Homebuyers Anxious as Soaring Real Estate Prices Test Affordability

Nearly half of prospective homebuyers ‘very concerned’ about rising real estate prices and affordability

Skyrocketing home prices across cities have become a major concern for Indian home seekers in recent years. According to a survey by Anarock, almost 80% of buyers are worried about rising costs, with nearly half saying they are ‘very concerned.’

Anarock’s survey showed that 47% of prospective homebuyers are 'very concerned', while 24% are 'moderately concerned'. The report said that 12% of respondents are 'slightly concerned' and 10% 'extremely concerned', while only 7% are 'not at all concerned'.

While 34% see price rise as a long-term trend, 44% are unsure. Price hikes have also affected buying decisions, only 21% will buy as planned, while 71% face delays (32% slight, 29% by 1–2 years, 12% indefinite) and 6% cancelled. The main reasons are affordability issues (41%) and fewer options within budget (35%), as per ANAROCK’s Consumer Sentiment Survey for H1 2025.

The impact on buying decisions has been significant, only 21% plan to go ahead as scheduled, while 71% face delays (32% slight, 29% by 1–2 years, and 12% indefinitely), and 6% have cancelled their plans altogether. The primary reasons cited are affordability challenges (41%) and limited options within budget (35%).

Price hikes are also influencing preferences, with 42% sticking to their original choices, while 34% are switching to renting, 19% are moving to peripheral locations, 5% are considering smaller units, and a section is shifting from branded to more affordable projects.

"City-wise trends indicate that while residential property seekers across cities are extremely concerned about the rising prices in their respective cities, MMR has emerged as a surprising outlier," says Anuj Puri, chairman, ANAROCK Group.

"In India's most over-the-top expensive real estate market, just 39% of our respondent property seekers expressed high concern about the steep prices in the region. The remaining 61% have equally surprising takes, 20% are not at all concerned, and 41% only moderately so.

Housing prices have risen by over 50% in the last two years

The average residential prices rose by over 50% in the last two years from ₹6,001 per sq ft in Q2 2023 to ₹8,990 a sq ft by Q2 2025, the consultant said.

The survey found that ₹90 lakh to ₹1.5 crore homes have emerged as the 'most favoured' option for over 36% of prospective homebuyers, indicating a stronger shift towards premium and luxury properties. As many as 25% prefer homes priced between ₹45 lakh and ₹90 lakh

Affordable housing buyers dissatisfied with project location and construction quality

The survey revealed that 62% of aspiring affordable housing buyers are dissatisfied with the options currently available in the market. Among them, 92% are unhappy with project locations, nearly 90% cite poor construction quality and design, and 77% feel the unit sizes are too small to be practical or appealing.

"These findings dovetail disturbingly with the documented demand contraction for affordable housing, or homes priced at or under ₹45 lakh," said Puri.

According to ANAROCK data, affordable housing demand has shrunk to just 17% in H1 2025 from 40% back in the same period in 2020. Concurrently, new supply of affordable housing has nosedived in the last two years across the top 7 cities, from 18% in H1 2023 to just 12% in H1 2025. Back in 2019, its supply share was 40% of the total new launches, the survey noted.