Government Eyes Relaxation of Height Restrictions to Boost Vertical Real Estate Growth

The central government is considering changes within the existing regulatory framework governing real estate and construction to accelerate vertical development of housing and allied sectors, as it seeks to double the sector’s contribution to India’s GDP by 2047, Civil Aviation Minister Kinjarapu Ram Mohan Naidu said on February 13.

Addressing the National Urban and Real Estate Development Conclave-2026 organised by NAREDCO, Naidu said India’s real estate sector is poised for significant long-term expansion, supported by reforms and rising investor confidence.

“Indian real estate market is expected to reach $1 trillion by 2030 driven by structural reforms, enhanced transparency and rising investor confidence. It has the potential to expand to $5–7 trillion by 2047,” he said.

Naidu underlined that future growth in real estate and construction would increasingly depend on vertical development, as horizontal expansion is constrained by limited urban land availability.

“Since horizontal expansion and growth of real estate and construction would not be possible in future given the constraint of space, the vertical development of the sector would be required, for which the government would have to make amendments in the present real estate and construction sector, including in some of its infrastructure segments,” he said.

While the minister did not specify the nature of regulatory changes under consideration, he said a comprehensive study is underway. According to him, an agency has been tasked to examine the regulatory framework, and its recommendations would be announced in the future. These changes, he said, are aimed at ensuring that real estate and construction benefit from airport-led infrastructure growth across the country.

“Nearly 50 more airports would be added to the current airport strength of India in the next five years whereas this number would multiply to 200 airports in the next 20 years, which would not only transform the civil aviation sector but have its massive multiplier effects in the real estate, construction and housing sectors,” he said.

He called upon National Real Estate Development Council (NAREDCO) to accelerate India’s transition towards rental housing, noting that younger, aspirational Indians increasingly prefer flexibility to ownership.

Speaking at the conclave, Tokhan Sahu, Minister of State for Housing and Urban Affairs (MoHUA), said the construction, housing and affordable housing segments would be supported in line with government targets as India moves towards its “Viksit Bharat” goals. Sahu emphasised the challenges in affordable housing and called on the industry to play a proactive role. He said the government remains committed to ensuring that affordable homes promised under the Pradhan Mantri Awas Yojana (PMAY) are delivered for the poorest sections of society.

Parveen Jain, president, NAREDCO, said the real estate sector requires supportive policies to help double its GDP contribution over the next few years, in line with India’s 2047 development vision. He added that balanced urban development is critical to ensure growth benefits reach rural India.

Echoing similar views, Niranjan Hiranandani, Chairman, NAREDCO, said India is at a pivotal point in its urban transformation as more than half of India will be urban by 2047.

“Urban India today houses nearly 37 percent of our population and contributes almost 65 percent of our GDP. As we move towards Viksit Bharat by 2047, the role of real estate and urban development becomes not peripheral—but central—to national progress,” he said.