Budget 2025: Key Announcements Boost Real Estate Stocks
Real estate stocks, including those of DLF, Sobha Ltd, Oberoi Realty, Prestige Estates, Phoenix Mills, and Macrotech Developers, surged up to 9% on February 1, 2025, following several positive announcements in the Union Budget 2025.
Real EstateBudget 2025Stock MarketPropertySwamih Fund 2Real Estate NewsFeb 03, 2025
The market welcomed the measures aimed at boosting the real estate sector.
Here’s a closer look at the stock performances and the key budget announcements that have been driving this positive sentiment.
Prestige Estates shares closed 5.03% higher at Rs 1,431.50 on the BSE, pushing the market cap to Rs 61,659 crore.
DLF, a prominent NCR-based developer, saw its shares rise by 2.10% to Rs 760.75, with its market cap reaching Rs 1.88 lakh crore.
Similarly, Phoenix Mills' shares climbed 7.27% to Rs 1,761.55, increasing its market cap to Rs 62,975 crore.
Oberoi Realty's stock also rose by 1.83% to Rs 1,845.65, bringing its market cap to Rs 67,108 crore.
South India-based developer Sobha's shares gained 4.10% to Rs 1,378, with a market cap of Rs 14,731 crore.
Macrotech Developers, based in Mumbai, saw its shares end 6.31% higher at Rs 1,280, with a market cap of Rs 1.27 lakh crore.
The Union Budget 2025 introduced several measures that are expected to bolster the real estate sector.
Here are the key announcements
SWAMIH Fund 2The establishment of a Rs 15,000 crore fund, SWAMIH Fund 2, aims to expedite the completion of 1 lakh units for affordable and mid-income housing.
This fund will be a blended facility involving the Government of India (GOI), banks, and private investors.
Tax Benefits for Up to 2 Self-Occupied PropertiesTaxpayers can now claim the annual value of self-occupied properties as Nil for up to 2 self-occupied properties, up from 1 earlier, and without any conditions.
This change is expected to provide significant relief to homeowners.
Increased TDS Limit on RentThe annual limit for Tax Deducted at Source (TDS) on rent has been increased from Rs 2.4 lakh to Rs 6 lakh.
This move will benefit small taxpayers receiving smaller rent payments, reducing their tax burden.
Enhanced Allocation for Smart City MissionThe allocation for the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Smart Cities Mission has been increased by 25% from Rs 8,000 crore to Rs 10,000 crore.
This higher allocation is expected to positively impact the building materials sector.
Additionally, Finance Minister Nirmala Sitharaman announced that no income tax would be payable on income up to Rs 12 lakh under the new tax regime.
This measure is expected to leave more money in the hands of salaried taxpayers, potentially boosting consumption and directing some of the savings into the real estate sector.
On February 1, the BSE realty index closed 3.69% higher at 7,414.
The index has surged 10.74% since the Interim Budget on February 1, 2024, but it has lost 11% since the Union Budget 2024 was presented on July 23, 2024.
These budget announcements have not only boosted the real estate sector but also instilled confidence among investors.
However, it's important for potential investors to consult with a qualified financial advisor before making any investment decisions.
Frequently Asked Questions
What is SWAMIH Fund 2 and how much is the fund allocated?
SWAMIH Fund 2 is a Rs 15,000 crore fund established to expedite the completion of 1 lakh units for affordable and mid-income housing, involving the Government of India, banks, and private investors.
What are the new tax benefits for self-occupied properties under the Union Budget 2025?
Taxpayers can now claim the annual value of self-occupied properties as Nil for up to 2 self-occupied properties, up from 1 earlier, and without any conditions.
How has the TDS limit on rent been increased in the Union Budget 2025?
The annual limit for Tax Deducted at Source (TDS) on rent has been increased from Rs 2.4 lakh to Rs 6 lakh, benefiting small taxpayers receiving smaller rent payments.
What is the increased allocation for the Smart City Mission in the Union Budget 2025?
The allocation for the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Smart Cities Mission has been increased by 25% from Rs 8,000 crore to Rs 10,000 crore.
How will the new tax regime benefit salaried taxpayers under the Union Budget 2025?
No income tax will be payable on income up to Rs 12 lakh under the new tax regime, leaving more money in the hands of salaried taxpayers and potentially boosting consumption, including investments in the real estate sector.
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