CREDAI Maharashtra expectations from the Union Budget 2025

Pune, 28th January 2025: The Indian real estate sector has always been at the top for nation-building. Real Estate Sector in India has a major contribution towards GDP generation influencing more than 50% of GDP, large employment generation and vast infrastructure developments, like Housing, along with offices and retail spaces, and essential infrastructure backbone for the IT, ITes, Health & Hospitals and financial sectors. The Real estate industry significantly influences 250 allied sectors consuming 30% to 100% goods from these industries.

Real Estate sector has a major role in the housing needs of more than 40 crore Indians who lack adequate homes. A study revealed that India has an existing shortage of 10.1 million affordable housing units and which is estimated to grow to a cumulative 31.2 million units by 2030. The urgent need for the Government to increase the affordable housing price threshold to reflect current market realities, particularly in Tier 2, 3 and Tier 4 cities, where the demand for affordable housing remains high.

CREDAI Maharashtra is the apex body of private Real Estate developers in Maharashtra, established in 1998, with a vision of transforming the landscape of Indian Real Estate industry and a mandate to pursue the cause of Housing and Habitat. Today, CREDAI Maharashtra represents 3500+ Developers across 66city chapters and plays an important role in policy formulation by representing the views of its members to various Ministries at regular intervals.

CREDAI Maharashtra’ Recommendations and expectations from the Budget 2025

a) Section 80-IBA Benefits: Developers seek the revival and extension of Section 80-IBA benefits, which provide a 100% tax exemption for profits earned from affordable housing projects, to incentivize more developments in this category.

b) Industry Status Recognition: Granting ‘industry status’ to the real estate sector is a long-standing demand to facilitate easier access to funding and attract investments.

c) Affordable Housing Boost: It is evident that supply of affordable housing projects is decreased over past few years substantially, to boost the same we suggest few measures below,

d) Govt has not revised price and size of affordable house as per market dynamics, we propose to enhance the same,

e) Increased Tax Deductions: Raising the tax deduction limit for housing loan interest under Section 24(b) from ₹2 lakh to ₹5 lakh to make homeownership more accessible.

f) Exemption of GST on JV Agreements: Developers are urging the government to exempt Goods and Services Tax (GST) on Joint Venture (JV) agreements to streamline transactions and reduce tax burdens in real estate collaborations.

g) GST Rationalization: Reducing GST rates on key construction materials such as steel and cement is essential to lower input costs for developers and make housing more affordable.

h) Single-Window Clearance System: A single-window clearance mechanism is critical to minimize delays in project approvals, cut red tape, and reduce overall project costs.

i) Infrastructure Development: Increased budget allocation for infrastructure projects can enhance connectivity, create growth corridors, and boost demand for real estate in suburban and emerging areas.

j) Incentives for Green Building Projects: Offering incentives for sustainable and energy-efficient buildings can promote eco-friendly practices in the real estate industry.

k) Digitization of Land Records: Expediting the digitization of land records will increase transparency, reduce disputes, and improve confidence among investors and homebuyers.

l) Measures to Promote Foreign Investment: FDI may be allowed in Limited Liability Partnerships to add to Ease of Doing Business. Real Estate projects are registered under RERA so the data of investment will be transparently available

Er. Pramod Khairnar Patil, President of CREDAI Maharashtra opines that, “considering the stability of the Government CREDAI Maharashtra is confident, these measures if implemented, can stimulate housing demand, encourage affordable housing developments, and drive overall growth in the real estate sector and Real Estate Sector will definitely expedite growth, empower homebuyers, and support India’s economic ambitions. We look forward to collaborating with the Government to create an enabling environment for the sector, ensuring that it remains a cornerstone of India’s economic progress. These recommendations not only focus on affordable housing but also aims to revitalize consumption, boost the service sector, increase State Government revenue, and empower economic growth, ultimately contributing to India’s 8 trillion-dollar economy by 2029 and strong support to Prime Minister’s Narendra Modiji’s Dream of Viksit Bharat”!