Supply of Affordable Homes Drops by 30% in 2024: PropEquity Report
In a significant shift in the real estate market, the supply of homes priced up to Rs 1 crore has seen a substantial decline of 30% in 2024, according to a recent report by PropEquity. The report highlights the growing gap between demand and supply, raisi
Affordable HousingReal EstateProperty MarketPropequityConstruction CostsReal Estate NewsJan 28, 2025
This decline underscores a growing disparity between the demand for affordable housing and its availability, particularly in major urban centers.
PropEquity, a leading real estate analytics firm, conducted an extensive study that analyzed data from major cities across the country.
The report highlights that this reduction in supply is a culmination of several factors, including increased construction costs, regulatory challenges, and a shift in developer focus towards higher-end properties.
According to the report, cities like Mumbai, Delhi, and Bengaluru have witnessed the most significant impact.
In Mumbai, the number of homes priced up to Rs 1 crore has dropped by 40%, while in Delhi and Bengaluru, the decline is around 35% and 30%, respectively.
This trend is troubling for first-time buyers and low-income families who are increasingly finding it difficult to enter the property market.
The report also points out that the supply of affordable homes has been consistently declining over the past few years.
However, the impact in 2024 is particularly pronounced due to the economic slowdown and the ongoing pandemic, which have further exacerbated the situation.
Construction costs have risen significantly, driven by increased prices of raw materials and labor.
Additionally, stringent regulations and compliance requirements have added to the burden, making it less attractive for developers to build affordable properties.
Many developers are now focusing on high-end projects, which offer better returns and are less affected by market volatility.
The decline in supply has led to a rise in property prices, making it even more challenging for buyers to find affordable homes.
This trend is particularly concerning in a country where a large segment of the population is still struggling to afford basic housing.
PropEquity suggests that policymakers and the real estate industry need to collaborate to address this issue.
Some potential solutions include offering incentives for developers to build more affordable homes, simplifying regulatory processes, and providing financial assistance to first-time buyers.
The report calls for a more balanced approach to housing development, ensuring that the needs of all segments of the population are met.
It highlights the importance of creating a supportive ecosystem that encourages the development of affordable housing while also ensuring the sustainability of the real estate market.
In conclusion, the 30% drop in the supply of homes priced up to Rs 1 crore in 2024 is a clear indicator of the challenges facing the real estate market.
Addressing this issue will require a concerted effort from all stakeholders, including the government, developers, and financial institutions, to ensure that affordable housing remains a viable option for all segments of the population.
Frequently Asked Questions
What is the main finding of the PropEquity report?
The main finding of the PropEquity report is that the supply of homes priced up to Rs 1 crore has fallen by 30% in 2024.
Which cities have been most affected by this decline?
The cities most affected by this decline are Mumbai, Delhi, and Bengaluru, with Mumbai seeing a 40% drop, Delhi a 35% drop, and Bengaluru a 30% drop.
What are the key factors contributing to the decline in affordable housing supply?
The key factors contributing to the decline in affordable housing supply include increased construction costs, regulatory challenges, and a shift in developer focus towards higher-end properties.
How has the economic slowdown and pandemic affected the real estate market?
The economic slowdown and pandemic have exacerbated the situation by increasing construction costs and reducing the availability of affordable homes, making it more challenging for buyers.
What solutions does PropEquity suggest to address the issue?
PropEquity suggests offering incentives for developers to build more affordable homes, simplifying regulatory processes, and providing financial assistance to first-time buyers.
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