Budget 2024: The real estate industry main priorities include tax breaks and a reduction in stamp duty

By Bricksnwall | 2024-02-01

Positive market attitudes, economic growth, urbanization, changing lifestyles, higher disposable incomes, improved job possibilities, more company activity, and government policies have all contributed to the remarkable real estate resurgence in the nation.

One industry that has flourished in the Indian economy during the past year as it has recovered from the crisis caused by COVID-19 is real estate. Positive market sentiments, economic growth, urbanization, changing lifestyles, higher disposable incomes, improved job possibilities, more corporate activity, and government policies were some of the factors that propelled the sector's rise.

In addition, the residential market continued to see robust demand as sales there surpassed earlier records.

Having stated that, here are some predictions made by the real estate industry for the Union Budget of 2024:

1. Tax breaks for homeowners: Ramani Sastri, Chairman and Managing Director of Sterling Developers, suggested that the government increase the annual deduction limit for interest payments on home loans from the current amount of Rs 2 lakh to Rs 5 lakh, as this would stimulate the demand for homes. The expert also demands changes to raw material prices and a decrease in the GST rate on properties that are still under construction.

According to Sastri, this year's expectations surpass the customary requirements of industry status and single-window clearance, which may open up financial benefits and speed up project approvals.

The business also wants the long-term capital gains tax (LTCG) on real estate sales to be reduced. Mananki Parulekar, co-founder of Claravest Technologies, stated that "looking into the possibility of lowering the long-term capital gains tax could amplify interest among homebuyers and investors, thereby contributing to the expansion of the real estate market in India."

2. Rationalization of house loan interest rates: Parulekar anticipates further rate reductions from the center. Real estate sales can be boosted, according to Parulekar, by lowering house loan interest rates, offering more flexible loan tenure alternatives, and modifying the credit provisioning requirements for home buyers.

This modification will therefore take into account the increasing cost of real estate, guaranteeing affordability for people whose salaries might not keep up with these rises.

3. Stamp Duty Concession: The real estate sector anticipates a stamp duty reduction as well, as it may serve as a catalyst for higher rates of apartment and home registrations and heightened market activity.

4. To broaden the meaning of affordable housing: Sastri of Sterling Developers pointed out that a significant portion of the populace still finds affordability to be the largest obstacle, so the term should be expanded. Increased investment in residential real estate will also result from any tax exemption on rental income.

5. Reduced GST for small-scale coworking customers: According to Pratyush Pandey, CEO of Upflex India, the coworking space market is expanding rapidly in the modern day. A policy change that lowers GST for small-scale coworking clients may encourage more entrepreneurs to enter this market.