• Fri. Feb 23rd, 2024

    Implications of Interim Budget 2024 on India’s Real Estate Sector

    Implications of Interim Budget 2024 on India’s Real Estate Sector

    The just-concluded Interim Budget 2024 may not have made any major announcements, but it has highlighted the importance of infrastructure enhancements and nationwide connectivity for the real estate sector. These initiatives are expected to have significant implications, not only for major cities but also for tier 2 and 3 cities.

    One of the key highlights of the budget is the continuation of the PM Awas Yojana (Gramin), which has already achieved its target of nearly 3 crore houses. The government now aims to build an additional 2 crore houses in the next five years, providing a significant boost to the affordable housing segment.

    Furthermore, a new scheme aimed at the middle class has been unveiled, which will aid in homeownership and potentially free up encroachment areas for redevelopment. This move is expected to create ample opportunities for real estate development.

    Another significant aspect of the budget is the allocation of an increased capex outlay by 11.1 per cent to Rs 11,11,111 crore. This represents 3.4 per cent of the country’s GDP and is expected to unlock real estate development opportunities through infrastructure upgrades and new projects. Transit-oriented development in urban areas and the development of iconic tourist centers will likely stimulate housing demand and benefit the hospitality sector, respectively.

    In addition to these measures, the budget also extends tax benefits to startups, which could lead to increased demand for office real estate.

    India’s real estate sector is intertwined with the construction industry and plays a crucial role in driving economic activity and shaping the lives of millions. With a rapidly urbanizing population, the demand for housing, office space, and infrastructure is on the rise. Government initiatives like Smart Cities and affordable housing schemes are fueling the growth of the sector, while innovative construction technologies promise a sustainable future.

    The list of stocks from the Construction & Real Estate Sector that provided multibagger returns from Budget 2023 to Budget 2024 demonstrates the potential for significant growth in this sector. Companies like Kesar India Ltd, Unitech Ltd, and Yuranus Infrastructure Ltd reported returns of up to 921 per cent during this period.

    Overall, the Interim Budget 2024 sets the stage for robust growth in India’s real estate sector, laying a strong foundation for the country’s prosperous future.

    FAQ Section:

    1. What is the PM Awas Yojana (Gramin) mentioned in the budget?
    The PM Awas Yojana (Gramin) is a housing scheme launched by the government to provide affordable housing to rural citizens. It has already achieved its target of nearly 3 crore houses and will now aim to build an additional 2 crore houses in the next five years.

    2. What is the new scheme for the middle class mentioned in the budget?
    The budget unveiled a new scheme aimed at the middle class, which will aid in homeownership and potentially free up encroachment areas for redevelopment. This move is expected to create ample opportunities for real estate development.

    3. How much has the capex outlay been increased in the budget?
    The budget has allocated an increased capex outlay by 11.1 per cent to Rs 11,11,111 crore. This represents 3.4 per cent of the country’s GDP and is expected to unlock real estate development opportunities through infrastructure upgrades and new projects.

    4. Which sectors are expected to benefit from the budget?
    Transit-oriented development in urban areas and the development of iconic tourist centers are expected to stimulate housing demand and benefit the hospitality sector, respectively. Additionally, tax benefits extended to startups could lead to increased demand for office real estate.

    5. Which construction and real estate companies reported significant returns in the given period?
    Companies like Kesar India Ltd, Unitech Ltd, and Yuranus Infrastructure Ltd reported returns of up to 921 per cent from Budget 2023 to Budget 2024 in the construction and real estate sector.

    Definitions for key terms or jargon:
    – Capex: Capital expenditure, which refers to the funds invested by a company or government to acquire, upgrade, or maintain physical assets such as property or infrastructure.

    Suggested related links:
    PM Awas Yojana (Gramin)
    Smart Cities