The Union Budget 2025 is a game-changer for homebuyers since it lowers income tax obligations, eliminates presumed rental income taxation, raises TDS thresholds, and supports affordable housing initiatives.
It is anticipated that a significant change in tax slabs will raise disposable income, facilitating homeownership and stimulating demand for real estate.
Let’s examine what the real estate industry might expect from the Union Budget 2025 this year.
Swamih Fund-2 to deliver 1 Lakh homes in stalled projects
The government increased funding for the Swamih Fund-2 to ₹15,000 crore in Budget 2025 with the aim of completing an extra 1 lakh housing units. The goal of this program is to give thousands of homebuyers who have been impacted by delayed real estate developments much-needed assistance.
Tax relief for residential property investors
Under certain restrictions, taxpayers can now declare the yearly worth of self-occupied homes to be zero. The government has suggested granting this benefit to up to two self-occupied residences without any limitations in order to alleviate the difficulties faced by property owners.
Increased annual TDS limit on rent
By raising the yearly TDS threshold on rent from ₹2.40 lakh to ₹6 lakh, fewer transactions are now liable to TDS. This adjustment improves landlords immediate cash flow, makes compliance and paperwork easier for tenants, and helps small taxpayers who get lower rental revenues.
Strengthening public-private partnership in infrastructure
Each relevant ministry will lay out a three-year pipeline of projects that can be carried out using the Public-Private Partnership (PPP) model in order to propel infrastructure development. States will be urged to follow this approach, and they can look to the India Infrastructure Project Development Fund (IIPDF) program for assistance in creating and organizing PPP projects.
Incentivizing Urban Sector Reforms
To improve efficiency and sustainable development, incentives will be provided for reforms in land management, urban planning, municipal services, and urban government.
Tax Certainty for Alternative Investment Funds
A more stable and predictable investment environment will be ensured by the provision of tax certainty on gains from securities to Category I and II Alternative Investment Funds (AIFs), which actively engage in infrastructure and other important industries.
Infrastructure support for states
To encourage structural reforms and increase capital investment, ₹1.5 lakh crore has been suggested for 50-year interest-free loans to states.
