GST 2.0 Boosts Real Estate Demand: CREDAI's Boman R. Irani
The central government's GST 2.0 reforms are expected to boost housing demand in India, with real estate companies ready to pass benefits to consumers. CREDAI, the apex real estate body, discusses the impact and potential of the real estate sector.
Gst 20Real EstateCredaiHousing DemandEconomic GrowthReal Estate NewsSep 12, 2025
CREDAI, the apex real estate body representing 13,000 developers in India, believes that real estate companies are ready to pass on the GST benefits to consumers. The exact details will be revealed after September 22, when GST 2.0 comes into effect.
Boman Rustom Irani, chairman and MD of Rustomjee Group and chairman of CREDAI National, stated that GST 2.0 is a positive step. The government has taken initiatives to make affordability more understandable and accessible to the masses. "They have uniformly brought down the GST slabs, removed things like cess, and simplified the GST rules. On the ground, there’s definitely a feel-good factor. People believe that the government is interested in bringing the cost down, and everyone is very excited about it," Irani told Fortune India.
Irani, who has been an investor in Jawa, Yezdi & BSA Motorcycles, emphasized that CREDAI developers will pass on GST 2.0 benefits to buyers. "GST cut on materials means that if the end price is less, even the GST on that will be less, and the stamp duty will be less. So, there will also be a multiplier effect. All of that will be passed on to the consumer," he explained.
However, the exact impact of GST 2.0 on real estate depends on the 250-odd industries that real estate companies rely on, such as cement and steel, which are the largest components. "If the reduction in taxes is passed on to the developer, we will definitely move towards that. On how much is possible, we are still working and will know in the short term," Irani added.
India’s real estate sector is poised to reach $5-10 trillion by 2047, fuelling close to one-fifth of India’s GDP. Office and industrial and warehousing stock are expected to cross 2 billion sq ft, according to a new report, “Indian real estate: Fostering equity and fueling economic growth” by Colliers and CREDAI.
Shekhar Patel, President of CREDAI, highlighted the sector's potential to contribute significantly to the nation’s economic transformation. He noted that GST 2.0 is set to boost demand, especially during the upcoming festivals. "The impact has started to be seen. We are feeling on the ground that the inquiry level has increased. The conversion level will increase either after Diwali or during Diwali. But the inquiry level has increased a lot," Patel responded to a Fortune India query.
High Commissioner of India to Singapore, Shilpak Ambule, also spoke on Day 1 of the CREDAI NATCON event, discussing the strengthening of bilateral ties, tech and skill collaboration, and opportunities in real estate-linked sectors. "The past year has been very busy. Prime Minister Modi visited here in September last year, and we decided to elevate the relationship to a comprehensive strategic partnership. They identified six new areas of collaboration between India and Singapore," Ambule said.
India and Singapore recently unveiled a roadmap to boost trade under the Comprehensive Strategic Partnership, aiming to deepen trade relations, tie up in the semiconductor space, sustainable industrial parks, and explore digital finance. Ambule mentioned that the strategic partnership has started with UPI and PayNow linkage and skilling collaboration. "Singapore has mastered the art of skilling. We are trying to take the help of Singapore and build similar skilling institutions back in India. Few states have done well, like we have a World Skilling Centre in Bhubaneswar, Odisha, built and operated by the Singaporeans," he added.
Ambule also highlighted the increased collaboration with different states of India. "We have had six state delegations coming in; five chief ministers have come in to pitch their state as an investment destination. Singaporean companies and investment funds like Temasek, GIC, and others are actively looking to expand their investments in India, particularly in areas related to housing and developers like logistics, warehousing, industrial parks, commercial real estate, and business and IT parks," he said.
CREDAI, via its latest report, has outlined the real estate sector’s role in driving India’s $30 trillion economy by 2047. The industry is poised to reach $5-10 trillion, fuelling close to one-fifth of India’s GDP, while office and industrial and warehousing stock are expected to cross 2 billion sq ft. As India reforms take shape and real estate companies expand beyond top hubs, annual housing sales could potentially double to 1 million units by 2047. The report also predicts that the share of REITs in real estate market capitalisation will be 40-50% by 2047, up from current levels of 10%.
Frequently Asked Questions
What is GST 2.0 and how will it impact the real estate sector?
GST 2.0 is a set of reforms by the Indian government aimed at simplifying and reducing the Goods and Services Tax. It is expected to lower the cost of materials and ultimately benefit consumers in the real estate sector, potentially boosting housing demand.
Who is CREDAI and what is its role in the real estate industry?
CREDAI, the Confederation of Real Estate Developers' Associations of India, is the apex body representing real estate developers. It plays a crucial role in advocating for the interests of developers and promoting the growth of the real estate sector.
What changes are sought in the definition of affordable housing?
Real estate companies are seeking changes in the definition of affordable housing to make it more accessible and understandable to the masses, aligning with the government's initiatives to bring down costs and improve affordability.
How will the GST 2.0 benefits be passed on to consumers?
CREDAI developers have committed to passing on the benefits of GST 2.0 to consumers. This includes reduced costs on materials, lower GST on the end price, and lower stamp duty, creating a multiplier effect that will benefit buyers.
What is the projected growth of the real estate sector by 2047?
According to a report by Colliers and CREDAI, the real estate sector in India is projected to reach $5-10 trillion by 2047, contributing close to one-fifth of India’s GDP. The sector is expected to see significant growth in office, industrial, and warehousing stock, potentially doubling annual housing sales to 1 million units.
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