Not many takers for Affordable Housing? Data reveals demand dropped to 20% in H1 2023

financialexpress.com:

Even as the Indian luxury homes segment is firing on all cylinders, affordable housing continues to languish due to pandemic-induced demand changes and various other factors. Both supply and demand for affordable housing are shrinking, according to latest ANAROCK Research data.

“The total sales share of this erstwhile poster-boy segment is down to approx. 20% in H1 2023, against 31% in the corresponding period in 2022. Of approx. 2.29 lakh units sold across the top 7 cities in H1 2023, just 20% or approx. 46,650 units were affordable homes. Back in H1 2022, of approx. 1.84 lakh units sold, over 31% or approx. 57,060 units were in the affordable category,” says Anuj Puri, Chairman, ANAROCK Group.

Among the top 7 cities, Mumbai Metropolitan Region (MMR) and Pune saw the maximum affordable housing sales with 37% (approx. 17,470 units) and 21% (approx. 9,700 units) shares, respectively. NCR was close behind with approx. 8,680 affordable homes sold in H1 2023, comprising a 19% share of all affordable homes sold in the top 7 cities in H1 2023.

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At approx. 720 units, Hyderabad saw the least number of affordable homes sold in H1 2023 – a minuscule 2% share of the total affordable housing sales in the top 7 cities.

“It isn’t just that the pandemic derailed the growth of this once highly-hyped segment – other factors posed challenges to both buyers and developers of this category,” says Puri.

“For instance, with land deals soaring across the country, the cost of this basic input for all real estate has spiralled in tandem. It is becoming increasingly unviable for developers to buy land at higher prices to build low-margin mass housing. Other input costs