India’s housing finance sector hits home run

The country’s housing market has evolved in syne with the aspirations, lifestyle choices and financial capabilities of homebuyers.

- JATUL ANAND

After a lull during the pandemic, all housing segments have bounced back, spurred by supportive government policies, vibrant consumer demand and urbanisation. Additionally, civic infrastructure development across India has enhanced accessibility, availability and connectivity to various housing projects.

The National Housing Bank's residential housing price index (NHB Residex) showed positive momentum in the first quarter of FY26. Property prices appreciated in 45 cities from April to June 2025, while the 50-city composite House Price Index based on assessment prices increased by 5.7 per cent from the previous year. This positive momentum complements broader statistics that point to rising outstanding loans and steady disbursements, reinforcing the case for continued institutional support to bridge regional gaps.

The outlook for the housing sector is bright because of the government's rising budget outlays for Pradhan Mantri Awas Yojana-Urban 2.0. The outlays include the provision of 30 million additional housing units in urban and rural regions, plus an investment of %10 trillion to address the housing needs of 10 million urban poor and middle-class families. The allocation of 2.66 trillion for rural development shows commitment to improving living conditions.