India's Affordable Housing Crisis: Shrinking Supply, Rising Challenges

India’s Affordable Housing Crisis: A Growing Concern

India’s metropolitan hubs—where millions migrate in search of jobs—are now facing a severe affordable and mid-income housing crisis. Over the past two years, the availability of homes priced at ₹1 crore and below has shrunk by 36%, as developers increasingly focus on luxury housing.

A report by PropEquity, a leading real estate data analytics firm, highlights that available units in this segment declined from 3,10,216 in 2022 to 1,98,926 in 2024. The worst-hit cities include Delhi-NCR, Mumbai, and Hyderabad, raising serious concerns about urban housing accessibility.

Steep Decline in Affordable Housing Supply

The drop in affordable housing supply has been alarming, with a 30% decline in just one year. The trend is particularly severe in major cities:

• Hyderabad: 69% decline, with supply plummeting to just 13,238 units in 2024.
• Mumbai: 60% drop, leaving only 6,062 units available.
• NCR: 45% decline, with just 2,672 units in the affordable segment.

Among the nine major cities—Bengaluru, Chennai, Hyderabad, Mumbai, Pune, Thane, Navi Mumbai, Kolkata, and NCR—the supply has been consistently declining, making homeownership increasingly difficult for middle-class buyers.

The Crisis in Numbers: A City-Wise Breakdown

City	Decline Over 2 Years	Affordable Homes in 2024
Hyderabad	69%	13,238
Mumbai	60%	6,062
NCR	45%	2,672
Pune	32%	50,095
Bengaluru	33%	25,012
Thane	36%	N/A
Navi Mumbai	6%	N/A
Chennai	13%	12,743
Kolkata	+7%	10,785

Why Is This Happening?

Experts suggest that developers are prioritizing high-margin luxury housing projects, leaving a significant gap in affordable housing. Rising construction costs, land prices, and financing challenges have made mid-income projects less attractive.

Government Intervention: A Need of the Hour

Samir Jasuja, Founder & CEO of PropEquity, warns that India could soon face a housing crisis similar to Australia and Canada if corrective measures are not taken. With the urban population set to grow exponentially over the next five years, he urges the government to:

• Provide tax incentives for developers building affordable homes.
• Introduce subsidies to make mid-income housing viable.
• Offer financial relief to homebuyers, such as home loan rebates and stamp duty reductions.

Luxury Housing on the Rise

While affordable housing supply dwindles, luxury housing (₹1 crore and above) has surged by 48% across India's top cities. Some of the biggest increases include:

• Bengaluru: 187% rise
• NCR: 192% rise
• Chennai: 127% rise
• Pune, Thane, Navi Mumbai: 50%+ rise

Interestingly, Mumbai and Hyderabad bucked this trend, witnessing an 11-14% decline in luxury housing supply.

What Lies Ahead?

With demand far exceeding supply in the affordable segment, housing prices are expected to rise further, pushing middle-class homeownership out of reach. Experts urge immediate policy action in the upcoming budget to prevent a deepening crisis.

About PropEquity

PE Analytics, an NSE-listed company, operates PropEquity, India's largest real estate data and analytics platform. Covering 1,70,000+ projects across 44 cities, it has been a trusted source for real estate insights for over 17 years.