September 10, 2025: Housing market is undergoing a dramatic shift, with a growing preference for premium homes over budget options, according to the latest ANAROCK Homebuyer Sentiment Survey (H1 2025).
The survey shows that 36% of buyers now favour properties priced between Rs 90 lakh and Rs 1.5 crore, double the 18% recorded before the pandemic. By contrast, affordable housing, defined as homes priced below Rs 45 lakh, has shrunk to just 17% of demand, down sharply from 40% in 2019.
Industry experts attribute this decline to dissatisfaction among buyers in the budget segment. As many as 62% of affordable homebuyers reported disappointment with current offerings, citing small unit sizes, poor construction quality, and inferior locations. A striking 92% flagged inadequate connectivity to hospitals, schools, and workplaces as a major drawback. “Affordable housing is no longer synonymous with value if buyers feel compromised on quality and convenience,” said Anuj Puri, Chairman, ANAROCK Group.
In contrast, demand for larger, better-located homes is surging. Three-bedroom units are now the most sought-after configuration in markets such as Delhi-NCR, Hyderabad, and Bengaluru. “Homebuyers are willing to pay a premium if it guarantees quality and timely delivery,” Puri noted.
Developers have responded accordingly. The share of new launches in the affordable category has fallen from 18% in H1 2023 to just 12% in H1 2025, with mid-range and premium projects dominating the pipeline. Metropolitan cities, in particular, are witnessing robust supply tailored to aspirational middle-class buyers.
The survey highlights the “premiumisation” of residential market, as aspirations outpace affordability. While developers are aligning with evolving consumer demand, experts caution that policymakers must reassess strategies for affordable housing to ensure inclusivity. For now, however, homebuyers appear more willing than ever to trade affordability for aspiration.
Source: Republic World
