“The union budget 2023-24 presented by the finance minister Nirmala  Seetharaman is a growth-boosting welcome budget with a focus on the growth of the green economy, start-up, and infrastructure. The budget provided some relief to the middle-income group salaried classes that may impact the growth of the affordable housing segment or rental residential segment.

The real estate sector requested the tax benefit on home loan interest and principal repayment, but the budget did not mention any sops on increasing the limit of home loan interest deduction on income tax returns. There should have been a separate deduction for the repayment of the principal amount of the home loan, which is currently clubbed under section 80C. At present, the ceiling of the deduction for principal repayment of housing loans is Rs 1,50,000 along with other tax saving instruments. However, there was no announcement of the raising of the overall ceiling limits of section 80C to Rs 5 lacs which could have spurred investments.

The budget also did not reduce capital gain tax and did not introduce new lending avenues for developers. However, PM Awas Yojana’s outlay has been  Increased by 66% to 79000 cr for 2024 and this will boost the real estate sector.  The budget also has encouraged urban planning reform with housing for police personnel and the setting up of libraries for children.  The tax benefit to startups may see an uptick in growth in the office segment in real estate as startups are ramping up their physical presence across the country.

We expected waivers or reductions of GST  on raw materials like cement and steel that would have boosted the real estate segment. Moreover, the real estate sector the second largest employer in India did not receive the industry status which is long overdue” said Sushil  Mohta, Chairman, Merlin Group & PRESIDENT, CREDAI –WEST BENGAL.