Archive · 19 May 2025
Affordable Housing in India Faces Challenges Despite Demand
Imagine building homes for people who don't have much money.
That's affordable housing.
Right now, it's getting tricky.
Even though there are fewer unsold homes and people still need these homes, builders are hesitant to build more.
This is because the costs of building are going up, which makes it harder to make money.
Also, fewer people are buying these homes now compared to a few years ago.
This problem is causing many builders to stop making new affordable homes, despite the fact that many people still need them.
Unsold inventory in affordable housing fell by 19% across top cities in the last year.
Sales share of affordable housing units decreased to 20% in CY2024.
Developers are reluctant to launch new affordable housing projects.
A report projects cumulative affordable housing demand to reach 31.2 million units by 2030.
Estimated market size for affordable housing is expected to be Rs 67 trillion by 2030.
- Who
- Developers, homebuyers, and analysts in the affordable housing market.
- What
- Affordable housing market faces challenges with reduced sales share and developer reluctance despite a decrease in unsold inventory.
- When
- Unsold inventory decreased in Q1 CY2024 to Q1 CY2025, with sales shares declining over four years.
- Where
- India
- Why
- Developers face challenges including high construction costs and reduced profitability, and decreased government incentives impacting the market.
Developers
Market
Market Challenges
Developers
Facing poor conversion rates, spiralling construction costs, and unsustainable margins.
Market
N/A
- Unsold Inventory Drop
- 19% in the last year
- Inventory in Q1 CY2024
- 1.4 lakh units
- Inventory in Q1 CY2025
- 1.1 lakh units
- Sales Share in CY2024
- 20%
- Sales Share 4 years ago
- 39%
- Estimated market size by 2030
- Rs 67 trillion
- Demand forecast by 2030
- 31.2 million units