Real Estate Experts Urge Long-Term Policy Changes in Budget 2026, Not Temporary Relief

As the Union Budget 2026-27 approaches, India’s real estate industry is emphasising the need for long-term structural reforms rather than short-lived relief measures that do little to address persistent challenges in the sector. While last year’s budget focused on promoting affordable housing and lowering transaction costs, industry leaders say that deep-seated issues — such as rising home prices, tax uncertainties and approval delays — still limit buyers’ ability to purchase homes and developers’ capacity to complete projects efficiently.

Housing affordability remains a central concern. Statutory caps on tax incentives like Section 80-IBA no longer match current market values in major cities, constraining the supply of affordable units. Experts argue that revisiting these limits and aligning them with real market price realities is essential to revitalising demand. They also call for enhanced deductions on home loan interest and a revisit of capital gains tax rules to make housing ownership more viable for middle-income families.

Beyond tax relief, the industry is pushing for regulatory and procedural reforms to break persistent bottlenecks in project approvals and land record systems. Despite ongoing talk of single-window clearances and digitised land titles, slow bureaucratic processes continue to delay project timelines and erode investor confidence. Budgetary support aimed at fast-tracking approvals and digitising land records could help ease these longstanding hurdles.

Stakeholders also highlight the early success of liquidity support measures such as the SWAMIH Fund, which has helped revive stalled housing projects by providing last-mile financing. They believe expanding such mechanisms, together with clear frameworks under the Insolvency and Bankruptcy Code, can further accelerate project completions and protect homebuyers.

Looking ahead, the real estate industry wants policy focus to go beyond the biggest cities. Support for rental housing, REITs and growth in non-metro regions — backed by infrastructure investments — is seen as key to sustainable, inclusive development. Simplifying tax pass-through rules for REITs and encouraging adoption of the Model Tenancy Act are among additional suggestions that could help broaden the sector’s contribution to economic growth.

In summary, the sector is urging Budget 2026 to shift from short-term “band-aid” measures to deep, structural fixes that strengthen housing affordability, reduce friction in transactions, accelerate clearances and incentives, and support both supply and demand across the real estate ecosystem.