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Real Estate: Budget 2024: A holistic boost for real estate and housing

Real Estate: Budget 2024: A holistic boost for real estate and housing

GURUGARM: The recent budget announcements have brought a renewed focus on the real estate and infrastructure sector, addressing key areas such as industrial parks, housing for urban poor, and the redevelopment of cities. Industry leaders have expressed optimism about the potential impact of these measures on the sector.

Focus on housing and urban development
Anshuman magazine, chairman & CEO – India, CBRE, highlighted the emphasis on industrial corridors, urban housing, and the redevelopment of cities. The announcement of PM Awas Yojana (PMAY) 2.0 aims to meet the housing needs of one crore urban poor and middle-class families, a significant step towards ensuring housing for all. Additionally, the anticipated revision of stamp duties across states is expected to make property registration more affordable, particularly benefiting women. Magazine also pointed out that new policies and regulations are set to enhance the rental housing market, promoting safety, transparency, and availability, thereby benefiting many cities.

Pradeep Aggarwal, founder & chairman, Signature Global (India) Ltd, praised the budget as “prudent and holistic in each aspect.” He emphasized that the government’s decision to allocate ₹10 lakh crore under the PMAY urban scheme, targeting 3 crore houses, and the key focus on rationalizing stamp duty for homebuyers, especially for women, underscores a robust vision for urban development. “At the macro level, sustained infrastructure impetus, reflected in the ₹11.11 lakh crore capex allocation, we anticipate all these would create a multiplier impact and a significant boost in the overall housing sector,” Aggarwal said. Additionally, he highlighted the focus on rental housing in industrial parks via the PPP model and the digitization of land records in cities, which will greatly improve transparency and ease property transactions.

Boosting affordable housing
Dr. Samantak Das, chief economist and head of research & REIS, India, JLL, noted that while the budget continues to focus on growth and development with an emphasis on youth, women, farmers, and the poor, there were no major surprises for the real estate sector. However, the support extended to affordable housing is expected to provide a renewed push to this segment, which has been facing challenges. The allocation of INR 10 lakh crore towards three crore additional homes under PMAY is a significant move that will support the affordable housing segment.

Infrastructure and manufacturing
The budget also emphasizes infrastructure development, with the setting up of industrial parks and vegetable supply chains near urban consumption centers. Plug-and-play industrial parks near 100 cities are expected to bolster the manufacturing sector, contributing to the rising share of manufacturing in the country’s GDP.

Land and property registration
While the rationalization of stamp duty and the creation of a transparent rental housing market were mentioned, there were no concrete solutions provided. The move towards a transparent land registry market through GIS mapping and other reforms is commendable, but it requires more operational and target-based announcements.

Real estate and allied sectors
Badal Yagnik, CEO, Colliers India, emphasized that housing continues to be a key focus area in the budgetary announcements. The allocation of Rs 10 lakh crore for the development of three crore additional houses under PMAY will drive construction in both urban and rural areas, positively impacting allied sectors. The PPP financing and Viability Gap Funding (VGF) for rental housing will help meet the housing needs of the poor while reducing the government’s burden. The rationalization of stamp duty across states, with a focus on women homebuyers, is expected to boost homebuyer sentiment in major cities. Furthermore, the development of industrial parks and corridors, as well as infrastructure in temple corridors, should provide ample opportunities for real estate stakeholders. Revisions in tax slabs and increases in deduction limits under the new tax regime are likely to enhance disposable income, potentially driving up real estate investment, particularly in the residential sector.