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The sector hopes for policy clarity and improved ease of doing business, including relaxed norms for foreign direct investment (FDI) in luxury real estate.
As the demand for luxury real estate grows, driven by an expanding base of affluent buyers, the Union Budget 2025 has the potential to create a robust ecosystem for this segment.
Authored By Mohit Agarwal:
The Indian real estate sector eagerly anticipates the Union Budget 2025, seeking measures to drive growth and attract investments. As the world’s fifth-largest economy, India has experienced a significant rise in purchasing power among its citizens. This growing affluence, coupled with increasing demand for premium living spaces, positions the luxury real estate market as a critical segment requiring targeted government support.
The sector hopes for policy clarity and improved ease of doing business, including relaxed norms for foreign direct investment (FDI) in luxury real estate, to establish India as a global destination for high-end residential and premium mixed-use projects.
To address rising input costs, the industry seeks relief in the form of reduced import duties on construction materials, particularly those used in luxury developments in high demand cities like Gurgaon. Reforms in taxation policies are also a priority.
Enhanced tax benefits for home loan borrowers in the luxury segment, particularly through increased deductions on interest payments, could further stimulate investment in high-value real estate. Streamlined project approval processes and timely clearances are also essential to build confidence among developers, investors and end-users.
Integrating smart city initiatives with luxury real estate projects offers an opportunity to enhance living standards and attract high-net-worth individuals (HNIs) and non-resident Indian (NRI) buyers. Additionally, promoting sustainability in luxury developments is crucial. Developers are increasingly adopting eco-friendly practices and energy-efficient designs, and government incentives such as subsidies for green certifications or tax benefits for sustainable construction materials would encourage this transition while aligning with India’s environmental goals.
The sector also expects measures to address financing and liquidity concerns. Relaxed norms for real estate investment trusts (REITs) and policies that attract institutional and private equity investments could enhance financial stability. Simplifying procedures for luxury projects would further boost investor confidence.
As the demand for luxury real estate grows, driven by an expanding base of affluent buyers, the Union Budget 2025 has the potential to create a robust ecosystem for this segment. By addressing its challenges and fostering an environment conducive to innovation and sustainability, the government can unlock the sector’s potential, contributing to economic growth and redefining premium living in India.
(The author is business head of Conscient Infrastructure Pvt Ltd. Views Are Personal)
