In the next weeks, Nirmala Sitharaman, the finance minister, is probably going to announce the Union Budget 2024–25. The real estate sector has high hopes for the Union Budget 2024–2025, believing it would solve long-standing problems and bring forth measures that will help the business. What then does the industry anticipate? Let’s find out the main points, due date, and most recent modifications for the Union Budget 2024–25.
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Stakeholders in real estate get together as the Union Budget 2024–25 draws near to talk and create the story that could help the fiscal policy. There is a lot of anticipation nationwide since the Union Budget 2024–25 is expect to be announce in July 2024, and there are definite expectations. sector insiders predict that in order to increase investment and eliminate sector opaqueness, the government would concentrate on important reforms. Go back and read the expectation summary for the Union Budget 2024–25.
Union Budget 2024–2025: Industry expectations
The next Union Budget 2024–25 has a lot of expectations from the real estate community. Among them are:
Union Budget 2024–2025: Reducing home loan taxes
The second-largest employer in the state and a major contributor to the economy, the real estate industry, is poised for potentially revolutionary changes, according to NAREDCO Maharashtra. The industry expects the Union Budget 2024 to have a significant impact on its future.
To stimulate the economy, the federal and state governments put in place a number of incentives and reforms the year before. These initiatives have played a crucial role in maintaining the real estate industry’s growth pace. Nonetheless, the budget did not include an increase in the annual maximum for interest rate deduction under Section 24(b) from Rs 2 lakh to Rs 5 lakh. Since this will greatly help the real estate market. The government should concentrate on including it in the Union Budget 2024.
It is imperative that personal tax relief be provided. Whether in the form of modified tax slabs or lower tax rates. We also anticipate a decrease in stamp duty and registration fees. As well as the Input Tax Credit (ITC) for developers. These elements influence a project’s cost significantly and attract homeowners.
Union Budget 2024–2025: GST Exemption, Infrastructure status, & CLSS Extension
The cost of building materials has increased, which has affected property prices and the demand for homes. In the next Union Budget 2024, the industry anticipates announcements on particular plans. Including a reduction in GST on houses under construction and price of critical raw commodities. In addition, the government should prioritise boosting funding for conventional infrastructure including ports, railroads, and highways as well as renewable energy sources.
A balanced budget is necessary to help the economy recover from the COVID-19 recession. Therefore, as it will benefit both domestic and foreign investors, an infrastructure status for the real estate sector remains desirable. Long-term real estate growth might be accelerate by extending the Credit-Linked Subsidy Scheme (CLSS), lowering the GST rates on essential building supplies. And adding alternative asset classes to Real Estate Investment Trusts (REITs). These requests continue to be widely held.
Union Budget 2024-25: Redefining the Affordable Housing Scheme
Experts in the field advise varying the concept of affordable housing in different cities. Currently, homes priced less Rs 45 lakh are classified as affordable housing. But with construction costs so high, the cap doesn’t seem to be enough in many locations today, especially metropolitan areas. Today’s homebuyers have a slight challenge in finding a property under Rs 45 lakh. Because it will incentivize homebuyers, raising the threshold to at least Rs 60–65 lakh is crucial.
Both cheap and mid-segment housing would be enhance by redefining affordable housing. And by raising the threshold from Rs 45 lakh to Rs 1 crore, mostly in metro areas. Therefore, in the next Union Budget 2024, the Government needs to take this demand into consideration.
Union Budget 2024–2025: Rental Housing Tax Relief
The Central and State governments have been implementing various reforms and incentives to boost the economy during the past year. It is anticipate that in order to accelerate investment in these schemes. The government will keep promoting them by offering tax breaks for rental housing projects. The government may accomplish its overarching objective of housing for all if it makes a commitment to increase both affordable & rental housing.
Furthermore, the government ought to reevaluate the income tax head for house property’s loss set-off limit. It needs to be increase or decrease from the current amount of Rs 2 lakh. It will encourage more people to invest in rental properties and assist in giving urban migrants decent places to live.
‘SWAMIH Investment Fund’ was introduced by Special Window for Affordable & Mid-Income Housing (SWAMIH) in November 2019 to assist in the completion of over 1,500 housing projects that have been declared Non-Performing Assets (NPAs). More liquidity must be added to the SWAMIH Fund in order to support financial institutions in creating enough cash. And to make it easier for real estate projects that are stuck to be complete. In addition, facilitating more affordable and better lending as well as promoting forward-thinking FDI inflows that permit foreign investment in completed homes could be crucial to the sector’s success in 2024.
Union Budget 2024–2025: Clearance of a single window
To begin development, the developer community currently needs many approvals from State and Central authorities, which causes major delays. Creating a single point of clearance for all real estate transactions would speed up development and cut down on project delays.
Union Budget 2024–2025: First-time homebuyers can receive waivers and lower stamp duty
The developer community wants first-time homebuyers to receive waivers or reduced stamp duty rates. Providing incentives to first-time purchasers in the inexpensive category is crucial. To address the growing gap, programmes like the pandemic-alike stamp duty incentives and efforts to revive affordable housing. Through the reinstatement of the Credit-linked Subsidy Scheme (CLSS) under PMAY are requires.
Union Budget 2024–2025: Long-term capital gains tax relaxation
Real estate professionals anticipate a significant change in the Union Budget 2024, with the long-term capital gains tax on the property being reduced from 20 percent to 10 percent. It is anticipate that the proposed reduction will increase investment in the real estate industry and accelerate economic growth in the nation.
As the Union Budget 2024 is presented, the aforemention expectations from the Union Budget 2024–25 will be put to the test. Until then, the mindset should be one of optimism that the government would take the necessary steps to boost consumer demand. And provide the real estate sector a significant boost to confirm strong infrastructure expansion. Without a doubt, taking all of these steps into account would strengthen the real estate market and accelerate the economy’s future recovery.
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