Luxury Housing Booms, Affordable Segment Struggles in 2024

India's real estate market is witnessing a significant shift, with luxury homes taking the lead in the latest sales figures. According to a recent Knight Frank India report, residential sales in the country’s top eight cities saw a 5% rise in Q3 2024, totaling 87,108 units—the highest quarterly sales this year. In the first nine months of the year, approximately 2.6 lakh homes have been sold, marking a 9% increase compared to the same period in 2023.

The spotlight, however, is on the luxury segment. Homes priced above ₹1 crore have surged by a staggering 41% year-on-year. This is a clear indication that affluent buyers are driving the current boom in India’s property market, with demand for premium homes rising sharply.

While the luxury market thrives, the mid and affordable housing segments have struggled to keep pace. Sales of homes in the ₹50 lakh to ₹1 crore range have dropped by 13%, and those priced under ₹50 lakh have seen a 14% decline. Rising interest rates on home loans and limited inventory in the affordable sector have contributed to this slowdown.

City-wise, Mumbai led the pack, recording the highest number of units sold at 24,222, followed by Bengaluru and Pune. These cities continue to be hotspots for real estate investment, driven by a combination of urbanization and high demand for quality housing. On the other hand, the National Capital Region (NCR) experienced a 7% dip in sales, primarily due to low inventory in the mid and affordable segments.

The trend highlights a growing divide in India’s housing market, where high-end properties are flourishing while the affordable segment struggles with challenges. Developers are increasingly focusing on luxury offerings, making it harder for budget-conscious buyers to find suitable homes.

As India’s real estate market evolves, it’s clear that the luxury segment is playing a dominant role, reshaping the industry’s landscape. With the demand for premium properties expected to grow, the future looks bright for high-end real estate.

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