Key Industry Demands
Industry stakeholders have expressed their expectations for the upcoming budget, centered on tax relief and policy stability. Key concerns include the need
for more affordable home loans, with stable EMIs, clear tax benefits, and easier access to credit, particularly for first-time buyers. The focus extends to enhancing deductions on home loan interest and principal repayment, and restoring higher limits for self-occupied homes. Experts also suggest offering targeted relief to first-time buyers, emphasizing the potential to revive demand without escalating property prices. Furthermore, the development community is seeking growth-oriented fiscal signals, including support for MSMEs, incentives for technology and AI adoption, and measures to stimulate consumption and job creation within the real estate sector. The PHD Chamber of Commerce and Industry (PHDCCI) advocates for tax relief and policy stability to boost housing demand, capital flows, and support various stakeholders in the industry, including homebuyers, developers, and NBFCs.
Addressing Tax Concerns
PHDCCI has raised concerns regarding real estate taxation that could impede housing supply and rental stock creation if left unaddressed. Specifically, they've highlighted that taxing notional rent on unsold housing stock, limiting loss set-off from house property, and low safe-harbour limits on circle rate differences are adding pressure on developers, especially during challenging market cycles. The PHDCCI is urging for the deletion or relaxation of these provisions to support housing supply and employment, as real estate is the second-largest employer in the country. Rohan Khatau, Director at CCI Projects, emphasized the importance of the budget in shaping long-term capital flows into real estate. The industry also suggests meaningful tax rationalization and targeted relief, especially in affordable and mid-income housing, to improve project viability and help bridge the demand-supply gap in urban housing. The industry's key priorities in the lead up to Budget 2026 also include the need for an infrastructure push, clarity on REIT and InvIT taxation, and incentives that encourage private and institutional participation.
Finance Perspective: Affordability Matters
From the housing finance perspective, industry experts believe Budget 2026 should prioritize improving affordability for genuine homebuyers rather than short-term rate signals. Atul Monga, Co-Founder and CEO of BASIC Home Loan, highlighted that NBFCs and fintech lenders continue to face tight regulatory and funding environments. Policy continuity, better access to liquidity, and support for tech-led underwriting can help these players expand credit responsibly, especially for self-employed and informal borrowers who remain underserved by banks. Tax reliefs are seen as a means to ease decision-making for potential homebuyers. Policy continuity and fiscal discipline are viewed as crucial for sustaining investor confidence and allowing developers to plan and scale projects in alignment with urban demand. Experts broadly agree that housing-led domestic growth can act as a natural economic hedge, given the backdrop of global uncertainty and shifting geopolitics. A forward-looking Union Budget 2026 that balances fiscal discipline with targeted support for housing, homebuyers, and developers could strengthen financial resilience and reinforce India’s long-term growth story.
Looking Ahead: Key Objectives
The real estate industry is anticipating Budget 2026, which is expected to address crucial aspects of the sector. The primary goals include reviving housing demand, attracting long-term capital flows, and fostering sustainable growth. Expectations include clear policy signals that will encourage investment and provide relief to both homebuyers and developers. The industry is looking for targeted measures to improve affordability, ease tax burdens, and ensure a stable regulatory environment. These measures are expected to contribute to a more robust and resilient real estate sector, which can play a significant role in India’s overall economic growth. Budget 2026 is viewed as an opportunity to set the stage for long-term growth by providing a balance between fiscal discipline and targeted support for housing.
