Union Budget 2026: Real Estate Sector Awaits Streamlined Approvals and Tax Relief
Real estate industry players are hopeful that the Union Budget 2026 will bring significant changes to address affordability, streamline approvals, and create a friendlier tax framework for homebuyers and developers alike.
Ramani Sastri, Chairman and MD of Sterling Developers, emphasized that affordability remains the biggest hurdle for most buyers. He hopes that the Centre will raise the interest deduction limit under Section 24(b) from the current Rs 2 lakh to Rs 5 lakh a year. Sastri also called for the rationalization of GST on under-construction homes and quicker approvals to reduce project delays. Expanding the definition of affordable housing in urban areas would bring more buyers under the benefit net and boost end-user demand.
Harsh Jagwani, Managing Director of Notandas Realty, stressed that a Single Window Clearance System for new construction projects is long overdue and would accelerate both development and home-buying. He also highlighted the need for digitization of land and property records, cleaner land-title systems, and stricter escrow enforcement under RERA to reduce transaction risks. Jagwani noted that the luxury and premium segment is seeing growing demand, and policies encouraging Global Capability Centres (GCCs) could drive commercial real estate growth as global firms expand in India.
The coworking sector is also looking forward to the Union Budget 2026 for specific tax reliefs. Manas Mehrotra, Founder of coworking firm 315Work Avenue, hopes the budget will introduce a concessional, slab-based GST rate for coworking services, especially for startups and small businesses, to improve cash flows. Mehrotra also urged the removal of blocked input tax credit on interior fit-outs and the rationalization of TDS on coworking payments, currently pegged at 10 per cent for land or building rentals. He stated, 'We request the government to introduce a concessional, slab-based GST rate for coworking services, especially for startups and small businesses, as it would meaningfully improve startup cash flows and accelerate entrepreneurship. For the coworking sector, the real advantage lies in improved cash flow management and working capital efficiency.'
Mehrotra further underlined that competitive institutional finance and a single-window clearance push could help coworking spaces expand into non-metro cities as well. These changes could significantly boost the real estate and coworking sectors, making them more accessible and attractive to a broader range of investors and users.
