7 months ago
Budget 2026: Real Estate Focus on Affordable Housing
The real estate industry in India is asking the government for help before the Budget 2026.
They want the government to make it easier and more profitable to build affordable homes and rental properties.
This is because the industry thinks that affordable housing is very important for creating jobs and helping the economy grow.
They also want the government to change some rules about taxes and home loans to make it simpler for people to buy homes.
The industry believes that these changes will help more people afford homes and make the real estate market stronger.
The government is also expected to focus on spending more money on building things like roads and schools, which will help the economy grow even more.
Real estate industry seeks government intervention for rental housing market reforms.
Affordable housing projects priced up to ₹45 lakh with specific carpet area limits.
Proposals include increasing stamp duty tolerance threshold and home loan deductions.
AI infrastructure and streamlined approvals are key demands for future growth.
Domestic demand and public capital expenditure are expected to drive economic growth in 2026.
- Who
- Real estate industry, including Naredco and CREDAI
- What
- Seeking policy push for affordable housing and rental market reforms
- Where
- India
- When
- Ahead of Budget 2026
- Why
- To boost job creation, facilitate manufacturing, and support economic growth
Key facts
- Real Estate Contribution to GDP
- 7–8% currently, expected to grow to 13–15% by 2030
- Affordable Housing Price Cap
- ₹45 lakh
- Affordable Housing Carpet Area
- Up to 60 sq m in metro cities, 90 sq m in non-metros
- Stamp Duty Tolerance Threshold Proposal
- Increase from 10% to 25%
- Home Loan Deduction Proposal
- Increase from ₹2 lakh to ₹4–6 lakh
- AI Infrastructure Demand
- Key demand for data centres, logistics, and shared spaces
- Domestic Demand Growth Drivers
- 8th Pay Commission, state welfare spending, GST rate rationalisation
- Public Capital Expenditure
- Risen from ₹4.4 lakh crore in FY20 to over ₹11 lakh crore in FY25
Timeline
Morgan Stanley's projection of the Sensex reaching 100,000 by 2026 was influenced by their expectation of a rate cut in October 2025, which was likely due to the slowing US economy and potential rate cuts by the Federal Reserve.
Morgan Stanley's expectation of a rate cut in October 2025 influenced their projection of the Sensex reaching 100,000 by 2026.
Morgan Stanley's projection of the Sensex reaching 100,000 by 2026 influenced their latest prediction on India's budget deficit for FY27.
Morgan Stanley's previous bullish outlook on India's stock market, predicting the Sensex to reach 100,000 by 2026, likely influenced their latest prediction of India's budget deficit for FY27.
Morgan Stanley predicts India's budget deficit for FY27 to be 4.2%.
Quotes
Niranjan Hiranandani
Chairman, Naredco
“removal of the stringent conditions under Section 80IBA(6)(da) of the Finance Bill and recommended extending the benefit period for affordable rental housing projects to at least five years. This will instil developer confidence and allow time to deliver quality rental stock. Further, rental income from properties held as stock-in-trade should be exempt from taxation for five years after construction completion, recognising the long-term nature of these investments.”
businesstoday.in
“Given inflation and soaring home prices, increasing the home loan interest deduction limit from ₹2 lakh to ₹5 lakh will provide much-needed relief to homeowners.”
businesstoday.in
Shekhar Patel
President, CREDAI
“called for targeted reforms to sustain residential supply and restore housing affordability.”
businesstoday.in
Ashwinder Singh
Chairman, CII Real Estate Committee and Advisor, National Association of Realtors
“Stable taxation, faster approvals and construction finance that supports last-mile delivery are critical. Cities must be recognised as economic engines, not administrative units.”
businesstoday.in
Sources
Fiscal deficit to be set at 4.2% of GDP for FY27: Morgan Stanley
CAG Reports Rise In Telangana Revenues
Budget 2026: Real estate industry switches tracks to affordable housing; seeks policy push
ICRA estimates gross tax revenue growth at 7% in FY27
Former World Bank advisor suggests why macroeconomic strength must translate into structural growth - CNBC TV18
Explained How Budget 2026 Could Tighten The Deficit While Spending More On Growth
Why India’s Growth Story Holds Firm Against 2026’s Global Risks?
False Stability
Sanjeev Ahluwalia | Budget Can Do Groundwork for Deep Reforms in India
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