Real Estate Market Remains Resilient, But Affordable Housing and High-End Segments Face Challenges
Gulam Zia, Senior Executive Director at Knight Frank India, highlights the resilience of the real estate market post-COVID-19, but raises concerns over the shrinking affordable housing segment and the challenges in the ₹10-50 crore property range.
Real EstateAffordable HousingHighend PropertyLuxury HomesMarket TrendsReal Estate NewsMar 18, 2025
Gulam Zia noted that the affordable housing segment, which typically includes properties priced up to ₹50 lakh, has seen a significant decline since the onset of the pandemic. Many developers have shifted their focus to higher-margin projects, such as luxury and premium homes, which are less affected by economic downturns. This shift has led to a shortage of affordable homes, making it increasingly difficult for first-time homebuyers and middle-income families to enter the market.
The government has introduced several initiatives to boost the affordable housing sector, including subsidies, tax benefits, and relaxed regulations. However, the impact of these measures has been limited, and the market still faces significant challenges. According to Zia, the lack of affordable land and the high cost of construction materials are major impediments to the growth of this segment.
In contrast, the high-end property market, particularly in the ₹10-50 crore range, has seen a mixed performance. While there has been a steady demand from ultra-high-net-worth individuals (UHNWIs) and foreign buyers, the segment has also faced challenges such as higher interest rates, increased regulatory scrutiny, and a slowdown in international investments. Zia pointed out that the luxury segment remains attractive due to its resilience and the potential for long-term capital appreciation.
Despite these challenges, the overall real estate market in India remains optimistic. The residential sector has shown a steady recovery, driven by pent-up demand, low-interest rates, and improved consumer confidence. The commercial property market, particularly in major cities like Mumbai, Delhi, and Bengaluru, has also started to pick up, with a growing demand for office spaces and retail outlets.
The future of the real estate market in India will depend on several factors, including economic growth, government policies, and global economic trends. Developers and stakeholders are closely monitoring these factors and are expected to adapt their strategies accordingly. The focus on sustainable and green buildings, as well as the adoption of smart technologies, is gaining traction, and these trends are likely to shape the future of the industry.
In conclusion, while the real estate market in India continues to show resilience, there are significant challenges that need to be addressed, particularly in the affordable housing and high-end property segments. The government and industry stakeholders must work together to create a conducive environment that promotes inclusive growth and ensures that all segments of the market thrive.
Frequently Asked Questions
What is the current state of the affordable housing market in India?
The affordable housing market in India has seen a decline since the onset of the COVID-19 pandemic, with many developers shifting their focus to higher-margin projects. This has led to a shortage of affordable homes, making it difficult for first-time homebuyers and middle-income families to enter the market.
What measures has the government taken to boost the affordable housing segment?
The government has introduced several initiatives to boost the affordable housing sector, including subsidies, tax benefits, and relaxed regulations. However, these measures have had limited impact, and the market still faces significant challenges such as the lack of affordable land and high construction costs.
How has the overall real estate market in India performed post-COVID-19?
The overall real estate market in India has shown resilience post-COVID-19, with the residential sector seeing a steady recovery driven by pent-up demand, low-interest rates, and improved consumer confidence. The commercial property market is also starting to pick up, particularly in major cities.
What are the future trends in the Indian real estate market?
The future of the Indian real estate market is likely to be shaped by a focus on sustainable and green buildings, the adoption of smart technologies, and the need for inclusive growth. Developers and stakeholders will need to adapt their strategies to address these trends and ensure the market continues to thrive.
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