Union Budget 2024 | Realtors seek tax rationalisation, ease-of-doing business

During 2023, average housing prices across the eight major cities of the country saw a 9 per cent year-on-year (YoY) rise. The trend persisted in Q1 2024 with a 10% YoY rise. About 52% of the surveyed developers across India expect a continued rise in housing prices in 2024.

Bengaluru: Realty developers who’ve been basking in the boom seen in the luxury segment of the residential property market, want more sops for affordable housing - a segment that has failed to take off, despite several nudges from the government in the past Union budgets. This apart, they are seeking tax rationalisation, single window clearance and facilitation of ‘ease of doing business’ in the upcoming Union Budget. 

According to the Real Estate Developers’ Sentiment Survey 2024 by CREDAI and Colliers released on Friday, over 50 per cent of the developers tapped, see the uptick witnessed in the past couple of years to sustain, with 53 per cent reporting a rise in buyer enquiries in 2023. Aligned to this, the realtors also see the housing prices continuing their upward trajectory in the present calendar year.

During 2023, average housing prices across the eight major cities of the country saw a 9 per cent year-on-year (YoY) rise. The trend persisted in Q1 2024 with a 10 per cent YoY rise. About 52 per cent of the surveyed developers across India expect a continued rise in housing prices in 2024. 

Badal Yagnik, Chief Executive Officer, Colliers India said, “This strong streak is expected to continue in 2024 largely led by stable interest rates, continued inclination for home ownership and positive market sentiment. Going ahead, developers anticipate a rise in housing prices, which reflects their confidence in the residential market.”

At least 45 per cent of the realtors surveyed reported 10-20 per cent rise in construction costs in 2023. Referring to this, Yagnik said, “Tackling rising construction costs and rationalisation of taxes remain key expectations from the new government, with more than 50 per cent of developers seeking constructive solutions for the same.” 

With evolving demand trends and lifestyle patterns, about 66 per cent developers are keen to explore alternate business segments like plotted developments, branded residences, and senior living. Factors such as privacy, green spaces and spacious dwellings have accelerated demand for plotted developments in urban areas, especially in tier II cities. Furthermore, branded residences are picking up pace across tier I cities led by increased affinity for unique living experiences, aesthetics, and luxurious amenities.

Over 80% of the surveyed developers are confident of an increase in housing demand from NRIs during 2024 led by the country’s attractive investment landscape and potential for investment gains. To cater to this growing demand, developers are likely to launch more upscale residential projects in relevant micro-markets across cities.

The survey has 550 respondents from 18 states.