What Real Estate Leaders Are Expecting

As India moves closer to the Union Budget 2026–27, expectations from the real estate sector are both high and nuanced. After a period marked by global volatility, shifting investment patterns and rising urbanisation pressures, stakeholders across housing segments — from affordable and mid-income to luxury, commercial, senior living and rental housing — are looking to the Budget for calibrated interventions rather than sweeping populism. The common thread running through industry views is clear: policy stability, affordability enhancement, liquidity support and infrastructure-led growth are now more important than ever.

At the macro level, there is cautious optimism. Growth momentum remains intact, inflation is relatively contained, and capital flows into India continue to be resilient despite geopolitical uncertainties. Binitha Dalal, founder and managing partner, Mt. K Kapital, points out that global developments, from energy market disruptions to trade uncertainties, underscore the need for a fiscally prudent yet growth-supportive Budget that strengthens India’s economic resilience. For real estate, this translates into a sharper focus on structural enablers such as GST rationalisation, access to long-term capital, policy clarity on REITs and redevelopment, and incentives for green and sustainable construction.

Recalibrating Affordability for Today’s Realities

A dominant theme across stakeholder commentary is the urgent need to realign housing affordability metrics with current market realities. While residential markets have shown resilience, affordable housing has lagged, weighed down by rising land prices, higher construction costs and stagnant incentive thresholds. Shishir Baijal, international partner and CMD, Knight Frank India, states that without timely policy recalibration, demand in this critical segment risks remaining suppressed. He emphasises the need for targeted fiscal support for homebuyers and measures that improve project viability, particularly in large urban centres where price thresholds no longer reflect actual costs.

Echoing this view, several developers have called for revisiting the definition of affordable housing. Boman Irani, CMD, Rustomjee Group, argues that affordability should be defined purely by unit size, without rigid price caps that fail to account for inflation, land costs and statutory premiums. He points out that the ₹45 lakh cap fixed in 2017 is effectively equivalent to ₹75–80 lakh today, making it increasingly disconnected from urban market realities. Others, such as Pradeep Aggarwal, founder & chairman, Signature Global and Ramji Subramaniam, MD, Sowparnika Projects, have suggested expanding price thresholds to ₹65–75 lakh or even upto ₹1 crore, especially in high-cost cities, to truly support the government’s ‘Housing for All’ vision.

Tax relief for homebuyers is another recurring demand. The home loan interest deduction under Section 24(b), capped at ₹2 lakh for nearly a decade, is widely seen as outdated. With average annual interest outgo for middle-income buyers in urban markets exceeding ₹7.5 lakh, developers including Irani, Vikas Bhasin, MD, Saya Group and Manan Joshi, founder, Sarvam Properties have urged the government to significantly enhance this limit, particularly for first-time buyers, to improve EMI affordability and convert latent demand into actual purchases.

GST Rationalisation and Liquidity Support

GST continues to be a central pain point for the sector. Many stakeholders have reiterated the long-standing demand for restoring input tax credit (ITC) for developers, arguing that it would bring cost efficiencies, improve transparency and lower effective prices for end-users. In the interim, suggestions range from making GST nil on homes qualifying under a revised affordable housing definition to capping GST at 2.5% on other residential units, compared to the current 5%. According to industry leaders, such rationalisation would stimulate transactions without significantly impacting government revenues, thanks to higher volumes and allied economic activity.

Beyond taxation, liquidity and access to capital remain critical concerns. Granting industry status to real estate — a demand reiterated by Pradeep Aggarwal, Vikas Bhasin and others — could improve access to institutional funding, reduce borrowing costs and enhance transparency. With the sector currently contributing around 7% to GDP and supporting over 200 allied industries, stakeholders believe this move could help real estate reach its potential contribution of upto 15% of GDP by 2047, aligning with the broader vision of a ‘Viksit Bharat’.

