The Confederation of Real Estate Developers' Associations of India (CREDAI), the apex body for realtors, has made a significant appeal to the government ahead of the upcoming Union Budget. The association has urged the launch of a National Rental Housing Mission, proposing comprehensive fiscal incentives for developers and tax relief measures for tenants. This initiative aims to revitalize India's underdeveloped organized rental housing market, which currently faces substantial challenges in meeting growing demand.
Addressing Urbanization and Migrant Inflows
In its detailed Budget wishlist, CREDAI highlighted that rapid urbanization and increasing migrant inflows have dramatically escalated the demand for rental homes across the country. However, the supply of adequate rental housing remains insufficient, creating a significant gap in the market. The association emphasized that a national mission focused on creating large-scale affordable rental housing in tier-1 and tier-2 cities is essential. This mission should be supported by targeted incentives for developers, greater institutional participation, and tenant-level tax benefits to make rental options more accessible and affordable.
Formalizing the Rental Market
CREDAI believes that such a strategic move would help formalize the rental market, which is currently dominated by informal arrangements. By establishing a structured ecosystem, the initiative could curb the growth of informal settlements and enhance workforce mobility. This would enable professionals and migrants to relocate more easily for employment opportunities, thereby supporting economic growth and urban development.
Key Demands for Affordable Housing
Beyond rental housing, CREDAI reiterated several long-pending demands to boost the broader real estate sector. The association has called for an increase in the deduction limit on interest paid on home loans, proposing a raise to Rs 5 lakh from the current Rs 2 lakh. This adjustment would provide significant financial relief to homebuyers and stimulate demand in the housing market.
Updating Affordable Housing Definition
CREDAI also stressed the urgent need to revise the definition of affordable housing, which has remained unchanged since 2017. The current criteria include area norms and a price cap of Rs 45 lakh, but these no longer reflect market realities due to sharply higher land and construction costs. The association proposed raising the carpet area limits to 90 square metres in metropolitan areas and 120 square metres in non-metros, while completely removing the value cap to better align with contemporary economic conditions.
Industry Perspectives and Additional Recommendations
Other real estate executives have echoed CREDAI's sentiments, outlining their own Budget expectations. Manoj Gaur, Chairman and Managing Director of Gaurs Group, advocated for granting industry status to the real estate sector. He cited its substantial contribution to India's GDP and its role as the second-largest employment generator in the country, underscoring the need for formal recognition and support.
Shivam Agarwal, Vice President of Strategic Growth at Sattva Group, called for single-window clearances for Global Capability Centres (GCCs) to accelerate foreign investment. He noted that GCCs are a key driver of office space demand, and streamlining approvals could enhance India's attractiveness as a global business hub.
Ashok Kapur, Chairman of Krisumi Corporation, urged the government to provide tax incentives and policy support for green and sustainable buildings. This would promote environmentally friendly construction practices and contribute to long-term sustainability goals.
Kirthi Chilukuri, Founder and Managing Director of Stonecraft Group, emphasized the need for stronger demand-side support for homebuyers. He argued that such measures are crucial to reviving housing growth and ensuring the sector's recovery post-pandemic.
Economic Impact and Future Outlook
Shekhar Patel, President of CREDAI, emphasized that housing remains a critical engine of economic growth, employment generation, and urban transformation. To keep pace with India's rapid urbanization, it is vital to strengthen affordability, expand access to formal finance, and develop a robust rental housing ecosystem. The association's proposals aim to address these challenges comprehensively, fostering a more dynamic and inclusive real estate market that supports both developers and consumers in the years to come.
