Record Property Investment, but Can Ordinary Buyers Still Afford a Home?

India’s real estate market can attract billions of dollars in investment and still leave many households struggling to find a home within budget. That is the central tension behind the latest housing figures: investment and sales are growing, but the supply mix is moving towards more expensive properties.

The FICCI-ANAROCK real estate investment report, covered by The Federal on 25 October 2026, highlights a significant change in the composition of new housing supply. High-end and luxury homes accounted for 45% of new supply in FY2025-26, compared with 13% in FY2021-22. Affordable housing’s share fell from 25% to 14%.

These are shares of new supply, not a count of every home built or a direct measure of how many households lack suitable housing. But they raise an important question: what determines whether investment reaches the people who need homes most?

Why should homebuyers care if investment is rising?

Because investment totals do not tell the whole story.

Capital may flow into office buildings, warehouses, data centres, land, premium residential projects or financing arrangements. These can strengthen the property sector and support economic activity, but they do not all increase the supply of homes that a first-time buyer can afford.

Even residential investment is not automatically affordable housing investment. A developer can sell more homes and generate higher revenue while the entry price for a typical household rises.

The distinction matters because housing serves two purposes at once: it is an asset for investors and a basic need for households. A market can perform strongly on the first measure without resolving the second.

Why are developers building more expensive homes?

There is no single explanation. Several commercial pressures can make higher-priced housing more attractive.

Land and construction costs: Land can account for a substantial share of development costs, particularly in large cities. Where land is expensive, building lower-priced homes may be difficult unless density, land use, infrastructure or project economics make the numbers work.

Financing and project risk: Developers need money not only for construction but also for land, approvals and early project stages. When funding is difficult to obtain or expensive, projects with stronger expected margins or more predictable sales may be easier to finance.

Buyer demand and sales value: Developers respond to the buyers they can reach and the prices those buyers can pay. Strong demand in premium segments can encourage more launches there, even while a different group of households remains underserved.

Location and infrastructure: Lower-priced land on the outskirts may not produce genuinely affordable housing if residents must spend more on commuting or cannot access reliable transport, schools, healthcare and jobs.

These factors can reinforce one another. But the available figures do not establish that every developer is deliberately avoiding affordable housing, or that one cause explains the entire supply shift.

What do the latest numbers actually tell us?

The reported figures point to three different issues.

First, residential sales value across India’s top seven cities reached ₹6.10 lakh crore in FY2025-26, more than double the ₹2.35 lakh crore recorded in FY2021-22, according to the FICCI-ANAROCK report.

Second, the composition of new supply changed. High-end and luxury homes gained a larger share, while affordable housing’s share contracted.

Third, access to finance remains a concern for lower-priced and delayed projects. Business Standard reported in May 2026, citing ANAROCK Capital, that more than 450,000 affordable and mid-range homes across over 1,500 stalled projects needed around ₹55,000 crore in funding support.

These measures are not interchangeable. Sales value reflects the value of transactions; supply shares describe the mix of launches; and a funding estimate refers to projects facing a financing need. None alone measures the full national housing shortage. Taken together, however, they suggest that the issue is not simply whether money enters real estate, but where it goes and which projects can access it.

Can public programmes close the gap?

Government-backed programmes can help, particularly when projects are stalled or households need assistance to access housing.

The SWAMIH programme was designed to provide funding support to eligible stalled residential projects, while PMAY-Urban 2.0 aims to support additional urban homes. NITI Aayog’s A Comprehensive Framework to Promote Affordable Housing, published in December 2025, also discusses structural barriers such as land supply, housing stock and access to capital.

These initiatives matter, but their impact should be judged by outcomes rather than announced allocations alone. Relevant questions include how many homes are completed, whether intended households can access them, whether prices fit their budgets, and whether the homes are located where people can live and work.

Affordable housing also requires coordination across the development process. Funding cannot compensate fully for costly land, long approval timelines, inadequate infrastructure or a location that makes daily travel unaffordable.

What should homebuyers and investors examine next?

If you are planning to buy a home, focus on the total cost of ownership rather than the advertised price alone.

• Calculate the full monthly burden. Include the home-loan EMI, maintenance, property taxes, insurance, commuting and essential household expenses. A lower purchase price may not mean a lower overall cost if transport or upkeep is expensive.
• Check whether the location works for your life. Consider reliable transport, access to work, schools, healthcare and daily services. A distant home is not necessarily affordable if travel consumes time and money.
• Verify project and possession details. Review applicable RERA registration, approvals, payment milestones, possession timelines and the terms governing delays. Seek qualified legal advice where documents or title issues are unclear.
• Stress-test your budget. Consider whether you could manage the EMI if income fell, rates changed or unexpected expenses arose. Avoid basing affordability only on the maximum loan a lender is willing to offer.

