If you earn an annual salary of 2.5 million rupees, buying a home in many major cities is out of reach. India's housing market is fraying, with sales of homes priced under 10 million rupees dwindling. In contrast, luxury homes are in high demand, and the middle-class finds themselves sidelined. The question arises, who is the nation being built for?
In the first quarter of 2025, sales of homes costing less than 5 million rupees dropped by 9%, while those in the 5 to 10 million range saw a 6% decline. On the other hand, sales of homes in the 20 to 50 million range surged by 28%, and properties over 50 million saw an astonishing 483% rise. Homes priced above 10 million now account for 46% of total residential sales in major cities.
Real estate developer Rajdeep Chauhan responds to these figures by stating, "When a software engineer earning 2.5 million annually can't buy a 2BHK in Mumbai, Bengaluru, or NCR, are we building homes or augmenting inequality?" He highlights this trend as a move towards a "barbell economy," where developers cater only to the very rich or very poor, leaving the middle class with shrinking options.
Discover: This entire island is being sold for less than a luxury flat.
Data reveals significant shifts in supply and affordability. New projects for homes under 5 million dropped by 31% across the country in the first half of 2025. In Bengaluru, the decline is 85% compared to 2018, and in Mumbai and Kolkata, the year-on-year drops are 11% and 67% respectively.
Income is failing to keep pace with housing prices, with the EMI-to-income ratio hitting 48% in Mumbai and surpassing 30% in several other metro cities, often indicating financial stress levels.
