The Union Budget 2025 brings a wave of relief for taxpayers, particularly those looking to invest in real estate. With revised income tax slabs and reduced tax rates, individuals may save up to Rs 10,000 per month, depending on their income bracket. This additional disposable income enhances financial flexibility, making it easier to manage existing loans and improve loan eligibility.
When applying for a home loan at an interest rate of 9% over a 20-year tenure, the increased savings of Rs 10,000 per month could raise a borrower’s loan eligibility by Rs 10-11 lakh. This increase in affordability makes homeownership a more achievable goal for many first-time buyers.
Higher TDS Threshold on Rent: A Boost for Landlords and Tenants
To further ease financial constraints, the government has increased the Tax Deducted at Source (TDS) threshold on rent from Rs 2.4 lakh to Rs 6 lakh per annum. This revision reduces compliance burdens for tenants while ensuring higher immediate cash flow for landlords. The change simplifies rental transactions, benefiting both parties involved in the rental market. Also the change simplifies rental transactions, benefiting both parties involved in the rental market, including those investing in projects in Kalyan for rental income opportunities.
A Stronger Real Estate Market for First-Time Buyers
Budget 2025 provides a solid foundation for first-time homebuyers by reducing tax liabilities, eliminating deemed rental income taxation, increasing TDS thresholds, and backing stalled housing projects. These measures collectively enhance financial stability, streamline home-buying processes, and make real estate investments more attractive. With these incentives, aspiring homeowners can look forward to a more affordable and seamless journey toward homeownership.
Tax-Free Second Homes: Encouraging Investment in Real Estate
A significant change in Budget 2025 is the elimination of conditions on self-occupied properties. Now, individuals can own and declare two homes as self-occupied without facing tax implications on notional rental income. Previously, homeowners were subject to tax complexities that often discouraged investment in a second home. With these restrictions lifted, potential buyers can confidently invest in additional properties without worrying about an extra tax burden.
SWAMIH Fund 2: Reviving Stalled Housing Projects
Recognizing the challenges faced by homebuyers of under-construction properties, the government has announced SWAMIH Fund 2, a Rs 15,000-crore blended finance initiative supported by the government, banks, and private investors. This follows the success of the first SWAMIH initiative, which has already delivered 50,000 completed homes in stalled projects. With the new fund, an additional 1 lakh housing units are expected to be completed, bringing relief to thousands of families waiting for their dream homes. In FY 2025 alone, 40,000 more homes are set for completion, ensuring a steady boost to the real estate sector.
