The Union Budget 2024 has the potential to be a game-changer for the real estate sector.
Mr. Tarun Bhatia, Vice-Chairman and Chair-Global, NAR India
As we look towards the Union Budget 2024, the real estate sector has high expectations for a continued and reinforced focus on affordable housing, particularly in metropolitan areas. The success of initiatives like the Pradhan Mantri Awaas Yojana–Urban (PMAY-U) has highlighted the significant demand for affordable homes. To sustain this momentum, it is imperative that the budget includes measures that enhance financial incentives for both developers and homebuyers. Furthermore, reducing GST rates on construction materials and simplifying the approval processes for housing projects will significantly lower the cost of development, making it easier for builders to deliver affordable housing units. Affordable housing is not just a matter of providing shelter; it is a critical element in fostering economic stability and growth. With a growing urban population, the need for well-planned, affordable housing solutions becomes increasingly vital.
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The government’s role in facilitating this through policy and financial incentives cannot be overstated. By reducing the GST rates on essential construction materials, the government can directly impact the cost structure of affordable housing projects. This reduction would allow developers to lower their prices, making homes more accessible to a larger segment of the population. Simplified approval processes would also play a significant role in speeding up project timelines and reducing bureaucratic delays, further encouraging developers to undertake affordable housing projects.
Additionally, we believe that a robust framework supporting sustainable urban development and easing financing options will not only benefit the real estate sector but also contribute significantly to the overall economic growth of the country. Enhanced credit flow to homebuyers, especially first-time buyers, through reduced interest rates and increased limits on home loan interest deductions under Section 24 of the Income Tax Act, will further stimulate demand in the housing sector. Encouraging banks and financial institutions to offer attractive loan terms to first-time homebuyers can have a ripple effect, boosting the entire real estate market and related industries.
A balanced and forward-looking budget that supports affordable housing initiatives, reduces costs for developers, and provides financial relief to homebuyers will not only revitalise the real estate market but also ensure inclusive growth and improved living standards for millions of Indians. Such measures would support the government’s broader goals of economic development and social welfare. Affordable housing can lead to better health outcomes, improved educational opportunities for children, and overall enhanced quality of life for residents. By investing in affordable housing, the government is investing in the future of its citizens.
For real estate agents, the Union Budget 2024 should also consider measures that enhance their business environment and operational efficiency. Simplified and streamlined regulatory processes like One Nation, One RERA Licence will allow real estate agents to work in more than one geographical zone, close deals more quickly and with less bureaucratic hassle. This flexibility is crucial in a market where agility and the ability to respond quickly to client needs can make a significant difference. Additionally, tax relief for real estate professionals, such as a reduction of GST on brokerage, and improved access to finance for small and medium-sized real estate firms can foster a more vibrant and competitive market. These measures would encourage more individuals and firms to enter the market, increasing competition and driving innovation.
Moreover, introducing digital tools and platforms supported by government initiatives can help real estate agents expand their reach and improve customer service. In today's digital age, the integration of technology in real estate transactions can streamline processes, enhance transparency, and provide better experiences for both agents and clients. Training and development programs funded or subsidised by the government in partnership with national associations like NAR India, can equip agents with the latest industry knowledge and skills, further professionalising the sector. These programs could cover areas such as digital marketing, customer relationship management, and new regulatory requirements, ensuring that agents are well-prepared to meet the demands of the modern real estate market.
Overall, the Union Budget 2024 has the potential to be a game-changer for the real estate sector. By addressing these critical areas, the government can ensure that affordable housing becomes a reality for many more Indians, supporting economic growth and enhancing the quality of life across the country.
Article By: Mr. Tarun Bhatia, Vice-Chairman and Chair-Global, NAR India
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