Affordable housing launches to remain muted despite rate cuts, tax benefits

Affordable housing supply across India is likely to remain muted in the coming quarters despite the repo rate cut of 100 basis points since February, income tax-related benefits announced in this year’s Budget and the extension of Pradhan Mantri Awas Yojna (PMAY), according to industry executives and sector watchers.

 

While demand for sub ₹50-lakh affordable housing prevails, market players cite increased land rates, escalated construction costs and low margins as key prohibiting factors. Some like Mahindra Lifespaces are moving out of the segment, while others are reducing their share of the housing portfolio dedicated to affordable housing.

 

“The viability of