Affordable housing sector is at the pivotal crossroads in India

India's supply-to-demand ratio for affordable housing across the top 8 cities has plummeted to 0.36 in 2025 (until June), down from 1.05 in 2019, signalling a significant undersupply in the crucial segment.

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This year's data show launches have collapsed to barely a third of sales, underscoring a deepening imbalance that threatens to impact housing affordability and limit buyer choice, according to a joint report on Affordable Housing: Tackling Urban Housing Deficit Through Supply-Side Reforms, by Knight Frank India, and NAREDCO.

The report has highlighted the critical supply challenges faced by India's affordable housing sector and said that urban affordable housing deficit of 9.4 million units is projected to surge to 30 million units by 2030. However, the challenge is not felt insurmountable.

The report finds that supply continues to lag demand as developers face mounting challenges including high land costs, limited access to construction finance, regulatory delays, and inadequate infrastructure in peripheral urban zones.