinvigorate the real estate sector. By prioritizing the needs of first-time homebuyers, providing tax sops for developers, and granting industry status, policymakers can unleash the sector’s full potential as an engine of economic growth and social development.

As the countdown to Budget Day begins, all eyes are on the Finance Minister, eagerly awaiting announcements that could reshape the future of real estate in India. By heeding the wishlist of industry stakeholders and enacting progressive reforms, the government can pave the way for a thriving, sustainable, and inclusive real estate ecosystem.