SINGAPORE: The Indian government’s decision to reduce GST rates on several products is expected to boost consumer purchasing power and drive demand for residential properties during the upcoming festive season, according to real estate body CREDAI.
The association, representing 13,000 members nationwide, noted that construction costs are likely to decrease due to lower GST rates on cement and select building materials. Organising its annual event, CREDAI-NATCON, in Singapore, the body emphasized that the benefits of GST rationalisation will reach customers, provided manufacturers of cement and other construction materials adjust their prices accordingly.
The new GST rates come into effect from September 22. Speaking at a press conference on Thursday, CREDAI Chairman Boman Irani said, “GST rationalisation has created a feel-good factor among people. There is a positive sentiment among consumers, which bodes well ahead of the festival season.”
CREDAI President Shekhar Patel added that the GST reduction, along with tax incentives in Budget 2025 and recent repo rate cuts by the RBI, is expected to give a significant boost to housing demand. He noted that while housing sales in the first half of 2025 rose in value terms, the number of units sold had declined.
Patel expressed optimism that strong economic growth in the June quarter and other policy measures would further strengthen housing demand in the coming months. He also reiterated the industry’s longstanding request to raise the affordable housing price cap of ₹45 lakh to better reflect market realities. Currently, affordable housing attracts a 1% GST, while properties above ₹45 lakh are taxed at 5%.
Highlighting the heavy tax burden on real estate, Patel said total taxes from central and state governments range from 35–45%, and reducing these could help lower property prices.
The CREDAI-NATCON conference is being attended by over 1,000 members from across India.
