The recently announced union budget for 2023-24 might be a crucial turning point for the real estate industry. The finance minister has announced many measures that will likely have a positive impact on real estate developers.
2023 Union Budget Impact on Real Estate Industry
The finance minister Nirmala Sitharaman presented her Fifth Union Budget. She has announced the measure of growth and progress.
While some significant initiatives announced will directly affect the real estate industry. let’s understand the important takeaways from Budget 2023. And determine how they will affect real estate developers.
Even if there have been a few omissions, the following actions are anticipated to help real estate developers, who have been under a lot of stress since the COVID incursion.
The economic growth is expected to be 7% for the fiscal years 2023–2024, according to the finance minister. More development would be observed throughout the country. thanks to the anticipated capital investment of Rs 10 lakh crore. A YoY rise of 33 per cent, would draw in more investors. The market would gain from more cash liquidity as a result, which would help the real estate industry.
Emphasis on Urban Planning in Tier 2 and Tier 3 cities
The finance minister highlighted urban planning and development in Tier 2 and Tier 3 cities in this year’s budget. Focusing on sustainable and planned construction may provide the housing market a boost.
The National Housing Bank is proposed Urban Infrastructure Development Fund’s (UIDF) manager (NHB). In Tier 2 and Tier 3 cities, this will help governmental agencies with infrastructure development. For this fund, an expenditure of Rs 10,000 crore has been planned.
Sustaining The Work for Affordable Housing
In the Union Budget 2023–24, a commitment of Rs 79,000 crore for PMAY homes was made. This is an increase of 66% from the previous year. The sum will contribute to a rise in the number of affordable homes available through the Pradhan Mantri Awas Yojana.
The finance minister has announced the upgradation of 50 airports and ports in this budget. The infrastructure finance secretariat encourages private investment in different infrastructure projects like power, road, urban development and railways.
In the last year’s union budget 2022-2023, the expansion of the national highway was also announced to exceed 25000KM. The PM Gati Shakti Plan for the development of expressways and cargo terminals for other infrastructure was also proposed.
Ease of Conducting Business
Many initiatives to make conducting business more accessible are included in the Union Budget for 2023–24. The number of compliances has been decreased by about 39,000. And changes to the Central Acts have been suggested to make governance more business-friendly.
For the maintenance of digital land records, a Unique Land Parcel Identification Number was proposed in the Union Budget from the previous year. This measure was taken to increase transparency in real estate dealings. Additionally, steps are being conducted to translate land records from local languages. For the Indian real estate market, the “anywhere registration” of deeds and papers using the “One nation One-Registration Software” might be a game changer.
Overall, the Union Budget has laid out a promising road map with a focus on urban planning and sustainable growth and a solid growth projection.
Ans. The proposed UIDF will be backed by the National Housing Bank.
Ans. The Smart Cities Mission will receive Rs 16,000 crore from the government in FY24.
Ans. 35,000 crore rupee budgetary provision has been allocated towards the transition to a low-carbon intensity and green economy.
Ans. The PMAY will receive Rs 79,000 crore from the government in FY24.
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