Real Estate Leaders React to Union Budget: Infra Push Not Enough

Join our Whatsapp channel

Real estate industry leaders have expressed mixed reactions to the Union Budget 2025-26, welcoming its focus on infrastructure and urban development but criticising the absence of direct measures to address sector-specific challenges.

Prashant Sharma, President, NAREDCO Maharashtra, noted that while the ₹1 lakh crore Urban Challenge Fund is a positive step for urban transformation, the budget missed opportunities to provide direct incentives such as industry status, single-window clearances, and enhanced tax benefits for homebuyers. He highlighted the increase in the income tax exemption limit to ₹12 lakh as a relief for the middle class, which could boost demand for affordable and mid-income housing. Sharma also praised the progress under the SWAMIH Fund, which has completed 50,000 homes in stressed projects and aims to deliver 40,000 more in 2025. However, he urged the government to address liquidity concerns and expedite approvals to strengthen the sector.

Rohan Khatau, Director, CCI Projects, welcomed the increased infrastructure spending and public-private partnership (PPP) initiatives but expressed disappointment over the lack of reforms in stamp duty rationalisation, higher home loan interest deductions, and rental housing incentives. He acknowledged that tax rationalisation and higher exemptions for the middle class would improve liquidity but called for mid-year policy interventions to stimulate real estate growth.

Vikas Sutaria, Founder, Iraah Lifespaces, criticised the budget for overlooking incentives for non-resident Indians (NRIs) and high-net-worth individuals (HNIs), who are key players in the luxury housing segment. He noted that while the Urban Challenge Fund would aid urban renewal, specific measures to boost luxury and second-home investments were absent. Sutaria also highlighted the potential indirect benefits of tax relief for the middle class on housing demand.

Abhishek Jain, COO, Satellite Developers Private Limited, echoed similar sentiments, stating that while the budget’s focus on infrastructure and PPP-driven urban transformation is commendable, it failed to address critical issues such as liquidity constraints, high taxation, and policy bottlenecks. Jain emphasised the need for a comprehensive real estate policy to accelerate sectoral growth.

Dr. Niranjan Hiranandani, Chairman, NAREDCO and Hiranandani Group, described the budget as a transformative blueprint for growth, highlighting its focus on infrastructure, the SWAMIH Fund 2.0, and tax incentives for the middle class. He noted that these measures would boost demand for housing and improve urban infrastructure. However, Hiranandani pointed out the lack of significant action on affordable housing, a segment crucial for inclusive growth.

The budget also addressed the growing skill gap in the construction sector, which employs 71 million workers, 81% of whom remain unskilled. By 2030, the sector is expected to employ 100 million individuals, requiring 33 million skilled workers. Experts stressed the urgent need for economic and fiscal policies to bridge this gap and support sustainable industry growth.

While the Union Budget 2025-26 has laid a foundation for infrastructure and urban development, real estate leaders believe targeted interventions are necessary to address sector-specific challenges and unlock its full potential.