Budget 2023 instills hope in real estate for long-term growth. By Financial Express
Budget 2023 instills hope in real estate for long-term growth
Besides the increased fund allocation for PMAY, the measures announced in the budget are expected to have positive implications for the real estate sector in the coming years.
With the increased funding, the government looks to vastly enhance the existing infrastructure and create a conducive environment for investment flow.
India’s real estate sector has received a positive push from the Union Budget 2023 presented yesterday. Several measures were announced to encourage investments and stimulate the economy’s growth. Besides the increased fund allocation for PMAY, these measures are expected to have positive implications for the real estate sector in the coming years. Realty experts have welcomed these announcements in their response to the Union Budget 2023.
S K Narvar, Group Chairman, Trident Realty, said, “This year’s Union Budget is future-focused on real estate. The increase in PMAY’s budgetary allocation by 66% to Rs 79000 crore will help countless Indians to realise their dreams of owning a home, helping the government accomplish the ‘housing for all’ objective. Furthermore, the threshold for income tax rebates has been increased from Rs 5 lakh to Rs 7 lakh, which will result in higher buying power for the middle class. This move, aimed at providing relief to middle-class citizens, will encourage them to invest more in real estate. With higher disposable incomes, more people would be in a position to buy a home in Tier 2 and 3 cities, which in turn will increase housing demand and boost the emerging real estate markets.”
The Budget 2023 also gave an impetus to the infrastructure segment. The government has established an Urban Infrastructure Development Fund with an annual budget that will be utilised to build a balanced and sustainable infrastructure in tier-2 and tier-3 cities to encourage cities to implement urban planning reforms.
Atul Banshal, Director Finance, Omaxe Ltd, said, “Despite a massive global slowdown due to the pandemic and war, the Indian economy continued to shine. To further strengthen it, the government has brought in huge emphasis on infra development and promoting youth power along with other key development areas in this budget. The big takeaway from the budget is the emphasis given to capital investment and an increase in its allocation by 33 percent. Focused on infra upgradation and job creation, an Urban Infra Fund would be set up. This is likely to give a huge push to the realty markets, particularly in tier 2 and 3 cities.”
The adjustments made in the tax bracket are expected to provide a significant boost to both homebuyers and developers, as it will free up more disposable income. This could lead to an increase in demand for housing, which in turn, will boost the residential real estate sector.
Aman Trehan, Executive Director, Trehan Iris, said, “With the increased funding, the government looks to vastly enhance the existing infrastructure and create a conducive environment for investment flow. This will attract more businesses, generate more job opportunities, and bolster the country’s economic growth. The announcement of the increase in the income tax rebate limit from Rs 5 lakh to Rs 7 lakh under the revised tax regime will significantly boost disposable income and empower aspirational middle-class consumers who are driven by aspirations when it comes to making purchasing decisions.”
These measures are likely to help increase the quality of life for their citizens, boost employment opportunities, and attract more businesses to the cities.
Vineet Taing, Chief Executive Officer, Vatika Business Centres, said, “The Budget for 2023 does indeed place emphasis on the development of tier 2 and tier 3 cities, which are seen as key drivers of growth for the country. The allocation of resources and initiatives aimed at these cities is expected to provide a boost to their economic and social development, making them new hopes for growth and progress in India.”
The Union Budget 2023 provides key support and incentives to the real estate sector. Overall, the budget presented a promising picture to real estate players, indicating a positive future ahead.