Union Budget 2026: Key Announcements for the Real Estate Sector

The Union Budget 2026–27, presented by Mr. Amit Chopra, President, brings several key announcements that are expected to have a profound impact on the real estate sector. These measures are designed to enhance the sector's growth and attract more investment, particularly in underutilized assets and infrastructure development.

The proposal to use Real Estate Investment Trusts (REITs) for monetizing Central Public Sector Enterprise (CPSE) assets is a significant step. This move is expected to unlock substantial value from underutilized government land, which can be leveraged for various developmental projects. The introduction of REITs will also attract institutional capital, providing a new avenue for investment in the real estate market.

Continued capital expenditure on infrastructure and urban connectivity is another crucial aspect of the budget. This focus on infrastructure development is anticipated to support demand in Tier-2 and Tier-3 markets. Improved connectivity and better infrastructure can make these regions more attractive for both residential and commercial real estate developments, thereby driving economic growth and urbanization.

One of the notable simplifications introduced in the budget is the removal of the Tax Deduction and Collection Account Number (TAN) requirement for Non-Resident Indians (NRIs) selling their properties. This change is expected to ease compliance and make the property transaction process smoother for NRIs, potentially increasing the number of NRI investments in the Indian real estate market.

Additionally, the budget includes tourism-focused initiatives that could benefit hospitality-led real estate. Enhanced tourism infrastructure and promotional activities can boost the demand for hotels, resorts, and other hospitality properties, contributing to the overall growth of the sector.

However, the budget has left some expectations unaddressed. For instance, there are no significant changes to home loan interest deductions, the definition of affordable housing, or the industry status for real estate. These areas may require further policy attention to fully realize the sector's potential and address the needs of various stakeholders.

Despite these gaps, the measures introduced in the Union Budget 2026–27 are expected to provide a strong foundation for the real estate sector's growth. The focus on asset monetization, infrastructure development, and transaction ease are positive steps that can attract more investment and drive demand in the market. Further policy initiatives and support will be crucial to addressing the remaining challenges and ensuring sustained growth in the real estate sector.