As the Union Budget 2025-2026 (FY26) inches closer, the Indian real estate industry is seeking stamp duty cuts, revised home loan limits and updated affordable housing norms through Pradhan Mantri Awas Yojna (PMAY), single-window clearance and eco-friendly policies, among others.
Industry leaders and consultancy firms have shared their expectations.
The president CREDAI-NCR and chairman & managing director, Gaurs Group, said, “One of the major demands of the sector is rationalisation of stamp duty, which has increased significantly in recent years and is causing a big financial burden on buyers. Further, a revision of the current deduction limit from Rs 1.5 lakh to Rs 5 lakh under Section 80(c) should also be considered to ease home ownership experience.”
He advocates revising affordable housing criteria by replacing the Rs 45 lakh price cap with a focus on carpet area — 60 square metres in metros and 90 square metres in non-metros.
He also urges reintroducing the 100 per cent tax holiday for projects approved before March 31, 2022, to boost affordable housing and advance the ‘Housing for All’ mission.
“The commercial real estate sector, aligned with the government’s push for entrepreneurship, also requires policy-level support to sustain its momentum. Rationalising interest rates to fuel demand and introducing a single-window clearance system to expedite approvals would further strengthen the real estate ecosystem,” said the vice-president (sales), Raheja Developers.
Delhi-NCR’s Kanodia Group urges tax relief and goods and services tax (GST) reduction on construction materials, aiming to lower project costs and empower developers to initiate new ventures more efficiently.
“We firmly believe that this year’s Budget has the potential to strengthen the real estate industry, enabling it to play an even more substantial role in shaping the nation’s economic landscape,” said the group’s founder of Kanodia Group.
The founder and chairman of Reach Group, too, suggested increasing the home loan deduction limit to Rs 5 lakh from Rs 2 lakh. This is to boost investment opportunities and attract more investors.
The chairman of Anarock Group, suggests that the Union Budget should reintroduce the credit-linked subsidy scheme (CLSS) under PMAY for economically-weaker section (EWS) households, which had expired in 2022. This would incentivise first-time buyers of affordable homes, extending subsidies to loans for new constructions or essential additions to existing properties.
Under PMAY (rural), subsidies could also help convert ‘kaccha’ homes into ‘pucca’ ones, given the eligibility criteria. Additionally, industry players also believe that the definition of affordable housing needs updating, especially in high-cost cities like Mumbai, with price caps raised accordingly.
“According to Anarock data, the sales share of affordable housing fell to a mere 18 per cent in 2024 from over 38 per cent in 2019. This stark decline highlights the urgent need for intervention. Affordable housing requires focused attention and targeted benefits, which have been lacking in the past two years,” he added.
The founder & director of real estate fintech firm Justo, advocates for GST rationalisation on under-construction residential and commercial properties, tax benefits for REITs to boost participation, and SEZ benefit extensions. “India’s real estate sector plays a crucial role in driving economic growth, contributing significantly to GDP and employment,” he says.
Home decor brand Urban Space co-founder said, “The home decor industry is optimistic about measures that can bolster growth and innovation. We hope for policies that incentivise domestic manufacturing, such as subsidies on raw materials and machinery, along with tax breaks for MSMEs and startups. A reduction in GST rates on home furnishings and decor items would be a significant step toward making quality products more accessible to the growing middle class. Additionally, we expect initiatives that encourage sustainable practices.”
