Affordable housing sales have witnessed a notable decline in the first half of the year, as per the Anarock report, indicating a significant shift in the real estate market.
Sales of affordable homes priced below ₹40 lakh have dropped by 18%, amounting to 46,650 units across seven major cities, compared to 57,060 units during the same period last year. This decline has been attributed to lower supply and an increase in mortgage rates, both of which have impacted the demand for such properties.
The report highlights that the share of affordable housing in the overall housing sales has also experienced a considerable drop from 31% in the corresponding period last year to 20% in the first half of this year.
This shift in the demand dynamics can be attributed to the challenges posed by the COVID-19 pandemic and other factors faced by developers and consumers alike. Rising land costs have rendered it unviable for developers to construct low-margin mass housing projects, making affordable housing ventures less attractive, as per Anarock Chairman Anuj Puri.
Prospective home buyers in the affordable segment are also delaying their purchase decisions due to the escalation in housing prices and interest rates on home loans, according to Anarock.
On the supply side, the share of affordable homes in total new launches across the seven cities has declined from 23% to 18% during the January-June period.
In specific cities, the sales of affordable homes have witnessed fluctuations. In Mumbai Metropolitan Region (MMR), there was a slight dip in sales, while Bengaluru, Pune, Hyderabad, Chennai, and Kolkata all experienced varying degrees of decline.
Amidst these challenges in the affordable housing sector, platforms like PeProp.Money are trying to offer innovative solutions for developers, brokers, and buyers, by combining PropTech and FinTech.
Despite the current dip in affordable housing sales, the emergence of such platforms signifies a potential for positive change and growth in the sector.