As the nation eagerly awaits the Union Budget 2025-26, the real estate sector has its eyes on potential tax reforms and financial incentives for homebuyers. With rising housing demand and government’s push toward “Housing for All,” experts are predicting some relief in property taxes and home loan interest rates.
Expectations from Homebuyers & Developers
Both developers and homebuyers are expecting rationalization in GST and property tax slabs. The industry also seeks extended tax deductions on home loan interest under Section 24(b) and an increase in the deduction limit under Section 80C for principal repayment.
“A 1–2% cut in home loan rates or enhanced deduction limits can boost both affordable and luxury housing segments,” says a senior real estate analyst.
Why Tax Relief Matters in 2025
Over the past two years, inflation and high lending rates have slowed down mid-segment sales. Any move to lower stamp duty or registration charges could reignite demand. States like Maharashtra and Karnataka have already demonstrated success through temporary tax reductions.
What Investors Should Watch For
Investors should look out for:
- Increase in home loan interest deduction limits
- Incentives for first-time homebuyers
- Lower capital gains tax on property sales
- Affordable housing subsidies and CLSS scheme extension
Expert Outlook
The government is likely to balance economic prudence with growth incentives. While a drastic cut in rates is unlikely, moderate relief is expected to stimulate property sales and improve liquidity in the real estate market.
Conclusion
Whether Budget 2025-26 delivers major tax relief or not, the real estate sector is expected to remain one of India’s top-performing investment categories. Any policy favoring affordable or middle-income housing will directly benefit homebuyers and developers alike.
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