Luxury housing surges as affordable segment shrinks dramatically

A marked realignment in India's property sector has favoured high-end developments at the expense of affordable housing, according to market analysis of residential trends. Luxury home sales have expanded substantially, growing nine times over a four-year period, while the share of homes valued under Rs 1.5 crore—traditionally the backbone of India's residential market—has halved from 85 per cent to 47 per cent of total transactions.

The shift reflects changing investment patterns and developer priorities, as builders increasingly focus on premium segments offering higher profit margins. Metropolitan areas have witnessed accelerated construction of upscale residential projects, attracting both domestic and international investors seeking returns in India's booming property market.

The decline in affordable housing's market share raises concerns about accessibility for middle-income homebuyers at a time when housing demand remains substantial across urban centres. Industry observers note that while absolute transaction volumes in the sub-Rs 1.5 crore category may have remained stable, their proportional decline indicates a fundamental restructuring of real estate development priorities.

The transition underscores a widening gap between segments of the residential market, with builders gravitating toward projects targeting affluent buyers. This realignment has implications for urban planning and housing policy as India continues to grapple with the challenge of providing adequate accommodation across income levels.