Real Estate

Affordable Housing Demand Shrinks to 20% in H1 2023, MMR, Pune Drive Sales

Affordable housing demand H1 2023
  • Total new supply demand in the affordable housing category across top 7 cities declined from 23% in H1 2022 to 18% in H1 2023
  • Of approx. 2.29 lakh units sold across the top 7 cities in H1 2023, affordable housing (priced <INR 40 lakh) comprised a mere 20% share, or approx. 46,650 units
  • Back in H1 2022, of total 1.84 lakh units sold, 31% or approx. 57,060 units were in the affordable segment
  • This year, MMR & Pune saw maximum affordable housing among the top 7 cities, followed by NCR
  • Of total affordable homes sold in H1 2023 across the top 7 cities, MMR comprised a 37% share, Pune – 21% share & NCR – 19% share; Hyderabad sold the least (<720) affordable housing units – a meagre 2% share
  • Besides the pandemic-induced dip in demand from this buyer class, affordable housing growth was depressed by high cost of land, deficient support infrastructure, and non-use of modern low-cost construction techniques

Mumbai, 23 July 2023: While 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 is shrinking, finds latest ANAROCK Research data.

Anuj Puri, Chairman – ANAROCK Group, says, “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.”

CitiesH1 2023H1 2022
Total Units Sold2,28,8601,84,000
Affordable Units Sold46,65057,060
Affordable % Share20%31%
Source: ANAROCK Research

Among the top 7 cities, 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.

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.

CitiesAffordable Homes Sold in H1 2023Affordable Homes Sold in H1 2022
Source: ANAROCK Research

“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 have also risen inexorably in the last few years. Launching affordable housing projects has become singularly unattractive, especially since the monetization potential of low-budget homes has also reduced due to shrinking demand for them.”

Lack of sound support infrastructure in the distant suburbs and the conspicuous absence of contemporary low-cost construction techniques are additional challenges for this segment. 

As for affordable housing buyers, a majority are seen postponing purchase decisions due to rising real estate prices over the last one year. The lower demand also reflects in the new supply of affordable housing as developers have turned their focus on mid-range, premium and luxury projects which are in significantly higher demand.

Affordable Housing – New Supply Dynamics

ANAROCK Research data indicates that the total new supply share in the affordable category across the top 7 cities has declined from 23% in H1 2022 to 18% in H1 2023.

Of approx. 2,12,180 units launched in H1 2023, just 39,220 were in the affordable housing category. In H1 2022, of approx. 1,71,290 units launched, approx. 38,820 were in this category.

CitiesH1 2023H1 2022
Total Units Launched2,12,1801,71,290
Affordable Units Launched39,22038,820
Affordable % Share18%23%
Source: ANAROCK Research

In terms of new supply across the top 7 cities, MMR, Pune and NCR saw the maximum new affordable housing supply in H1 2023, collectively accounting for 87% of all affordable supply share.

CitiesNew Affordable Supply in H1 2023New Affordable Supply in H1 2022
Source: ANAROCK Research
  • MMR saw new affordable housing supply of approx. 23,965 units in H1 2023, against 13,480 units in H1 2022 – a 78% increase in the period.
  • Pune saw approx. 5,200 new affordable units launched in H1 2023, down by 34% from approx. 7,990 units launched in the year ago period. 
  • NCR saw its new affordable housing supply drop by 40% in the period – from approx. 7,990 units in H1 2022 to approx. 4,810 units in H1 2023.

Read Also:

CEO & Editor
I'm Ved Prakash, Founder & Editor @Newsblare Media, specialised in Business and Finance niches who writes content for reputed publication such as,, Motley Fool Singapore, etc. I'm the contributor of different... news sites that have widened my views on the current happenings in the world.


Leave a Reply

Your email address will not be published. Required fields are marked *