Explore the Indian housing crisis, where more than 300,000 homes are vacancies in Mumbai while the affordable housing fades. Learn why developers favor luxury projects, the impact on the middle class and solutions to close the gap.
In today’s rapid rhythm, having its own place, seen as a vital human need, right next to food and clothing. However, over time, the situation in India has become such that galloping inflation no longer allows a house to be a realistic objective for the masses of the population.
Most people can afford at least food and clothes with a side hustle, but to get a place at home, talk particularly about people in busy centers like Mumbai, it seems to be out of the matter for them. The common worker, through the difficult days to pay the house loan, usually lives through the reduction of his life, where weekly payments are distributed approximately several decades.
This does not affect the fact that it is still a minimum requirement for people to decide on the subject or not run the risk of such a massive debt, if having a good home is a reasonable standard. However, I can think of a problem that stolves the stomach, why more than 300,000 floors in Mumbai, the financial center of India, vacant when the demand for economic life is so pressing?
Mumbai’s paradox: a city of dreams and empty houses
Mumbai, which is also called the “city of dreams”, is the place where millions of people come to try their luck. And yet, many people have to face a task as difficult as finding a place to live, even if they are accommodated. Mumbai is the most exensive city when it comes to the prices of properties in India. Rentals are common very high and, therefore, more than half of the Jobwolder salary can be splashed. Most people consider obtaining a home as a more difficult option than finding a job.
Recent statistics data published by a real estate research firm that do not quote on Fora Liesses show that the number of vacant homes in the Mumbai metropolitan region was huge, 352,670 houses were empty in Marche 2025, Pune Pune Pune Houses. Although Mumbai’s housing sales saw an increase of 24.8% (162,400 houses were sold in 2024 compared to 129,793 of 2023-24) and an increase of 8.9% in Pune was noticed (2024-25 has 85,000 housing sales against 78,000 the previous year), the number of empty houses has almost not changed during the last 19 months.
So what is the cause of this phenomenon? Can the average Indian buy a house?
The decrease in affordable housing
The data paint a gloomy image for the lower and media income groups in India. According to Propropequly, a real estate data analysis firm that appears in the NSE, the supply of affordable housing, defined as those that have a price of ₹ 1 crore or less, has collapsed by 36% in the last two years. In 2022, 312,160 affordable housing units were avoidable without birds in nine metropolitan cities (Bengaluru, Chennai, Hyderabad, Mumbai, Pune, Thante, Navi Mumbai, Kolkata and Delhi-DNCR). By 2023, this number fell to 283,230, and by 2024, the intention of 199,826 was seen.
The most pronounced decreases were observed in Hyderabad (69% drop, with only 1,328 units available), Mumbai (60% fall, 662 units) and Delhi-CR (45% fall, 2,672 units). Pune saw a 32% reduction (5,095 units), while Kolkata was the only city that reported a 7% increase in the supply of affordable homes, reaching 10,785 units.
This drastic reduction in the stock of affordable homes is the alarm, especially as the urban population of India continues to increase. Approximately 8% of Indian population waste in level 1 cities, and it is projected that this figure will grow rapidly for the next five years as employment applicants go to urban centers. Experts estimate that India will need 15 million affordable homes in the next half decade for accommodation this migration and the emergence of nuclear families.
Why do affordable houses disappear?
Several factors contribute to the reduction of affordable housing supply:
- Change to luxury homes: Developers focus more and more on high -end projects, driven by an increase in the demand for the growing cohort of India or high network (HNIS) and ultra -high networks individuals (UHNIS). Procopechy reports a 48%increase in the housing supply with a price greater than ₹ 1 crore between 2022 and 2024. In NCR, the luxury housing supply shot in 192%, while Bengaluru and Chennai saw increases of 187%, respective. This trend reflects the growing wealth of the elite of India, with 8 Lakh Hnis (assets in ₹ 8.5 million rupees) and 13,600 UHNIS (assets in ₹ 250 million rupees) recorded in 2024.
- Price appreciation: Post Covid, the prices of the properties in the cities of level 1 have triggered, with some areas such as Gurugram and Noida that witness 400-500% increase approximately five years. The average price of the apartments in the cities of level 2 now looms between ₹ 90 Lakh and ₹ 1 crore, which makes the majority of the “affordable” names an inappropriate name.
- Economic disparity: While the Indian economy and stock market have had robust performance, the benefits are concentrated among the rich. Salaries in high payment sectors such as technology and finance have increased, feeding the demand for luxury houses. Meanwhile, the low middle class struggles to keep up with the increase in costs.
- Developer priorities: With private land prices in cities of level 1 ranging from ₹ 20 million rupees to ₹ 50 million rupees per acre, developers find that it is not profitable to build houses with a price of less than ₹ 1 crore. The average size of the apartment in India (1,200 square feet) to ₹ 9000- ₹ 10,000 per square foot translates into a minimum cost of ₹ 1.2- ₹ 1.5 million Rore beyond the reach of the majority of salaried workers.
The luxury boom: a story of two Indies
While affordable homes decrease, the luxury segment is thriving. The emergence of HNIS and UHNIS, particularly the creators of young wealth of new technology companies, real estate and market markets, has promoted the demand for opulent houses. In 2024, India occupied sixth place worldwide and the third in Asia (behind China and Japan) for its UHNI population, which grew 6% per year and is expected to increase by 50% by 2028.
Luxury houses are not only residences, but investment vehicles that offer high yields. However, this approach to Premium properties exacerbates the housing crisis for the masses, since developers set aside affordable projects in favor of lucrative high -end companies.
Solutions to close the gap
To address the shortage of affordable housing, experts propose several measures:
- Government intervention: Schemes such as Deen Dayal Awas Yojana in Gurugram, which limited prices per square foot to ₹ 4,000, show promise. The government must take advantage of their fast land banks to install developers through a sudden subsidized, provided they build affordable homes.
- Financial incentives: Tax exemptions, subsidies and reduced bell tax for developers and buyers can increase the supply and demand of affordable homes.
- Policy reforms: Regulation regulations and offer concessions of mortgage loans for lower class buyers can make housing property more accessible.
- Public-private associations: Collaboration between the Government and developers can guarantee a constant supply of affordable units, partly for weaker economic sections (EW), low -income groups (LIG) and average income groups (MIG).
The way ahead
India’s housing crisis underlines a growing division between the rich and the aspirational. While the Soper Rich Snap Up Luxury Homes, the low middle class is dealing with an acute shortage of affordable options. The CII and Knight Frank India report estimates a deficit or 31.2 million housing units by 2030, with the highest demand from EWS, Lig and Mig.
As the urban population of India grows, the government must act quickly to ensure that the dream of the house does not go further from reach. When prioritizing affordable homes through specific policies and incentives, India can create a more inclusive future where each citizen has a place to call home.