Real Estate Industry Calls for Urgent Policy Support in Budget 2026 to Revive Affordable Housing

As the 2026 Union Budget approaches, India’s real estate industry is advocating for urgent government action to revive the affordable housing segment and strengthen rental housing policies. Industry leaders warn that while overall market value has shown growth, demand for affordable homes has weakened, revealing structural imbalances that could affect long-term sector health.

Experts highlighted data showing that new home sales volumes declined in 2025, even as the total value of sales rose — indicating strong demand in the higher-end luxury segment but slackening interest at more affordable price points. To address this, they want the Budget to reintroduce tax incentives such as the 100 % tax holiday under Section 80-IBA, which previously helped boost affordable housing development and developer participation.

Industry bodies are also advocating a revision of the affordable housing definition and price caps to match current market realities, aligning thresholds with housing costs in major cities to make more units eligible for supportive policies. Stakeholders argue that policy support for rental housing, streamlined approvals, and incentives for sustainable, green construction should be central to the Budget to foster broader, inclusive growth in both residential supply and demand.

These recommendations come as part of wider discussions among real estate players seeking a balanced budget that addresses affordable housing stress, promotes long-term investment confidence, and helps restore buyer sentiment across diverse income groups.