Infrastructure, Approvals and Ease of Doing Business

If affordability is the demand-side lever, infrastructure is the supply-side catalyst. Continued investment in urban infrastructure, mass transit and connectivity has been widely acknowledged as essential to unlocking new growth corridors and expanding affordable land supply. Baijal stresses that improved connectivity to peripheral areas can enable more inclusive urbanisation, while Robin Mangla, president, M3M India highlights how infrastructure-led development has already reshaped the NCR over the past decade.

Stakeholders across regions, from NCR-focused developers like Aman Sharma, founder and MD, Aarize Group and Ashish Agarwal, director, AU Real Estate to those eyeing tier 2 cities such as Parvinder Singh, CEO, Trident Realty, have called for faster approvals, single-window clearances and time-bound environmental permissions. These reforms, they argue, would reduce holding costs, improve capital efficiency and ensure timely project delivery, benefits that ultimately flow to homebuyers.

Premium, Luxury and Emerging Segments

While affordability dominates the discourse, premium and luxury housing is also undergoing a transformation. Manish Agarwal, MD, Satya Group and president, CREDAI Haryana notes that luxury homebuyers are now seeking curated, investment-grade living experiences rather than just high-end residences. He urges policy measures that enhance capital availability, streamline regulations for high-value transactions and encourage structured fractional ownership to democratise access to marquee assets.

Tier 2 cities are emerging as a new frontier for premium housing, driven by lifestyle upgrades, talent migration and improved infrastructure. Parvinder Singh points out that luxury housing in these markets is not just about aspirational living but also about job creation, talent attraction and the development of future-ready urban ecosystems.

Holiday homes and second residences are another area of growing interest. Aditya Kushwaha, CEO and director, Axis Ecorp believes that continued focus on infrastructure and tourism-led development in destinations like Goa, along with simplified ownership processes, could significantly boost demand, particularly among NRIs looking at second homes as lifestyle-cum-investment assets.

Rental Housing, Senior Living and Inclusivity

Beyond ownership-focused models, there is increasing recognition of underserved segments such as rental housing and senior living. Baijal underscores the need for a formal, long-term rental housing ecosystem supported by an enabling regulatory and fiscal framework. Such a move could unlock underutilised housing stock, improve workforce mobility and attract patient institutional capital.

Senior living has emerged as a distinct priority as India’s demographic profile evolves. Adarsh Narahari, founder & MD, Primus Senior Living and Anil Godara, founder and MD, J Estates highlight the need for targeted incentives, GST relief on essential services, expanded health insurance access and a functional reverse-mortgage framework. With the elderly population projected to grow sharply by 2030, stakeholders argue that senior living must be recognised not just as a niche asset class but as a critical component of India’s social and housing infrastructure.

Commercial Real Estate and MSME-led Growth

The commercial and mixed-use segments also figure prominently in pre-budget expectations. Ashok Nawany, co-founder and chairman, Nawany Group links the growth of commercial real estate to the strengthening of MSMEs, which already contribute nearly 30% to India’s GDP. Clearer GST norms, easier credit access and targeted incentives, particularly for women entrepreneurs, could catalyse the creation of new business hubs, generate employment and even help reverse brain drain by fostering a more attractive startup ecosystem.

A Balanced Path Forward

Taken together, stakeholder views suggest that the real estate sector is not seeking short-term stimulus but a balanced, forward-looking policy framework. Measures that enhance affordability, rationalise taxation, improve liquidity and accelerate infrastructure development can reinforce buyer confidence and sustain long-term growth. Equally important are reforms that improve ease of doing business, encourage sustainable construction and recognise emerging segments such as rental housing, senior living and mixed-use developments.

As India stands at a pivotal point in its urban and economic journey, the Union Budget 2026–27 has the opportunity to position real estate not just as a beneficiary of growth, but as a strategic enabler of inclusive urbanisation, employment generation and long-term wealth creation. A stable, growth-oriented budget could go a long way in ensuring that the sector continues to support India’s aspirations — today and well into the decades ahead.