India's affordable housing market lacks lower-tier options, claims BCD Group Vice-Chairman Ashwinder R. Singh
Ashwinder R. Singh, Vice-Chairman & CEO of BCD Group and Chairman of the CII Real Estate Committee, has highlighted the critical challenge of shrinking affordable housing supply in India. The housing ladder in India is missing its bottom rungs, meaning the lower segments of affordable housing are increasingly unavailable, restricting access for the low- and middle-income groups.
The key challenges Singh identifies include rapid urbanization and population growth increasing demand predominantly in affordable housing segments, supply constraints due to rising land and construction costs, and the struggling bottom-end affordable housing market, which is essential for inclusive growth but remains underserved.
In terms of proposed solutions, Singh emphasizes the need for focused interventions to increase supply at the bottom end of the market, improved financing, and balancing evolving housing demands from India's emerging middle class to ensure inclusive and equitable housing growth.
Singh argues that India's urban future cannot rest on luxury towers alone, emphasizing the need for a housing ladder that includes affordable homes. To address the capital drought, he suggests leveraging blended finance with first-loss guarantees. Developers must rethink affordable projects as modern communities, including EV-readiness, climate resilience, and digital connectivity.
The market continues to signal strong demand for affordability, with 73% of incremental urban housing demand sitting below the Rs. 50-lakh mark. However, the share of homes priced under Rs. 50 lakh fell from 63% of new launches in 2019 to 47% in 2023, before plateauing. Developers in India are turning away from sub-Rs. 50-lakh homes, and even in seven major metros, sales of units priced below Rs. 50 lakh declined by 14% in 2024.
Affordable housing launches in 15 Tier-2 cities plummeted 67% year-on-year in Q1 2025. The stigma surrounding budget housing in the industry is a significant factor in this trend. Singh recommends bridging the perception gap through recognition of affordable developers via awards, ESG indices, and REIT weightage.
Nearly half the homes sold in India's top eight cities in the first half of 2025 were priced above Rs. 1 crore. Capital continues to favour premium projects, with banks and funds applying stricter lending norms and lower exposure limits to budget housing. If India aims for a $5-trillion economy, it must restore dignity and profitability to the business of building affordable homes.
Singh advocates for streamlining compliance via a digital single-window system with deemed approvals. He also urges policymakers to introduce a "Taxpayer Bill of Rights" for developers, setting clear approval timelines with penalties for delay. By addressing these challenges, India can ensure a more inclusive and equitable housing market that caters to the needs of its growing population.
- Ashwinder R. Singh suggests leveraging awards, ESG indices, and REIT weightage to recognize affordable developers and bridge the perception gap in the industry.
- In terms of proposed solutions, Singh advocates for streamlining compliance with a digital single-window system and deemed approvals, as well as introducing a "Taxpayer Bill of Rights" for developers to set clear approval timelines with penalties for delay.
- To address the capital drought in the affordable housing market, Singh suggests using blended finance with first-loss guarantees.
- With 73% of incremental urban housing demand sitting below the Rs. 50-lakh mark, Singh argues that India must restore dignity and profitability to the business of building affordable homes to ensure an inclusive and equitable housing market that caters to the needs of its growing population.
