When the Union Budget was presented last year, real estate walked away without headline-grabbing announcements. Instead, a series of incremental policy moves through the year—rate cuts, lower home loan costs, selective GST relief and easing construction expenses—quietly helped the sector regain its footing. As Budget 2026 approaches, the industry is less anxious and more deliberate, seeking policy stability to protect a recovery that is still finding depth rather than speed.

Luxury housing wants fewer roadblocks

Sandeep Agarwal, Executive Director – Finance and Group CFO, Elan Group, said, “As India’s real estate sector enters a phase of sustained maturity, the Union Budget 2026 offers an opportunity to reinforce the structural strength of the market. Continued focus on improving access to organised credit, enabling smoother project execution and strengthening long-term confidence among discerning homebuyers and institutional capital will be critical to maintaining momentum. A clear, stable fiscal and regulatory framework that supports responsible growth can go a long way in building a resilient real estate ecosystem aligned with the evolving aspirations of urban India.”

At the premium end, expectations from the budget are more targeted.

“As the union budget approaches, the real estate sector – especially premium and luxury housing markets like Golf Course Road, Gurugram – looks forward to policy continuity and targeted fiscal support. End-user demand and investor confidence would be significantly boosted by rationlisation of stamp duty, enhanced tax benefits on home loan interest. Additionally, extending infrastructure status benefits and easy access to long terms, low cost financing for developers will help push high-quality project execution. With Gurugram emerging as a global residential and commercial hub, a forward looking budget can further strengthen NCR’s position as a preferred destination for both domestic and global real estate investments,” says Sidharth Chowdhry, Managing Director, Dalcore.

Navdeep Sardana, Founder of Whiteland Corporation, describes the current phase as one where luxury housing is no longer chasing volume but stability. For ultra-high-net-worth buyers, the Rs 10 crore cap on capital gains reinvestment under Sections 54 and 54F has become a sticking point. Revisiting that limit, he believes, would help smoothen transactions in the upper end of the market.

Sardana also expects the budget to support ESG-aligned developments and technology-led housing through green financing avenues. Access to capital, he says, should become simpler and less restrictive, allowing developers to spend more time on execution and less on managing cash flow. For NRI buyers, unresolved issues around TDS on property transactions continue to dampen sentiment.

Infrastructure, more than incentives, is driving demand

If developers had to pick one area where Budget 2026 really matters, infrastructure would top the list.

Abhay Mishra, President and CEO of Jindal Realty, says, “Housing demand is no longer being shaped only by metro markets. In his view, Tier-II cities are setting the pace, largely because connectivity has improved faster than expected.”

Sonipat, he points out, sits at the intersection of expressways, regional transit systems and industrial zones. That combination has begun translating into consistent housing demand rather than sporadic spikes. Mishra believes that directing more capital expenditure towards urban infrastructure in such cities will have a far greater impact than isolated buyer incentives. Tax benefits help, he says, but infrastructure is what converts interest into actual purchases.

Why Tier-II cities are no longer a side story

One change that is hard to miss this budget season is the growing importance of Tier-II cities. Housing demand is no longer concentrated only in large metros, and developers say this is not a short-term diversion.

Beyond affordability, a lifestyle shift

“With Sonipat rapidly emerging as a key residential and industrial extension of Delhi-NCR, the real estate sector expects the upcoming Union Budget to strengthen policy support for high-growth peripheral markets. Sonipat’s appeal to investors and end-users will be further enhanced by increased allocation of infrastructure development, particularly road, rail and last-mile connectivity. Additionally, the industry also looks forward to rationalisation of stamp duty, enhanced tax benefits on home loan interest, and easier access to institutional financing for developers. Such measure will push planned developments, improve housing affordability, and position Sonipat as a sustainable, well-integrated urban hub within the NCR,” said Rahul Singla, Director, Mapsko Group.

Affordable housing needs updating, not repackaging

One issue that continues to surface in pre-budget discussions is the definition of affordable housing. Developers argue that price limits fixed years ago have little resemblance to current land and construction costs, especially in fast-expanding urban clusters.

The concern is not academic. When price caps lag reality, incentives meant for middle-income buyers lose their bite, and new supply becomes harder to justify. Several developers believe that a pragmatic revision in Budget 2026 could ease pressure on project viability and bring more affordable and mid-income homes to market, where demand still exists but supply has thinned.

A test of consistency, not ambition

Residential prices have inched up over the past year, but without the sharp swings that usually worry policymakers. Developers are cautious with new launches, and most sales are driven by genuine homebuyers rather than short-term investors.

That is why Budget 2026 is being watched closely, not for bold experimentation, but for signals of continuity. The industry wants reassurance that infrastructure spending will continue, homebuyers will not be unsettled by sudden tax changes, and policy direction will remain steady.

If that balance holds, the real estate recovery may not make dramatic headlines, but it could deepen quietly, supported by a wider spread of cities and a demand base that feels far more grounded than it has in years.