Budget 2024-25: What Real Estate Gains from the New Provisions

                Nirmala Sitharaman, minister of finance, presented the union budget 2024-2025 in Lok Sabha on July 23, 2024. Presenting her seventh straight budget, Sitharaman said, India’s 
inflation continues to be low, stable and moving towards the 4per cent target. Core inflation (non-food, non-fuel) currently is 3.1 per cent.
She also said this budget envisages sustained efforts on the following nine priorities for generating ample opportunities for all: Productivity and resilience in agriculture, employment & 
skiling, inclusive human resource development and social justice, manufacturing & services, urban development, energy security, infrastructure, innovation, research & development 
and next generation reforms.
Here is what real estate industry gained from Union Budget 2025-25:

Pradhan Mantri Awas Yojana (PMAY)

Three crore additional houses under the Pradhan Mantri Awas Yojana in rural and urban areas in the country have been announced, for which the necessary allocations are being 
made.
Under the PM Awas Yojana Urban 2.0, housing needs of 1 crore urban poor and middle-class families will be addressed with an investment of Rs 10 lakh crore. This will include the 
central assistance of Rs 2.2 lakh
crore in the next 5 years. A provision of interest subsidy to facilitate loans at affordable rates is also envisaged.
Transit Oriented Development

Transit oriented development plans for 14 large cities with a population above 30 lakh will be formulated, along with an implementation and financing strategy.
Rental Housing

In addition, enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place.
Rental housing with dormitory type accommodation for industrial workers will be facilitated in PPP mode with VGF support and commitment from anchor industries.
Stamp Duty

FM said that centre will encourage states which continue to charge high stamp duty to moderate the rates for all, and also consider further lowering duties for properties purchased by 
women. This reform will be made an essential component of urban development schemes.
Land-related reforms by state governments

Land-related reforms and actions, both in rural and urban areas, will cover (1) land administration, planning and management, and (2) urban planning, usage and building bylaws. 
These will be incentivized for completion within the next 3 years through appropriate fiscal support.
Rural Land related actions

Rural land related actions will include (1) assignment of Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar for all lands, (2) digitization of cadastral maps, (3) survey 
of map sub-divisions as per current ownership, (4) establishment of land registry, and (5) linking to the farmers registry. These actions will also facilitate credit flow and other 
agricultural services.
Urban Land related actions

Land records in urban areas will be digitized with GIS mapping. An IT based system for property record administration, updating, and tax administration will be established. These will 
also facilitate improving the financial position of urban local bodies.

Cities as Growth Hubs

Working with states, our government will facilitate development of ‘Cities as Growth Hubs’. This will be achieved through economic and transit planning, and orderly development of 
peri-urban areas utilizing town planning schemes.

Creative redevelopment of cities
For creative brownfield redevelopment of existing cities with a transformative impact, our government will formulate a framework for enabling policies, market-based mechanisms and 
regulation.
Long term capital gains

Long term gains on all financial and non-financial assets, on the other hand, will attract a tax rate of 12.5 per cent. For the benefit of the lower and middle-income classes, FM 
proposed to increase the limit of exemption of capital gains on certain financial assets to Rs 1.25 lakh per year.
Andhra Pradesh capital

Central government has made concerted efforts to fulfil the commitments in the Andhra Pradesh Reorganization Act. Recognizing the state’s need for a capital, we will facilitate special 
financial support through multilateral development agencies. In the current financial year Rs 15,000 crore will be arranged, with additional amounts in future years.
National Company Law Tribunals

The IBC has resolved more than 1,000 companies, resulting in direct recovery of over Rs 3.3 lakh crore to creditors. In addition, 28,000 cases involving over Rs 10 lakh crore have 
been disposed of, even prior to admission.
Appropriate changes to the IBC, reforms and strengthening of the tribunal and appellate tribunals will be initiated to speed up insolvency resolution. Additional tribunals will be 
established. Out of those, some will be notified to decide cases exclusively under the Companies Act.
PM Surya Ghar Muft Bijli Yojana

In line with the announcement in the interim budget, PM Surya Ghar Muft Bijli Yojana has been launched to install rooftop solar plants to enable 1 crore households obtain free 
electricity up to 300 units every month. The scheme has generated remarkable response with more than 1.28 crore registrations and 14 lakh applications, and we will further 
encourage it.
Industrial Parks

Our government will facilitate development of investment-ready “plug and play” industrial parks with complete infrastructure in or near 100 cities, in partnership with the states and 
private sector, by better using town planning schemes, said Sitharaman.

