Real Estate Budget 2024: 8 things the sector expects from the Finance Minister

The real estate sector's Budget 2024 wish list includes an expansion of the definition of affordable housing, industry status and tax sops for homebuyers.

Budget 2024 will be presented by Finance Minister Nirmala Sitharaman today. The real estate sector has sought an expansion of the definition of affordable housing, industry status for the real estate sector, tax sops for homebuyers as well as developers, increase in exemption on principal amount as well as the interest paid on home loans, and greater retail engagement in Real Estate Investment Trust or REITs.

Tax exemptions

Confederation of Real Estate Developers' Associations of India (CREDAI), has urged the government to increase tax exemption limit on principal amount as well as interest paid on home loans to boost demand for residential properties.

In its pre-Budget recommendations, it suggested that the deduction for principal repayment of housing loan should be considered for a separate or standalone exemption. CREDAI has sought deduction under section 80C for principal repayment of housing loan should be increased from the existing limit of ₹1.5 lakh.

Limit on tax deduction on interest paid should be increased from the current ₹2 lakhs to about ₹3-4 lakhs in case of self-occupied property. In case of let-out property, limits can be dropped entirely.

“Homebuyers are anticipating increased tax benefits in the upcoming budget. One key expectation is to elevate the current ₹2 lakh tax rebate on housing loan interest under Section 24 of the Income Tax Act to a minimum of ₹5 lakh. This adjustment is crucial to bolster housing demand, especially within the affordable housing segment,” said Piyush Bothra, Co-Founder and CFO, Square Yards.
Increase the size of SWAMIH Fund to ₹50,000 crore

Despite the recent capital infusion of ₹5,000 crore, the overall size of the Special Window for Completion of Affordable and Mid-Income Housing Projects (SWAMIH) fund set up under the Special Window for Affordable and Mid-Income Housing should be raised to ₹50,000 crore to improve the housing market and ensure more delayed projects are completed, said real estate experts.