The Union Budget 2019-20, the first after the 2019 General Elections, was unveiled by Finance Minister Nirmala Sitharaman. All sectors, including real estate, anticipated pro-industry measures and enhanced tax breaks for homebuyers. While the government addressed some industry expectations, others remain unfulfilled.
1. Continued Focus on Affordable Housing
Furthering the government's commitment to affordable housing, the Finance Minister announced that approximately 1.5 crore rural homes have been built under the Pradhan Mantri Awas Yojana (PMAY). The central government also proposed building an additional 1.95 crore affordable dwellings between 2019 and 2022 under phase two of this flagship program. These new homes will be equipped with essential amenities like toilets, electricity, and gas connections.
Sitharaman also reported progress under the PMAY-Urban, with over 81 lakh homes approved, 26 lakh constructed, and 24 lakh already delivered to beneficiaries. Another 47 lakh homes are currently under construction.
2. Model Tenancy Law to Stimulate Rental Housing
Despite repeated appeals from industry stakeholders, the formulation of a comprehensive Rental Housing Policy has been long overdue. This need was finally addressed in the Union Budget 2019-20. The government declared it would finalize a 'model tenancy law' outlining the relationship between landlords and tenants, which will then be circulated to the states. This initiative not only aims to boost rental housing nationwide but also safeguard the interests of both tenant and landlord associations.
3. Infrastructure and Connectivity Boost
In a significant move to enhance infrastructure and connectivity, the government allocated a substantial Rs 100 lakh crore for infrastructure development. This is more than double the amount proposed in the Interim Budget 2019. The funds will be utilized to revamp the National Highways Programme and upgrade railway infrastructure for improved connectivity through various initiatives, including industrial corridors, the Dedicated Freight Corridor (DFC), and UDAN. This decision is expected to propel growth in the real estate sector and generate employment opportunities.