Twelve industrial parks under the National Industrial Corridor Development Programme also will be sanctioned.
Here is how real estate industry reacted to Budget 2024-25:

Reducing the holding period for long-term capital gains from 36 to 12 months puts us at par with listed equity shares, further popularizing the REIT asset class in India. This move will 
further enhance the attractiveness of the REIT product, increasing investor participation.
Aravind Maiya, chief executive officer, Embassy REIT

The government's step towards digitizing India's archaic land documentation system is a game-changer, as transparent and accessible land records facilitate property transactions, 
reduce disputes, and encourage investment, benefiting both the real estate sector and the broader economy. However, some critical aspects remain unaddressed, such as GST 
rationalization for the real estate industry and the long-standing demand for industry status, which would facilitate access to funding.

Murali Malayappan, chairman & managing director, Shriram Properties

The increase in the affordable housing deduction for interest paid on loans is a positive change that will provide much-needed relief to homebuyers and boost the real estate market.
Venkatesh Gopalakrishnan, director Group Promoter’s Office, MD & CEO - Shapoorji Pallonji Real Estate (SPRE)
The comprehensive focus on efficient urban planning, including transit-oriented development and enhanced infrastructure for water supply, sewage, and waste management across 
100 large cities, will elevate the quality of urban living.
Ashwin Sheth, chairman and managing director, Ashwin Sheth Group


Taking into consideration the popularity of hybrid working, the budget could have met a few expectations of coworking sector – particularly lower GST rate for small-scale coworking 
clients and the establishment of the single-window clearance system. An important requirement for the coworking industry has also been Lower/Concessional rate of TDS which will 
improve the working capital.
Manas Mehrotra, founder, 315Work Avenue

The development of industrial parks in 100 cities under the Industrial Corridor initiative is expected to create new real estate opportunities in these areas, potentially leading to the 
growth of commercial and residential properties.
G Hari Babu, national president, NAREDCO

The abolition of angel tax and reduction of corporate tax on foreign companies are particularly encouraging for start-ups and Global Capability Centers (GCCs), all of which have been 
big drivers of commercial real estate demand.
Anshul Jain, chief executive - India, SE Asia & APAC Tenant Representation, Cushman & Wakefield
We were expecting the announcements related to the fund outlay for Smart City Mission 2.0. The plan to develop TOD in 14 large cities will also definitely help in creating industrial 
and commercial hubs in these catchment areas. Digitalization of Land records in urban areas with GIS mapping will increase the transparency and provide the better administrative 
services.
Pradeep Misra, chairman & MD, Rudrabhishek Enterprises
The budget has also given ample attention to urban and rural development, with rental housing for industrial workers through the PPP model, interest subsidies for rental housing, and 
Transit-Oriented Developments.
Anurag Mathur, CEO, Savills India


The union budget 2024 however has not addressed some of the key demands of the real estate sector, including granting of industry status, input tax credit, reduction of GST and 
single window clearance. Additionally, there is only a marginal increase in savings on individual income tax under the new taxation regime. We urge the union government to 
reconsider the focus on the real estate sector to include these demand.

Pavitra Shankar, managing director, Brigade Enterprises 

Innovative initiatives such as the digitization of land records, GIS mapping, and urban housing for the middle class, combined with workforce skilling, are expected to have a profound 
multiplier effect on the burgeoning real estate sector, currently experiencing double-digit growth. Moreover, the budget’s focus on sustainable development through solar and 
renewable energy, water and solid waste management aligns perfectly with the goal of climate-resilient real estate development.
Niranjan Hiranandani, chairman, Hiranandani Group

Mega allocation for the Hyderabad-Bengaluru industrial corridor and Vizag-Chennai corridor will boost growth along these corridors and consequently boost real estate growth there.
Anuj Puri, chairman, ANAROCK Group

We commend the Union Budget 2024-25 for its comprehensive approach towards job creation and boosting consumption, which are positive developments for the real estate sector.
Prashant Sharma, president, NAREDCO Maharashtra

The budget falls short of addressing the industry's core challenges. The sector requires a more supportive policy framework, including industry status, GST relief, and streamlined 
approvals.


Source : The Economic Time