Realtors’ apex body NAREDCO has urged the Centre to grant industry status to the real estate sector and sharply raise tax deductions on home loan interest in the upcoming Union Budget, arguing that stronger fiscal support is needed to revive affordable housing and sustain growth in the sector.
Addressing a press conference on Thursday, NAREDCO Chairman Niranjan Hiranandani said that while the government has taken several supportive steps for real estate in recent years, affordable housing continues to need focused policy intervention, PTI reported.
“We need to ensure Housing For All. Housing should get equal importance like any other infrastructure sector,” Hiranandani said, adding that the government should consider using its own land for developing affordable and mid-income housing projects.
A key demand flagged by the association is a steep hike in the income tax deduction limit on home loan interest for self-occupied properties. NAREDCO President Parveen Jain said the current cap of Rs 2 lakh should be increased to Rs 5 lakh to improve housing affordability and stimulate demand.
Jain also called for a revision in the definition of affordable housing, proposing that homes priced up to Rs 75–80 lakh be classified as affordable, compared with the current ceiling of Rs 45 lakh. Such a change, he said, would significantly expand the eligible buyer base, noting that GST on affordable homes is levied at just 1 per cent.
The association further pushed for policy support for rental housing, arguing that low rental yields discourage private investment. Jain said rental returns in the housing segment are currently just 1–3 per cent, making rental projects financially unviable for developers.
“To promote rental housing, the government must provide appropriate tax incentives and other facilities to real estate developers,” he said.
On industry status, Jain said the sector has been seeking this recognition for years, as it would enable access to cheaper institutional credit, including for land acquisition and construction inputs.
Considering real estate’s role in employment generation and its contribution to the economy, he said it was time for policy parity. The Indian real estate sector is estimated to grow to $ 1 trillion by 2030, he added.
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