Budget Reactions from the Real Estate Sector

New Delhi, February 02, 2022: 

Mr. Dhruv Agarwala, Group CEO, Housing.com, Makaan.com and Proptiger.com

“In a Budget that aspired to boost private consumption and create jobs to improve the economy in the backdrop of the third wave of the coronavirus pandemic, a variety of measures have been announced by Hon’ble FM Smt. Nirmala Sitharaman that would go a long way in meeting the twin targets.The provision of Rs. 48000 crore under Prime Minister Awas Yojana for completion of 80 lakh houses will help the government in achieving its target of Housing For All.The government’s proposal to cut down the approval time related to land and construction will bring ease of doing business.The real estate sector will also be benefitted from announcements related to industrial & logistics and data centers, enabling them to aggressively diversify into these two upcoming asset classes in the overall real estate sector.A lot of emphasis has also been given on better land record management.Steps such as tax exemption to start-ups extended to March 2023 will go a long way in invigorating the entrepreneurial spirit in the country.
However, the industry did expect some tweaks in tax slab, a move that would have resulted in greater savings for people, which would have consequently boosted consumption, especially in the real estate sector. The Budget has also been largely mute on any direct support for the housing sector.”

Manoj Gaur, CMD, Gaurs Group and Vice-President, North, CREDAI National
“The Union Budget 2022-23 was balanced and focused on overall nation’s economy and not just extending benefits to particular sectors. We believe that when all industries stay on the path of recovery and growth, sustenance gains strong ground and all industries get boosted equally. The focus on affordable housing and housing for all looked very strong in today’s budget. Allocation of 48,000 crore for PMAY will go a long way in helping people satisfy their basic need of owning a home. Another important aspect which was day’s highlight and we really appreciate as a developer who develops not just group housing but also townships, is the push on infrastructure and urban planning. With a committee being formed for urban capacity building and planning, I am sure India’s real estate development will no more be confined to few big metros only. Our long standing demand of industry status for the real estate sector remains unaddressed this year and we hope authorities look into it in the coming years.”

Pradeep Aggarwal, founder and chairman of Signature Global Group and chairman, Assocham – National Council on Real Estate, Housing and Urban Development
The Government has always focused on affordable housing, and in this Budget, the announcement was made regarding the allocation of Rs 48, 000 crore for PM Awas Yojana, and completing 80 lakh houses in 2022-23. It was a balanced Budget that took care of the overall economic development, including improving multi-model transportation in cities and increasing the highways by 25000 km. The improvement in transportation will generate employment in cities, leading to a growth in demand for housing. The affordable segment will also benefit from the announcement of reduction of time for land and construction related approvals in urban areas which was earlier a matter of concern for the industry. The Government has also talked about tier II and III cities and that it will work with urban planners to ensure that these cities witness economic growth and employment.  The Government will also work with Financial Sector regulators to expand access of capital along with reduction in cost of intermediaries; this will help the sector have access to funds to finish projects on time. Through, this a common man can complete his dream to have a home.

Mr.Amarjit Bakshi, CMD Central Park

We anticipated a budget that is both people and business-friendly; the current Budget made it clear that economic growth is the prime focus as the Economic Survey projected a GDP growth of 8-8.5 per cent in the next fiscal. The emphasis on improving transport infrastructure, including highways, will go a long way in creating sustainable pockets of real estate development. Though there was no announcement related to the sector, we are hopeful that job creation and the announcement of Ease of Doing Business 2.0 will lead to increased demand.

Uddhav Poddar, MD, Bhumika Group

This year’s budget focus was more on boosting the overall infrastructure, urban planning etc. not just in metros but also to Tier II-III cities.  The measure of setting up a high-level committee for urban planners and economists to be formed for recommendations on urban capacity building, planning implementation, and governance is a giant leap to introduce modern urban planning structures. Overall, the Union Budget 2022-23 had a mixed bag of announcements for the real estate sector, much was expected on the terms of single window clearance, industry status and tax incentives which did not come through.