For investors, the relevant question is slightly different: does the investment support sustainable demand, reliable execution and an appropriate risk-adjusted return? A high-priced segment may offer opportunities, but it can also exclude a broader pool of buyers. Lower-priced housing may address a real need, but its commercial viability depends on land, funding, execution and local purchasing power.

Neither segment should be assumed to deliver better returns without examining the specific project, costs, risks and time horizon.

What would make affordable housing more viable?

The evidence points towards a combination of measures rather than a single solution: access to early-stage and completion finance, more predictable approvals, appropriate land-use planning, infrastructure near housing, and project models that keep construction and delivery costs under control.

Public support can help bridge gaps, but programmes need clear eligibility, transparent implementation and measurable completion outcomes. Developers, lenders and policymakers also need to assess affordability in practical terms, including household income, transport and recurring costs, rather than using a home’s price alone.

A useful measure of progress would be whether more homes are delivered at price points suited to the households they are intended to serve, without compromising safety, quality or access to essential services.

FAQ

1. Does record real estate investment mean housing is becoming more affordable?

No. Investment totals can rise while capital is concentrated in commercial property or higher-priced homes. Affordability depends on prices, incomes, available supply, financing costs and location.

2. Is affordable housing's share of new supply falling?

The FICCI-ANAROCK figures reported in October 2026 show affordable housing's share of new supply declining from 25% in FY2021-22 to 14% in FY2025-26. This is a supply-share measure, not a count of all homes in India.

3. Why might developers prefer premium homes?

Higher selling prices and potentially stronger margins can make premium projects more attractive. Land costs, construction costs, financing access, buyer demand and project risk also influence decisions.

4. Does a cheaper home on the outskirts offer better affordability?

Not necessarily. Transport costs, commuting time, access to jobs and services, maintenance and infrastructure can materially change the total cost of living there.

5. What is the SWAMIH programme?

SWAMIH is a government-backed funding initiative designed to support the completion of eligible stalled residential projects. Buyers should verify the status and eligibility of a specific project rather than assume every delayed development is covered.

6. What does PMAY-Urban 2.0 do?

PMAY-Urban 2.0 is a government housing programme intended to support eligible urban households. The assistance available depends on the applicable scheme component, eligibility conditions and implementation rules, which should be checked through official sources.

7. How can a buyer judge whether a home is affordable?

Consider the purchase price, down payment, loan EMI, recurring ownership costs, transport and the effect on other essential financial commitments. The amount a lender approves is not necessarily the amount a household can comfortably sustain.

8. Does declining affordable supply prove that India has fewer homes overall?

No. A falling share of affordable homes in new supply does not establish that the absolute number of homes has fallen. It indicates that affordable homes make up a smaller portion of the reported new supply mix.

Sources

Click an article title to view the source.

• India's realty investment hits Rs 57,917 crore, but affordable housing lags published on 25 October 2026 in The Federal.
• India's affordable housing sector faces ₹55,000 crore funding gap published on 21 May 2026 in Business Standard.
• A Comprehensive Framework to Promote Affordable Housing published in December 2025 by NITI Aayog.
• Year-end investment surge propels institutional inflows in Indian realty to record USD 8.5 bn in 2025 published on 7 January 2026 by Colliers.

Evidence Caveats

Investment and housing indicators use different definitions, reporting periods and coverage. The figures cited here should not be treated as a single, directly comparable dataset. In particular, the share of affordable homes in new supply is not the same as the total number of affordable homes, the size of the housing shortage or the number of households that can qualify for a loan.

The article uses reported industry research and public policy material. Industry estimates are not official nationwide counts unless explicitly stated as such. The available evidence supports concern about the changing composition of supply and financing constraints, but it does not establish that all investment is diverted away from affordable housing or that one policy measure alone can solve the problem.

Continue the discussion in the attached Vantage Forum: Which change would make the biggest practical difference to affordable housing: lower land and approval costs, better financing for developers, stronger public support, or homes closer to jobs and transport? Explain your choice, share relevant experience or offer evidence that challenges the analysis.

Disclaimer

This article is for general information and educational purposes only. It is not personalised financial, investment, legal or property-buying advice. Readers should independently verify current data, scheme eligibility, project approvals and contractual terms, and seek qualified professional advice where appropriate.