Union Budget a ‘mixed bag’, say real estate players in Gurugram

The real estate industry in Gurugram on Tuesday described the Union Budget as a “mixed bag”, with some commending its push for low-cost housing, while others said the sector’s long-standing demands (such as a single-window for clearances) were left unmet.

During her Budget speech on Tuesday, Union finance minister Nirmala Sitharaman announced that eight million houses, both rural and urban, will be built under the flagship PM Awas Yojana housing scheme, setting aside 48,000 crore for their construction.

Pradeep Agarwal, managing director, Signature Group, said the Budget will benefit those building affordable houses, following the finance minister’s move to speed up land and construction-related approvals in urban areas. “The plan to develop tier two and tier three cities and involvement of urban players will also boost the sector,” he said.

Varun Gupta, director of Ashiyana Housing, said the budget emphasised the need to nurture mega-cities, while also focusing on tier-two and tier-three cities. “The increased allocation to infrastructure and capital expenditure in this budget will catalyse urban development and economic growth,” he said.

Nayan Raheja, director of Raheja Developers, said he was disappointed at the lack of a single-window clearance system, a long-standing industry demand. “We’ve been requesting industry status for the entire sector as well as single-window for clearances to ensure smooth operations but the government is yet to respond to this demand. The announcements appear to be a mixed bag from a real estate point of view,” he said.

Another developer, who requested anonymity, said the Budget did not address issues such as providing long-term loans for construction of housing projects at cheaper interest rates, providing input tax credit and reducing the cost of raw material for construction.

Amarjeet Bakshi, chairman and managing director, Central Park, said they expected increased spend on infrastructure to boost growth and create avenues of employment. “We are hopeful that job creation and the announcement of ease of doing business 2.0 will lead to increased demand,” he said.

Consultants at Anarock said the allocation of 48,000 crore for the Pradhan Mantri Awas Yojana (urban and rural) will help boost the government’s ‘housing for all’ initiative. Under PMAY, the government plans to build 8 million houses by 2023.“Affordable housing still has the maximum demand in India. It’s just that buyers went into a wait and watch mode. Affordable housing demand will gain momentum once the economic impact of the pandemic begins to subside for the target audience,” said Anuj Puri, chairman of Anarock Group.

Gurugram is one of the largest real estate hubs in the country, and has seen sharp growth in the residential, commercial and logistics segments in the past two decades.

In 2021, the city reported the maximum launches of residential complexes and highest sale of residential units across Delhi and the National Capital Region (NCR), according to an Anarock report released in January this year.