Archive · 23 Jun 2025
Affordable Housing Losing Favor Among Major Realty Players
Many big builders are moving away from building cheaper homes.
They're finding it's not as profitable because of high costs and low profit margins.
Plus, these homes are often far from jobs and schools, making them hard to live in.
Developers want the government to help with land prices and other incentives to make these projects work.
Several major real estate developers are exiting or scaling back affordable housing projects.
High costs, lower margins, and location challenges are cited as primary reasons for the shift.
Connectivity issues and lack of social infrastructure in affordable housing areas deter buyers.
Experts suggest that affordable housing faces challenges due to rising construction costs and high interest rates.
Government intervention such as land subsidies is needed for affordable housing projects to succeed.
- Who
- Real estate developers, potential homebuyers.
- What
- Major developers are moving away from affordable housing projects.
- When
- Ongoing trend as of current time.
- Where
- Across major Indian cities.
- Why
- High costs, lower margins, and location issues.
Challenges faced by affordable housing projects
Needed Measures to improve Affordable Housing
Economic factors
Challenges faced by affordable housing projects
Developers face high costs and low margins on affordable housing.
Needed Measures to improve Affordable Housing
High interest rates hinder affordable housing sales.
Location and infrastructure
Challenges faced by affordable housing projects
Locations are often poorly connected and lack social infrastructure.
Needed Measures to improve Affordable Housing
Developers must focus on the location that suits the desired customer segment.
- Defining Price (Anarock)
- Homes under Rs 40 lakh
- Mahindra Lifespaces
- Discontinuing affordable housing
- Margins in Premium Housing
- 30-40%
- Margins in Affordable Housing
- 10-15%
- Joyville's original project
- Sold units at Rs 20-22 lakh apiece in 2016
- Joyville's project current price
- Units now start at Rs 40 lakh
Sources
Housing sales in India’s top 9 cities dip below 1 lakh units for first time since 2021
Housing sales slump to 4-year low in Q2 2025; new supply slides 30%: Report
Housing sales set to fall in Bengaluru and eight other cities
Housing Sales In Top 9 Cities Fall Below 1 Lakh Units For First Time In 14 Quarters: Report
