The Union Budget is a highly awaited occasion, particularly for the real estate sector. Homebuyers, especially in states like Kerala, pay close attention to the announcements that may influence their dreams of homeownership and the market for apartments in Kochi. Prior to the budget's release, there was a high level of expectation, with many individuals hoping for policies that would reduce the financial pressures of purchasing a home and boost the property market. It is important to analyze how the actual budget met these expectations and what it means for future homeowners in Kerala.

Pre-Budget Expectations

Before the budget was revealed, homebuyers were filled with a sense of expectation. Many were optimistic about modifications in tax laws that would provide greater relief to individuals paying home loan EMIs. Interest rate support schemes were also prominently requested, as they could greatly reduce the overall cost of borrowing. The need to simplify the property registration process and reduce stamp duty charges was considered a critical step to make property transactions more economically affordable. Apart from financial incentives, there existed expectations for the advancement of infrastructure in Kerala, which indirectly influences property values and contributes to the creation of more attractive residential areas. 

Income Tax Exemptions Revised

A key change in this budget is the revision of income tax exemptions. The government has now exempted individuals with an annual income of up to ₹12 lakh from paying income tax. This decision is expected to improve the financial status of middle-class families, making homeownership more accessible to a larger portion of society. With a reduced tax burden, families will have increased disposable income available for investment in real estate.

Reduced Tax Burden on Second Homes

A prominent change in the budget for this year involves the revision of tax benefits for property owners. Previously, taxpayers were allowed to claim a nil valuation for just one self-occupied property, which meant that any additional properties were subject to taxation based on notional rental income. The government has now expanded this benefit to include two properties, thus reducing the financial pressure on those purchasing second homes. This decision is expected to encourage a larger segment of the population to invest in real estate, especially in suburban and semi-urban regions where property prices are comparatively lower. It also provides advantages for individuals who often relocate or have a second home for their families.

Transforming Cities into Economic Hubs

A successful real estate market is closely linked to the presence of well-structured infrastructure. The government has allocated ₹1 lakh crore under the Urban Challenge Fund to upgrade urban infrastructure and connectivity. This investment is expected to drive the development of urban centers into economic hubs by improving roadways, metro networks, and public amenities.  

Calls for More Immediate Relief

Another important expectation prior to the budget was the reduction of stamp duty and registration charges, particularly for first-time homebuyers. Although the central government did not directly lower these charges, it encouraged state governments to reconsider and reduce the high rates of stamp duty. Specifically, states have been advised to offer concessions to women homebuyers, which could promote more accessible property ownership for households led by women. However, a direct reduction in stamp duty at the national level would have provided more immediate relief.  

Conclusion

The Union Budget 2025 has outlined a strategic plan for national development, with a strong focus on infrastructure. Although the immediate impact on homebuyers in Kerala may not be obvious, the indirect effects of infrastructure funding and anticipated policy changes could influence the real estate market in the state. For anyone looking to buy a home in Kerala or exploring flats for sale in Ernakulam, it is important to assess their financial situation, study market trends, and consult with qualified professionals. Kent Constructions is here to support you in navigating the complexities of the real estate market, ensuring you can make informed decisions about your dream home.