The year 2020 was a struggle for the Indian real estate business, but it rebounded well in 2021. The industry has high hopes for the Union Budget 2022-23, which will be delivered on February 1 by Finance Minister Nirmala Sitharaman.
Most developers have high hopes for the budget, anticipating that it would boost both the residential and rental housing segments. Many business experts are concerned about growing raw material costs and expect the government to step in to help.
The real estate sector’s expansion is critical to the economy’s expansion. Aditya Kushwaha, CEO and Director of Axis Ecorp, anticipates that the government would implement significant policy reforms to aid in the acceleration of real estate expansion, particularly at this time.
The Covid-19 epidemic, according to Kushwaha, has had a tremendous impact on influencing people’s perceptions of property ownership, particularly among NRIs.
The demand from the NRI segment has increased dramatically in recent years. The government could consider modifying the relevant tax deducted at source (TDS) on property purchases for NRIs to stimulate this segment, he added.
This would assist our country to grow its foreign reserves while also boosting investment in the industry. As individuals continue to work from anywhere (WFA), there has been an increase in rental homes. To stimulate the rental market even further, Kushwaha advises that the government provide tax incentives to tenants, such as an increase in the HRA Tax Exemption.
According to Vinit Dungarwal, Director of AMs Project Consultants Private Ltd, this year’s budget is critical since real estate demand, particularly in the residential segment, has just recently begun to recover following the pandemic-induced downturn.
The RBI’s sustained involvement and holding of interest rates have aided demand generation in the real estate industry, and it is expected that the budget for 2022 to focus on demand generation as well.
The rising costs of crucial raw materials such as iron and cement may stifle this expansion. To counterbalance the price increase, the government may consider lowering the GST on certain items.
Overall, the government should continue to prioritize infrastructure and investments since they will help create employment and propel the country forward, according to Dungarwal.
For a long time, some experts have advocated for real estate to be classified as infrastructure, and they want to see this happen in 2022.
Anurag Mathur, CEO of Savills India, commented on this, saying that at a time when the economy is worried about recovery owing to the Omicron threat, he hopes for a constructive attitude from the budget.
Aside from agriculture, the budget is anticipated to keep a focus on industry, infrastructure, and the real estate sector. It has the potential to open up a slew of advantages for both international and local investment.