Nayan Raheja, Raheja Developers
The real estate sector’s long-standing demand has not been addressed in Budget 22-23. We’ve been requesting industry status for the entire sector as well as single-window clearance to ensure smooth operations, but the government has yet to respond. Overall, Hon’ble FM’s budget announcements appear to be a mixed bag from a real estate standpoint. While the anticipated expansion of smaller cities and infrastructural improvements can be considered as favorable developments for the sector

Amit Modi, Director ABA Corp, President Elect, CREDAI Western UP

The sector had hoped for some tangible announcements like industry status and GST input tax credits for developers in this years Budget, but these did not happen. At the same time, we welcome Rs 48, 000 crore as allocation for PM Awas Yojana and identification of nearly 80 lakh households or the affordable housing scheme in 2022-23. We also look forward to recommendations of the government formed high-level committee for urban planners and economists to be formed for urban capacity building, planning implementation, and governance.Following a challenging year, it was critical to allocate resources to job creation and the strengthening of employment-creating industries, which the government has attempted to do, but real estate sector being one of the largest employers in the country had hoped for more fiscal and policy support to not only bounce back from the pandemic induced slowdown, but also be a sizeable contributor to governments 60 lakh job creation target and $5 trillion economy scale

Abhishek Bansal, Executive Director, Pacific Group
We congratulate the FM for coming up with a Budget with a focus on overall economic health; the announcement will lead to better-earning opportunities for people directly impacting the retail sector. We can see the retail and commercial segment moving to more Indian cities as infrastructure will improve after various announcements in the Budget. Though there was not much in terms of tax savings for people, overall economic growth will lead to increased income that will support retail consumption.

Mr. Ankit Kansal Founder and MD, 360 Realtors
Despite very high hopes, the budget so far has been a little disappointing for the Indian Real Estate industry. There has been a slew of sector-specific policies for industries such as chemicals & fertilizers, gems & stones, steel, defense, animation, electronic appliances, etc. Meanwhile, nothing very concrete has been announced about real estate. However, there have been a couple of positive outcomes. Firstly GOIs commitment to further develop urban infrastructure in a robust but sustainable fashion is a welcome step. Secondly, GOI has rationalized custom duties for a host of steel products including steel scarp for secondary steel producers. Lowering steel prices might be helpful in optimizing input costs. Another icing on the cake has been the Indian economic comeback. The Honorable Finance Minister during the budget session suggested the GST collection of over 140,000 Crores during JAN 2022, the highest after the implementation of the GST regime. The spike in GST collection resonates with a healthy economic outlook, which will drive demand for real estate. Meanwhile, the government has also extended one more year for availing tax benefits for newly incorporated manufacturing units. This might help drive demand for industrial lands, warehouses, and commercial assets.

Prateek Mittal, Executive Director, IIT Alumni at Sushma Group

Indirectly, the real estate sector will benefit from focusing on infrastructure, innovation, and job growth. The Government also talked about urban development, where it will nurture the megacities as centres of economic growth and focus on tier II-III cities to develop a sustainable growth environment. We foresee an influx of financial Institutions will focus and invest in tier II – III cities which will ease the liquidity and  boost the sector, providing people with varied housing options; the players already working in these areas will benefit from the first-mover advantage and their working experience in these regions.

Sanjay Sharma, Director,SKA Group
As expected, Affordable Housing was once again the focus as the Government is moving towards ‘Housing for all’ by announcing the completion of 80 lakh houses under PMAY and allocation of Rs 48,000 crore under the PM Housing scheme. The Central Government will work with state govt for reduction of time for land and construction related approvals promoting affordable housing for middle class and economically weaker section in urban areas. We are sure that the work on the segment will speed up, and people will realize the dream of owning a home.

Mr.Vikas Garg, DMD, MRG World
We are happy that the focus of the Government is on providing affordable housing; the announcement to come up with 80 lakh houses under PMAY for urban and rural areas calls for a concerted effort of Government and the developers. The focus on improving transport will definitely help develop affordable houses, which is a precondition of the buyers. The Government has also said that it will work with the financial sector to reduce the cost of intermediaries, which will further streamline the process and control the cost.

Mr.Aman Sharma, Director Spaze Group

One step to encourage people to buy homes is to improve the economy, and Budget 22-23 had everything required to kick start a healthy economic growth. Improved transportation and expansion of highways will lead to the demand for more commercial real estate. Support to startups and MSMEs will create an environment that will require more office spaces, even in Tier II-II cities.

Mr. LC Mittal, Director, Motia Group

Improvement in transport infrastructure and highways will go a long way in making people move to smaller cities; the announcement regarding developing a sustainable growth environment for these cities will further lead to a uniform economic development creating real estate demand. We welcome the Budget as it is work towards overall growth of economy and reach the target of 8-8.5 per cent GDP growth as predicted in Economic Survey.

Corporate Comm India (CCI Newswire)