Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
India's Union Budget for 2026-27 introduced a range of measures expected to bolster the real estate and construction sectors, with a focus on infrastructure-led urban development, asset monetisation and regulatory relief. The government proposed the accelerated monetisation of central public sector enterprise real estate through dedicated Real Estate Investment Trust (REIT) structures, alongside incentives to strengthen construction equipment manufacturing. Income tax exemptions were announced for landowners affected by compulsory acquisition for infrastructure projects, while compliance for property transactions involving non-residents was simplified. A new initiative to establish City Economic Regions (CERs) is designed to channel investment into Tier-2 and Tier-3 cities and temple towns, with dedicated financing for civic infrastructure. Urbanisation and connectivity measures are expected to widen real estate demand beyond the largest metropolitan markets. However, direct incentives for affordable housing remained absent.
The Union Budget 2026-27 has unveiled policy measures expected to influence India's real estate ecosystem by strengthening infrastructure, enhancing market liquidity and supporting urban growth. Finance Minister Nirmala Sitharaman presented the Budget, emphasising initiatives aimed at improving capital recycling, easing compliance and accelerating the development of urban economic infrastructure. Advertisement
A central plank of the Budget is the accelerated monetisation of real estate assets held by central public sector enterprises through dedicated Real Estate Investment Trusts (REITs). The government reiterated its confidence in REITs as instruments for unlocking capital from mature assets, creating recurring revenue streams and diverting liquidity toward new infrastructure projects. This move is anticipated to attract institutional investors and broaden the market for large, income-generating property assets.
The Budget also proposed a Scheme for Enhancement of Construction and Infrastructure Equipment to support domestic manufacturing of advanced machinery used in multi-storey residential construction and infrastructure projects. This initiative is aimed at expediting project execution and enhancing productivity across building and transport-oriented sectors.
On the taxation front, the government announced an income tax exemption for individuals and Hindu Undivided Families (HUFs) on income derived from compulsory land acquisition under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, excluding certain categories of land. The measure is expected to alleviate tax-related disputes for landowners affected by public infrastructure works. Simultaneously, compliance procedures for property transactions involving non-residents have been streamlined by permitting the use of Permanent Account Numbers (PAN) instead of requiring a separate Tax Deduction and Collection Account Number (TAN).
Urban development received a significant push through the announcement of City Economic Regions (CERs), aimed at harnessing agglomeration-led economic growth in Tier-2 and Tier-3 cities, as well as key temple towns. The government proposed an allocation of INR 5,000 crore per CER over five years, to be deployed through a results-based financing mechanism focused on civic infrastructure and services. Analysts and industry stakeholders expect this to broaden real estate demand beyond traditional metropolitan corridors and support diversified urbanisation.
Stakeholders welcomed the increased public capital expenditure and focus on urban growth but noted the absence of direct fiscal incentives for affordable housing, a key concern for the sector. Nonetheless, the Budget's emphasis on connectivity and expansion of urban markets is seen as a positive structural backdrop for the real estate industry over the medium term.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
