Housing Supply: Builders have been emphasizing luxury houses for the past few years. Due to which the supply of houses of cheap and middle income groups (houses worth Rs 1 crore or less) is facing a crisis as the supply of these houses in the major 9 cities of the country has declined sharply in the last two years. In this case, major real estate markets like NCR, Mumbai and Hyderabad have performed the worst. In the last two years, the supply of houses worth more than one crore has increased by 48 per cent in the top 9 cities. In Bangalore, it has recorded 187 percent, 127 percent in Chennai, 58 percent in Kolkata, 70 percent in Navi Mumbai, 53 percent in Thane, 52 percent in Pune and 192 percent in Delhi-NCR. However, Hyderabad and Mumbai have fallen by 11 per cent and 14 per cent respectively in the last two years.
How much reduction in supply of houses worth one crore or low price?
According to the report of real estate data analytics firm Propint, builders are paying more attention to luxury housing. Due to this, during the last two years, there has been a 36 percent decline in supply of houses in the main 9 cities i.e. in the economical and middle-age class i.e. one crore rupees or low-cost houses. The supply of houses of this price was 3,10,216 in 2022, which fell to 1,98,926 in 2024. The supply of these houses in 2023 was 2,83,323. Obviously, the supply of these houses has fallen by 30 percent in a year. Major 9 cities include Bangalore, Chennai, Hyderabad, Mumbai, Pune, Thane, Navi Mumbai, Kolkata and NCR.
In which city the most supplied houses were reduced?
According to this report of Propket, the supply of houses worth 1 crore or low in Hyderabad has fallen by 69 per cent to 13,238 in the last two years. During the same period, the supply of houses of this price in Mumbai declined by 60 per cent to 6,062 and 45 per cent in NCR to 2672. In Bangalore, the supply of houses worth Rs 1 crore or less in Bangalore recorded 33 per cent, Chennai 13 per cent, 6 per cent in Navi Mumbai, 36 per cent in Thane, 32 per cent in Pune. However, Kolkata was the only city in these 9 major cities where the supply of houses worth Rs 1 crore or low in the last two years increased. The supply of these houses in this city increased by 7 percent. However, there was a 41 percent reduction in supply in a year.
1.5 crore houses of one crore or low price in 5 years will be required
Propket founder and CEO Sameer Jasuja said that today 8 per cent of India’s population is Tier 1 cities and this number will increase rapidly in the next 5 years as a large number of people are moving towards these cities in search of jobs. In such a situation, if the government does not pay attention to the problem of decreasing supply of affordable and middle class houses, then lack of supply in this category can cause a crisis like Australia and Canada. In view of the increasing number of nuclear families and increasing migration, 1.5 crore houses are expected to be required in these cities in the next five years. To solve the problem of supply of these houses, the government will have to give relief to the builder through tax exemption and subsidy to make affordable and medium -income housing options practical. Also, the buyers of the house need to give benefits of rebate in home loan and cut in stamp duty.