BUDGET 2022-23: IMPACT ON REAL ESTATE SECTOR

The recently announced Union Budget 2022-23 may prove to be a significant moment in the real estate industry. The Finance Minister has announced several measures that are expected to benefit the real estate sector.n The Union Budget 2022-23 announcements appear facilitating and forward-thinking, with a strong emphasis on affordable housing and infrastructure development. Due to the Coronavirus-induced challenges, India’s real estate sector has suffered from a slowdown in housing sales, reduced site visits, and project delays over the last few years. The announcements in Budget 2022-23 have given a boost to the affordable housing sector and reduced anti-dumping duties on steel. Let us look more closely at the recommendations and their impact on the real estate sector.

real estate budget

INDEX:

1. Economic stimulants for real estate growth
2. Recommendations for Housing Development in the Budget
3. Tier 2 and Tier 3 cities place an emphasis on urban planning.
4. Budget for Infrastructure Development
5. Land Records Administration

1. Economic stimulants for real estate growth:

real estate increase

The Finance Minister forecasts 9.2 percent economic growth in fiscal year 2022-23. With a planned capital expenditure of Rs 7.5 lakh crore, these indicators could lead to increased market cash liquidity, which would have a direct impact on the real estate sector.

2. Recommendations for Housing Development in the Budget:

The finance minister has recommended that over 80 lakh affordable houses be built and delivered by 2023 in order to give a boost to the ‘Housing for All’ mission. These houses will be built as part of the flagship housing development programme “Pradhan Mantri Awas Yojana” (PMAY). It will enable the economically disadvantaged sections of society to own a housing unit at a low cost.

In addition, the Finance Minister has proposed allocating Rs 48,000 crore to stalled projects under the country’s affordable housing schemes. It allows for the timely completion of under-construction projects.

3. Tier 2 and Tier 3 cities place an emphasis on urban planning:

The Finance Minister emphasised development and urban planning in Tier 2 and Tier 3 cities in this year’s Budget. With a focus on sustainable and planned development, the housing sector could benefit. In addition, five centres of excellence for urban planning have been proposed, which will provide the sector with a channel to hire trained professionals. To recommend urban planning policies, implementation plans, capacity building, and governance, a high-level committee of urban planners, economists, and institutions will be formed.

4. Budget for Infrastructure Development of real estate:

real estate

The expansion of National Highways has been announced in the Budget to exceed 25,000 km. The Prime Minister Gati Shakti’s plan for a coordinated strategy to develop cargo terminals and express ways, in addition to other infrastructure, will contribute to overall growth and development.

Colliers’ Ramesh Nair, CEO of India and Managing Director of Market Development in Asia, says, “Several announcements were made in the Budget to help the country’s logistics sector grow. We eagerly await the announcement of new legislation on real estate to replace the Special Economic Zone Act. This has the potential to make export-led parks more appealing to investors. The new benefits will also benefit technology companies that export services, as well as commercial office real estate.”

5. Land Records Administration for:

The Union Budget recommends a Unique Land Parcel Identification Number for the management of digital land records of real estate. This step will increase the level of transparency in real estate transactions. Efforts are also being made to translate land records from regional languages. The ‘anywhere registration’ of deeds and documents through the ‘One Nation One-Registration Software’ could be a game changer for India’s real estate sector.

Overall, the Union Budget has laid out a positive road map, with a promising growth outlook and a focus on urban planning and long-term growth.

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