Real Estate Stocks Jump as Tax on Rent Increases to Rs 6 Lakh Annually

Real estate stocks soar after new budget raises rental tax limit! Landlords and tenants benefit from simplified TDS rules and tax-free housing income.

budget 2025 real estate stocks rally up to 9 after rent tds threshold raised to rs 6 lakh

On Saturday, February 1, real estate stocks jumped by up to 9.3% after India’s Finance Minister Nirmala Sitharaman announced some good news for landlords and tenants in the Union Budget 2025. She raised the limit for tax deducted at source (TDS) on rent to Rs 6 lakh per year, up from Rs 2.4 lakh. This change means landlords won’t have to pay tax on rental income until it exceeds Rs 6 lakh annually, making renting easier for everyone.

Stocks of companies like Prestige Estates soared by 9.3%, reaching Rs 1,489.95 on the BSE, while Sobha’s shares increased by 4.6% to Rs 1,385. Other companies like Phoenix Mills, DLF, Oberoi Realty, and Godrej Properties saw their shares rise between 1% and 2%.

This new limit not only reduces the tax load for landlords but also makes the rental market simpler to navigate. Plus, taxpayers can now report the value of up to two homes they live in as “zero” for tax purposes, meaning they won’t have to pay taxes on that rental income.

Additionally, individuals earning up to Rs 12 lakh a year will be exempt from income tax, which may lead to more spending and a boost for the real estate market.

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