Government Signals Big Relief for Homebuyers
India’s real estate sector may finally be heading toward a long-awaited revival. Recently, Union Housing Minister Manohar Lal Khattar proposed the creation of a dedicated fund to revive housing projects that stalled before the implementation of RERA. The announcement came during the NAREDCO Conclave 2026 and immediately generated optimism among developers, investors, and most importantly, homebuyers.
For years, thousands of families have remained trapped between paying EMIs and rent. Meanwhile, developers have struggled with liquidity issues and limited access to finance. Therefore, this proposal arrives at the perfect time. It promises a win-win solution that benefits both developers and buyers while strengthening confidence in the housing sector.
The Real Problem Behind Pre-RERA Stalled Projects
Before RERA transformed the regulatory framework, the real estate industry lacked strict compliance norms and financial discipline. As a result, several projects ran into funding challenges and construction delays.
Multiple factors caused this crisis. Developers often relied heavily on buyer payments for construction funding. When sales slowed, cash flow collapsed. Banks also turned cautious and stopped lending to stressed projects. Consequently, construction halted across many sites nationwide.
This situation created severe financial pressure for homebuyers. Families continued to pay EMIs for homes they never received. Emotional stress increased year after year. Naturally, restoring trust in the housing sector became a national priority.
The ₹2.5 Lakh Crore Fund Proposal Explained
During the conclave, NAREDCO proposed a government-backed fund of nearly ₹2.5 lakh crore to revive stalled projects. The proposal focuses on providing last-mile funding so construction can restart and projects can reach completion.
The minister acknowledged that access to timely financing remains the biggest obstacle. Without funding, even viable projects cannot move forward. Therefore, this proposed fund could bridge the critical gap between incomplete construction and final delivery.
Importantly, the fund may draw money from multiple sources. Government participation will play a key role. Institutional investors may also contribute. Additionally, CSR funding through charitable institutions could support housing for economically weaker sections. This blended financing approach spreads risk while ensuring sustainability.
Slum Redevelopment to Boost Affordable Housing Supply
The government also plans to redevelop 700–750 slum settlements in and around the National Capital Territory of Delhi. This initiative will significantly boost affordable housing supply and improve urban living standards.
This redevelopment plan will create a ripple effect across the economy. New housing supply will increase. Infrastructure demand will rise. Employment opportunities will expand. At the same time, urban transformation will accelerate.
Affordable housing will gain strong momentum. More families will move from informal settlements into planned communities. As a result, the housing ecosystem will grow stronger and more inclusive.
Unlocking Urban Land Through Cross-Subsidisation
Land availability has always posed a challenge for real estate development. However, the government now proposes cross-subsidisation as a solution to unlock underutilised urban land parcels.
This strategy encourages collaboration between stakeholders. Developers can build premium housing alongside affordable units. Revenue from premium projects can subsidise affordable housing. Consequently, projects become financially viable without increasing housing costs.
Industry leaders welcomed this progressive approach. Niranjan Hiranandani emphasised that housing must contribute nearly 15% to India’s GDP by 2047 to achieve the Viksit Bharat vision. Meanwhile, Parveen Jain stressed the importance of promoting rental housing and improving financing access.
Additionally, a joint roadmap released by KPMG and NAREDCO provides a long-term strategy for sector growth.
Why This Policy Matters for Buyers, Developers, and Investors
This proposed fund could transform the real estate market in multiple ways.
For homebuyers, the benefits appear immediate. Construction timelines may finally restart. Financial stress may reduce. Most importantly, trust in the housing sector may return.
For developers, the fund offers renewed liquidity and improved cash flow. Projects can resume. Deliveries can happen faster. Market sentiment can improve rapidly.
For investors, the sector suddenly looks attractive again. Policy support reduces risk. Strong demand boosts long-term returns. Therefore, this move may trigger a new real estate growth cycle.
Expert View – Sanjeev Singh, MD SKJ Landbase
According to SKJ Landbase Managing Director Sanjeev Singh:
The proposed revival fund can become a major turning point for Indian real estate. Stalled projects damaged buyer confidence for years. Once funding reaches incomplete developments, construction will restart and delivery timelines will improve. Trust will return to the market. As a result, housing demand will rise across affordable and mid-income segments.
His perspective highlights how funding and trust remain deeply connected in the housing market.
The Road Ahead for Indian Real Estate
India’s housing sector now stands at a transformational moment. The revival fund, slum redevelopment plans, rental housing push, and land reforms together create a powerful roadmap for future growth.
If implemented effectively, the results could be remarkable. Urban transformation will accelerate. Buyer confidence will strengthen. Housing supply will expand. The sector’s contribution to GDP will rise steadily.
Most importantly, lakhs of families may finally receive the homes they booked years ago. And that alone makes this policy announcement one of the most hopeful developments in Indian real estate today.
