Did You Know?

Nearly 35% of annual property sales show a significant rise in Pune city during the festive season. Now the launch of GST 2.0 on September 22, 2025, the festive quarter this year is expected to bring some golden opportunities for home buyers and investors.

With the launch of GST 2.0 on 22 September 2025 , golden opportunites for home buyers and investors are expected to increase in this festive quarter.

Introduction

Planning to purchase or invest in property in Pune?
Pune’s property market is growing. Are you wondering how GST 2.0 affects the real estate in Pune? Pune city in past years has grown its importance as a business hub and lifestyle hub and understanding the tax implications is crucial.

Goods and Service Tax popularly known as GST is a framework was first revised in 2019, which set the current rates for under-construction and affordable projects. In 2025, GST 2.0 reforms have further streamlined the taxation in India, reducing GST on key construction inputs, such as cement and tiles. All these changes together have shaped Pune’s property landscape.

Reading this log helps you understand what GST 2.0 means for the real estate market in Pune, and how it will impact you as a buyer, seller or a developer, also see what opportunities lie in the property market.

GST 2.0 Eeal Estate Rate in Real Estate – Things You Need to Know.

Under the GST system for housing:

• For ready-to-move in products no GST is applied and only stamp duty and registration charges are to be paid.
• 5% GST without ITC (Input Tax Credit) for Under Construction Residential Properties (Non-Affordable)
• 1% GST, without ITC for Affordable Housing Projects.
• Resale Flats → Exempt from GST; only stamp duty and registration apply.

Affordable Housing Definition

If the project qualifies as affordable housing under GST rules then concessional 1% rate applies.

• In metro cities the carpet area of 60 sq.m and 90 sq.m in non-metro cities.
• Property value capped around ₹45 lakh.

(Always check the builder’s compliance with GST Council definitions before purchase.)

GST 2.0 – What Changed in 2025?

In 2025, the GST 2.0 reforms have simplified the tax systems and cut rates on several inputs used in construction all over India:

• GST reductions and material costs were reduced on inputs such as Cement, Tiles, and Fittings.
• Logistics and services related to construction were rationalized into fewer tax slabs.
• Services related to construction such as logistics were rationalized into lower tax slabs.

➡️ While homebuyers won’t directly see a change in GST rates on flats (1%, 5%, or nil remain the same), developers may benefit from lower input costs, which could translate into more competitive pricing in Pune.

How GST 2.0 will influence homebuyers in Pune

1. Clarity in Pricing – Buying a ready-to-move in flat? No need to pay GST, which ensures transparency in pricing.
2. Affordable Homes More Attractive – Buying your first home or looking for budget housing 1% GST makes it within reach of middle class.
3. Leaning towards Completed Projects – Ready-to-move in flats are preferred by the many Pune buyers due to option of saving on GST.

Impact on Developers and Builders

1. Easy Compliance –Accounting complexities have reduced due to streamlined GST 2.0 slab
2. No ITC for Housing – Under the 1% and 5% schemes, the developers cannot claim the ITC affecting profit margins.
3. Relief in Material Cost – Reduced GST on construction materials helps offset the lack of ITC.
4. Ready Homes Sell Faster – Ready projects are always preferred by buyers which help the developers to clear the unsold inventory.

Pune Real Estate Market Position under new GST 2.0 reforms

• Luxury buyers are leaning towards completed projects to avoid GST and looking for premium locations like – Koregaon Park, Kalyani nagar, Viman Nagar.
• Emerging Hubs (Hinjewadi, Wagholi, Kharadi): Affordable and mid-segment projects see higher demand thanks to the 1% rate.
• Increase in demand for affordable and mid-range properties in emerging business and IT hubs (Kharadi, Viman Nagar, Kalyani Nagar) due to 1% rate.
• GST clarity and RERA compliance boost confidence in Pune’s real estate as a secure investment for NRI Investors.

Challenges Under GST 2.0

• No Input Tax Credit: Prices of under-construction home have increased as developers cannot claim credit on raw materials.
• Higher Costs for Under Construction Buyers: 5% GST is added to buyer expenses for under-construction as compare to ready homes.
• Transitional Rules: Buyers should confirm the scheme applied to their unit as Projects started before April 2019 had special provisions

FAQs on GST 2.0 and Pune Real Estate

Q1. Do I have to pay GST on a ready-to-move apartment in Pune?
No, GST is not applicable on ready-to-move homes. Buyers need to pay only the stamp duty and registration charges.

Q2. How much GST is applicable on under-construction flats?
5% without ITC for regular residential projects, 1% without ITC for affordable housing.

Q3. Does GST apply to resale flats?
No, resale flats are exempt from GST. Only stamp duty and registration apply.

Q4. What defines affordable housing under GST?
Homes priced up to ₹45 lakh with carpet area up to 60 sq.m (metros) or 90 sq.m (non-metros).

Q5. How does GST 2.0 help developers?
By lowering GST on inputs like cement and fittings, developers may reduce construction costs.

In conclusion, Pune’s real estate market is now more transparent and cost-effective thanks to the implementation of GST 2.0. The lower input costs can assist developers in better managing pricing, even when the housing GST rates (1%, 5%, or 0%) stay the same. Developers experience respite from compliance and building costs, while buyers gain from more transparent taxation, particularly on affordable and ready-to-move-in homes.

Ready to Buy Smart in Pune?

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