Demand-supply mismatch: Affordable housing shortage must be addressed

A Knight Frank study shows that India will face an affordable housing shortage of 31.2 million units by 2030. There is already an existing shortage of 10.1 million units

Housing affordability is getting worse across Indian cities. In recent years, demand in the affordable segment has suffered as the target group concerned was deeply affected by the pandemic. Further, interest-rate hikes on housing loans and a sharp rise in residential prices have made it challenging for low-income buyers to enter the market.  Consequently, the share of affordable housing in overall sales has substantially declined in recent years. Pandemic-induced distress, coupled with rising costs of construction and labour costs, prompted real estate developers to shift their focus away from affordable housing and lean towards the premium and luxury segments.