If you have been waiting to buy your first home or invest in a piece of land, the news from the Finance Minister yesterday is worth your time. The Union Budget 2026 has moved away from quick tax breaks and instead focused on building the massive infrastructure that actually makes property values grow. While the core tax slabs stayed the same, the government is betting big on urban growth and making it easier for people to live outside the crowded mega-cities.
The massive push for urban housing
The government is putting a lot of money into making sure people have roofs over their heads in the city. The allocation for the Pradhan Mantri Awas Yojana (PMAY) – Urban has jumped significantly to ₹18,625 crore. On top of that, a new phase called PMAY-Urban 2.0 is getting an extra ₹3,000 crore to speed up construction. This is a huge signal that the goal of “Housing for All” is still the top priority.
Key housing highlights:
- A combined ₹21,625 crore is being pumped into urban housing to finish pending projects.
- The PMAY-Gramin for rural areas saw a massive hike to ₹54,917 crore to improve village homes.
- A new ₹10,000 crore Urban Challenge Fund will help redevelop older parts of our cities.
- There is a major focus on Tier-II and Tier-III cities to create new hubs for living and working.
Infrastructure that drives property value
The real secret to real estate growth isn’t just the house itself, but the roads and rails that lead to it. For the 2026-27 year, public capital expenditure is rising to ₹12.2 lakh crore. I saw a developer recently explain that a new highway can boost nearby land prices by 30% almost overnight. This budget doubles down on that logic by connecting more towns to the main economic grid.
Infrastructure impacts:
- Seven new high-speed rail corridors will make commuting from satellite towns much more realistic.
- New dedicated freight corridors will help industrial real estate grow in states like Gujarat and West Bengal.
- The government is setting up an Infrastructure Risk Guarantee Fund to help private developers get loans easily.
- REITs (Real Estate Investment Trusts) will now be used to manage and sell land owned by the central government.
Tax and compliance relief for buyers
For the individual homebuyer, the budget brought some small but very helpful changes to the paperwork. One major headache for those buying from NRIs was the need for a TAN (Tax Account Number), which is usually for companies. Starting October 1, 2026, you can just use your PAN to handle the tax on these deals, making the process much smoother.
Important tax points:
- No change in the ₹2 lakh cap for home loan interest deduction under Section 24(b) this year.
- Income from the compulsory acquisition of land by the government is now exempt from tax for families.
- The new Income Tax Act, 2025 aims to simplify all property-related filings by next April.
- Staggered deadlines for tax returns will give you more time to get your property papers in order.
As industry expert Anuj Puri of Anarock recently noted, “Infrastructure remains the chief engine of economic growth for the housing market”. The 2026 budget proves this by focusing on long-term stability and better cities. It may not have the massive tax cuts some hoped for, but it ensures that the home you buy today is part of a better-connected India tomorrow.
Also Read – Your dream home in Mumbai: A simple guide to the MHADA lottery 2026
Disclaimer – This article is for informational purposes only and does not constitute financial advice. Real estate investments carry risks; please consult with a professional advisor before making any financial decisions.
Source – RP Realty Plus
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